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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4173 Enrolled Bill (ENR)]

        H.R.4173

                      One Hundred Eleventh Congress

                                 of the

                        United States of America

                          AT THE SECOND SESSION

          Begun and held at the City of Washington on Tuesday,
             the fifth day of January, two thousand and ten

                                 An Act

 
  To promote the financial stability of the United States by improving 
 accountability and transparency in the financial system, to end ``too 
 big to fail'', to protect the American taxpayer by ending bailouts, to 
  protect consumers from abusive financial services practices, 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 ``Dodd-Frank Wall 
Street Reform and Consumer Protection Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Severability.
Sec. 4. Effective date.
Sec. 5. Budgetary effects.
Sec. 6. Antitrust savings clause.

                      TITLE I--FINANCIAL STABILITY

Sec. 101. Short title.
Sec. 102. Definitions.

            Subtitle A--Financial Stability Oversight Council

Sec. 111. Financial Stability Oversight Council established.
Sec. 112. Council authority.
Sec. 113. Authority to require supervision and regulation of certain 
          nonbank financial companies.
Sec. 114. Registration of nonbank financial companies supervised by the 
          Board of Governors.
Sec. 115. Enhanced supervision and prudential standards for nonbank 
          financial companies supervised by the Board of Governors and 
          certain bank holding companies.
Sec. 116. Reports.
Sec. 117. Treatment of certain companies that cease to be bank holding 
          companies.
Sec. 118. Council funding.
Sec. 119. Resolution of supervisory jurisdictional disputes among member 
          agencies.
Sec. 120. Additional standards applicable to activities or practices for 
          financial stability purposes.
Sec. 121. Mitigation of risks to financial stability.
Sec. 122. GAO Audit of Council.
Sec. 123. Study of the effects of size and complexity of financial 
          institutions on capital market efficiency and economic growth.

                Subtitle B--Office of Financial Research

Sec. 151. Definitions.
Sec. 152. Office of Financial Research established.
Sec. 153. Purpose and duties of the Office.
Sec. 154. Organizational structure; responsibilities of primary 
          programmatic units.
Sec. 155. Funding.
Sec. 156. Transition oversight.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

Sec. 161. Reports by and examinations of nonbank financial companies by 
          the Board of Governors.
Sec. 162. Enforcement.
Sec. 163. Acquisitions.
Sec. 164. Prohibition against management interlocks between certain 
          financial companies.
Sec. 165. Enhanced supervision and prudential standards for nonbank 
          financial companies supervised by the Board of Governors and 
          certain bank holding companies.
Sec. 166. Early remediation requirements.
Sec. 167. Affiliations.
Sec. 168. Regulations.
Sec. 169. Avoiding duplication.
Sec. 170. Safe harbor.
Sec. 171. Leverage and risk-based capital requirements.
Sec. 172. Examination and enforcement actions for insurance and orderly 
          liquidation purposes.
Sec. 173. Access to United States financial market by foreign 
          institutions.
Sec. 174. Studies and reports on holding company capital requirements.
Sec. 175. International policy coordination.
Sec. 176. Rule of construction.

                 TITLE II--ORDERLY LIQUIDATION AUTHORITY

Sec. 201. Definitions.
Sec. 202. Judicial review.
Sec. 203. Systemic risk determination.
Sec. 204. Orderly liquidation of covered financial companies.
Sec. 205. Orderly liquidation of covered brokers and dealers.
Sec. 206. Mandatory terms and conditions for all orderly liquidation 
          actions.
Sec. 207. Directors not liable for acquiescing in appointment of 
          receiver.
Sec. 208. Dismissal and exclusion of other actions.
Sec. 209. Rulemaking; non-conflicting law.
Sec. 210. Powers and duties of the Corporation.
Sec. 211. Miscellaneous provisions.
Sec. 212. Prohibition of circumvention and prevention of conflicts of 
          interest.
Sec. 213. Ban on certain activities by senior executives and directors.
Sec. 214. Prohibition on taxpayer funding.
Sec. 215. Study on secured creditor haircuts.
Sec. 216. Study on bankruptcy process for financial and nonbank 
          financial institutions
Sec. 217. Study on international coordination relating to bankruptcy 
          process for nonbank financial institutions

 TITLE III--TRANSFER OF POWERS TO THE COMPTROLLER OF THE CURRENCY, THE 
                 CORPORATION, AND THE BOARD OF GOVERNORS

Sec. 300. Short title.
Sec. 301. Purposes.
Sec. 302. Definition.

                Subtitle A--Transfer of Powers and Duties

Sec. 311. Transfer date.
Sec. 312. Powers and duties transferred.
Sec. 313. Abolishment.
Sec. 314. Amendments to the Revised Statutes.
Sec. 315. Federal information policy.
Sec. 316. Savings provisions.
Sec. 317. References in Federal law to Federal banking agencies.
Sec. 318. Funding.
Sec. 319. Contracting and leasing authority.

                   Subtitle B--Transitional Provisions

Sec. 321. Interim use of funds, personnel, and property of the Office of 
          Thrift Supervision.
Sec. 322. Transfer of employees.
Sec. 323. Property transferred.
Sec. 324. Funds transferred.
Sec. 325. Disposition of affairs.
Sec. 326. Continuation of services.
Sec. 327. Implementation plan and reports.

            Subtitle C--Federal Deposit Insurance Corporation

Sec. 331. Deposit insurance reforms.
Sec. 332. Elimination of procyclical assessments.
Sec. 333. Enhanced access to information for deposit insurance purposes.
Sec. 334. Transition reserve ratio requirements to reflect new 
          assessment base.
Sec. 335. Permanent increase in deposit and share insurance.
Sec. 336. Management of the Federal Deposit Insurance Corporation.

                        Subtitle D--Other Matters

Sec. 341. Branching.
Sec. 342. Office of Minority and Women Inclusion.
Sec. 343. Insurance of transaction accounts.

             Subtitle E--Technical and Conforming Amendments

Sec. 351. Effective date.
Sec. 352. Balanced Budget and Emergency Deficit Control Act of 1985.
Sec. 353. Bank Enterprise Act of 1991.
Sec. 354. Bank Holding Company Act of 1956.
Sec. 355. Bank Holding Company Act Amendments of 1970.
Sec. 356. Bank Protection Act of 1968.
Sec. 357. Bank Service Company Act.
Sec. 358. Community Reinvestment Act of 1977.
Sec. 359. Crime Control Act of 1990.
Sec. 360. Depository Institution Management Interlocks Act.
Sec. 361. Emergency Homeowners' Relief Act.
Sec. 362. Federal Credit Union Act.
Sec. 363. Federal Deposit Insurance Act.
Sec. 364. Federal Home Loan Bank Act.
Sec. 365. Federal Housing Enterprises Financial Safety and Soundness Act 
          of 1992.
Sec. 366. Federal Reserve Act.
Sec. 367. Financial Institutions Reform, Recovery, and Enforcement Act 
          of 1989.
Sec. 368. Flood Disaster Protection Act of 1973.
Sec. 369. Home Owners' Loan Act.
Sec. 370. Housing Act of 1948.
Sec. 371. Housing and Community Development Act of 1992.
Sec. 372. Housing and Urban-Rural Recovery Act of 1983.
Sec. 373. National Housing Act.
Sec. 374. Neighborhood Reinvestment Corporation Act.
Sec. 375. Public Law 93-100.
Sec. 376. Securities Exchange Act of 1934.
Sec. 377. Title 18, United States Code.
Sec. 378. Title 31, United States Code.

       TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS

Sec. 401. Short title.
Sec. 402. Definitions.
Sec. 403. Elimination of private adviser exemption; limited exemption 
          for foreign private advisers; limited intrastate exemption.
Sec. 404. Collection of systemic risk data; reports; examinations; 
          disclosures.
Sec. 405. Disclosure provision amendment.
Sec. 406. Clarification of rulemaking authority.
Sec. 407. Exemption of venture capital fund advisers.
Sec. 408. Exemption of and record keeping by private equity 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. 412. Adjusting the accredited investor standard.
Sec. 413. GAO study and report on accredited investors.
Sec. 414. GAO study on self-regulatory organization for private funds.
Sec. 415. Commission study and report on short selling.
Sec. 416. Transition period.

                           TITLE V--INSURANCE

                Subtitle A--Office of National Insurance

Sec. 501. Short title.
Sec. 502. Federal Insurance Office.

                Subtitle B--State-Based Insurance Reform

Sec. 511. Short title.
Sec. 512. Effective date.

                      PART I--Nonadmitted Insurance

Sec. 521. Reporting, payment, and allocation of premium taxes.
Sec. 522. Regulation of nonadmitted insurance by insured's home State.
Sec. 523. Participation in national producer database.
Sec. 524. Uniform standards for surplus lines eligibility.
Sec. 525. Streamlined application for commercial purchasers.
Sec. 526. GAO study of nonadmitted insurance market.
Sec. 527. Definitions.

                          PART II--Reinsurance

Sec. 531. Regulation of credit for reinsurance and reinsurance 
          agreements.
Sec. 532. Regulation of reinsurer solvency.
Sec. 533. Definitions.

                     PART III--Rule of Construction

Sec. 541. Rule of construction.
Sec. 542. Severability.

  TITLE VI--IMPROVEMENTS TO REGULATION OF BANK AND SAVINGS ASSOCIATION 
              HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

Sec. 601. Short title.
Sec. 602. Definition.
Sec. 603. Moratorium and study on treatment of credit card banks, 
          industrial loan companies, and certain other companies under 
          the Bank Holding Company Act of 1956.
Sec. 604. Reports and examinations of holding companies; regulation of 
          functionally regulated subsidiaries.
Sec. 605. Assuring consistent oversight of permissible activities of 
          depository institution subsidiaries of holding companies.
Sec. 606. Requirements for financial holding companies to remain well 
          capitalized and well managed.
Sec. 607. Standards for interstate acquisitions.
Sec. 608. Enhancing existing restrictions on bank transactions with 
          affiliates.
Sec. 609. Eliminating exceptions for transactions with financial 
          subsidiaries.
Sec. 610. Lending limits applicable to credit exposure on derivative 
          transactions, repurchase agreements, reverse repurchase 
          agreements, and securities lending and borrowing transactions.
Sec. 611. Consistent treatment of derivative transactions in lending 
          limits.
Sec. 612. Restriction on conversions of troubled banks.
Sec. 613. De novo branching into States.
Sec. 614. Lending limits to insiders.
Sec. 615. Limitations on purchases of assets from insiders.
Sec. 616. Regulations regarding capital levels.
Sec. 617. Elimination of elective investment bank holding company 
          framework.
Sec. 618. Securities holding companies.
Sec. 619. Prohibitions on proprietary trading and certain relationships 
          with hedge funds and private equity funds.
Sec. 620. Study of bank investment activities.
Sec. 621. Conflicts of interest.
Sec. 622. Concentration limits on large financial firms.
Sec. 623. Interstate merger transactions.
Sec. 624. Qualified thrift lenders.
Sec. 625. Treatment of dividends by certain mutual holding companies.
Sec. 626. Intermediate holding companies.
Sec. 627. Interest-bearing transaction accounts authorized.
Sec. 628. Credit card bank small business lending.

         TITLE VII--WALL STREET TRANSPARENCY AND ACCOUNTABILITY

Sec. 701. Short title.

        Subtitle A--Regulation of Over-the-Counter Swaps Markets

                      PART I--Regulatory Authority

Sec. 711. Definitions.
Sec. 712. Review of regulatory authority.
Sec. 713. Portfolio margining conforming changes.
Sec. 714. Abusive swaps.
Sec. 715. Authority to prohibit participation in swap activities.
Sec. 716. Prohibition against Federal Government bailouts of swaps 
          entities.
Sec. 717. New product approval CFTC--SEC process.
Sec. 718. Determining status of novel derivative products.
Sec. 719. Studies.
Sec. 720. Memorandum.

                   PART II--Regulation of Swap Markets

Sec. 721. Definitions.
Sec. 722. Jurisdiction.
Sec. 723. Clearing.
Sec. 724. Swaps; segregation and bankruptcy treatment.
Sec. 725. Derivatives clearing organizations.
Sec. 726. Rulemaking on conflict of interest.
Sec. 727. Public reporting of swap transaction data.
Sec. 728. Swap data repositories.
Sec. 729. Reporting and recordkeeping.
Sec. 730. Large swap trader reporting.
Sec. 731. Registration and regulation of swap dealers and major swap 
          participants.
Sec. 732. Conflicts of interest.
Sec. 733. Swap execution facilities.
Sec. 734. Derivatives transaction execution facilities and exempt boards 
          of trade.
Sec. 735. Designated contract markets.
Sec. 736. Margin.
Sec. 737. Position limits.
Sec. 738. Foreign boards of trade.
Sec. 739. Legal certainty for swaps.
Sec. 740. Multilateral clearing organizations.
Sec. 741. Enforcement.
Sec. 742. Retail commodity transactions.
Sec. 743. Other authority.
Sec. 744. Restitution remedies.
Sec. 745. Enhanced compliance by registered entities.
Sec. 746. Insider trading.
Sec. 747. Antidisruptive practices authority.
Sec. 748. Commodity whistleblower incentives and protection.
Sec. 749. Conforming amendments.
Sec. 750. Study on oversight of carbon markets.
Sec. 751. Energy and environmental markets advisory committee.
Sec. 752. International harmonization.
Sec. 753. Anti-manipulation authority.
Sec. 754. Effective date.

          Subtitle B--Regulation of Security-Based Swap Markets

Sec. 761. Definitions under the Securities Exchange Act of 1934.
Sec. 762. Repeal of prohibition on regulation of security-based swap 
          agreements.
Sec. 763. Amendments to the Securities Exchange Act of 1934.
Sec. 764. Registration and regulation of security-based swap dealers and 
          major security-based swap participants.
Sec. 765. Rulemaking on conflict of interest.
Sec. 766. Reporting and recordkeeping.
Sec. 767. State gaming and bucket shop laws.
Sec. 768. Amendments to the Securities Act of 1933; treatment of 
          security-based swaps.
Sec. 769. Definitions under the Investment Company Act of 1940.
Sec. 770. Definitions under the Investment Advisers Act of 1940.
Sec. 771. Other authority.
Sec. 772. Jurisdiction.
Sec. 773. Civil penalties.
Sec. 774. Effective date.

        TITLE VIII--PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION

Sec. 801. Short title.
Sec. 802. Findings and purposes.
Sec. 803. Definitions.
Sec. 804. Designation of systemic importance.
Sec. 805. Standards for systemically important financial market 
          utilities and payment, clearing, or settlement activities.
Sec. 806. Operations of designated financial market utilities.
Sec. 807. Examination of and enforcement actions against designated 
          financial market utilities.
Sec. 808. Examination of and enforcement actions against financial 
          institutions subject to standards for designated activities.
Sec. 809. Requests for information, reports, or records.
Sec. 810. Rulemaking.
Sec. 811. Other authority.
Sec. 812. Consultation.
Sec. 813. Common framework for designated clearing entity risk 
          management.
Sec. 814. Effective date.

  TITLE IX--INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 
                               SECURITIES

Sec. 901. Short title.

               Subtitle A--Increasing Investor Protection

Sec. 911. Investor Advisory Committee established.
Sec. 912. Clarification of authority of the Commission to engage in 
          investor testing.
Sec. 913. Study and rulemaking regarding obligations of brokers, 
          dealers, and investment advisers.
Sec. 914. Study on enhancing investment adviser examinations.
Sec. 915. Office of the Investor Advocate.
Sec. 916. Streamlining of filing procedures for self-regulatory 
          organizations.
Sec. 917. Study regarding financial literacy among investors.
Sec. 918. Study regarding mutual fund advertising.
Sec. 919. Clarification of Commission authority to require investor 
          disclosures before purchase of investment products and 
          services.
Sec. 919A. Study on conflicts of interest.
Sec. 919B. Study on improved investor access to information on 
          investment advisers and broker-dealers.
Sec. 919C. Study on financial planners and the use of financial 
          designations.
Sec. 919D. Ombudsman.

       Subtitle B--Increasing Regulatory Enforcement and Remedies

Sec. 921. Authority to restrict mandatory pre-dispute arbitration.
Sec. 922. Whistleblower protection.
Sec. 923. Conforming amendments for whistleblower protection.
Sec. 924. Implementation and transition provisions for whistleblower 
          protection.
Sec. 925. Collateral bars.
Sec. 926. Disqualifying felons and other ``bad actors'' from Regulation 
          D offerings.
Sec. 927. Equal treatment of self-regulatory organization rules.
Sec. 928. Clarification that section 205 of the Investment Advisers Act 
          of 1940 does not apply to State-registered advisers.
Sec. 929. Unlawful margin lending.
Sec. 929A. Protection for employees of subsidiaries and affiliates of 
          publicly traded companies.
Sec. 929B. Fair Fund amendments.
Sec. 929C. Increasing the borrowing limit on Treasury loans.
Sec. 929D. Lost and stolen securities.
Sec. 929E. Nationwide service of subpoenas.
Sec. 929F. Formerly associated persons.
Sec. 929G. Streamlined hiring authority for market specialists.
Sec. 929H. SIPC Reforms.
Sec. 929I. Protecting confidentiality of materials submitted to the 
          Commission.
Sec. 929J. Expansion of audit information to be produced and exchanged.
Sec. 929K. Sharing privileged information with other authorities.
Sec. 929L. Enhanced application of antifraud provisions.
Sec. 929M. Aiding and abetting authority under the Securities Act and 
          the Investment Company Act.
Sec. 929N. Authority to impose penalties for aiding and abetting 
          violations of the Investment Advisers Act.
Sec. 929O. Aiding and abetting standard of knowledge satisfied by 
          recklessness.
Sec. 929P. Strengthening enforcement by the Commission.
Sec. 929Q. Revision to recordkeeping rule.
Sec. 929R. Beneficial ownership and short-swing profit reporting.
Sec. 929S. Fingerprinting.
Sec. 929T. Equal treatment of self-regulatory organization rules.
Sec. 929U. Deadline for completing examinations, inspections and 
          enforcement actions.
Sec. 929V. Security Investor Protection Act amendments.
Sec. 929W. Notice to missing security holders.
Sec. 929X. Short sale reforms.
Sec. 929Y. Study on extraterritorial private rights of action.
Sec. 929Z. GAO study on securities litigation.

  Subtitle C--Improvements to the Regulation of Credit Rating Agencies

Sec. 931. Findings.
Sec. 932. Enhanced regulation, accountability, and transparency of 
          nationally recognized statistical rating organizations.
Sec. 933. State of mind in private actions.
Sec. 934. Referring tips to law enforcement or regulatory authorities.
Sec. 935. Consideration of information from sources other than the 
          issuer in rating decisions.
Sec. 936. Qualification standards for credit rating analysts.
Sec. 937. Timing of regulations.
Sec. 938. Universal ratings symbols.
Sec. 939. Removal of statutory references to credit ratings.
Sec. 939A. Review of reliance on ratings.
Sec. 939B. Elimination of exemption from fair disclosure rule.
Sec. 939C. Securities and Exchange Commission study on strengthening 
          credit rating agency independence.
Sec. 939D. Government Accountability Office study on alternative 
          business models.
Sec. 939E. Government Accountability Office study on the creation of an 
          independent professional analyst organization.
Sec. 939F. Study and rulemaking on assigned credit ratings.
Sec. 939G. Effect of Rule 436(g).
Sec. 939H. Sense of Congress.

   Subtitle D--Improvements to the Asset-Backed Securitization Process

Sec. 941. Regulation of credit risk retention.
Sec. 942. Disclosures and reporting for asset-backed securities.
Sec. 943. Representations and warranties in asset-backed offerings.
Sec. 944. Exempted transactions under the Securities Act of 1933.
Sec. 945. Due diligence analysis and disclosure in asset-backed 
          securities issues.
Sec. 946. Study on the macroeconomic effects of risk retention 
          requirements.

          Subtitle E--Accountability and Executive Compensation

Sec. 951. Shareholder vote on executive compensation disclosures.
Sec. 952. Compensation committee independence.
Sec. 953. Executive compensation disclosures.
Sec. 954. Recovery of erroneously awarded compensation.
Sec. 955. Disclosure regarding employee and director hedging.
Sec. 956. Enhanced compensation structure reporting.
Sec. 957. Voting by brokers.

    Subtitle F--Improvements to the Management of the Securities and 
                           Exchange Commission

Sec. 961. Report and certification of internal supervisory controls.
Sec. 962. Triennial report on personnel management.
Sec. 963. Annual financial controls audit.
Sec. 964. Report on oversight of national securities associations.
Sec. 965. Compliance examiners.
Sec. 966. Suggestion program for employees of the Commission.
Sec. 967. Commission organizational study and reform.
Sec. 968. Study on SEC revolving door.

             Subtitle G--Strengthening Corporate Governance

Sec. 971. Proxy access.
Sec. 972. Disclosures regarding chairman and CEO structures.

                    Subtitle H--Municipal Securities

Sec. 975. Regulation of municipal securities and changes to the board of 
          the MSRB.
Sec. 976. Government Accountability Office study of increased disclosure 
          to investors.
Sec. 977. Government Accountability Office study on the municipal 
          securities markets.
Sec. 978. Funding for Governmental Accounting Standards Board.
Sec. 979. Commission Office of Municipal Securities.

    Subtitle I--Public Company Accounting Oversight Board, Portfolio 
                      Margining, and Other Matters

Sec. 981. Authority to share certain information with foreign 
          authorities.
Sec. 982. Oversight of brokers and dealers.
Sec. 983. Portfolio margining.
Sec. 984. Loan or borrowing of securities.
Sec. 985. Technical corrections to Federal securities laws.
Sec. 986. Conforming amendments relating to repeal of the Public Utility 
          Holding Company Act of 1935.
Sec. 987. Amendment to definition of material loss and nonmaterial 
          losses to the Deposit Insurance Fund for purposes of Inspector 
          General reviews.
Sec. 988. Amendment to definition of material loss and nonmaterial 
          losses to the National Credit Union Share Insurance Fund for 
          purposes of Inspector General reviews.
Sec. 989. Government Accountability Office study on proprietary trading.
Sec. 989A. Senior investor protections.
Sec. 989B. Designated Federal entity inspectors general independence.
Sec. 989C. Strengthening Inspector General accountability.
Sec. 989D. Removal of Inspectors General of designated Federal entities.
Sec. 989E. Additional oversight of financial regulatory system.
Sec. 989F. GAO study of person to person lending.
Sec. 989G. Exemption for nonaccelerated filers.
Sec. 989H. Corrective responses by heads of certain establishments to 
          deficiencies identified by Inspectors General.
Sec. 989I. GAO study regarding exemption for smaller issuers.
Sec. 989J. Further promoting the adoption of the NAIC Model Regulations 
          that enhance protection of seniors and other consumers.

      Subtitle J--Securities and Exchange Commission Match Funding

Sec. 991. Securities and Exchange Commission match funding.

            TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

Sec. 1001. Short title.
Sec. 1002. Definitions.

           Subtitle A--Bureau of Consumer Financial Protection

Sec. 1011. Establishment of the Bureau of Consumer Financial Protection.
Sec. 1012. Executive and administrative powers.
Sec. 1013. Administration.
Sec. 1014. Consumer Advisory Board.
Sec. 1015. Coordination.
Sec. 1016. Appearances before and reports to Congress.
Sec. 1017. Funding; penalties and fines.
Sec. 1018. Effective date.

                Subtitle B--General Powers of the Bureau

Sec. 1021. Purpose, objectives, and functions.
Sec. 1022. Rulemaking authority.
Sec. 1023. Review of Bureau regulations.
Sec. 1024. Supervision of nondepository covered persons.
Sec. 1025. Supervision of very large banks, savings associations, and 
          credit unions.
Sec. 1026. Other banks, savings associations, and credit unions.
Sec. 1027. Limitations on authorities of the Bureau; preservation of 
          authorities.
Sec. 1028. Authority to restrict mandatory pre-dispute arbitration.
Sec. 1029. Exclusion for auto dealers.
Sec. 1029A. Effective date.

                 Subtitle C--Specific Bureau Authorities

Sec. 1031. Prohibiting unfair, deceptive, or abusive acts or practices.
Sec. 1032. Disclosures.
Sec. 1033. Consumer rights to access information.
Sec. 1034. Response to consumer complaints and inquiries.
Sec. 1035. Private education loan ombudsman.
Sec. 1036. Prohibited acts.
Sec. 1037. Effective date.

                  Subtitle D--Preservation of State Law

Sec. 1041. Relation to State law.
Sec. 1042. Preservation of enforcement powers of States.
Sec. 1043. Preservation of existing contracts.
Sec. 1044. State law preemption standards for national banks and 
          subsidiaries clarified.
Sec. 1045. Clarification of law applicable to nondepository institution 
          subsidiaries.
Sec. 1046. State law preemption standards for Federal savings 
          associations and subsidiaries clarified.
Sec. 1047. Visitorial standards for national banks and savings 
          associations.
Sec. 1048. Effective date.

                     Subtitle E--Enforcement Powers

Sec. 1051. Definitions.
Sec. 1052. Investigations and administrative discovery.
Sec. 1053. Hearings and adjudication proceedings.
Sec. 1054. Litigation authority.
Sec. 1055. Relief available.
Sec. 1056. Referrals for criminal proceedings.
Sec. 1057. Employee protection.
Sec. 1058. Effective date.

Subtitle F--Transfer of Functions and Personnel; Transitional Provisions

Sec. 1061. Transfer of consumer financial protection functions.
Sec. 1062. Designated transfer date.
Sec. 1063. Savings provisions.
Sec. 1064. Transfer of certain personnel.
Sec. 1065. Incidental transfers.
Sec. 1066. Interim authority of the Secretary.
Sec. 1067. Transition oversight.

                   Subtitle G--Regulatory Improvements

Sec. 1071. Small business data collection.
Sec. 1072. Assistance for economically vulnerable individuals and 
          families.
Sec. 1073. Remittance transfers.
Sec. 1074. Department of the Treasury study on ending the 
          conservatorship of Fannie Mae, Freddie Mac, and reforming the 
          housing finance system.
Sec. 1075. Reasonable fees and rules for payment card transactions.
Sec. 1076. Reverse mortgage study and regulations.
Sec. 1077. Report on private education loans and private educational 
          lenders.
Sec. 1078. Study and report on credit scores.
Sec. 1079. Review, report, and program with respect to exchange 
          facilitators.
Sec. 1079A. Financial fraud provisions.

                    Subtitle H--Conforming Amendments

Sec. 1081. Amendments to the Inspector General Act.
Sec. 1082. Amendments to the Privacy Act of 1974.
Sec. 1083. Amendments to the Alternative Mortgage Transaction Parity Act 
          of 1982.
Sec. 1084. Amendments to the Electronic Fund Transfer Act.
Sec. 1085. Amendments to the Equal Credit Opportunity Act.
Sec. 1086. Amendments to the Expedited Funds Availability Act.
Sec. 1087. Amendments to the Fair Credit Billing Act.
Sec. 1088. Amendments to the Fair Credit Reporting Act and the Fair and 
          Accurate Credit Transactions Act of 2003.
Sec. 1089. Amendments to the Fair Debt Collection Practices Act.
Sec. 1090. Amendments to the Federal Deposit Insurance Act.
Sec. 1091. Amendment to Federal Financial Institutions Examination 
          Council Act of 1978.
Sec. 1092. Amendments to the Federal Trade Commission Act.
Sec. 1093. Amendments to the Gramm-Leach-Bliley Act.
Sec. 1094. Amendments to the Home Mortgage Disclosure Act of 1975.
Sec. 1095. Amendments to the Homeowners Protection Act of 1998.
Sec. 1096. Amendments to the Home Ownership and Equity Protection Act of 
          1994.
Sec. 1097. Amendments to the Omnibus Appropriations Act, 2009.
Sec. 1098. Amendments to the Real Estate Settlement Procedures Act of 
          1974.
Sec. 1098A. Amendments to the Interstate Land Sales Full Disclosure Act.
Sec. 1099. Amendments to the Right to Financial Privacy Act of 1978.
Sec. 1100. Amendments to the Secure and Fair Enforcement for Mortgage 
          Licensing Act of 2008.
Sec. 1100A. Amendments to the Truth in Lending Act.
Sec. 1100B. Amendments to the Truth in Savings Act.
Sec. 1100C. Amendments to the Telemarketing and Consumer Fraud and Abuse 
          Prevention Act.
Sec. 1100D. Amendments to the Paperwork Reduction Act.
Sec. 1100E. Adjustments for inflation in the Truth in Lending Act.
Sec. 1100F. Use of consumer reports.
Sec. 1100G. Small business fairness and regulatory transparency.
Sec. 1100H. Effective date.

               TITLE XI--FEDERAL RESERVE SYSTEM PROVISIONS

Sec. 1101. Federal Reserve Act amendments on emergency lending 
          authority.
Sec. 1102. Reviews of special Federal reserve credit facilities.
Sec. 1103. Public access to information.
Sec. 1104. Liquidity event determination.
Sec. 1105. Emergency financial stabilization.
Sec. 1106. Additional related amendments.
Sec. 1107. Federal Reserve Act amendments on Federal reserve bank 
          governance.
Sec. 1108. Federal Reserve Act amendments on supervision and regulation 
          policy.
Sec. 1109. GAO audit of the Federal Reserve facilities; publication of 
          Board actions.

    TITLE XII--IMPROVING ACCESS TO MAINSTREAM FINANCIAL INSTITUTIONS

Sec. 1201. Short title.
Sec. 1202. Purpose.
Sec. 1203. Definitions.
Sec. 1204. Expanded access to mainstream financial institutions.
Sec. 1205. Low-cost alternatives to payday loans.
Sec. 1206. Grants to establish loan-loss reserve funds.
Sec. 1207. Procedural provisions.
Sec. 1208. Authorization of appropriations.
Sec. 1209. Regulations.
Sec. 1210. Evaluation and reports to Congress.

                       TITLE XIII--PAY IT BACK ACT

Sec. 1301. Short title.
Sec. 1302. Amendment to reduce TARP authorization.
Sec. 1303. Report.
Sec. 1304. Amendments to Housing and Economic Recovery Act of 2008.
Sec. 1305. Federal Housing Finance Agency report.
Sec. 1306. Repayment of unobligated ARRA funds.

        TITLE XIV--MORTGAGE REFORM AND ANTI-PREDATORY LENDING ACT

Sec. 1400. Short title; designation as enumerated consumer law.

       Subtitle A--Residential Mortgage Loan Origination Standards

Sec. 1401. Definitions.
Sec. 1402. Residential mortgage loan origination.
Sec. 1403. Prohibition on steering incentives.
Sec. 1404. Liability.
Sec. 1405. Regulations.
Sec. 1406. Study of shared appreciation mortgages.

               Subtitle B--Minimum Standards For Mortgages

Sec. 1411. Ability to repay.
Sec. 1412. Safe harbor and rebuttable presumption.
Sec. 1413. Defense to foreclosure.
Sec. 1414. Additional standards and requirements.
Sec. 1415. Rule of construction.
Sec. 1416. Amendments to civil liability provisions.
Sec. 1417. Lender rights in the context of borrower deception.
Sec. 1418. Six-month notice required before reset of hybrid adjustable 
          rate mortgages.
Sec. 1419. Required disclosures.
Sec. 1420. Disclosures required in monthly statements for residential 
          mortgage loans.
Sec. 1421. Report by the GAO.
Sec. 1422. State attorney general enforcement authority.

                     Subtitle C--High-Cost Mortgages

Sec. 1431. Definitions relating to high-cost mortgages.
Sec. 1432. Amendments to existing requirements for certain mortgages.
Sec. 1433. Additional requirements for certain mortgages.

                Subtitle D--Office of Housing Counseling

Sec. 1441. Short title.
Sec. 1442. Establishment of Office of Housing Counseling.
Sec. 1443. Counseling procedures.
Sec. 1444. Grants for housing counseling assistance.
Sec. 1445. Requirements to use HUD-certified counselors under HUD 
          programs.
Sec. 1446. Study of defaults and foreclosures.
Sec. 1447. Default and foreclosure database.
Sec. 1448. Definitions for counseling-related programs.
Sec. 1449. Accountability and transparency for grant recipients.
Sec. 1450. Updating and simplification of mortgage information booklet.
Sec. 1451. Home inspection counseling.
Sec. 1452. Warnings to homeowners of foreclosure rescue scams.

                     Subtitle E--Mortgage Servicing

Sec. 1461. Escrow and impound accounts relating to certain consumer 
          credit transactions.
Sec. 1462. Disclosure notice required for consumers who waive escrow 
          services.
Sec. 1463. Real Estate Settlement Procedures Act of 1974 amendments.
Sec. 1464. Truth in Lending Act amendments.
Sec. 1465. Escrows included in repayment analysis.

                    Subtitle F--Appraisal Activities

Sec. 1471. Property appraisal requirements.
Sec. 1472. Appraisal independence requirements.
Sec. 1473. Amendments relating to Appraisal Subcommittee of FFIEC, 
          Appraiser Independence Monitoring, Approved Appraiser 
          Education, Appraisal Management Companies, Appraiser Complaint 
          Hotline, Automated Valuation Models, and Broker Price 
          Opinions.
Sec. 1474. Equal Credit Opportunity Act amendment.
Sec. 1475. Real Estate Settlement Procedures Act of 1974 amendment 
          relating to certain appraisal fees.
Sec. 1476. GAO study on the effectiveness and impact of various 
          appraisal methods, valuation models and distributions 
          channels, and on the Home Valuation Code of conduct and the 
          Appraisal Subcommittee.

            Subtitle G--Mortgage Resolution and Modification

Sec. 1481. Multifamily mortgage resolution program.
Sec. 1482. Home Affordable Modification Program guidelines.
Sec. 1483. Public availability of information of Making Home Affordable 
          Program.
Sec. 1484. Protecting tenants at foreclosure extension and 
          clarification.

                  Subtitle H--Miscellaneous Provisions

Sec. 1491. Sense of Congress regarding the importance of government-
          sponsored enterprises reform to enhance the protection, 
          limitation, and regulation of the terms of residential 
          mortgage credit.
Sec. 1492. GAO study report on government efforts to combat mortgage 
          foreclosure rescue scams and loan modification fraud.
Sec. 1493. Reporting of mortgage data by State.
Sec. 1494. Study of effect of drywall presence on foreclosures.
Sec. 1495. Definition.
Sec. 1496. Emergency mortgage relief.
Sec. 1497. Additional assistance for Neighborhood Stabilization Program.
Sec. 1498. Legal assistance for foreclosure-related issues.

                   TITLE XV--MISCELLANEOUS PROVISIONS

Sec. 1501. Restrictions on use of United States funds for foreign 
          governments; protection of American taxpayers.
Sec. 1502. Conflict minerals.
Sec. 1503. Reporting requirements regarding coal or other mine safety.
Sec. 1504. Disclosure of payments by resource extraction issuers.
Sec. 1505. Study by the Comptroller General.
Sec. 1506. Study on core deposits and brokered deposits.

                    TITLE XVI--SECTION 1256 CONTRACTS

Sec. 1601. Certain swaps, etc., not treated as section 1256 contracts.
SEC. 2. DEFINITIONS.
    As used in this Act, the following definitions shall apply, except 
as the context otherwise requires or as otherwise specifically provided 
in this Act:
        (1) Affiliate.--The term ``affiliate'' has the same meaning as 
    in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).
        (2) Appropriate federal banking agency.--On and after the 
    transfer date, the term ``appropriate Federal banking agency'' has 
    the same meaning as in section 3(q) of the Federal Deposit 
    Insurance Act (12 U.S.C. 1813(q)), as amended by title III.
        (3) Board of governors.--The term ``Board of Governors'' means 
    the Board of Governors of the Federal Reserve System.
        (4) Bureau.--The term ``Bureau'' means the Bureau of Consumer 
    Financial Protection established under title X.
        (5) Commission.--The term ``Commission'' means the Securities 
    and Exchange Commission, except in the context of the Commodity 
    Futures Trading Commission.
        (6) Commodity futures terms.--The terms ``futures commission 
    merchant'', ``swap'', ``swap dealer'', ``swap execution facility'', 
    ``derivatives clearing organization'', ``board of trade'', 
    ``commodity trading advisor'', ``commodity pool'', and ``commodity 
    pool operator'' have the same meanings as given the terms in 
    section 1a of the Commodity Exchange Act (7 U.S.C. 1 et seq.).
        (7) Corporation.--The term ``Corporation'' means the Federal 
    Deposit Insurance Corporation.
        (8) Council.--The term ``Council'' means the Financial 
    Stability Oversight Council established under title I.
        (9) Credit union.--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).
        (10) Federal banking agency.--The term--
            (A) ``Federal banking agency'' means, individually, the 
        Board of Governors, the Office of the Comptroller of the 
        Currency, and the Corporation; and
            (B) ``Federal banking agencies'' means all of the agencies 
        referred to in subparagraph (A), collectively.
        (11) Functionally regulated subsidiary.--The term 
    ``functionally regulated subsidiary'' has the same meaning as in 
    section 5(c)(5) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1844(c)(5)).
        (12) Primary financial regulatory agency.--The term ``primary 
    financial regulatory agency'' means--
            (A) the appropriate Federal banking agency, with respect to 
        institutions described in section 3(q) of the Federal Deposit 
        Insurance Act, except to the extent that an institution is or 
        the activities of an institution are otherwise described in 
        subparagraph (B), (C), (D), or (E);
            (B) the Securities and Exchange Commission, with respect 
        to--
                (i) any broker or dealer that is registered with the 
            Commission under the Securities Exchange Act of 1934, with 
            respect to the activities of the broker or dealer that 
            require the broker or dealer to be registered under that 
            Act;
                (ii) any investment company that is registered with the 
            Commission under the Investment Company Act of 1940, with 
            respect to the activities of the investment company that 
            require the investment company to be registered under that 
            Act;
                (iii) any investment adviser that is registered with 
            the Commission under the Investment Advisers Act of 1940, 
            with respect to the investment advisory activities of such 
            company and activities that are incidental to such advisory 
            activities;
                (iv) any clearing agency registered with the Commission 
            under the Securities Exchange Act of 1934, with respect to 
            the activities of the clearing agency that require the 
            agency to be registered under such Act;
                (v) any nationally recognized statistical rating 
            organization registered with the Commission under the 
            Securities Exchange Act of 1934;
                (vi) any transfer agent registered with the Commission 
            under the Securities Exchange Act of 1934;
                (vii) any exchange registered as a national securities 
            exchange with the Commission under the Securities Exchange 
            Act of 1934;
                (viii) any national securities association registered 
            with the Commission under the Securities Exchange Act of 
            1934;
                (ix) any securities information processor registered 
            with the Commission under the Securities Exchange Act of 
            1934;
                (x) the Municipal Securities Rulemaking Board 
            established under the Securities Exchange Act of 1934;
                (xi) the Public Company Accounting Oversight Board 
            established under the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
            7211 et seq.);
                (xii) the Securities Investor Protection Corporation 
            established under the Securities Investor Protection Act of 
            1970 (15 U.S.C. 78aaa et seq.); and
                (xiii) any security-based swap execution facility, 
            security-based swap data repository, security-based swap 
            dealer or major security-based swap participant registered 
            with the Commission under the Securities Exchange Act of 
            1934, with respect to the security-based swap activities of 
            the person that require such person to be registered under 
            such Act;
            (C) the Commodity Futures Trading Commission, with respect 
        to--
                (i) any futures commission merchant registered with the 
            Commodity Futures Trading Commission under the Commodity 
            Exchange Act (7 U.S.C. 1 et seq.), with respect to the 
            activities of the futures commission merchant that require 
            the futures commission merchant to be registered under that 
            Act;
                (ii) any commodity pool operator registered with the 
            Commodity Futures Trading Commission under the Commodity 
            Exchange Act (7 U.S.C. 1 et seq.), with respect to the 
            activities of the commodity pool operator that require the 
            commodity pool operator to be registered under that Act, or 
            a commodity pool, as defined in that Act;
                (iii) any commodity trading advisor or introducing 
            broker registered with the Commodity Futures Trading 
            Commission under the Commodity Exchange Act (7 U.S.C. 1 et 
            seq.), with respect to the activities of the commodity 
            trading advisor or introducing broker that require the 
            commodity trading adviser or introducing broker to be 
            registered under that Act;
                (iv) any derivatives clearing organization registered 
            with the Commodity Futures Trading Commission under the 
            Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect 
            to the activities of the derivatives clearing organization 
            that require the derivatives clearing organization to be 
            registered under that Act;
                (v) any board of trade designated as a contract market 
            by the Commodity Futures Trading Commission under the 
            Commodity Exchange Act (7 U.S.C. 1 et seq.);
                (vi) any futures association registered with the 
            Commodity Futures Trading Commission under the Commodity 
            Exchange Act (7 U.S.C. 1 et seq.);
                (vii) any retail foreign exchange dealer registered 
            with the Commodity Futures Trading Commission under the 
            Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect 
            to the activities of the retail foreign exchange dealer 
            that require the retail foreign exchange dealer to be 
            registered under that Act;
                (viii) any swap execution facility, swap data 
            repository, swap dealer, or major swap participant 
            registered with the Commodity Futures Trading Commission 
            under the Commodity Exchange Act (7 U.S.C. 1 et seq.) with 
            respect to the swap activities of the person that require 
            such person to be registered under that Act; and
                (ix) any registered entity under the Commodity Exchange 
            Act (7 U.S.C. 1 et seq.), with respect to the activities of 
            the registered entity that require the registered entity to 
            be registered under that Act;
            (D) the State insurance authority of the State in which an 
        insurance company is domiciled, with respect to the insurance 
        activities and activities that are incidental to such insurance 
        activities of an insurance company that is subject to 
        supervision by the State insurance authority under State 
        insurance law; and
            (E) the Federal Housing Finance Agency, with respect to 
        Federal Home Loan Banks or the Federal Home Loan Bank System, 
        and with respect to the Federal National Mortgage Association 
        or the Federal Home Loan Mortgage Corporation.
        (13) Prudential standards.--The term ``prudential standards'' 
    means enhanced supervision and regulatory standards developed by 
    the Board of Governors under section 165.
        (14) Secretary.--The term ``Secretary'' means the Secretary of 
    the Treasury.
        (15) Securities terms.--The--
            (A) terms ``broker'', ``dealer'', ``issuer'', ``nationally 
        recognized statistical rating organization'', ``security'', and 
        ``securities laws'' have the same meanings as in section 3 of 
        the Securities Exchange Act of 1934 (15 U.S.C. 78c);
            (B) term ``investment adviser'' has the same meaning as in 
        section 202 of the Investment Advisers Act of 1940 (15 U.S.C. 
        80b-2); and
            (C) term ``investment company'' has the same meaning as in 
        section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-
        3).
        (16) State.--The term ``State'' means any State, commonwealth, 
    territory, or possession of the United States, the District of 
    Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the 
    Northern Mariana Islands, American Samoa, Guam, or the United 
    States Virgin Islands.
        (17) Transfer date.--The term ``transfer date'' means the date 
    established under section 311.
        (18) Other incorporated definitions.--
            (A) Federal deposit insurance act.--The terms ``bank'', 
        ``bank holding company'', ``control'', ``deposit'', 
        ``depository institution'', ``Federal depository institution'', 
        ``Federal savings association'', ``foreign bank'', 
        ``including'', ``insured branch'', ``insured depository 
        institution'', ``national member bank'', ``national nonmember 
        bank'', ``savings association'', ``State bank'', ``State 
        depository institution'', ``State member bank'', ``State 
        nonmember bank'', ``State savings association'', and 
        ``subsidiary'' have the same meanings as in section 3 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1813).
            (B) Holding companies.--The term--
                (i) ``bank holding company'' has the same meaning as in 
            section 2 of the Bank Holding Company Act of 1956 (12 
            U.S.C. 1841);
                (ii) ``financial holding company'' has the same meaning 
            as in section 2(p) of the Bank Holding Company Act of 1956 
            (12 U.S.C. 1841(p)); and
                (iii) ``savings and loan holding company'' has the same 
            meaning as in section 10 of the Home Owners' Loan Act (12 
            U.S.C. 1467a(a)).
SEC. 3. SEVERABILITY.
    If any provision of this Act, an amendment made by this Act, or the 
application of such provision or amendment to any person or 
circumstance is held to be unconstitutional, the remainder of this Act, 
the amendments made by this Act, and the application of the provisions 
of such to any person or circumstance shall not be affected thereby.
SEC. 4. EFFECTIVE DATE.
    Except as otherwise specifically provided in this Act or the 
amendments made by this Act, this Act and such amendments shall take 
effect 1 day after the date of enactment of this Act.
SEC. 5. BUDGETARY EFFECTS.
    The budgetary effects of this Act, for the purpose of complying 
with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by 
reference to the latest statement titled ``Budgetary Effects of PAYGO 
Legislation'' for this Act, jointly submitted for printing in the 
Congressional Record by the Chairmen of the House and Senate Budget 
Committees, provided that such statement has been submitted prior to 
the vote on passage in the House acting first on this conference report 
or amendment between the Houses.
SEC. 6. ANTITRUST SAVINGS CLAUSE.
    Nothing in this Act, or any amendment made by this Act, shall be 
construed to modify, impair, or supersede the operation of any of the 
antitrust laws, unless otherwise specified. For purposes of this 
section, the term ``antitrust laws'' has the same meaning as in 
subsection (a) of 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.

                      TITLE I--FINANCIAL STABILITY

    SEC. 101. SHORT TITLE.
    This title may be cited as the ``Financial Stability Act of 2010''.
    SEC. 102. DEFINITIONS.
    (a) In General.--For purposes of this title, unless the context 
otherwise requires, the following definitions shall apply:
        (1) Bank holding company.--The term ``bank holding company'' 
    has the same meaning as in section 2 of the Bank Holding Company 
    Act of 1956 (12 U.S.C. 1841). A foreign bank or company that is 
    treated as a bank holding company for purposes of the Bank Holding 
    Company Act of 1956, pursuant to section 8(a) of the International 
    Banking Act of 1978 (12 U.S.C. 3106(a)), shall be treated as a bank 
    holding company for purposes of this title.
        (2) Chairperson.--The term ``Chairperson'' means the 
    Chairperson of the Council.
        (3) Member agency.--The term ``member agency'' means an agency 
    represented by a voting member of the Council.
        (4) Nonbank financial company definitions.--
            (A) Foreign nonbank financial company.--The term ``foreign 
        nonbank financial company'' means a company (other than a 
        company that is, or is treated in the United States as, a bank 
        holding company) that is--
                (i) incorporated or organized in a country other than 
            the United States; and
                (ii) predominantly engaged in, including through a 
            branch in the United States, financial activities, as 
            defined in paragraph (6).
            (B) U.S. nonbank financial company.--The term ``U.S. 
        nonbank financial company'' means a company (other than a bank 
        holding company, a Farm Credit System institution chartered and 
        subject to the provisions of the Farm Credit Act of 1971 (12 
        U.S.C. 2001 et seq.), or a national securities exchange (or 
        parent thereof), clearing agency (or parent thereof, unless the 
        parent is a bank holding company), security-based swap 
        execution facility, or security-based swap data repository 
        registered with the Commission, or a board of trade designated 
        as a contract market (or parent thereof), or a derivatives 
        clearing organization (or parent thereof, unless the parent is 
        a bank holding company), swap execution facility or a swap data 
        repository registered with the Commodity Futures Trading 
        Commission), that is--
                (i) incorporated or organized under the laws of the 
            United States or any State; and
                (ii) predominantly engaged in financial activities, as 
            defined in paragraph (6).
            (C) Nonbank financial company.--The term ``nonbank 
        financial company'' means a U.S. nonbank financial company and 
        a foreign nonbank financial company.
            (D) Nonbank financial company supervised by the board of 
        governors.--The term ``nonbank financial company supervised by 
        the Board of Governors'' means a nonbank financial company that 
        the Council has determined under section 113 shall be 
        supervised by the Board of Governors.
        (5) Office of financial research.--The term ``Office of 
    Financial Research'' means the office established under section 
    152.
        (6) Predominantly engaged.--A company is ``predominantly 
    engaged in financial activities'' if--
            (A) the annual gross revenues derived by the company 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 company; or
            (B) the consolidated assets of the company 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 company.
        (7) Significant institutions.--The terms ``significant nonbank 
    financial company'' and ``significant bank holding company'' have 
    the meanings given those terms by rule of the Board of Governors, 
    but in no instance shall the term ``significant nonbank financial 
    company'' include those entities that are excluded under paragraph 
    (4)(B).
    (b) Definitional Criteria.--The Board of Governors shall establish, 
by regulation, the requirements for determining if a company is 
predominantly engaged in financial activities, as defined in subsection 
(a)(6).
    (c) Foreign Nonbank Financial Companies.--For purposes of the 
application of subtitles A and C (other than section 113(b)) with 
respect to a foreign nonbank financial company, references in this 
title to ``company'' or ``subsidiary'' include only the United States 
activities and subsidiaries of such foreign company, except as 
otherwise provided.

           Subtitle A--Financial Stability Oversight Council

    SEC. 111. FINANCIAL STABILITY OVERSIGHT COUNCIL ESTABLISHED.
    (a) Establishment.--Effective on the date of enactment of this Act, 
there is established the Financial Stability Oversight Council.
    (b) Membership.--The Council shall consist of the following 
members:
        (1) Voting members.--The voting members, who shall each have 1 
    vote on the Council shall be--
            (A) the Secretary of the Treasury, who shall serve as 
        Chairperson of the Council;
            (B) the Chairman of the Board of Governors;
            (C) the Comptroller of the Currency;
            (D) the Director of the Bureau;
            (E) the Chairman of the Commission;
            (F) the Chairperson of the Corporation;
            (G) the Chairperson of the Commodity Futures Trading 
        Commission;
            (H) the Director of the Federal Housing Finance Agency;
            (I) the Chairman of the National Credit Union 
        Administration Board; and
            (J) an independent member appointed by the President, by 
        and with the advice and consent of the Senate, having insurance 
        expertise.
        (2) Nonvoting members.--The nonvoting members, who shall serve 
    in an advisory capacity as a nonvoting member of the Council, shall 
    be--
            (A) the Director of the Office of Financial Research;
            (B) the Director of the Federal Insurance Office;
            (C) a State insurance commissioner, to be designated by a 
        selection process determined by the State insurance 
        commissioners;
            (D) a State banking supervisor, to be designated by a 
        selection process determined by the State banking supervisors; 
        and
            (E) a State securities commissioner (or an officer 
        performing like functions), to be designated by a selection 
        process determined by such State securities commissioners.
        (3) Nonvoting member participation.--The nonvoting members of 
    the Council shall not be excluded from any of the proceedings, 
    meetings, discussions, or deliberations of the Council, except that 
    the Chairperson may, upon an affirmative vote of the member 
    agencies, exclude the nonvoting members from any of the 
    proceedings, meetings, discussions, or deliberations of the Council 
    when necessary to safeguard and promote the free exchange of 
    confidential supervisory information.
    (c) Terms; Vacancy.--
        (1) Terms.--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 subsection (b)(2) shall serve 
    for a term of 2 years.
        (2) Vacancy.--Any vacancy on the Council shall be filled in the 
    manner in which the original appointment was made.
        (3) Acting officials may serve.--In the event of a vacancy in 
    the office of the head of a member agency or department, and 
    pending the appointment of a successor, or during the absence or 
    disability of the head of a member agency or department, the acting 
    head of the member agency or department shall serve as a member of 
    the Council in the place of that agency or department head.
    (d) Technical and Professional Advisory Committees.--The Council 
may appoint such special advisory, technical, or professional 
committees as may be useful in carrying out the functions of the 
Council, including an advisory committee consisting of State 
regulators, and the members of such committees may be members of the 
Council, or other persons, or both.
    (e) Meetings.--
        (1) Timing.--The Council shall meet at the call of the 
    Chairperson or a majority of the members then serving, but not less 
    frequently than quarterly.
        (2) Rules for conducting business.--The Council shall adopt 
    such rules as may be necessary for the conduct of the business of 
    the Council. Such rules shall be rules of agency organization, 
    procedure, or practice for purposes of section 553 of title 5, 
    United States Code.
    (f) Voting.--Unless otherwise specified, the Council shall make all 
decisions that it is authorized or required to make by a majority vote 
of the voting members then serving.
    (g) Nonapplicability of FACA.--The Federal Advisory Committee Act 
(5 U.S.C. App.) shall not apply to the Council, or to any special 
advisory, technical, or professional committee appointed by the 
Council, except that, if an advisory, technical, or professional 
committee has one or more members who are not employees of or 
affiliated with the United States Government, the Council shall publish 
a list of the names of the members of such committee.
    (h) Assistance From Federal Agencies.--Any department or agency of 
the United States may provide to the Council and any special advisory, 
technical, or professional committee appointed by the Council, such 
services, funds, facilities, staff, and other support services as the 
Council may determine advisable.
    (i) Compensation of Members.--
        (1) Federal employee members.--All members of the Council who 
    are officers or employees of the United States shall serve without 
    compensation in addition to that received for their services as 
    officers or employees of the United States.
        (2) Compensation for non-federal member.--Section 5314 of title 
    5, United States Code, is amended by adding at the end the 
    following:
        ``Independent Member of the Financial Stability Oversight 
    Council (1).''.
    (j) Detail of Government Employees.--Any employee of the Federal 
Government may be detailed to the Council 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 Council shall report to and be subject to oversight by the Council 
during the assignment to the Council, and shall be compensated by the 
department or agency from which the employee was detailed.
    SEC. 112. COUNCIL AUTHORITY.
    (a) Purposes and Duties of the Council.--
        (1) In general.--The purposes of the Council are--
            (A) to identify risks to the financial stability of the 
        United States that could arise from the material financial 
        distress or failure, or ongoing activities, of large, 
        interconnected bank holding companies or nonbank financial 
        companies, or that could arise outside the financial services 
        marketplace;
            (B) to promote market discipline, by eliminating 
        expectations on the part of shareholders, creditors, and 
        counterparties of such companies that the Government will 
        shield them from losses in the event of failure; and
            (C) to respond to emerging threats to the stability of the 
        United States financial system.
        (2) Duties.--The Council shall, in accordance with this title--
            (A) collect information from member agencies, other Federal 
        and State financial regulatory agencies, the Federal Insurance 
        Office and, if necessary to assess risks to the United States 
        financial system, direct the Office of Financial Research to 
        collect information from bank holding companies and nonbank 
        financial companies;
            (B) provide direction to, and request data and analyses 
        from, the Office of Financial Research to support the work of 
        the Council;
            (C) monitor the financial services marketplace in order to 
        identify potential threats to the financial stability of the 
        United States;
            (D) to monitor domestic and international financial 
        regulatory proposals and developments, including insurance and 
        accounting issues, and to advise Congress and make 
        recommendations in such areas that will enhance the integrity, 
        efficiency, competitiveness, and stability of the U.S. 
        financial markets;
            (E) facilitate information sharing and coordination among 
        the member agencies and other Federal and State agencies 
        regarding domestic financial services policy development, 
        rulemaking, examinations, reporting requirements, and 
        enforcement actions;
            (F) recommend to the member agencies general supervisory 
        priorities and principles reflecting the outcome of discussions 
        among the member agencies;
            (G) identify gaps in regulation that could pose risks to 
        the financial stability of the United States;
            (H) require supervision by the Board of Governors for 
        nonbank financial companies that may pose risks to the 
        financial stability of the United States in the event of their 
        material financial distress or failure, or because of their 
        activities pursuant to section 113;
            (I) make recommendations to the Board of Governors 
        concerning the establishment of heightened prudential standards 
        for risk-based capital, leverage, liquidity, contingent 
        capital, resolution plans and credit exposure reports, 
        concentration limits, enhanced public disclosures, and overall 
        risk management for nonbank financial companies and large, 
        interconnected bank holding companies supervised by the Board 
        of Governors;
            (J) identify systemically important financial market 
        utilities and payment, clearing, and settlement activities (as 
        that term is defined in title VIII);
            (K) make recommendations to primary financial regulatory 
        agencies to apply new or heightened standards and safeguards 
        for financial activities or practices that could create or 
        increase risks of significant liquidity, credit, or other 
        problems spreading among bank holding companies, nonbank 
        financial companies, and United States financial markets;
            (L) review and, as appropriate, may submit comments to the 
        Commission and any standard-setting body with respect to an 
        existing or proposed accounting principle, standard, or 
        procedure;
            (M) provide a forum for--
                (i) discussion and analysis of emerging market 
            developments and financial regulatory issues; and
                (ii) resolution of jurisdictional disputes among the 
            members of the Council; and
            (N) annually report to and testify before Congress on--
                (i) the activities of the Council;
                (ii) significant financial market and regulatory 
            developments, including insurance and accounting 
            regulations and standards, along with an assessment of 
            those developments on the stability of the financial 
            system;
                (iii) potential emerging threats to the financial 
            stability of the United States;
                (iv) all determinations made under section 113 or title 
            VIII, and the basis for such determinations;
                (v) all recommendations made under section 119 and the 
            result of such recommendations; and
                (vi) recommendations--

                    (I) to enhance the integrity, efficiency, 
                competitiveness, and stability of United States 
                financial markets;
                    (II) to promote market discipline; and
                    (III) to maintain investor confidence.

    (b) Statements by Voting Members of the Council.--At the time at 
which each report is submitted under subsection (a), each voting member 
of the Council shall--
        (1) if such member believes that the Council, the Government, 
    and the private sector are taking all reasonable steps to ensure 
    financial stability and to mitigate systemic risk that would 
    negatively affect the economy, submit a signed statement to 
    Congress stating such belief; or
        (2) if such member does not believe that all reasonable steps 
    described under paragraph (1) are being taken, submit a signed 
    statement to Congress stating what actions such member believes 
    need to be taken in order to ensure that all reasonable steps 
    described under paragraph (1) are taken.
    (c) Testimony by the Chairperson.--The Chairperson 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 at an annual hearing, after the report is 
submitted under subsection (a)--
        (1) to discuss the efforts, activities, objectives, and plans 
    of the Council; and
        (2) to discuss and answer questions concerning such report.
    (d) Authority To Obtain Information.--
        (1) In general.--The Council may receive, and may request the 
    submission of, any data or information from the Office of Financial 
    Research, member agencies, and the Federal Insurance Office, as 
    necessary--
            (A) to monitor the financial services marketplace to 
        identify potential risks to the financial stability of the 
        United States; or
            (B) to otherwise carry out any of the provisions of this 
        title.
        (2) Submissions by the office and member agencies.--
    Notwithstanding any other provision of law, the Office of Financial 
    Research, any member agency, and the Federal Insurance Office, are 
    authorized to submit information to the Council.
        (3) Financial data collection.--
            (A) In general.--The Council, acting through the Office of 
        Financial Research, may require the submission of periodic and 
        other reports from any nonbank financial company or bank 
        holding company for the purpose of assessing the extent to 
        which a financial activity or financial market in which the 
        nonbank financial company or bank holding company participates, 
        or the nonbank financial company or bank holding company 
        itself, poses a threat to the financial stability of the United 
        States.
            (B) Mitigation of report burden.--Before requiring the 
        submission of reports from any nonbank financial company or 
        bank holding company that is regulated by a member agency or 
        any primary financial regulatory agency, the Council, acting 
        through the Office of Financial Research, shall coordinate with 
        such agencies and shall, whenever possible, rely on information 
        available from the Office of Financial Research or such 
        agencies.
            (C) Mitigation in case of foreign financial companies.--
        Before requiring the submission of reports from a company that 
        is a foreign nonbank financial company or foreign-based bank 
        holding company, the Council shall, acting through the Office 
        of Financial Research, to the extent appropriate, consult with 
        the appropriate foreign regulator of such company and, whenever 
        possible, rely on information already being collected by such 
        foreign regulator, with English translation.
        (4) Back-up examination by the board of governors.--If the 
    Council is unable to determine whether the financial activities of 
    a U.S. nonbank financial company pose a threat to the financial 
    stability of the United States, based on information or reports 
    obtained under paragraphs (1) and (3), discussions with management, 
    and publicly available information, the Council may request the 
    Board of Governors, and the Board of Governors is authorized, to 
    conduct an examination of the U.S. nonbank financial company for 
    the sole purpose of determining whether the nonbank financial 
    company should be supervised by the Board of Governors for purposes 
    of this title.
        (5) Confidentiality.--
            (A) In general.--The Council, the Office of Financial 
        Research, and the other member agencies shall maintain the 
        confidentiality of any data, information, and reports submitted 
        under this title.
            (B) Retention of privilege.--The submission of any 
        nonpublicly available data or information under this subsection 
        and subtitle B shall not constitute a waiver of, or otherwise 
        affect, any privilege arising under Federal or State law 
        (including the rules of any Federal or State court) to which 
        the data or information is otherwise subject.
            (C) Freedom of information act.--Section 552 of title 5, 
        United States Code, including the exceptions thereunder, shall 
        apply to any data or information submitted under this 
        subsection and subtitle B.
    SEC. 113. AUTHORITY TO REQUIRE SUPERVISION AND REGULATION OF 
      CERTAIN NONBANK FINANCIAL COMPANIES.
    (a) U.S. Nonbank Financial Companies Supervised by the Board of 
Governors.--
        (1) Determination.--The Council, on a nondelegable basis and by 
    a vote of not fewer than \2/3\ of the voting members then serving, 
    including an affirmative vote by the Chairperson, may determine 
    that a U.S. nonbank financial company shall be supervised by the 
    Board of Governors and shall be subject to prudential standards, in 
    accordance with this title, if the Council determines that material 
    financial distress at the U.S. nonbank financial company, or the 
    nature, scope, size, scale, concentration, interconnectedness, or 
    mix of the activities of the U.S. nonbank financial company, could 
    pose a threat to the financial stability of the United States.
        (2) Considerations.--In making a determination under paragraph 
    (1), the Council shall consider--
            (A) the extent of the leverage of the company;
            (B) the extent and nature of the off-balance-sheet 
        exposures of the company;
            (C) the extent and nature of the transactions and 
        relationships of the company with other significant nonbank 
        financial companies and significant bank holding companies;
            (D) the importance of the company as a source of credit for 
        households, businesses, and State and local governments and as 
        a source of liquidity for the United States financial system;
            (E) the importance of the company as a source of credit for 
        low-income, minority, or underserved communities, and the 
        impact that the failure of such company would have on the 
        availability of credit in such communities;
            (F) the extent to which assets are managed rather than 
        owned by the company, and the extent to which ownership of 
        assets under management is diffuse;
            (G) the nature, scope, size, scale, concentration, 
        interconnectedness, and mix of the activities of the company;
            (H) the degree to which the company is already regulated by 
        1 or more primary financial regulatory agencies;
            (I) the amount and nature of the financial assets of the 
        company;
            (J) the amount and types of the liabilities of the company, 
        including the degree of reliance on short-term funding; and
            (K) any other risk-related factors that the Council deems 
        appropriate.
    (b) Foreign Nonbank Financial Companies Supervised by the Board of 
Governors.--
        (1) Determination.--The Council, on a nondelegable basis and by 
    a vote of not fewer than \2/3\ of the voting members then serving, 
    including an affirmative vote by the Chairperson, may determine 
    that a foreign nonbank financial company shall be supervised by the 
    Board of Governors and shall be subject to prudential standards, in 
    accordance with this title, if the Council determines that material 
    financial distress at the foreign nonbank financial company, or the 
    nature, scope, size, scale, concentration, interconnectedness, or 
    mix of the activities of the foreign nonbank financial company, 
    could pose a threat to the financial stability of the United 
    States.
        (2) Considerations.--In making a determination under paragraph 
    (1), the Council shall consider--
            (A) the extent of the leverage of the company;
            (B) the extent and nature of the United States related off-
        balance-sheet exposures of the company;
            (C) the extent and nature of the transactions and 
        relationships of the company with other significant nonbank 
        financial companies and significant bank holding companies;
            (D) the importance of the company as a source of credit for 
        United States households, businesses, and State and local 
        governments and as a source of liquidity for the United States 
        financial system;
            (E) the importance of the company as a source of credit for 
        low-income, minority, or underserved communities in the United 
        States, and the impact that the failure of such company would 
        have on the availability of credit in such communities;
            (F) the extent to which assets are managed rather than 
        owned by the company and the extent to which ownership of 
        assets under management is diffuse;
            (G) the nature, scope, size, scale, concentration, 
        interconnectedness, and mix of the activities of the company;
            (H) the extent to which the company is subject to 
        prudential standards on a consolidated basis in its home 
        country that are administered and enforced by a comparable 
        foreign supervisory authority;
            (I) the amount and nature of the United States financial 
        assets of the company;
            (J) the amount and nature of the liabilities of the company 
        used to fund activities and operations in the United States, 
        including the degree of reliance on short-term funding; and
            (K) any other risk-related factors that the Council deems 
        appropriate.
    (c) Antievasion.--
        (1) Determinations.--In order to avoid evasion of this title, 
    the Council, on its own initiative or at the request of the Board 
    of Governors, may determine, on a nondelegable basis and by a vote 
    of not fewer than \2/3\ of the voting members then serving, 
    including an affirmative vote by the Chairperson, that--
            (A) material financial distress related to, or the nature, 
        scope, size, scale, concentration, interconnectedness, or mix 
        of, the financial activities conducted directly or indirectly 
        by a company incorporated or organized under the laws of the 
        United States or any State or the financial activities in the 
        United States of a company incorporated or organized in a 
        country other than the United States would pose a threat to the 
        financial stability of the United States, based on 
        consideration of the factors in subsection (a)(2) or (b)(2), as 
        applicable;
            (B) the company is organized or operates in such a manner 
        as to evade the application of this title; and
            (C) such financial activities of the company shall be 
        supervised by the Board of Governors and subject to prudential 
        standards in accordance with this title, consistent with 
        paragraph (3).
        (2) Report.--Upon making a determination under paragraph (1), 
    the Council shall submit a report to the appropriate committees of 
    Congress detailing the reasons for making such determination.
        (3) Consolidated supervision of only financial activities; 
    establishment of an intermediate holding company.--
            (A) Establishment of an intermediate holding company.--Upon 
        a determination under paragraph (1), the company that is the 
        subject of the determination may establish an intermediate 
        holding company in which the financial activities of such 
        company and its subsidiaries shall be conducted (other than the 
        activities described in section 167(b)(2)) in compliance with 
        any regulations or guidance provided by the Board of Governors. 
        Such intermediate holding company shall be subject to the 
        supervision of the Board of Governors and to prudential 
        standards under this title as if the intermediate holding 
        company were a nonbank financial company supervised by the 
        Board of Governors.
            (B) Action of the board of governors.--To facilitate the 
        supervision of the financial activities subject to the 
        determination in paragraph (1), the Board of Governors may 
        require a company to establish an intermediate holding company, 
        as provided for in section 167, which would be subject to the 
        supervision of the Board of Governors and to prudential 
        standards under this title, as if the intermediate holding 
        company were a nonbank financial company supervised by the 
        Board of Governors.
        (4) Notice and opportunity for hearing and final determination; 
    judicial review.--Subsections (d) through (h) shall apply to 
    determinations made by the Council pursuant to paragraph (1) in the 
    same manner as such subsections apply to nonbank financial 
    companies.
        (5) Covered financial activities.--For purposes of this 
    subsection, the term ``financial activities''--
            (A) means activities that are financial in nature (as 
        defined in section 4(k) of the Bank Holding Company Act of 
        1956);
            (B) includes the ownership or control of one or more 
        insured depository institutions; and
            (C) does not include internal financial activities 
        conducted for the company or any affiliate thereof, including 
        internal treasury, investment, and employee benefit functions.
        (6) Only financial activities subject to prudential 
    supervision.--Nonfinancial activities of the company shall not be 
    subject to supervision by the Board of Governors and prudential 
    standards of the Board. For purposes of this Act, the financial 
    activities that are the subject of the determination in paragraph 
    (1) shall be subject to the same requirements as a nonbank 
    financial company supervised by the Board of Governors. Nothing in 
    this paragraph shall prohibit or limit the authority of the Board 
    of Governors to apply prudential standards under this title to the 
    financial activities that are subject to the determination in 
    paragraph (1).
    (d) Reevaluation and Rescission.--The Council shall--
        (1) not less frequently than annually, reevaluate each 
    determination made under subsections (a) and (b) with respect to 
    such nonbank financial company supervised by the Board of 
    Governors; and
        (2) rescind any such determination, if the Council, by a vote 
    of not fewer than \2/3\ of the voting members then serving, 
    including an affirmative vote by the Chairperson, determines that 
    the nonbank financial company no longer meets the standards under 
    subsection (a) or (b), as applicable.
    (e) Notice and Opportunity for Hearing and Final Determination.--
        (1) In general.--The Council shall provide to a nonbank 
    financial company written notice of a proposed determination of the 
    Council, including an explanation of the basis of the proposed 
    determination of the Council, that a nonbank financial company 
    shall be supervised by the Board of Governors and shall be subject 
    to prudential standards in accordance with this title.
        (2) Hearing.--Not later than 30 days after the date of receipt 
    of any notice of a proposed determination under paragraph (1), the 
    nonbank financial company may request, in writing, an opportunity 
    for a written or oral hearing before the Council to contest the 
    proposed determination. Upon receipt of a timely request, the 
    Council shall fix a time (not later than 30 days after the date of 
    receipt of the request) and place at which such company may appear, 
    personally or through counsel, to submit written materials (or, at 
    the sole discretion of the Council, oral testimony and oral 
    argument).
        (3) Final determination.--Not later than 60 days after the date 
    of a hearing under paragraph (2), the Council shall notify the 
    nonbank financial company of the final determination of the 
    Council, which shall contain a statement of the basis for the 
    decision of the Council.
        (4) No hearing requested.--If a nonbank financial company does 
    not make a timely request for a hearing, the Council shall notify 
    the nonbank financial company, in writing, of the final 
    determination of the Council under subsection (a) or (b), as 
    applicable, not later than 10 days after the date by which the 
    company may request a hearing under paragraph (2).
    (f) Emergency Exception.--
        (1) In general.--The Council may waive or modify the 
    requirements of subsection (e) with respect to a nonbank financial 
    company, if the Council determines, by a vote of not fewer than \2/
    3\ of the voting members then serving, including an affirmative 
    vote by the Chairperson, that such waiver or modification is 
    necessary or appropriate to prevent or mitigate threats posed by 
    the nonbank financial company to the financial stability of the 
    United States.
        (2) Notice.--The Council shall provide notice of a waiver or 
    modification under this subsection to the nonbank financial company 
    concerned as soon as practicable, but not later than 24 hours after 
    the waiver or modification is granted.
        (3) International coordination.--In making a determination 
    under paragraph (1), the Council shall consult with the appropriate 
    home country supervisor, if any, of the foreign nonbank financial 
    company that is being considered for such a determination.
        (4) Opportunity for hearing.--The Council shall allow a nonbank 
    financial company to request, in writing, an opportunity for a 
    written or oral hearing before the Council to contest a waiver or 
    modification under this subsection, not later than 10 days after 
    the date of receipt of notice of the waiver or modification by the 
    company. Upon receipt of a timely request, the Council shall fix a 
    time (not later than 15 days after the date of receipt of the 
    request) and place at which the nonbank financial company may 
    appear, personally or through counsel, to submit written materials 
    (or, at the sole discretion of the Council, oral testimony and oral 
    argument).
        (5) Notice of final determination.--Not later than 30 days 
    after the date of any hearing under paragraph (4), the Council 
    shall notify the subject nonbank financial company of the final 
    determination of the Council under this subsection, which shall 
    contain a statement of the basis for the decision of the Council.
    (g) Consultation.--The Council shall consult with the primary 
financial regulatory agency, if any, for each nonbank financial company 
or subsidiary of a nonbank financial company that is being considered 
for supervision by the Board of Governors under this section before the 
Council makes any final determination with respect to such nonbank 
financial company under subsection (a), (b), or (c).
    (h) Judicial Review.--If the Council makes a final determination 
under this section with respect to a nonbank financial company, such 
nonbank financial company may, not later than 30 days after the date of 
receipt of the notice of final determination under subsection (d)(2), 
(e)(3), or (f)(5), bring an action in the United States district court 
for the judicial district in which the home office of such nonbank 
financial company is located, or in the United States District Court 
for the District of Columbia, for an order requiring that the final 
determination be rescinded, and the court shall, upon review, dismiss 
such action or direct the final determination to be rescinded. Review 
of such an action shall be limited to whether the final determination 
made under this section was arbitrary and capricious.
    (i) International Coordination.--In exercising its duties under 
this title with respect to foreign nonbank financial companies, 
foreign-based bank holding companies, and cross-border activities and 
markets, the Council shall consult with appropriate foreign regulatory 
authorities, to the extent appropriate.
    SEC. 114. REGISTRATION OF NONBANK FINANCIAL COMPANIES SUPERVISED BY 
      THE BOARD OF GOVERNORS.
    Not later than 180 days after the date of a final Council 
determination under section 113 that a nonbank financial company is to 
be supervised by the Board of Governors, such company shall register 
with the Board of Governors, on forms prescribed by the Board of 
Governors, which shall include such information as the Board of 
Governors, in consultation with the Council, may deem necessary or 
appropriate to carry out this title.
    SEC. 115. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK 
      FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF GOVERNORS AND 
      CERTAIN BANK HOLDING COMPANIES.
    (a) In General.--
        (1) Purpose.--In order to prevent or mitigate risks to the 
    financial stability of the United States that could arise from the 
    material financial distress, failure, or ongoing activities of 
    large, interconnected financial institutions, the Council may make 
    recommendations to the Board of Governors concerning the 
    establishment and refinement of prudential standards and reporting 
    and disclosure requirements applicable to nonbank financial 
    companies supervised by the Board of Governors and large, 
    interconnected bank holding companies, that--
            (A) are more stringent than those applicable to other 
        nonbank financial companies and bank holding companies that do 
        not present similar risks to the financial stability of the 
        United States; and
            (B) increase in stringency, based on the considerations 
        identified in subsection (b)(3).
        (2) Recommended application of required standards.--In making 
    recommendations under this section, the Council may--
            (A) differentiate among companies that are subject to 
        heightened standards 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 Council deems appropriate; or
            (B) recommend an asset threshold that is higher than 
        $50,000,000,000 for the application of any standard described 
        in subsections (c) through (g).
    (b) Development of Prudential Standards.--
        (1) In general.--The recommendations of the Council under 
    subsection (a) may include--
            (A) risk-based capital requirements;
            (B) leverage limits;
            (C) liquidity requirements;
            (D) resolution plan and credit exposure report 
        requirements;
            (E) concentration limits;
            (F) a contingent capital requirement;
            (G) enhanced public disclosures;
            (H) short-term debt limits; and
            (I) overall risk management requirements.
        (2) Prudential standards for foreign financial companies.--In 
    making recommendations concerning the standards set forth in 
    paragraph (1) that would apply to foreign nonbank financial 
    companies supervised by the Board of Governors or foreign-based 
    bank holding companies, the Council shall--
            (A) give due regard to the principle of national treatment 
        and equality of competitive opportunity; and
            (B) take into account the extent to which the foreign 
        nonbank financial company or foreign-based bank holding company 
        is subject on a consolidated basis to home country standards 
        that are comparable to those applied to financial companies in 
        the United States.
        (3) Considerations.--In making recommendations concerning 
    prudential standards under paragraph (1), the Council shall--
            (A) take into account differences among nonbank financial 
        companies supervised by the Board of Governors and bank holding 
        companies described in subsection (a), based on--
                (i) the factors described in subsections (a) and (b) of 
            section 113;
                (ii) whether the company owns an insured depository 
            institution;
                (iii) nonfinancial activities and affiliations of the 
            company; and
                (iv) any other factors that the Council determines 
            appropriate;
            (B) to the extent possible, ensure that small changes in 
        the factors listed in subsections (a) and (b) of section 113 
        would not result in sharp, discontinuous changes in the 
        prudential standards established under section 165; and
            (C) adapt its recommendations as appropriate in light of 
        any predominant line of business of such company, including 
        assets under management or other activities for which 
        particular standards may not be appropriate.
    (c) Contingent Capital.--
        (1) Study required.--The Council shall conduct a study of the 
    feasibility, benefits, costs, and structure of a contingent capital 
    requirement for nonbank financial companies supervised by the Board 
    of Governors and bank holding companies described in subsection 
    (a), which study shall include--
            (A) an evaluation of the degree to which such requirement 
        would enhance the safety and soundness of companies subject to 
        the requirement, promote the financial stability of the United 
        States, and reduce risks to United States taxpayers;
            (B) an evaluation of the characteristics and amounts of 
        contingent capital that should be required;
            (C) an analysis of potential prudential standards that 
        should be used to determine whether the contingent capital of a 
        company would be converted to equity in times of financial 
        stress;
            (D) an evaluation of the costs to companies, the effects on 
        the structure and operation of credit and other financial 
        markets, and other economic effects of requiring contingent 
        capital;
            (E) an evaluation of the effects of such requirement on the 
        international competitiveness of companies subject to the 
        requirement and the prospects for international coordination in 
        establishing such requirement; and
            (F) recommendations for implementing regulations.
        (2) Report.--The Council shall submit a report to Congress 
    regarding the study required by paragraph (1) not later than 2 
    years after the date of enactment of this Act.
        (3) Recommendations.--
            (A) In general.--Subsequent to submitting a report to 
        Congress under paragraph (2), the Council may make 
        recommendations to the Board of Governors to require any 
        nonbank financial company supervised by the Board of Governors 
        and any bank holding company described in subsection (a) to 
        maintain a minimum amount of contingent capital that is 
        convertible to equity in times of financial stress.
            (B) Factors to consider.--In making recommendations under 
        this subsection, the Council shall consider--
                (i) an appropriate transition period for implementation 
            of a conversion under this subsection;
                (ii) the factors described in subsection (b)(3);
                (iii) capital requirements applicable to a nonbank 
            financial company supervised by the Board of Governors or a 
            bank holding company described in subsection (a), and 
            subsidiaries thereof;
                (iv) results of the study required by paragraph (1); 
            and
                (v) any other factor that the Council deems 
            appropriate.
    (d) Resolution Plan and Credit Exposure Reports.--
        (1) Resolution plan.--The Council may make recommendations to 
    the Board of Governors concerning the requirement that each nonbank 
    financial company supervised by the Board of Governors and each 
    bank holding company described in subsection (a) report 
    periodically to the Council, the Board of Governors, and the 
    Corporation, the plan of such company for rapid and orderly 
    resolution in the event of material financial distress or failure.
        (2) Credit exposure report.--The Council may make 
    recommendations to the Board of Governors concerning the 
    advisability of requiring each nonbank financial company supervised 
    by the Board of Governors and bank holding company described in 
    subsection (a) to report periodically to the Council, the Board of 
    Governors, and the Corporation on--
            (A) the nature and extent to which the company has credit 
        exposure to other significant nonbank financial companies and 
        significant bank holding companies; and
            (B) the nature and extent to which other such significant 
        nonbank financial companies and significant bank holding 
        companies have credit exposure to that company.
    (e) Concentration Limits.--In order to limit the risks that the 
failure of any individual company could pose to nonbank financial 
companies supervised by the Board of Governors or bank holding 
companies described in subsection (a), the Council may make 
recommendations to the Board of Governors to prescribe standards to 
limit such risks, as set forth in section 165.
    (f) Enhanced Public Disclosures.--The Council may make 
recommendations to the Board of Governors to require periodic public 
disclosures by bank holding companies described in subsection (a) and 
by nonbank financial companies supervised by the Board of Governors, in 
order to support market evaluation of the risk profile, capital 
adequacy, and risk management capabilities thereof.
    (g) Short-term Debt Limits.--The Council may make recommendations 
to the Board of Governors to require short-term debt limits to mitigate 
the risks that an over-accumulation of such debt could pose to bank 
holding companies described in subsection (a), nonbank financial 
companies supervised by the Board of Governors, or the financial 
system.
    SEC. 116. REPORTS.
    (a) In General.--Subject to subsection (b), the Council, acting 
through the Office of Financial Research, may require a bank holding 
company with total consolidated assets of $50,000,000,000 or greater or 
a nonbank financial company supervised by the Board of Governors, and 
any subsidiary thereof, to submit certified reports to keep the Council 
informed as to--
        (1) the financial condition of the company;
        (2) systems for monitoring and controlling financial, 
    operating, and other risks;
        (3) transactions with any subsidiary that is a depository 
    institution; and
        (4) the extent to which the activities and operations of the 
    company and any subsidiary thereof, could, under adverse 
    circumstances, have the potential to disrupt financial markets or 
    affect the overall financial stability of the United States.
    (b) Use of Existing Reports.--
        (1) In general.--For purposes of compliance with subsection 
    (a), the Council, acting through the Office of Financial Research, 
    shall, to the fullest extent possible, use--
            (A) reports that a bank holding company, nonbank financial 
        company supervised by the Board of Governors, or any 
        functionally regulated subsidiary of such company has been 
        required to provide to other Federal or State regulatory 
        agencies or to a relevant foreign supervisory authority;
            (B) information that is otherwise required to be reported 
        publicly; and
            (C) externally audited financial statements.
        (2) Availability.--Each bank holding company described in 
    subsection (a) and nonbank financial company supervised by the 
    Board of Governors, and any subsidiary thereof, shall provide to 
    the Council, at the request of the Council, copies of all reports 
    referred to in paragraph (1).
        (3) Confidentiality.--The Council shall maintain the 
    confidentiality of the reports obtained under subsection (a) and 
    paragraph (1)(A) of this subsection.
    SEC. 117. TREATMENT OF CERTAIN COMPANIES THAT CEASE TO BE BANK 
      HOLDING COMPANIES.
    (a) Applicability.--This section shall apply to--
        (1) any entity that--
            (A) was a bank holding company having total consolidated 
        assets equal to or greater than $50,000,000,000 as of January 
        1, 2010; and
            (B) received financial assistance under or participated in 
        the Capital Purchase Program established under the Troubled 
        Asset Relief Program authorized by the Emergency Economic 
        Stabilization Act of 2008; and
        (2) any successor entity (as defined by the Board of Governors, 
    in consultation with the Council) to an entity described in 
    paragraph (1).
    (b) Treatment.--If an entity described in subsection (a) ceases to 
be a bank holding company at any time after January 1, 2010, then such 
entity shall be treated as a nonbank financial company supervised by 
the Board of Governors, as if the Council had made a determination 
under section 113 with respect to that entity.
    (c) Appeal.--
        (1) Request for hearing.--An entity may request, in writing, an 
    opportunity for a written or oral hearing before the Council to 
    appeal its treatment as a nonbank financial company supervised by 
    the Board of Governors in accordance with this section. Upon 
    receipt of the request, the Council shall fix a time (not later 
    than 30 days after the date of receipt of the request) and place at 
    which such entity may appear, personally or through counsel, to 
    submit written materials (or, at the sole discretion of the 
    Council, oral testimony and oral argument).
        (2) Decision.--
            (A) Proposed decision.--A Council decision to grant an 
        appeal under this subsection shall be made by a vote of not 
        fewer than \2/3\ of the voting members then serving, including 
        an affirmative vote by the Chairperson. Not later than 60 days 
        after the date of a hearing under paragraph (1), the Council 
        shall submit a report to, and may testify before, the Committee 
        on Banking, Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of Representatives 
        on the proposed decision of the Council regarding an appeal 
        under paragraph (1), which report shall include a statement of 
        the basis for the proposed decision of the Council.
            (B) Notice of final decision.--The Council shall notify the 
        subject entity of the final decision of the Council regarding 
        an appeal under paragraph (1), which notice shall contain a 
        statement of the basis for the final decision of the Council, 
        not later than 60 days after the later of--
                (i) the date of the submission of the report under 
            subparagraph (A); or
                (ii) if, not later than 1 year after the date of 
            submission of the report under subparagraph (A), the 
            Committee on Banking, Housing, and Urban Affairs of the 
            Senate or the Committee on Financial Services of the House 
            of Representatives holds one or more hearings regarding 
            such report, the date of the last such hearing.
            (C) Considerations.--In making a decision regarding an 
        appeal under paragraph (1), the Council shall consider whether 
        the company meets the standards under section 113(a) or 113(b), 
        as applicable, and the definition of the term ``nonbank 
        financial company'' under section 102. The decision of the 
        Council shall be final, subject to the review under paragraph 
        (3).
        (3) Review.--If the Council denies an appeal under this 
    subsection, the Council shall, not less frequently than annually, 
    review and reevaluate the decision.
    SEC. 118. COUNCIL FUNDING.
    Any expenses of the Council shall be treated as expenses of, and 
paid by, the Office of Financial Research.
    SEC. 119. RESOLUTION OF SUPERVISORY JURISDICTIONAL DISPUTES AMONG 
      MEMBER AGENCIES.
    (a) Request for Council Recommendation.--The Council shall seek to 
resolve a dispute among 2 or more member agencies, if--
        (1) a member agency has a dispute with another member agency 
    about the respective jurisdiction over a particular bank holding 
    company, nonbank financial company, or financial activity or 
    product (excluding matters for which another dispute mechanism 
    specifically has been provided under title X);
        (2) the Council determines that the disputing agencies cannot, 
    after a demonstrated good faith effort, resolve the dispute without 
    the intervention of the Council; and
        (3) any of the member agencies involved in the dispute--
            (A) provides all other disputants prior notice of the 
        intent to request dispute resolution by the Council; and
            (B) requests in writing, not earlier than 14 days after 
        providing the notice described in subparagraph (A), that the 
        Council seek to resolve the dispute.
    (b) Council Recommendation.--The Council shall seek to resolve each 
dispute described in subsection (a)--
        (1) within a reasonable time after receiving the dispute 
    resolution request;
        (2) after consideration of relevant information provided by 
    each agency party to the dispute; and
        (3) by agreeing with 1 of the disputants regarding the entirety 
    of the matter, or by determining a compromise position.
    (c) Form of Recommendation.--Any Council recommendation under this 
section shall--
        (1) be in writing;
        (2) include an explanation of the reasons therefor; and
        (3) be approved by the affirmative vote of \2/3\ of the voting 
    members of the Council then serving.
    (d) Nonbinding Effect.--Any recommendation made by the Council 
under subsection (c) shall not be binding on the Federal agencies that 
are parties to the dispute.
    SEC. 120. ADDITIONAL STANDARDS APPLICABLE TO ACTIVITIES OR 
      PRACTICES FOR FINANCIAL STABILITY PURPOSES.
    (a) In General.--The Council may provide for more stringent 
regulation of a financial activity by issuing recommendations to the 
primary financial regulatory agencies to apply new or heightened 
standards and safeguards, including standards enumerated in section 
115, for a financial activity or practice conducted by bank holding 
companies or nonbank financial companies under their respective 
jurisdictions, if the Council determines that the conduct, scope, 
nature, size, scale, concentration, or interconnectedness of such 
activity or practice could create or increase the risk of significant 
liquidity, credit, or other problems spreading among bank holding 
companies and nonbank financial companies, financial markets of the 
United States, or low-income, minority, or underserved communities.
    (b) Procedure for Recommendations to Regulators.--
        (1) Notice and opportunity for comment.--The Council shall 
    consult with the primary financial regulatory agencies and provide 
    notice to the public and opportunity for comment for any proposed 
    recommendation that the primary financial regulatory agencies apply 
    new or heightened standards and safeguards for a financial activity 
    or practice.
        (2) Criteria.--The new or heightened standards and safeguards 
    for a financial activity or practice recommended under paragraph 
    (1)--
            (A) shall take costs to long-term economic growth into 
        account; and
            (B) may include prescribing the conduct of the activity or 
        practice in specific ways (such as by limiting its scope, or 
        applying particular capital or risk management requirements to 
        the conduct of the activity) or prohibiting the activity or 
        practice.
    (c) Implementation of Recommended Standards.--
        (1) Role of primary financial regulatory agency.--
            (A) In general.--Each primary financial regulatory agency 
        may impose, require reports regarding, examine for compliance 
        with, and enforce standards in accordance with this section 
        with respect to those entities for which it is the primary 
        financial regulatory agency.
            (B) Rule of construction.--The authority under this 
        paragraph is in addition to, and does not limit, any other 
        authority of a primary financial regulatory agency. Compliance 
        by an entity with actions taken by a primary financial 
        regulatory agency under this section shall be enforceable in 
        accordance with the statutes governing the respective 
        jurisdiction of the primary financial regulatory agency over 
        the entity, as if the agency action were taken under those 
        statutes.
        (2) Imposition of standards.--The primary financial regulatory 
    agency shall impose the standards recommended by the Council in 
    accordance with subsection (a), or similar standards that the 
    Council deems acceptable, or shall explain in writing to the 
    Council, not later than 90 days after the date on which the Council 
    issues the recommendation, why the agency has determined not to 
    follow the recommendation of the Council.
    (d) Report to Congress.--The Council shall report to Congress on--
        (1) any recommendations issued by the Council under this 
    section;
        (2) the implementation of, or failure to implement, such 
    recommendation on the part of a primary financial regulatory 
    agency; and
        (3) in any case in which no primary financial regulatory agency 
    exists for the nonbank financial company conducting financial 
    activities or practices referred to in subsection (a), 
    recommendations for legislation that would prevent such activities 
    or practices from threatening the stability of the financial system 
    of the United States.
    (e) Effect of Rescission of Identification.--
        (1) Notice.--The Council may recommend to the relevant primary 
    financial regulatory agency that a financial activity or practice 
    no longer requires any standards or safeguards implemented under 
    this section.
        (2) Determination of primary financial regulatory agency to 
    continue.--
            (A) In general.--Upon receipt of a recommendation under 
        paragraph (1), a primary financial regulatory agency that has 
        imposed standards under this section shall determine whether 
        such standards should remain in effect.
            (B) Appeal process.--Each primary financial regulatory 
        agency that has imposed standards under this section shall 
        promulgate regulations to establish a procedure under which 
        entities under its jurisdiction may appeal a determination by 
        such agency under this paragraph that standards imposed under 
        this section should remain in effect.
    SEC. 121. MITIGATION OF RISKS TO FINANCIAL STABILITY.
    (a) Mitigatory Actions.--If the Board of Governors determines that 
a bank holding company with total consolidated assets of 
$50,000,000,000 or more, or a nonbank financial company supervised by 
the Board of Governors, poses a grave threat to the financial stability 
of the United States, the Board of Governors, upon an affirmative vote 
of not fewer than \2/3\ of the voting members of the Council then 
serving, shall--
        (1) limit the ability of the company to merge with, acquire, 
    consolidate with, or otherwise become affiliated with another 
    company;
        (2) restrict the ability of the company to offer a financial 
    product or products;
        (3) require the company to terminate one or more activities;
        (4) impose conditions on the manner in which the company 
    conducts 1 or more activities; or
        (5) if the Board of Governors determines that the actions 
    described in paragraphs (1) through (4) are inadequate to mitigate 
    a threat to the financial stability of the United States in its 
    recommendation, require the company to sell or otherwise transfer 
    assets or off-balance-sheet items to unaffiliated entities.
    (b) Notice and Hearing.--
        (1) In general.--The Board of Governors, in consultation with 
    the Council, shall provide to a company described in subsection (a) 
    written notice that such company is being considered for mitigatory 
    action pursuant to this section, including an explanation of the 
    basis for, and description of, the proposed mitigatory action.
        (2) Hearing.--Not later than 30 days after the date of receipt 
    of notice under paragraph (1), the company may request, in writing, 
    an opportunity for a written or oral hearing before the Board of 
    Governors to contest the proposed mitigatory action. Upon receipt 
    of a timely request, the Board of Governors shall fix a time (not 
    later than 30 days after the date of receipt of the request) and 
    place at which such company may appear, personally or through 
    counsel, to submit written materials (or, at the discretion of the 
    Board of Governors, in consultation with the Council, oral 
    testimony and oral argument).
        (3) Decision.--Not later than 60 days after the date of a 
    hearing under paragraph (2), or not later than 60 days after the 
    provision of a notice under paragraph (1) if no hearing was held, 
    the Board of Governors shall notify the company of the final 
    decision of the Board of Governors, including the results of the 
    vote of the Council, as described in subsection (a).
    (c) Factors for Consideration.--The Board of Governors and the 
Council shall take into consideration the factors set forth in 
subsection (a) or (b) of section 113, as applicable, in making any 
determination under subsection (a).
    (d) Application to Foreign Financial Companies.--The Board of 
Governors may prescribe regulations regarding the application of this 
section to foreign nonbank financial companies supervised by the Board 
of Governors and foreign-based bank holding companies--
        (1) giving due regard to the principle of national treatment 
    and equality of competitive opportunity; and
        (2) taking into account the extent to which the foreign nonbank 
    financial company or foreign-based bank holding company is subject 
    on a consolidated basis to home country standards that are 
    comparable to those applied to financial companies in the United 
    States.
    SEC. 122. GAO AUDIT OF COUNCIL.
    (a) Authority To Audit.--The Comptroller General of the United 
States may audit the activities of--
        (1) the Council; and
        (2) any person or entity acting on behalf of or under the 
    authority of the Council, to the extent that such activities relate 
    to work for the Council by such person or entity.
    (b) Access to Information.--
        (1) In general.--Notwithstanding any other provision of law, 
    the Comptroller General shall, upon request and at such reasonable 
    time and in such reasonable form as the Comptroller General may 
    request, have access to--
            (A) any records or other information under the control of 
        or used by the Council;
            (B) any records or other information under the control of a 
        person or entity acting on behalf of or under the authority of 
        the Council, to the extent that such records or other 
        information is relevant to an audit under subsection (a); and
            (C) the officers, directors, employees, financial advisors, 
        staff, working groups, and agents and representatives of the 
        Council (as related to the activities on behalf of the Council 
        of such agent or representative), at such reasonable times as 
        the Comptroller General may request.
        (2) Copies.--The Comptroller General may make and retain copies 
    of such books, accounts, and other records, access to which is 
    granted under this section, as the Comptroller General considers 
    appropriate.
    SEC. 123. STUDY OF THE EFFECTS OF SIZE AND COMPLEXITY OF FINANCIAL 
      INSTITUTIONS ON CAPITAL MARKET EFFICIENCY AND ECONOMIC GROWTH.
    (a) Study Required.--
        (1) In general.--The Chairperson of the Council shall carry out 
    a study of the economic impact of possible financial services 
    regulatory limitations intended to reduce systemic risk. Such study 
    shall estimate the benefits and costs on the efficiency of capital 
    markets, on the financial sector, and on national economic growth, 
    of--
            (A) explicit or implicit limits on the maximum size of 
        banks, bank holding companies, and other large financial 
        institutions;
            (B) limits on the organizational complexity and 
        diversification of large financial institutions;
            (C) requirements for operational separation between 
        business units of large financial institutions in order to 
        expedite resolution in case of failure;
            (D) limits on risk transfer between business units of large 
        financial institutions;
            (E) requirements to carry contingent capital or similar 
        mechanisms;
            (F) limits on commingling of commercial and financial 
        activities by large financial institutions;
            (G) segregation requirements between traditional financial 
        activities and trading or other high-risk operations in large 
        financial institutions; and
            (H) other limitations on the activities or structure of 
        large financial institutions that may be useful to limit 
        systemic risk.
        (2) Recommendations.--The study required by this section shall 
    include recommendations for the optimal structure of any limits 
    considered in subparagraphs (A) through (E), in order to maximize 
    their effectiveness and minimize their economic impact.
    (b) Report.--Not later than the end of the 180-day period beginning 
on the date of enactment of this title, and not later than every 5 
years thereafter, the Chairperson shall issue a report to the Congress 
containing any findings and determinations made in carrying out the 
study required under subsection (a).

                Subtitle B--Office of Financial Research

    SEC. 151. DEFINITIONS.
    For purposes of this subtitle--
        (1) the terms ``Office'' and ``Director'' mean the Office of 
    Financial Research established under this subtitle and the Director 
    thereof, respectively;
        (2) the term ``financial company'' has the same meaning as in 
    title II, and includes an insured depository institution and an 
    insurance company;
        (3) the term ``Data Center'' means the data center established 
    under section 154;
        (4) the term ``Research and Analysis Center'' means the 
    research and analysis center established under section 154;
        (5) the term ``financial transaction data'' means the structure 
    and legal description of a financial contract, with sufficient 
    detail to describe the rights and obligations between 
    counterparties and make possible an independent valuation;
        (6) the term ``position data''--
            (A) means data on financial assets or liabilities held on 
        the balance sheet of a financial company, where positions are 
        created or changed by the execution of a financial transaction; 
        and
            (B) includes information that identifies counterparties, 
        the valuation by the financial company of the position, and 
        information that makes possible an independent valuation of the 
        position;
        (7) the term ``financial contract'' means a legally binding 
    agreement between 2 or more counterparties, describing rights and 
    obligations relating to the future delivery of items of intrinsic 
    or extrinsic value among the counterparties; and
        (8) the term ``financial instrument'' means a financial 
    contract in which the terms and conditions are publicly available, 
    and the roles of one or more of the counterparties are assignable 
    without the consent of any of the other counterparties (including 
    common stock of a publicly traded company, government bonds, or 
    exchange traded futures and options contracts).
    SEC. 152. OFFICE OF FINANCIAL RESEARCH ESTABLISHED.
    (a) Establishment.--There is established within the Department of 
the Treasury the Office of Financial Research.
    (b) Director.--
        (1) In general.--The Office shall be headed by a Director, who 
    shall be appointed by the President, by and with the advice and 
    consent of the Senate.
        (2) Term of service.--The Director shall serve for a term of 6 
    years, except that, in the event that a successor is not nominated 
    and confirmed by the end of the term of service of a Director, the 
    Director may continue to serve until such time as the next Director 
    is appointed and confirmed.
        (3) Executive level.--The Director shall be compensated at 
    Level III of the Executive Schedule.
        (4) Prohibition on dual service.--The individual serving in the 
    position of Director may not, during such service, also serve as 
    the head of any financial regulatory agency.
        (5) Responsibilities, duties, and authority.--The Director 
    shall have sole discretion in the manner in which the Director 
    fulfills the responsibilities and duties and exercises the 
    authorities described in this subtitle.
    (c) Budget.--The Director, in consultation with the Chairperson, 
shall establish the annual budget of the Office.
    (d) Office Personnel.--
        (1) In general.--The Director, in consultation with the 
    Chairperson, may fix the number of, and appoint and direct, all 
    employees of the Office.
        (2) Compensation.--The Director, in consultation with the 
    Chairperson, shall fix, adjust, and administer the pay for all 
    employees of the Office, without regard to chapter 51 or subchapter 
    III of chapter 53 of title 5, United States Code, relating to 
    classification of positions and General Schedule pay rates.
        (3) Comparability.--Section 1206(a) of the Financial 
    Institutions Reform, Recovery, and Enforcement Act of 1989 (12 
    U.S.C. 1833b(a)) is amended--
            (A) by striking ``Finance Board,'' and inserting ``Finance 
        Board, the Office of Financial Research, and the Bureau of 
        Consumer Financial Protection''; and
            (B) by striking ``and the Office of Thrift Supervision,''.
        (4) Senior executives.--Section 3132(a)(1)(D) of title 5, 
    United States Code, is amended by striking ``and the National 
    Credit Union Administration;'' and inserting ``the National Credit 
    Union Administration, the Bureau of Consumer Financial Protection, 
    and the Office of Financial Research;''.
    (e) Assistance From Federal Agencies.--Any department or agency of 
the United States may provide to the Office and any special advisory, 
technical, or professional committees appointed by the Office, such 
services, funds, facilities, staff, and other support services as the 
Office may determine advisable. Any Federal Government employee may be 
detailed to the Office without reimbursement, and such detail shall be 
without interruption or loss of civil service status or privilege.
    (f) Procurement of Temporary and Intermittent Services.--The 
Director 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.
    (g) Post-employment Prohibitions.--The Secretary, with the 
concurrence of the Director of the Office of Government Ethics, shall 
issue regulations prohibiting the Director and any employee of the 
Office who has had access to the transaction or position data 
maintained by the Data Center or other business confidential 
information about financial entities required to report to the Office 
from being employed by or providing advice or consulting services to a 
financial company, for a period of 1 year after last having had access 
in the course of official duties to such transaction or position data 
or business confidential information, regardless of whether that entity 
is required to report to the Office. For employees whose access to 
business confidential information was limited, the regulations may 
provide, on a case-by-case basis, for a shorter period of post-
employment prohibition, provided that the shorter period does not 
compromise business confidential information.
    (h) Technical and Professional Advisory Committees.--The Office, in 
consultation with the Chairperson, 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.
    (i) Fellowship Program.--The Office, in consultation with the 
Chairperson, may establish and maintain an academic and professional 
fellowship program, under which qualified academics and professionals 
shall be invited to spend not longer than 2 years at the Office, to 
perform research and to provide advanced training for Office personnel.
    (j) Executive Schedule Compensation.--Section 5314 of title 5, 
United States Code, is amended by adding at the end the following new 
item:
        ``Director of the Office of Financial Research.''.
    SEC. 153. PURPOSE AND DUTIES OF THE OFFICE.
    (a) Purpose and Duties.--The purpose of the Office is to support 
the Council in fulfilling the purposes and duties of the Council, as 
set forth in subtitle A, and to support member agencies, by--
        (1) collecting data on behalf of the Council, and providing 
    such data to the Council and member agencies;
        (2) standardizing the types and formats of data reported and 
    collected;
        (3) performing applied research and essential long-term 
    research;
        (4) developing tools for risk measurement and monitoring;
        (5) performing other related services;
        (6) making the results of the activities of the Office 
    available to financial regulatory agencies; and
        (7) assisting such member agencies in determining the types and 
    formats of data authorized by this Act to be collected by such 
    member agencies.
    (b) Administrative Authority.--The Office may--
        (1) share data and information, including software developed by 
    the Office, with the Council, member agencies, and the Bureau of 
    Economic Analysis, which shared data, information, and software--
            (A) shall be maintained with at least the same level of 
        security as is used by the Office; and
            (B) may not be shared with any individual or entity without 
        the permission of the Council;
        (2) sponsor and conduct research projects; and
        (3) assist, on a reimbursable basis, with financial analyses 
    undertaken at the request of other Federal agencies that are not 
    member agencies.
    (c) Rulemaking Authority.--
        (1) Scope.--The Office, in consultation with the Chairperson, 
    shall issue rules, regulations, and orders only to the extent 
    necessary to carry out the purposes and duties described in 
    paragraphs (1), (2), and (7) of subsection (a).
        (2) Standardization.--Member agencies, in consultation with the 
    Office, shall implement regulations promulgated by the Office under 
    paragraph (1) to standardize the types and formats of data reported 
    and collected on behalf of the Council, as described in subsection 
    (a)(2). If a member agency fails to implement such regulations 
    prior to the expiration of the 3-year period following the date of 
    publication of final regulations, the Office, in consultation with 
    the Chairperson, may implement such regulations with respect to the 
    financial entities under the jurisdiction of the member agency. 
    This paragraph shall not supersede or interfere with the 
    independent authority of a member agency under other law to collect 
    data, in such format and manner as the member agency requires.
    (d) Testimony.--
        (1) In general.--The Director of the Office shall report to and 
    testify before the Committee on Banking, Housing, and Urban Affairs 
    of the Senate and the Committee on Financial Services of the House 
    of Representatives annually on the activities of the Office, 
    including the work of the Data Center and the Research and Analysis 
    Center, and the assessment of the Office of significant financial 
    market developments and potential emerging threats to the financial 
    stability of the United States.
        (2) No prior review.--No officer or agency of the United States 
    shall have any authority to require the Director to submit the 
    testimony required under paragraph (1) or other congressional 
    testimony to any officer or agency of the United States for 
    approval, comment, or review prior to the submission of such 
    testimony. Any such testimony to Congress shall include a statement 
    that the views expressed therein are those of the Director and do 
    not necessarily represent the views of the President.
    (e) Additional Reports.--The Director may provide additional 
reports to Congress concerning the financial stability of the United 
States. The Director shall notify the Council of any such additional 
reports provided to Congress.
    (f) Subpoena.--
        (1) In general.--The Director may require from a financial 
    company, by subpoena, the production of the data requested under 
    subsection (a)(1) and section 154(b)(1), but only upon a written 
    finding by the Director that--
            (A) such data is required to carry out the functions 
        described under this subtitle; and
            (B) the Office has coordinated with the relevant primary 
        financial regulatory agency, as required under section 
        154(b)(1)(B)(ii).
        (2) Format.--Subpoenas under paragraph (1) shall bear the 
    signature of the Director, and shall be served by any person or 
    class of persons designated by the Director for that purpose.
        (3) Enforcement.--In the case of contumacy or failure to obey a 
    subpoena, the subpoena shall be enforceable by order of any 
    appropriate district court of the United States. Any failure to 
    obey the order of the court may be punished by the court as a 
    contempt of court.
    SEC. 154. ORGANIZATIONAL STRUCTURE; RESPONSIBILITIES OF PRIMARY 
      PROGRAMMATIC UNITS.
    (a) In General.--There are established within the Office, to carry 
out the programmatic responsibilities of the Office--
        (1) the Data Center; and
        (2) the Research and Analysis Center.
    (b) Data Center.--
        (1) General duties.--
            (A) Data collection.--The Data Center, on behalf of the 
        Council, shall collect, validate, and maintain all data 
        necessary to carry out the duties of the Data Center, as 
        described in this subtitle. The data assembled shall be 
        obtained from member agencies, commercial data providers, 
        publicly available data sources, and financial entities under 
        subparagraph (B).
            (B) Authority.--
                (i) In general.--The Office may, as determined by the 
            Council or by the Director in consultation with the 
            Council, require the submission of periodic and other 
            reports from any financial company for the purpose of 
            assessing the extent to which a financial activity or 
            financial market in which the financial company 
            participates, or the financial company itself, poses a 
            threat to the financial stability of the United States.
                (ii) Mitigation of report burden.--Before requiring the 
            submission of a report from any financial company that is 
            regulated by a member agency, any primary financial 
            regulatory agency, a foreign supervisory authority, or the 
            Office shall coordinate with such agencies or authority, 
            and shall, whenever possible, rely on information available 
            from such agencies or authority.
                (iii) Collection of financial transaction and position 
            data.--The Office shall collect, on a schedule determined 
            by the Director, in consultation with the Council, 
            financial transaction data and position data from financial 
            companies.
            (C) Rulemaking.--The Office shall promulgate regulations 
        pursuant to subsections (a)(1), (a)(2), (a)(7), and (c)(1) of 
        section 153 regarding the type and scope of the data to be 
        collected by the Data Center under this paragraph.
        (2) Responsibilities.--
            (A) Publication.--The Data Center shall prepare and 
        publish, in a manner that is easily accessible to the public--
                (i) a financial company reference database;
                (ii) a financial instrument reference database; and
                (iii) formats and standards for Office data, including 
            standards for reporting financial transaction and position 
            data to the Office.
            (B) Confidentiality.--The Data Center shall not publish any 
        confidential data under subparagraph (A).
        (3) Information security.--The Director shall ensure that data 
    collected and maintained by the Data Center are kept secure and 
    protected against unauthorized disclosure.
        (4) Catalog of financial entities and instruments.--The Data 
    Center shall maintain a catalog of the financial entities and 
    instruments reported to the Office.
        (5) Availability to the council and member agencies.--The Data 
    Center shall make data collected and maintained by the Data Center 
    available to the Council and member agencies, as necessary to 
    support their regulatory responsibilities.
        (6) Other authority.--The Office shall, after consultation with 
    the member agencies, provide certain data to financial industry 
    participants and to the general public to increase market 
    transparency and facilitate research on the financial system, to 
    the extent that intellectual property rights are not violated, 
    business confidential information is properly protected, and the 
    sharing of such information poses no significant threats to the 
    financial system of the United States.
    (c) Research and Analysis Center.--
        (1) General duties.--The Research and Analysis Center, on 
    behalf of the Council, shall develop and maintain independent 
    analytical capabilities and computing resources--
            (A) to develop and maintain metrics and reporting systems 
        for risks to the financial stability of the United States;
            (B) to monitor, investigate, and report on changes in 
        systemwide risk levels and patterns to the Council and 
        Congress;
            (C) to conduct, coordinate, and sponsor research to support 
        and improve regulation of financial entities and markets;
            (D) to evaluate and report on stress tests or other 
        stability-related evaluations of financial entities overseen by 
        the member agencies;
            (E) to maintain expertise in such areas as may be necessary 
        to support specific requests for advice and assistance from 
        financial regulators;
            (F) to investigate disruptions and failures in the 
        financial markets, report findings, and make recommendations to 
        the Council based on those findings;
            (G) to conduct studies and provide advice on the impact of 
        policies related to systemic risk; and
            (H) to promote best practices for financial risk 
        management.
    (d) Reporting Responsibilities.--
        (1) Required reports.--Not later than 2 years after the date of 
    enactment of this Act, and not later than 120 days after the end of 
    each fiscal year thereafter, the Office shall prepare and submit a 
    report to Congress.
        (2) Content.--Each report required by this subsection shall 
    assess the state of the United States financial system, including--
            (A) an analysis of any threats to the financial stability 
        of the United States;
            (B) the status of the efforts of the Office in meeting the 
        mission of the Office; and
            (C) key findings from the research and analysis of the 
        financial system by the Office.
    SEC. 155. FUNDING.
    (a) Financial Research Fund.--
        (1) Fund established.--There is established in the Treasury of 
    the United States a separate fund to be known as the ``Financial 
    Research Fund''.
        (2) Fund receipts.--All amounts provided to the Office under 
    subsection (c), and all assessments that the Office receives under 
    subsection (d) shall be deposited into the Financial Research Fund.
        (3) Investments authorized.--
            (A) Amounts in fund may be invested.--The Director may 
        request the Secretary to invest the portion of the Financial 
        Research Fund that is not, in the judgment of the Director, 
        required to meet the needs of the Office.
            (B) Eligible investments.--Investments shall be made by the 
        Secretary in obligations of the United States or obligations 
        that are guaranteed as to principal and interest by the United 
        States, with maturities suitable to the needs of the Financial 
        Research Fund, as determined by the Director.
        (4) Interest and proceeds credited.--The interest on, and the 
    proceeds from the sale or redemption of, any obligations held in 
    the Financial Research Fund shall be credited to and form a part of 
    the Financial Research Fund.
    (b) Use of Funds.--
        (1) In general.--Funds obtained by, transferred to, or credited 
    to the Financial Research Fund shall be immediately available to 
    the Office, and shall remain available until expended, to pay the 
    expenses of the Office in carrying out the duties and 
    responsibilities of the Office.
        (2) Fees, assessments, and other funds not government funds.--
    Funds obtained by, transferred to, or credited to the Financial 
    Research Fund shall not be construed to be Government funds or 
    appropriated moneys.
        (3) Amounts not subject to apportionment.--Notwithstanding any 
    other provision of law, amounts in the Financial Research Fund 
    shall not be subject to apportionment for purposes of chapter 15 of 
    title 31, United States Code, or under any other authority, or for 
    any other purpose.
    (c) Interim Funding.--During the 2-year period following the date 
of enactment of this Act, the Board of Governors shall provide to the 
Office an amount sufficient to cover the expenses of the Office.
    (d) Permanent Self-funding.--Beginning 2 years after the date of 
enactment of this Act, the Secretary shall establish, by regulation, 
and with the approval of the Council, an assessment schedule, including 
the assessment base and rates, applicable to bank holding companies 
with total consolidated assets of $50,000,000,000 or greater and 
nonbank financial companies supervised by the Board of Governors, that 
takes into account differences among such companies, based on the 
considerations for establishing the prudential standards under section 
115, to collect assessments equal to the total expenses of the Office.
    SEC. 156. TRANSITION OVERSIGHT.
    (a) Purpose.--The purpose of this section is to ensure that the 
Office--
        (1) has an orderly and organized startup;
        (2) attracts and retains a qualified workforce; and
        (3) establishes comprehensive employee training and benefits 
    programs.
    (b) Reporting Requirement.--
        (1) In general.--The Office shall submit an annual report to 
    the Committee on Banking, Housing, and Urban Affairs of the Senate 
    and the Committee on Financial Services of the House of 
    Representatives that includes the plans described in paragraph (2).
        (2) Plans.--The plans described in this paragraph are as 
    follows:
            (A) Training and workforce development plan.--The Office 
        shall submit a training and workforce development plan that 
        includes, to the extent practicable--
                (i) identification of skill and technical expertise 
            needs and actions taken to meet those requirements;
                (ii) steps taken to foster innovation and creativity;
                (iii) leadership development and succession planning; 
            and
                (iv) effective use of technology by employees.
            (B) Workplace flexibility plan.--The Office shall submit a 
        workforce flexibility plan that includes, to the extent 
        practicable--
                (i) telework;
                (ii) flexible work schedules;
                (iii) phased retirement;
                (iv) reemployed annuitants;
                (v) part-time work;
                (vi) job sharing;
                (vii) parental leave benefits and childcare assistance;
                (viii) domestic partner benefits;
                (ix) other workplace flexibilities; or
                (x) any combination of the items described in clauses 
            (i) through (ix).
            (C) Recruitment and retention plan.--The Office shall 
        submit a recruitment and retention plan that includes, to the 
        extent practicable, provisions relating to--
                (i) the steps necessary to target highly qualified 
            applicant pools with diverse backgrounds;
                (ii) streamlined employment application processes;
                (iii) the provision of timely notification of the 
            status of employment applications to applicants; and
                (iv) the collection of information to measure 
            indicators of hiring effectiveness.
    (c) Expiration.--The reporting requirement under subsection (b) 
shall terminate 5 years after the date of enactment of this Act.
    (d) Rule of Construction.--Nothing in this section may be construed 
to affect--
        (1) a collective bargaining agreement, as that term is defined 
    in section 7103(a)(8) of title 5, United States Code, that is in 
    effect on the date of enactment of this Act; or
        (2) the rights of employees under chapter 71 of title 5, United 
    States Code.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

    SEC. 161. REPORTS BY AND EXAMINATIONS OF NONBANK FINANCIAL 
      COMPANIES BY THE BOARD OF GOVERNORS.
    (a) Reports.--
        (1) In general.--The Board of Governors may require each 
    nonbank financial company supervised by the Board of Governors, and 
    any subsidiary thereof, to submit reports under oath, to keep the 
    Board of Governors informed as to--
            (A) the financial condition of the company or subsidiary, 
        systems of the company or subsidiary for monitoring and 
        controlling financial, operating, and other risks, and the 
        extent to which the activities and operations of the company or 
        subsidiary pose a threat to the financial stability of the 
        United States; and
            (B) compliance by the company or subsidiary with the 
        requirements of this title.
        (2) Use of existing reports and information.--In carrying out 
    subsection (a), the Board of Governors shall, to the fullest extent 
    possible, use--
            (A) reports and supervisory information that a nonbank 
        financial company or subsidiary thereof has been required to 
        provide to other Federal or State regulatory agencies;
            (B) information otherwise obtainable from Federal or State 
        regulatory agencies;
            (C) information that is otherwise required to be reported 
        publicly; and
            (D) externally audited financial statements of such company 
        or subsidiary.
        (3) Availability.--Upon the request of the Board of Governors, 
    a nonbank financial company supervised by the Board of Governors, 
    or a subsidiary thereof, shall promptly provide to the Board of 
    Governors any information described in paragraph (2).
    (b) Examinations.--
        (1) In general.--Subject to paragraph (2), the Board of 
    Governors may examine any nonbank financial company supervised by 
    the Board of Governors and any subsidiary of such company, to 
    inform the Board of Governors of--
            (A) the nature of the operations and financial condition of 
        the company and such subsidiary;
            (B) the financial, operational, and other risks of the 
        company or such subsidiary that may pose a threat to the safety 
        and soundness of such company or subsidiary or to the financial 
        stability of the United States;
            (C) the systems for monitoring and controlling such risks; 
        and
            (D) compliance by the company or such subsidiary with the 
        requirements of this title.
        (2) Use of examination reports and information.--For purposes 
    of this subsection, the Board of Governors shall, to the fullest 
    extent possible, rely on reports of examination of any subsidiary 
    depository institution or functionally regulated subsidiary made by 
    the primary financial regulatory agency for that subsidiary, and on 
    information described in subsection (a)(2).
    (c) Coordination With Primary Financial Regulatory Agency.--The 
Board of Governors shall--
        (1) provide reasonable notice to, and consult with, the primary 
    financial regulatory agency for any subsidiary before requiring a 
    report or commencing an examination of such subsidiary under this 
    section; and
        (2) avoid duplication of examination activities, reporting 
    requirements, and requests for information, to the fullest extent 
    possible.
    SEC. 162. ENFORCEMENT.
    (a) In General.--Except as provided in subsection (b), a nonbank 
financial company supervised by the Board of Governors and any 
subsidiaries of such company (other than any depository institution 
subsidiary) shall be subject to the provisions of subsections (b) 
through (n) of section 8 of the Federal Deposit Insurance Act (12 
U.S.C. 1818), in the same manner and to the same extent as if the 
company were a bank holding company, as provided in section 8(b)(3) of 
the Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)).
    (b) Enforcement Authority for Functionally Regulated 
Subsidiaries.--
        (1) Referral.--If the Board of Governors determines that a 
    condition, practice, or activity of a depository institution 
    subsidiary or functionally regulated subsidiary of a nonbank 
    financial company supervised by the Board of Governors does not 
    comply with the regulations or orders prescribed by the Board of 
    Governors under this Act, or otherwise poses a threat to the 
    financial stability of the United States, the Board of Governors 
    may recommend, in writing, to the primary financial regulatory 
    agency for the subsidiary that such agency initiate a supervisory 
    action or enforcement proceeding. The recommendation shall be 
    accompanied by a written explanation of the concerns giving rise to 
    the recommendation.
        (2) Back-up authority of the board of governors.--If, during 
    the 60-day period beginning on the date on which the primary 
    financial regulatory agency receives a recommendation under 
    paragraph (1), the primary financial regulatory agency does not 
    take supervisory or enforcement action against a subsidiary that is 
    acceptable to the Board of Governors, the Board of Governors (upon 
    a vote of its members) may take the recommended supervisory or 
    enforcement action, as if the subsidiary were a bank holding 
    company subject to supervision by the Board of Governors.
    SEC. 163. ACQUISITIONS.
    (a) Acquisitions of Banks; Treatment as a Bank Holding Company.--
For purposes of section 3 of the Bank Holding Company Act of 1956 (12 
U.S.C. 1842), a nonbank financial company supervised by the Board of 
Governors shall be deemed to be, and shall be treated as, a bank 
holding company.
    (b) Acquisition of Nonbank Companies.--
        (1) Prior notice for large acquisitions.--Notwithstanding 
    section 4(k)(6)(B) of the Bank Holding Company Act of 1956 (12 
    U.S.C. 1843(k)(6)(B)), a bank holding company with total 
    consolidated assets equal to or greater than $50,000,000,000 or a 
    nonbank financial company supervised by the Board of Governors 
    shall not acquire direct or indirect ownership or control of any 
    voting shares of any company (other than an insured depository 
    institution) that is engaged in activities described in section 
    4(k) of the Bank Holding Company Act of 1956 having total 
    consolidated assets of $10,000,000,000 or more, without providing 
    written notice to the Board of Governors in advance of the 
    transaction.
        (2) Exemptions.--The prior notice requirement in paragraph (1) 
    shall not apply with regard to the acquisition of shares that would 
    qualify for the exemptions in section 4(c) or section 4(k)(4)(E) of 
    the Bank Holding Company Act of 1956 (12 U.S.C. 1843(c) and 
    (k)(4)(E)).
        (3) Notice procedures.--The notice procedures set forth in 
    section 4(j)(1) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1843(j)(1)), without regard to section 4(j)(3) of that Act, shall 
    apply to an acquisition of any company (other than an insured 
    depository institution) by a bank holding company with total 
    consolidated assets equal to or greater than $50,000,000,000 or a 
    nonbank financial company supervised by the Board of Governors, as 
    described in paragraph (1), including any such company engaged in 
    activities described in section 4(k) of that Act.
        (4) Standards for review.--In addition to the standards 
    provided in section 4(j)(2) of the Bank Holding Company Act of 1956 
    (12 U.S.C. 1843(j)(2)), the Board of Governors shall consider the 
    extent to which the proposed acquisition would result in greater or 
    more concentrated risks to global or United States financial 
    stability or the United States economy.
        (5) Hart-Scott-Rodino filing requirement.--Solely for purposes 
    of section 7A(c)(8) of the Clayton Act (15 U.S.C. 18a(c)(8)), the 
    transactions subject to the requirements of paragraph (1) shall be 
    treated as if Board of Governors approval is not required.
    SEC. 164. PROHIBITION AGAINST MANAGEMENT INTERLOCKS BETWEEN CERTAIN 
      FINANCIAL COMPANIES.
    A nonbank financial company supervised by the Board of Governors 
shall be treated as a bank holding company for purposes of the 
Depository Institutions Management Interlocks Act (12 U.S.C. 3201 et 
seq.), except that the Board of Governors shall not exercise the 
authority provided in section 7 of that Act (12 U.S.C. 3207) to permit 
service by a management official of a nonbank financial company 
supervised by the Board of Governors as a management official of any 
bank holding company with total consolidated assets equal to or greater 
than $50,000,000,000, or other nonaffiliated nonbank financial company 
supervised by the Board of Governors (other than to provide a temporary 
exemption for interlocks resulting from a merger, acquisition, or 
consolidation).
    SEC. 165. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK 
      FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF GOVERNORS AND 
      CERTAIN BANK HOLDING COMPANIES.
    (a) In General.--
        (1) Purpose.--In order to prevent or mitigate risks to the 
    financial stability of the United States that could arise from the 
    material financial distress or failure, or ongoing activities, of 
    large, interconnected financial institutions, the Board of 
    Governors shall, on its own or pursuant to recommendations by the 
    Council under section 115, establish prudential standards for 
    nonbank financial companies supervised by the Board of Governors 
    and bank holding companies with total consolidated assets equal to 
    or greater than $50,000,000,000 that--
            (A) are more stringent than the standards and requirements 
        applicable to nonbank financial companies and bank holding 
        companies that do not present similar risks to the financial 
        stability of the United States; and
            (B) increase in stringency, based on the considerations 
        identified in subsection (b)(3).
        (2) Tailored application.--
            (A) In general.--In prescribing more stringent prudential 
        standards under this section, the Board of Governors may, on 
        its own or pursuant to a recommendation by the Council in 
        accordance with section 115, 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.
            (B) Adjustment of threshold for application of certain 
        standards.--The Board of Governors may, pursuant to a 
        recommendation by the Council in accordance with section 115, 
        establish an asset threshold above $50,000,000,000 for the 
        application of any standard established under subsections (c) 
        through (g).
    (b) Development of Prudential Standards.--
        (1) In general.--
            (A) Required standards.--The Board of Governors shall 
        establish prudential standards for nonbank financial companies 
        supervised by the Board of Governors and bank holding companies 
        described in subsection (a), that shall include--
                (i) risk-based capital requirements and leverage 
            limits, unless the Board of Governors, in consultation with 
            the Council, determines that such requirements are not 
            appropriate for a company subject to more stringent 
            prudential standards because of the activities of such 
            company (such as investment company activities or assets 
            under management) or structure, in which case, the Board of 
            Governors shall apply other standards that result in 
            similarly stringent risk controls;
                (ii) liquidity requirements;
                (iii) overall risk management requirements;
                (iv) resolution plan and credit exposure report 
            requirements; and
                (v) concentration limits.
            (B) Additional standards authorized.--The Board of 
        Governors may establish additional prudential standards for 
        nonbank financial companies supervised by the Board of 
        Governors and bank holding companies described in subsection 
        (a), that include--
                (i) a contingent capital requirement;
                (ii) enhanced public disclosures;
                (iii) short-term debt limits; and
                (iv) such other prudential standards as the Board or 
            Governors, on its own or pursuant to a recommendation made 
            by the Council in accordance with section 115, determines 
            are appropriate.
        (2) Standards for foreign financial companies.--In applying the 
    standards set forth in paragraph (1) to any foreign nonbank 
    financial company supervised by the Board of Governors or foreign-
    based bank holding company, the Board of Governors shall--
            (A) give due regard to the principle of national treatment 
        and equality of competitive opportunity; and
            (B) take into account the extent to which the foreign 
        financial company is subject on a consolidated basis to home 
        country standards that are comparable to those applied to 
        financial companies in the United States.
        (3) Considerations.--In prescribing prudential standards under 
    paragraph (1), the Board of Governors shall--
            (A) take into account differences among nonbank financial 
        companies supervised by the Board of Governors and bank holding 
        companies described in subsection (a), based on--
                (i) the factors described in subsections (a) and (b) of 
            section 113;
                (ii) whether the company owns an insured depository 
            institution;
                (iii) nonfinancial activities and affiliations of the 
            company; and
                (iv) any other risk-related factors that the Board of 
            Governors determines appropriate;
            (B) to the extent possible, ensure that small changes in 
        the factors listed in subsections (a) and (b) of section 113 
        would not result in sharp, discontinuous changes in the 
        prudential standards established under paragraph (1) of this 
        subsection;
            (C) take into account any recommendations of the Council 
        under section 115; and
            (D) adapt the required standards as appropriate in light of 
        any predominant line of business of such company, including 
        assets under management or other activities for which 
        particular standards may not be appropriate.
        (4) Consultation.--Before imposing prudential standards or any 
    other requirements pursuant to this section, including notices of 
    deficiencies in resolution plans and more stringent requirements or 
    divestiture orders resulting from such notices, that are likely to 
    have a significant impact on a functionally regulated subsidiary or 
    depository institution subsidiary of a nonbank financial company 
    supervised by the Board of Governors or a bank holding company 
    described in subsection (a), the Board of Governors shall consult 
    with each Council member that primarily supervises any such 
    subsidiary with respect to any such standard or requirement.
        (5) Report.--The Board of Governors shall submit an annual 
    report to Congress regarding the implementation of the prudential 
    standards required pursuant to paragraph (1), including the use of 
    such standards to mitigate risks to the financial stability of the 
    United States.
    (c) Contingent Capital.--
        (1) In general.--Subsequent to submission by the Council of a 
    report to Congress under section 115(c), the Board of Governors may 
    issue regulations that require each nonbank financial company 
    supervised by the Board of Governors and bank holding companies 
    described in subsection (a) to maintain a minimum amount of 
    contingent capital that is convertible to equity in times of 
    financial stress.
        (2) Factors to consider.--In issuing regulations under this 
    subsection, the Board of Governors shall consider--
            (A) the results of the study undertaken by the Council, and 
        any recommendations of the Council, under section 115(c);
            (B) an appropriate transition period for implementation of 
        contingent capital under this subsection;
            (C) the factors described in subsection (b)(3)(A);
            (D) capital requirements applicable to the nonbank 
        financial company supervised by the Board of Governors or a 
        bank holding company described in subsection (a), and 
        subsidiaries thereof; and
            (E) any other factor that the Board of Governors deems 
        appropriate.
    (d) Resolution Plan and Credit Exposure Reports.--
        (1) Resolution plan.--The Board of Governors shall require each 
    nonbank financial company supervised by the Board of Governors and 
    bank holding companies described in subsection (a) to report 
    periodically to the Board of Governors, the Council, and the 
    Corporation the plan of such company for rapid and orderly 
    resolution in the event of material financial distress or failure, 
    which shall include--
            (A) information regarding the manner and extent to which 
        any insured depository institution affiliated with the company 
        is adequately protected from risks arising from the activities 
        of any nonbank subsidiaries of the company;
            (B) full descriptions of the ownership structure, assets, 
        liabilities, and contractual obligations of the company;
            (C) identification of the cross-guarantees tied to 
        different securities, identification of major counterparties, 
        and a process for determining to whom the collateral of the 
        company is pledged; and
            (D) any other information that the Board of Governors and 
        the Corporation jointly require by rule or order.
        (2) Credit exposure report.--The Board of Governors shall 
    require each nonbank financial company supervised by the Board of 
    Governors and bank holding companies described in subsection (a) to 
    report periodically to the Board of Governors, the Council, and the 
    Corporation on--
            (A) the nature and extent to which the company has credit 
        exposure to other significant nonbank financial companies and 
        significant bank holding companies; and
            (B) the nature and extent to which other significant 
        nonbank financial companies and significant bank holding 
        companies have credit exposure to that company.
        (3) Review.--The Board of Governors and the Corporation shall 
    review the information provided in accordance with this subsection 
    by each nonbank financial company supervised by the Board of 
    Governors and bank holding company described in subsection (a).
        (4) Notice of deficiencies.--If the Board of Governors and the 
    Corporation jointly determine, based on their review under 
    paragraph (3), that the resolution plan of a nonbank financial 
    company supervised by the Board of Governors or a bank holding 
    company described in subsection (a) is not credible or would not 
    facilitate an orderly resolution of the company under title 11, 
    United States Code--
            (A) the Board of Governors and the Corporation shall notify 
        the company of the deficiencies in the resolution plan; and
            (B) the company shall resubmit the resolution plan within a 
        timeframe determined by the Board of Governors and the 
        Corporation, with revisions demonstrating that the plan is 
        credible and would result in an orderly resolution under title 
        11, United States Code, including any proposed changes in 
        business operations and corporate structure to facilitate 
        implementation of the plan.
        (5) Failure to resubmit credible plan.--
            (A) In general.--If a nonbank financial company supervised 
        by the Board of Governors or a bank holding company described 
        in subsection (a) fails to timely resubmit the resolution plan 
        as required under paragraph (4), with such revisions as are 
        required under subparagraph (B), the Board of Governors and the 
        Corporation may jointly impose more stringent capital, 
        leverage, or liquidity requirements, or restrictions on the 
        growth, activities, or operations of the company, or any 
        subsidiary thereof, until such time as the company resubmits a 
        plan that remedies the deficiencies.
            (B) Divestiture.--The Board of Governors and the 
        Corporation, in consultation with the Council, may jointly 
        direct a nonbank financial company supervised by the Board of 
        Governors or a bank holding company described in subsection 
        (a), by order, to divest certain assets or operations 
        identified by the Board of Governors and the Corporation, to 
        facilitate an orderly resolution of such company under title 
        11, United States Code, in the event of the failure of such 
        company, in any case in which--
                (i) the Board of Governors and the Corporation have 
            jointly imposed more stringent requirements on the company 
            pursuant to subparagraph (A); and
                (ii) the company has failed, within the 2-year period 
            beginning on the date of the imposition of such 
            requirements under subparagraph (A), to resubmit the 
            resolution plan with such revisions as were required under 
            paragraph (4)(B).
        (6) No limiting effect.--A resolution plan submitted in 
    accordance with this subsection shall not be binding on a 
    bankruptcy court, a receiver appointed under title II, or any other 
    authority that is authorized or required to resolve the nonbank 
    financial company supervised by the Board, any bank holding 
    company, or any subsidiary or affiliate of the foregoing.
        (7) No private right of action.--No private right of action may 
    be based on any resolution plan submitted in accordance with this 
    subsection.
        (8) Rules.--Not later than 18 months after the date of 
    enactment of this Act, the Board of Governors and the Corporation 
    shall jointly issue final rules implementing this subsection.
    (e) Concentration Limits.--
        (1) Standards.--In order to limit the risks that the failure of 
    any individual company could pose to a nonbank financial company 
    supervised by the Board of Governors or a bank holding company 
    described in subsection (a), the Board of Governors, by regulation, 
    shall prescribe standards that limit such risks.
        (2) Limitation on credit exposure.--The regulations prescribed 
    by the Board of Governors under paragraph (1) shall prohibit each 
    nonbank financial company supervised by the Board of Governors and 
    bank holding company described in subsection (a) from having credit 
    exposure to any unaffiliated company that exceeds 25 percent of the 
    capital stock and surplus (or such lower amount as the Board of 
    Governors may determine by regulation to be necessary to mitigate 
    risks to the financial stability of the United States) of the 
    company.
        (3) Credit exposure.--For purposes of paragraph (2), ``credit 
    exposure'' to a company means--
            (A) all extensions of credit to the company, including 
        loans, deposits, and lines of credit;
            (B) all repurchase agreements and reverse repurchase 
        agreements with the company, and all securities borrowing and 
        lending transactions with the company, to the extent that such 
        transactions create credit exposure for the nonbank financial 
        company supervised by the Board of Governors or a bank holding 
        company described in subsection (a);
            (C) all guarantees, acceptances, or letters of credit 
        (including endorsement or standby letters of credit) issued on 
        behalf of the company;
            (D) all purchases of or investment in securities issued by 
        the company;
            (E) counterparty credit exposure to the company in 
        connection with a derivative transaction between the nonbank 
        financial company supervised by the Board of Governors or a 
        bank holding company described in subsection (a) and the 
        company; and
            (F) any other similar transactions that the Board of 
        Governors, by regulation, determines to be a credit exposure 
        for purposes of this section.
        (4) Attribution rule.--For purposes of this subsection, any 
    transaction by a nonbank financial company supervised by the Board 
    of Governors or a bank holding company described in subsection (a) 
    with any person is a transaction with a company, to the extent that 
    the proceeds of the transaction are used for the benefit of, or 
    transferred to, that company.
        (5) Rulemaking.--The Board of Governors may issue such 
    regulations and orders, including definitions consistent with this 
    section, as may be necessary to administer and carry out this 
    subsection.
        (6) Exemptions.--This subsection shall not apply to any Federal 
    home loan bank. The Board of Governors may, by regulation or order, 
    exempt transactions, in whole or in part, from the definition of 
    the term ``credit exposure'' for purposes of this subsection, if 
    the Board of Governors finds that the exemption is in the public 
    interest and is consistent with the purpose of this subsection.
        (7) Transition period.--
            (A) In general.--This subsection and any regulations and 
        orders of the Board of Governors under this subsection shall 
        not be effective until 3 years after the date of enactment of 
        this Act.
            (B) Extension authorized.--The Board of Governors may 
        extend the period specified in subparagraph (A) for not longer 
        than an additional 2 years.
    (f) Enhanced Public Disclosures.--The Board of Governors may 
prescribe, by regulation, periodic public disclosures by nonbank 
financial companies supervised by the Board of Governors and bank 
holding companies described in subsection (a) in order to support 
market evaluation of the risk profile, capital adequacy, and risk 
management capabilities thereof.
    (g) Short-term Debt Limits.--
        (1) In general.--In order to mitigate the risks that an over-
    accumulation of short-term debt could pose to financial companies 
    and to the stability of the United States financial system, the 
    Board of Governors may, by regulation, prescribe a limit on the 
    amount of short-term debt, including off-balance sheet exposures, 
    that may be accumulated by any bank holding company described in 
    subsection (a) and any nonbank financial company supervised by the 
    Board of Governors.
        (2) Basis of limit.--Any limit prescribed under paragraph (1) 
    shall be based on the short-term debt of the company described in 
    paragraph (1) as a percentage of capital stock and surplus of the 
    company or on such other measure as the Board of Governors 
    considers appropriate.
        (3) Short-term debt defined.--For purposes of this subsection, 
    the term ``short-term debt'' means such liabilities with short-
    dated maturity that the Board of Governors identifies, by 
    regulation, except that such term does not include insured 
    deposits.
        (4) Rulemaking authority.--In addition to prescribing 
    regulations under paragraphs (1) and (3), the Board of Governors 
    may prescribe such regulations, including definitions consistent 
    with this subsection, and issue such orders, as may be necessary to 
    carry out this subsection.
        (5) Authority to issue exemptions and adjustments.--
    Notwithstanding the Bank Holding Company Act of 1956 (12 U.S.C. 
    1841 et seq.), the Board of Governors may, if it determines such 
    action is necessary to ensure appropriate heightened prudential 
    supervision, with respect to a company described in paragraph (1) 
    that does not control an insured depository institution, issue to 
    such company an exemption from or adjustment to the limit 
    prescribed under paragraph (1).
    (h) Risk Committee.--
        (1) Nonbank financial companies supervised by the board of 
    governors.--The Board of Governors shall require each nonbank 
    financial company supervised by the Board of Governors that is a 
    publicly traded company to establish a risk committee, as set forth 
    in paragraph (3), not later than 1 year after the date of receipt 
    of a notice of final determination under section 113(e)(3) with 
    respect to such nonbank financial company supervised by the Board 
    of Governors.
        (2) Certain bank holding companies.--
            (A) Mandatory regulations.--The Board of Governors shall 
        issue regulations requiring each bank holding company that is a 
        publicly traded company and that has total consolidated assets 
        of not less than $10,000,000,000 to establish a risk committee, 
        as set forth in paragraph (3).
            (B) Permissive regulations.--The Board of Governors may 
        require each bank holding company that is a publicly traded 
        company and that has total consolidated assets of less than 
        $10,000,000,000 to establish a risk committee, as set forth in 
        paragraph (3), as determined necessary or appropriate by the 
        Board of Governors to promote sound risk management practices.
        (3) Risk committee.--A risk committee required by this 
    subsection shall--
            (A) be responsible for the oversight of the enterprise-wide 
        risk management practices of the nonbank financial company 
        supervised by the Board of Governors or bank holding company 
        described in subsection (a), as applicable;
            (B) include such number of independent directors as the 
        Board of Governors may determine appropriate, based on the 
        nature of operations, size of assets, and other appropriate 
        criteria related to the nonbank financial company supervised by 
        the Board of Governors or a bank holding company described in 
        subsection (a), as applicable; and
            (C) include at least 1 risk management expert having 
        experience in identifying, assessing, and managing risk 
        exposures of large, complex firms.
        (4) Rulemaking.--The Board of Governors shall issue final rules 
    to carry out this subsection, not later than 1 year after the 
    transfer date, to take effect not later than 15 months after the 
    transfer date.
    (i) Stress Tests.--
        (1) By the board of governors.--
            (A) Annual tests required.--The Board of Governors, in 
        coordination with the appropriate primary financial regulatory 
        agencies and the Federal Insurance Office, shall conduct annual 
        analyses in which nonbank financial companies supervised by the 
        Board of Governors and bank holding companies described in 
        subsection (a) are subject to evaluation of whether such 
        companies have the capital, on a total consolidated basis, 
        necessary to absorb losses as a result of adverse economic 
        conditions.
            (B) Test parameters and consequences.--The Board of 
        Governors--
                (i) shall 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;
                (ii) may require the tests described in subparagraph 
            (A) at bank holding companies and nonbank financial 
            companies, in addition to those for which annual tests are 
            required under subparagraph (A);
                (iii) may develop and apply such other analytic 
            techniques as are necessary to identify, measure, and 
            monitor risks to the financial stability of the United 
            States;
                (iv) shall require the companies described in 
            subparagraph (A) to update their resolution plans required 
            under subsection (d)(1), as the Board of Governors 
            determines appropriate, based on the results of the 
            analyses; and
                (v) shall publish a summary of the results of the tests 
            required under subparagraph (A) or clause (ii) of this 
            subparagraph.
        (2) By the company.--
            (A) Requirement.--A nonbank financial company supervised by 
        the Board of Governors and a bank holding company described in 
        subsection (a) shall conduct semiannual stress tests. All other 
        financial companies that have total consolidated assets of more 
        than $10,000,000,000 and are regulated by a primary Federal 
        financial regulatory agency shall conduct annual stress tests. 
        The tests required under this subparagraph shall be conducted 
        in accordance with the regulations prescribed under 
        subparagraph (C).
            (B) Report.--A company required to conduct stress tests 
        under subparagraph (A) shall submit a report to the Board of 
        Governors and to its primary financial regulatory agency at 
        such time, in such form, and containing such information as the 
        primary financial regulatory agency shall require.
            (C) Regulations.--Each Federal primary financial regulatory 
        agency, in coordination with the Board of Governors and the 
        Federal Insurance Office, shall issue consistent and comparable 
        regulations to implement this paragraph that shall--
                (i) define the term ``stress test'' for purposes of 
            this paragraph;
                (ii) establish methodologies for the conduct of stress 
            tests required by this paragraph that shall provide for at 
            least 3 different sets of conditions, including baseline, 
            adverse, and severely adverse;
                (iii) establish the form and content of the report 
            required by subparagraph (B); and
                (iv) require companies subject to this paragraph to 
            publish a summary of the results of the required stress 
            tests.
    (j) Leverage Limitation.--
        (1) Requirement.--The Board of Governors shall require a bank 
    holding company with total consolidated assets equal to or greater 
    than $50,000,000,000 or a nonbank financial company supervised by 
    the Board of Governors to maintain a debt to equity ratio of no 
    more than 15 to 1, upon a determination by the Council that such 
    company poses a grave threat to the financial stability of the 
    United States and that the imposition of such requirement is 
    necessary to mitigate the risk that such company poses to the 
    financial stability of the United States. Nothing in this paragraph 
    shall apply to a Federal home loan bank.
        (2) Considerations.--In making a determination under this 
    subsection, the Council shall consider the factors described in 
    subsections (a) and (b) of section 113 and any other risk-related 
    factors that the Council deems appropriate.
        (3) Regulations.--The Board of Governors shall promulgate 
    regulations to establish procedures and timelines for complying 
    with the requirements of this subsection.
    (k) Inclusion of Off-balance-sheet Activities in Computing Capital 
Requirements.--
        (1) In general.--In the case of any bank holding company 
    described in subsection (a) or nonbank financial company supervised 
    by the Board of Governors, the computation of capital for purposes 
    of meeting capital requirements shall take into account any off-
    balance-sheet activities of the company.
        (2) Exemptions.--If the Board of Governors determines that an 
    exemption from the requirement under paragraph (1) is appropriate, 
    the Board of Governors may exempt a company, or any transaction or 
    transactions engaged in by such company, from the requirements of 
    paragraph (1).
        (3) Off-balance-sheet activities defined.--For purposes of this 
    subsection, the term ``off-balance-sheet activities'' means an 
    existing liability of a company that is not currently a balance 
    sheet liability, but may become one upon the happening of some 
    future event, including the following transactions, to the extent 
    that they may create a liability:
            (A) Direct credit substitutes in which a bank substitutes 
        its own credit for a third party, including standby letters of 
        credit.
            (B) Irrevocable letters of credit that guarantee repayment 
        of commercial paper or tax-exempt securities.
            (C) Risk participations in bankers' acceptances.
            (D) Sale and repurchase agreements.
            (E) Asset sales with recourse against the seller.
            (F) Interest rate swaps.
            (G) Credit swaps.
            (H) Commodities contracts.
            (I) Forward contracts.
            (J) Securities contracts.
            (K) Such other activities or transactions as the Board of 
        Governors may, by rule, define.
    SEC. 166. EARLY REMEDIATION REQUIREMENTS.
    (a) In General.--The Board of Governors, in consultation with the 
Council and the Corporation, shall prescribe regulations establishing 
requirements to provide for the early remediation of financial distress 
of a nonbank financial company supervised by the Board of Governors or 
a bank holding company described in section 165(a), except that nothing 
in this subsection authorizes the provision of financial assistance 
from the Federal Government.
    (b) Purpose of the Early Remediation Requirements.--The purpose of 
the early remediation requirements under subsection (a) shall be to 
establish a series of specific remedial actions to be taken by a 
nonbank financial company supervised by the Board of Governors or a 
bank holding company described in section 165(a) that is experiencing 
increasing financial distress, in order to minimize the probability 
that the company will become insolvent and the potential harm of such 
insolvency to the financial stability of the United States.
    (c) Remediation Requirements.--The regulations prescribed by the 
Board of Governors under subsection (a) shall--
        (1) define measures of the financial condition of the company, 
    including regulatory capital, liquidity measures, and other 
    forward-looking indicators; and
        (2) establish requirements that increase in stringency as the 
    financial condition of the company declines, including--
            (A) requirements in the initial stages of financial 
        decline, including limits on capital distributions, 
        acquisitions, and asset growth; and
            (B) requirements at later stages of financial decline, 
        including a capital restoration plan and capital-raising 
        requirements, limits on transactions with affiliates, 
        management changes, and asset sales.
    SEC. 167. AFFILIATIONS.
    (a) Affiliations.--Nothing in this subtitle shall be construed to 
require a nonbank financial company supervised by the Board of 
Governors, or a company that controls a nonbank financial company 
supervised by the Board of Governors, to conform the activities thereof 
to the requirements of section 4 of the Bank Holding Company Act of 
1956 (12 U.S.C. 1843).
    (b) Requirement.--
        (1) In general.--
            (A) Board authority.--If a nonbank financial company 
        supervised by the Board of Governors conducts activities other 
        than those that are determined to be financial in nature or 
        incidental thereto under section 4(k) of the Bank Holding 
        Company Act of 1956, the Board of Governors may require such 
        company to establish and conduct all or a portion of such 
        activities that are determined to be financial in nature or 
        incidental thereto in or through an intermediate holding 
        company established pursuant to regulation of the Board of 
        Governors, not later than 90 days (or such longer period as the 
        Board of Governors may deem appropriate) after the date on 
        which the nonbank financial company supervised by the Board of 
        Governors is notified of the determination of the Board of 
        Governors under this section.
            (B) Necessary actions.--Notwithstanding subparagraph (A), 
        the Board of Governors shall require a nonbank financial 
        company supervised by the Board of Governors to establish an 
        intermediate holding company if the Board of Governors makes a 
        determination that the establishment of such intermediate 
        holding company is necessary to--
                (i) appropriately supervise activities that are 
            determined to be financial in nature or incidental thereto; 
            or
                (ii) to ensure that supervision by the Board of 
            Governors does not extend to the commercial activities of 
            such nonbank financial company.
        (2) Internal financial activities.--For purposes of this 
    subsection, activities that are determined to be financial in 
    nature or incidental thereto under section 4(k) of the Bank Holding 
    Company Act of 1956, as described in paragraph (1), shall not 
    include internal financial activities, including internal treasury, 
    investment, and employee benefit functions. With respect to any 
    internal financial activity engaged in for the company or an 
    affiliate and a non-affiliate of such company during the year prior 
    to the date of enactment of this Act, such company (or an affiliate 
    that is not an intermediate holding company or subsidiary of an 
    intermediate holding company) may continue to engage in such 
    activity, as long as not less than 2/3 of the assets or 2/3 of the 
    revenues generated from the activity are from or attributable to 
    such company or an affiliate, subject to review by the Board of 
    Governors, to determine whether engaging in such activity presents 
    undue risk to such company or to the financial stability of the 
    United States.
        (3) Source of strength.--A company that directly or indirectly 
    controls an intermediate holding company established under this 
    section shall serve as a source of strength to its subsidiary 
    intermediate holding company.
        (4) Parent company reports.--The Board of Governors may, from 
    time to time, require reports under oath from a company that 
    controls an intermediate holding company, and from the appropriate 
    officers or directors of such company, solely for purposes of 
    ensuring compliance with the provisions of this section, including 
    assessing the ability of the company to serve as a source of 
    strength to its subsidiary intermediate holding company pursuant to 
    paragraph (3) and enforcing such compliance.
        (5) Limited parent company enforcement.--
            (A) In general.--In addition to any other authority of the 
        Board of Governors, the Board of Governors may enforce 
        compliance with the provisions of this subsection that are 
        applicable to any company described in paragraph (1) that 
        controls an intermediate holding company under section 8 of the 
        Federal Deposit Insurance Act, and such company shall be 
        subject to such section (solely for such purposes) in the same 
        manner and to the same extent as if such company were a bank 
        holding company.
            (B) Application of other act.--Any violation of this 
        subsection by any company that controls an intermediate holding 
        company may also be treated as a violation of the Federal 
        Deposit Insurance Act for purposes of subparagraph (A).
            (C) No effect on other authority.--No provision of this 
        paragraph shall be construed as limiting any authority of the 
        Board of Governors or any other Federal agency under any other 
        provision of law.
    (c) Regulations.--The Board of Governors--
        (1) shall promulgate regulations to establish the criteria for 
    determining whether to require a nonbank financial company 
    supervised by the Board of Governors to establish an intermediate 
    holding company under subsection (b); and
        (2) may promulgate regulations to establish any restrictions or 
    limitations on transactions between an intermediate holding company 
    or a nonbank financial company supervised by the Board of Governors 
    and its affiliates, as necessary to prevent unsafe and unsound 
    practices in connection with transactions between such company, or 
    any subsidiary thereof, and its parent company or affiliates that 
    are not subsidiaries of such company, except that such regulations 
    shall not restrict or limit any transaction in connection with the 
    bona fide acquisition or lease by an unaffiliated person of assets, 
    goods, or services.
    SEC. 168. REGULATIONS.
    The Board of Governors shall have authority to issue regulations to 
implement subtitles A and C and the amendments made thereunder. Except 
as otherwise specified in subtitle A or C, not later than 18 months 
after the effective date of this Act, the Board of Governors shall 
issue final regulations to implement subtitles A and C, and the 
amendments made thereunder.
    SEC. 169. AVOIDING DUPLICATION.
    The Board of Governors shall take any action that the Board of 
Governors deems appropriate to avoid imposing requirements under this 
subtitle that are duplicative of requirements applicable to bank 
holding companies and nonbank financial companies under other 
provisions of law.
    SEC. 170. SAFE HARBOR.
    (a) Regulations.--The Board of Governors shall promulgate 
regulations on behalf of, and in consultation with, the Council setting 
forth the criteria for exempting certain types or classes of U.S. 
nonbank financial companies or foreign nonbank financial companies from 
supervision by the Board of Governors.
    (b) Considerations.--In developing the criteria under subsection 
(a), the Board of Governors shall take into account the factors for 
consideration described in subsections (a) and (b) of section 113 in 
determining whether a U.S. nonbank financial company or foreign nonbank 
financial company shall be supervised by the Board of Governors.
    (c) Rule of Construction.--Nothing in this section shall be 
construed to require supervision by the Board of Governors of a U.S. 
nonbank financial company or foreign nonbank financial company, if such 
company does not meet the criteria for exemption established under 
subsection (a).
    (d) Revisions.--
        (1) In general.--The Board of Governors shall, in consultation 
    with the Council, review the regulations promulgated under 
    subsection (a), not less frequently than every 5 years, and based 
    upon the review, the Board of Governors may revise such regulations 
    on behalf of, and in consultation with, the Council to update as 
    necessary the criteria set forth in such regulations.
        (2) Transition period.--No revisions under paragraph (1) shall 
    take effect before the end of the 2-year period after the date of 
    publication of such revisions in final form.
    (e) Report.--The Chairman of the Board of Governors and the 
Chairperson of the Council shall submit a joint report to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives not later than 30 
days after the date of the issuance in final form of regulations under 
subsection (a), or any subsequent revision to such regulations under 
subsection (d), as applicable. Such report shall include, at a minimum, 
the rationale for exemption and empirical evidence to support the 
criteria for exemption.
    SEC. 171. LEVERAGE AND RISK-BASED CAPITAL REQUIREMENTS.
    (a) Definitions.--For purposes of this section, the following 
definitions shall apply:
        (1) Generally applicable leverage capital requirements.--The 
    term ``generally applicable leverage capital requirements'' means--
            (A) the minimum ratios of tier 1 capital to average total 
        assets, as established by the appropriate Federal banking 
        agencies to apply to insured depository institutions under the 
        prompt corrective action regulations implementing section 38 of 
        the Federal Deposit Insurance Act, regardless of total 
        consolidated asset size or foreign financial exposure; and
            (B) includes the regulatory capital components in the 
        numerator of that capital requirement, average total assets in 
        the denominator of that capital requirement, and the required 
        ratio of the numerator to the denominator.
        (2) Generally applicable risk-based capital requirements.--The 
    term ``generally applicable risk-based capital requirements'' 
    means--
            (A) the risk-based capital requirements, as established by 
        the appropriate Federal banking agencies to apply to insured 
        depository institutions under the prompt corrective action 
        regulations implementing section 38 of the Federal Deposit 
        Insurance Act, regardless of total consolidated asset size or 
        foreign financial exposure; and
            (B) includes the regulatory capital components in the 
        numerator of those capital requirements, the risk-weighted 
        assets in the denominator of those capital requirements, and 
        the required ratio of the numerator to the denominator.
        (3) Definition of depository institution holding company.--The 
    term ``depository institution holding company'' means a bank 
    holding company or a savings and loan holding company (as those 
    terms are defined in section 3 of the Federal Deposit Insurance 
    Act) that is organized in the United States, including any bank or 
    savings and loan holding company that is owned or controlled by a 
    foreign organization, but does not include the foreign 
    organization.
    (b) Minimum Capital Requirements.--
        (1) Minimum leverage capital requirements.--The appropriate 
    Federal banking agencies shall establish minimum leverage capital 
    requirements on a consolidated basis for insured depository 
    institutions, depository institution holding companies, and nonbank 
    financial companies supervised by the Board of Governors. The 
    minimum leverage capital requirements established under this 
    paragraph shall not be less than the generally applicable leverage 
    capital requirements, which shall serve as a floor for any capital 
    requirements that the agency may require, nor quantitatively lower 
    than the generally applicable leverage capital requirements that 
    were in effect for insured depository institutions as of the date 
    of enactment of this Act.
        (2) Minimum risk-based capital requirements.--The appropriate 
    Federal banking agencies shall establish minimum risk-based capital 
    requirements on a consolidated basis for insured depository 
    institutions, depository institution holding companies, and nonbank 
    financial companies supervised by the Board of Governors. The 
    minimum risk-based capital requirements established under this 
    paragraph shall not be less than the generally applicable risk-
    based capital requirements, which shall serve as a floor for any 
    capital requirements that the agency may require, nor 
    quantitatively lower than the generally applicable risk-based 
    capital requirements that were in effect for insured depository 
    institutions as of the date of enactment of this Act.
        (3) Investments in financial subsidiaries.--For purposes of 
    this section, investments in financial subsidiaries that insured 
    depository institutions are required to deduct from regulatory 
    capital under section 5136A of the Revised Statutes of the United 
    States or section 46(a)(2) of the Federal Deposit Insurance Act 
    need not be deducted from regulatory capital by depository 
    institution holding companies or nonbank financial companies 
    supervised by the Board of Governors, unless such capital deduction 
    is required by the Board of Governors or the primary financial 
    regulatory agency in the case of nonbank financial companies 
    supervised by the Board of Governors.
        (4) Effective dates and phase-in periods.--
            (A) Debt or equity instruments on or after may 19, 2010.--
        For debt or equity instruments issued on or after May 19, 2010, 
        by depository institution holding companies or by nonbank 
        financial companies supervised by the Board of Governors, this 
        section shall be deemed to have become effective as of May 19, 
        2010.
            (B) Debt or equity instruments issued before may 19, 
        2010.--For debt or equity instruments issued before May 19, 
        2010, by depository institution holding companies or by nonbank 
        financial companies supervised by the Board of Governors, any 
        regulatory capital deductions required under this section shall 
        be phased in incrementally over a period of 3 years, with the 
        phase-in period to begin on January 1, 2013, except as set 
        forth in subparagraph (C).
            (C) Debt or equity instruments of smaller institutions.--
        For debt or equity instruments issued before May 19, 2010, by 
        depository institution holding companies with total 
        consolidated assets of less than $15,000,000,000 as of December 
        31, 2009, and by organizations that were mutual holding 
        companies on May 19, 2010, the capital deductions that would be 
        required for other institutions under this section are not 
        required as a result of this section.
            (D) Depository institution holding companies not previously 
        supervised by the board of governors.--For any depository 
        institution holding company that was not supervised by the 
        Board of Governors as of May 19, 2010, the requirements of this 
        section, except as set forth in subparagraphs (A) and (B), 
        shall be effective 5 years after the date of enactment of this 
        Act
            (E) Certain bank holding company subsidiaries of foreign 
        banking organizations.--For bank holding company subsidiaries 
        of foreign banking organizations that have relied on 
        Supervision and Regulation Letter SR-01-1 issued by the Board 
        of Governors (as in effect on May 19, 2010), the requirements 
        of this section, except as set forth in subparagraph (A), shall 
        be effective 5 years after the date of enactment of this Act.
        (5) Exceptions.--This section shall not apply to--
            (A) debt or equity instruments issued to the United States 
        or any agency or instrumentality thereof pursuant to the 
        Emergency Economic Stabilization Act of 2008, and prior to 
        October 4, 2010;
            (B) any Federal home loan bank; or
            (C) any small bank holding company that is subject to the 
        Small Bank Holding Company Policy Statement of the Board of 
        Governors, as in effect on May 19, 2010.
        (6) Study and report on small institution access to capital.--
            (A) Study required.--The Comptroller General of the United 
        States, after consultation with the Federal banking agencies, 
        shall conduct a study of access to capital by smaller insured 
        depository institutions.
            (B) Scope.--For purposes of this study required by 
        subparagraph (A), the term ``smaller insured depository 
        institution'' means an insured depository institution with 
        total consolidated assets of $5,000,000,000 or less.
            (C) Report to congress.--Not later than 18 months after the 
        date of enactment of this Act, the Comptroller General of the 
        United States shall submit to the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives a report 
        summarizing the results of the study conducted under 
        subparagraph (A), together with any recommendations for 
        legislative or regulatory action that would enhance the access 
        to capital of smaller insured depository institutions, in a 
        manner that is consistent with safe and sound banking 
        operations.
        (7) Capital requirements to address activities that pose risks 
    to the financial system.--
            (A) In general.--Subject to the recommendations of the 
        Council, in accordance with section 120, the Federal banking 
        agencies shall develop capital requirements applicable to 
        insured depository institutions, depository institution holding 
        companies, and nonbank financial companies supervised by the 
        Board of Governors that address the risks that the activities 
        of such institutions pose, not only to the institution engaging 
        in the activity, but to other public and private stakeholders 
        in the event of adverse performance, disruption, or failure of 
        the institution or the activity.
            (B) Content.--Such rules shall address, at a minimum, the 
        risks arising from--
                (i) significant volumes of activity in derivatives, 
            securitized products purchased and sold, financial 
            guarantees purchased and sold, securities borrowing and 
            lending, and repurchase agreements and reverse repurchase 
            agreements;
                (ii) concentrations in assets for which the values 
            presented in financial reports are based on models rather 
            than historical cost or prices deriving from deep and 
            liquid 2-way markets; and
                (iii) concentrations in market share for any activity 
            that would substantially disrupt financial markets if the 
            institution is forced to unexpectedly cease the activity.
    SEC. 172. EXAMINATION AND ENFORCEMENT ACTIONS FOR INSURANCE AND 
      ORDERLY LIQUIDATION PURPOSES.
    (a) Examinations for Insurance and Resolution Purposes.--Section 
10(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1820(b)(3)) is 
amended--
        (1) by striking ``In addition'' and inserting the following:
            ``(A) In general.--In addition''; and
        (2) by striking ``whenever the board of directors determines'' 
    and all that follows through the period and inserting the 
    following: ``or nonbank financial company supervised by the Board 
    of Governors or a bank holding company described in section 165(a) 
    of the Financial Stability Act of 2010, whenever the Board of 
    Directors determines that a special examination of any such 
    depository institution is necessary to determine the condition of 
    such depository institution for insurance purposes, 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, provided that such authority may not be 
    used with respect to any such company that is in a generally sound 
    condition.
            ``(B) Limitation.--Before conducting a special examination 
        of a nonbank financial company supervised by the Board of 
        Governors or a bank holding company described in section 165(a) 
        of the Financial Stability Act of 2010, the Corporation shall 
        review any available and acceptable resolution plan that the 
        company has submitted in accordance with section 165(d) of that 
        Act, consistent with the nonbinding effect of such plan, and 
        available reports of examination, and shall coordinate to the 
        maximum extent practicable with the Board of Governors, in 
        order to minimize duplicative or conflicting examinations.''.
    (b) Enforcement Authority.--Section 8(t) of the Federal Deposit 
Insurance Act (12 U.S.C. 1818(t)) is amended--
        (1) in paragraph (1), by inserting ``, any depository 
    institution holding company,'' before ``or any institution-
    affiliated party'';
        (2) in paragraph (2)--
            (A) by striking ``or'' at the end of subparagraph (B);
            (B) at the end of subparagraph (C), by striking the period 
        and inserting ``or''; and
            (C) by inserting at the end the following new subparagraph:
            ``(D) the conduct or threatened conduct (including any acts 
        or omissions) of the depository institution holding company 
        poses a risk to the Deposit Insurance Fund, provided that such 
        authority may not be used with respect to a depository 
        institution holding company that is in generally sound 
        condition and whose conduct does not pose a foreseeable and 
        material risk of loss to the Deposit Insurance Fund;''; and
        (3) by adding at the end the following:
        ``(6) Powers and duties with respect to depository institution 
    holding companies.--For purposes of exercising the backup authority 
    provided in this subsection--
            ``(A) the Corporation shall have the same powers with 
        respect to a depository institution holding company and its 
        affiliates as the appropriate Federal banking agency has with 
        respect to the holding company and its affiliates; and
            ``(B) the holding company and its affiliates shall have the 
        same duties and obligations with respect to the Corporation as 
        the holding company and its affiliates have with respect to the 
        appropriate Federal banking agency.''.
    (c) Rule of Construction.--Nothing in this Act shall be construed 
to limit or curtail the Corporation's current authority to examine or 
bring enforcement actions with respect to any insured depository 
institution or institution-affiliated party.
    SEC. 173. ACCESS TO UNITED STATES FINANCIAL MARKET BY FOREIGN 
      INSTITUTIONS.
    (a) Establishment of Foreign Bank Offices in the United States.--
Section 7(d)(3) of the International Banking Act of 1978 (12 U.S.C. 
3105(d)(3)) is amended--
        (1) in subparagraph (C), by striking ``and'' at the end;
        (2) in subparagraph (D), by striking the period at the end of 
    and inserting ``; and''; and
        (3) by adding at the end the following new subparagraph:
            ``(E) for a foreign bank that presents a risk to the 
        stability of United States financial system, whether the home 
        country of the foreign bank has adopted, or is making 
        demonstrable progress toward adopting, an appropriate system of 
        financial regulation for the financial system of such home 
        country to mitigate such risk.''.
    (b) Termination of Foreign Bank Offices in the United States.--
Section 7(e)(1) of the International Banking Act of 1978 (12 U.S.C. 
3105(e)(1)) is amended--
        (1) in subparagraph (A), by striking ``or'' at the end;
        (2) in subparagraph (B), by striking the period at the end of 
    and inserting ``; or''; and
        (3) by inserting after subparagraph (B), the following new 
    subparagraph:
            ``(C) for a foreign bank that presents a risk to the 
        stability of the United States financial system, the home 
        country of the foreign bank has not adopted, or made 
        demonstrable progress toward adopting, an appropriate system of 
        financial regulation to mitigate such risk.''.
    (c) Registration or Succession to a United States Broker or Dealer 
and Termination of Such Registration.--Section 15 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o) is amended by adding at the end 
the following new subsections:
    ``(k) Registration or Succession to a United States Broker or 
Dealer.--In determining whether to permit a foreign person or an 
affiliate of a foreign person to register as a United States broker or 
dealer, or succeed to the registration of a United States broker or 
dealer, the Commission may consider whether, for a foreign person, or 
an affiliate of a foreign person that presents a risk to the stability 
of the United States financial system, the home country of the foreign 
person has adopted, or made demonstrable progress toward adopting, an 
appropriate system of financial regulation to mitigate such risk.
    ``(l) Termination of a United States Broker or Dealer.--For a 
foreign person or an affiliate of a foreign person that presents such a 
risk to the stability of the United States financial system, the 
Commission may determine to terminate the registration of such foreign 
person or an affiliate of such foreign person as a broker or dealer in 
the United States, if the Commission determines that the home country 
of the foreign person has not adopted, or made demonstrable progress 
toward adopting, an appropriate system of financial regulation to 
mitigate such risk.''.
    SEC. 174. STUDIES AND REPORTS ON HOLDING COMPANY CAPITAL 
      REQUIREMENTS.
    (a) Study of Hybrid Capital Instruments.--The Comptroller General 
of the United States, in consultation with the Board of Governors, the 
Comptroller of the Currency, and the Corporation, shall conduct a study 
of the use of hybrid capital instruments as a component of Tier 1 
capital for banking institutions and bank holding companies. The study 
shall consider--
        (1) the current use of hybrid capital instruments, such as 
    trust preferred shares, as a component of Tier 1 capital;
        (2) the differences between the components of capital permitted 
    for insured depository institutions and those permitted for 
    companies that control insured depository institutions;
        (3) the benefits and risks of allowing such instruments to be 
    used to comply with Tier 1 capital requirements;
        (4) the economic impact of prohibiting the use of such capital 
    instruments for Tier 1;
        (5) a review of the consequences of disqualifying trust 
    preferred instruments, and whether it could lead to the failure or 
    undercapitalization of existing banking organizations;
        (6) the international competitive implications prohibiting 
    hybrid capital instruments for Tier 1;
        (7) the impact on the cost and availability of credit in the 
    United States from such a prohibition;
        (8) the availability of capital for financial institutions with 
    less than $10,000,000,000 in total assets; and
        (9) any other relevant factors relating to the safety and 
    soundness of our financial system and potential economic impact of 
    such a prohibition.
    (b) Study of Foreign Bank Intermediate Holding Company Capital 
Requirements.--The Comptroller General of the United States, in 
consultation with the Secretary, the Board of Governors, the 
Comptroller of the Currency, and the Corporation, shall conduct a study 
of capital requirements applicable to United States intermediate 
holding companies of foreign banks that are bank holding companies or 
savings and loan holding companies. The study shall consider--
        (1) current Board of Governors policy regarding the treatment 
    of intermediate holding companies;
        (2) the principle of national treatment and equality of 
    competitive opportunity for foreign banks operating in the United 
    States;
        (3) the extent to which foreign banks are subject on a 
    consolidated basis to home country capital standards comparable to 
    United States capital standards;
        (4) potential effects on United States banking organizations 
    operating abroad of changes to United States policy regarding 
    intermediate holding companies;
        (5) the impact on the cost and availability of credit in the 
    United States from a change in United States policy regarding 
    intermediate holding companies; and
        (6) any other relevant factors relating to the safety and 
    soundness of our financial system and potential economic impact of 
    such a prohibition.
    (c) Report.--Not later than 18 months after the date of enactment 
of this Act, the Comptroller General of the United States shall submit 
reports to the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives summarizing the results of the studies required under 
subsection (a). The reports shall include specific recommendations for 
legislative or regulatory action regarding the treatment of hybrid 
capital instruments, including trust preferred shares, and shall 
explain the basis for such recommendations.
    SEC. 175. INTERNATIONAL POLICY COORDINATION.
    (a) By the President.--The President, or a designee of the 
President, may coordinate through all available international policy 
channels, similar policies as those found in United States law relating 
to limiting the scope, nature, size, scale, concentration, and 
interconnectedness of financial companies, in order to protect 
financial stability and the global economy.
    (b) By the Council.--The Chairperson of the Council, in 
consultation with the other members of the Council, shall regularly 
consult with the financial regulatory entities and other appropriate 
organizations of foreign governments or international organizations on 
matters relating to systemic risk to the international financial 
system.
    (c) By the Board of Governors and the Secretary.--The Board of 
Governors and the Secretary shall consult with their foreign 
counterparts and through appropriate multilateral organizations to 
encourage comprehensive and robust prudential supervision and 
regulation for all highly leveraged and interconnected financial 
companies.
    SEC. 176. RULE OF CONSTRUCTION.
    No regulation or standard imposed under this title may be construed 
in a manner that would lessen the stringency of the requirements of any 
applicable primary financial regulatory agency or any other Federal or 
State agency that are otherwise applicable. This title, and the rules 
and regulations or orders prescribed pursuant to this title, do not 
divest any such agency of any authority derived from any other 
applicable law.

                TITLE II--ORDERLY LIQUIDATION AUTHORITY

    SEC. 201. DEFINITIONS.
    (a) In General.--In this title, the following definitions shall 
apply:
        (1) Administrative expenses of the receiver.--The term 
    ``administrative expenses of the receiver'' includes--
            (A) the actual, necessary costs and expenses incurred by 
        the Corporation as receiver for a covered financial company in 
        liquidating a covered financial company; and
            (B) any obligations that the Corporation as receiver for a 
        covered financial company determines are necessary and 
        appropriate to facilitate the smooth and orderly liquidation of 
        the covered financial company.
        (2) Bankruptcy code.--The term ``Bankruptcy Code'' means title 
    11, United States Code.
        (3) Bridge financial company.--The term ``bridge financial 
    company'' means a new financial company organized by the 
    Corporation in accordance with section 210(h) for the purpose of 
    resolving a covered financial company.
        (4) Claim.--The term ``claim'' means any right to payment, 
    whether or not such right is reduced to judgment, liquidated, 
    unliquidated, fixed, contingent, matured, unmatured, disputed, 
    undisputed, legal, equitable, secured, or unsecured.
        (5) Company.--The term ``company'' has the same meaning as in 
    section 2(b) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1841(b)), except that such term includes any company described in 
    paragraph (11), the majority of the securities of which are owned 
    by the United States or any State.
        (6) Court.--The term ``Court'' means the United States District 
    Court for the District of Columbia, unless the context otherwise 
    requires.
        (7) Covered broker or dealer.--The term ``covered broker or 
    dealer'' means a covered financial company that is a broker or 
    dealer that--
            (A) is registered with the Commission under section 15(b) 
        of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)); and
            (B) is a member of SIPC.
        (8) Covered financial company.--The term ``covered financial 
    company''--
            (A) means a financial company for which a determination has 
        been made under section 203(b); and
            (B) does not include an insured depository institution.
        (9) Covered subsidiary.--The term ``covered subsidiary'' means 
    a subsidiary of a covered financial company, other than--
            (A) an insured depository institution;
            (B) an insurance company; or
            (C) a covered broker or dealer.
        (10) Definitions relating to covered brokers and dealers.--The 
    terms ``customer'', ``customer name securities'', ``customer 
    property'', and ``net equity'' in the context of a covered broker 
    or dealer, have the same meanings as in section 16 of the 
    Securities Investor Protection Act of 1970 (15 U.S.C. 78lll).
        (11) Financial company.--The term ``financial company'' means 
    any company that--
            (A) is incorporated or organized under any provision of 
        Federal law or the laws of any State;
            (B) is--
                (i) a bank holding company, as defined in section 2(a) 
            of the Bank Holding Company Act of 1956 (12 U.S.C. 
            1841(a));
                (ii) a nonbank financial company supervised by the 
            Board of Governors;
                (iii) any company that is predominantly engaged in 
            activities that the Board of Governors has determined are 
            financial in nature or incidental thereto for purposes of 
            section 4(k) of the Bank Holding Company Act of 1956 (12 
            U.S.C. 1843(k)) other than a company described in clause 
            (i) or (ii); or
                (iv) any subsidiary of any company described in any of 
            clauses (i) through (iii) that is predominantly engaged in 
            activities that the Board of Governors has determined are 
            financial in nature or incidental thereto for purposes of 
            section 4(k) of the Bank Holding Company Act of 1956 (12 
            U.S.C. 1843(k)) (other than a subsidiary that is an insured 
            depository institution or an insurance company); and
            (C) is not a Farm Credit System institution chartered under 
        and subject to the provisions of the Farm Credit Act of 1971, 
        as amended (12 U.S.C. 2001 et seq.), a governmental entity, or 
        a regulated entity, as defined under section 1303(20) of the 
        Federal Housing Enterprises Financial Safety and Soundness Act 
        of 1992 (12 U.S.C. 4502(20)).
        (12) Fund.--The term ``Fund'' means the Orderly Liquidation 
    Fund established under section 210(n).
        (13) Insurance company.--The term ``insurance company'' means 
    any entity that is--
            (A) engaged in the business of insurance;
            (B) subject to regulation by a State insurance regulator; 
        and
            (C) covered by a State law that is designed to specifically 
        deal with the rehabilitation, liquidation, or insolvency of an 
        insurance company.
        (14) Nonbank financial company.--The term ``nonbank financial 
    company'' has the same meaning as in section 102(a)(4)(C).
        (15) Nonbank financial company supervised by the board of 
    governors.--The term ``nonbank financial company supervised by the 
    Board of Governors'' has the same meaning as in section 
    102(a)(4)(D).
        (16) SIPC.--The term ``SIPC'' means the Securities Investor 
    Protection Corporation.
    (b) Definitional Criteria.--For purpose of the definition of the 
term ``financial company'' under subsection (a)(11), no company shall 
be deemed to be predominantly engaged in activities that the Board of 
Governors has determined are financial in nature or incidental thereto 
for purposes of section 4(k) of the Bank Holding Company Act of 1956 
(12 U.S.C. 1843(k)), if the consolidated revenues of such company from 
such activities constitute less than 85 percent of the total 
consolidated revenues of such company, as the Corporation, in 
consultation with the Secretary, shall establish by regulation. In 
determining whether a company is a financial company under this title, 
the consolidated revenues derived from the ownership or control of a 
depository institution shall be included.
    SEC. 202. JUDICIAL REVIEW.
    (a) Commencement of Orderly Liquidation.--
        (1) Petition to district court.--
            (A) District court review.--
                (i) Petition to district court.--Subsequent to a 
            determination by the Secretary under section 203 that a 
            financial company satisfies the criteria in section 203(b), 
            the Secretary shall notify the Corporation and the covered 
            financial company. If the board of directors (or body 
            performing similar functions) of the covered financial 
            company acquiesces or consents to the appointment of the 
            Corporation as receiver, the Secretary shall appoint the 
            Corporation as receiver. If the board of directors (or body 
            performing similar functions) of the covered financial 
            company does not acquiesce or consent to the appointment of 
            the Corporation as receiver, the Secretary shall petition 
            the United States District Court for the District of 
            Columbia for an order authorizing the Secretary to appoint 
            the Corporation as receiver.
                (ii) Form and content of order.--The Secretary shall 
            present all relevant findings and the recommendation made 
            pursuant to section 203(a) to the Court. The petition shall 
            be filed under seal.
                (iii) Determination.--On a strictly confidential basis, 
            and without any prior public disclosure, the Court, after 
            notice to the covered financial company and a hearing in 
            which the covered financial company may oppose the 
            petition, shall determine whether the determination of the 
            Secretary that the covered financial company is in default 
            or in danger of default and satisfies the definition of a 
            financial company under section 201(a)(11) is arbitrary and 
            capricious.
                (iv) Issuance of order.--If the Court determines that 
            the determination of the Secretary that the covered 
            financial company is in default or in danger of default and 
            satisfies the definition of a financial company under 
            section 201(a)(11)--

                    (I) is not arbitrary and capricious, the Court 
                shall issue an order immediately authorizing the 
                Secretary to appoint the Corporation as receiver of the 
                covered financial company; or
                    (II) is arbitrary and capricious, the Court shall 
                immediately provide to the Secretary a written 
                statement of each reason supporting its determination, 
                and afford the Secretary an immediate opportunity to 
                amend and refile the petition under clause (i).

                (v) Petition granted by operation of law.--If the Court 
            does not make a determination within 24 hours of receipt of 
            the petition--

                    (I) the petition shall be granted by operation of 
                law;
                    (II) the Secretary shall appoint the Corporation as 
                receiver; and
                    (III) liquidation under this title shall 
                automatically and without further notice or action be 
                commenced and the Corporation may immediately take all 
                actions authorized under this title.

            (B) Effect of determination.--The determination of the 
        Court under subparagraph (A) shall be final, and shall be 
        subject to appeal only in accordance with paragraph (2). The 
        decision shall not be subject to any stay or injunction pending 
        appeal. Upon conclusion of its proceedings under subparagraph 
        (A), the Court shall provide immediately for the record a 
        written statement of each reason supporting the decision of the 
        Court, and shall provide copies thereof to the Secretary and 
        the covered financial company.
            (C) Criminal penalties.--A person who recklessly discloses 
        a determination of the Secretary under section 203(b) or a 
        petition of the Secretary under subparagraph (A), or the 
        pendency of court proceedings as provided for under 
        subparagraph (A), shall be fined not more than $250,000, or 
        imprisoned for not more than 5 years, or both.
        (2) Appeal of decisions of the district court.--
            (A) Appeal to court of appeals.--
                (i) In general.--Subject to clause (ii), the United 
            States Court of Appeals for the District of Columbia 
            Circuit shall have jurisdiction of an appeal of a final 
            decision of the Court filed by the Secretary or a covered 
            financial company, through its board of directors, 
            notwithstanding section 210(a)(1)(A)(i), not later than 30 
            days after the date on which the decision of the Court is 
            rendered or deemed rendered under this subsection.
                (ii) Condition of jurisdiction.--The Court of Appeals 
            shall have jurisdiction of an appeal by a covered financial 
            company only if the covered financial company did not 
            acquiesce or consent to the appointment of a receiver by 
            the Secretary under paragraph (1)(A).
                (iii) Expedition.--The Court of Appeals shall consider 
            any appeal under this subparagraph on an expedited basis.
                (iv) Scope of review.--For an appeal taken under this 
            subparagraph, review shall be limited to whether the 
            determination of the Secretary that a covered financial 
            company is in default or in danger of default and satisfies 
            the definition of a financial company under section 
            201(a)(11) is arbitrary and capricious.
            (B) Appeal to the supreme court.--
                (i) In general.--A petition for a writ of certiorari to 
            review a decision of the Court of Appeals under 
            subparagraph (A) may be filed by the Secretary or the 
            covered financial company, through its board of directors, 
            notwithstanding section 210(a)(1)(A)(i), with the Supreme 
            Court of the United States, not later than 30 days after 
            the date of the final decision of the Court of Appeals, and 
            the Supreme Court shall have discretionary jurisdiction to 
            review such decision.
                (ii) Written statement.--In the event of a petition 
            under clause (i), the Court of Appeals shall immediately 
            provide for the record a written statement of each reason 
            for its decision.
                (iii) Expedition.--The Supreme Court shall consider any 
            petition under this subparagraph on an expedited basis.
                (iv) Scope of review.--Review by the Supreme Court 
            under this subparagraph shall be limited to whether the 
            determination of the Secretary that the covered financial 
            company is in default or in danger of default and satisfies 
            the definition of a financial company under section 
            201(a)(11) is arbitrary and capricious.
    (b) Establishment and Transmittal of Rules and Procedures.--
        (1) In general.--Not later than 6 months after the date of 
    enactment of this Act, the Court shall establish such rules and 
    procedures as may be necessary to ensure the orderly conduct of 
    proceedings, including rules and procedures to ensure that the 24-
    hour deadline is met and that the Secretary shall have an ongoing 
    opportunity to amend and refile petitions under subsection (a)(1).
        (2) Publication of rules.--The rules and procedures established 
    under paragraph (1), and any modifications of such rules and 
    procedures, shall be recorded and shall be transmitted to--
            (A) the Committee on the Judiciary of the Senate;
            (B) the Committee on Banking, Housing, and Urban Affairs of 
        the Senate;
            (C) the Committee on the Judiciary of the House of 
        Representatives; and
            (D) the Committee on Financial Services of the House of 
        Representatives.
    (c) Provisions Applicable to Financial Companies.--
        (1) Bankruptcy code.--Except as provided in this subsection, 
    the provisions of the Bankruptcy Code and rules issued thereunder 
    or otherwise applicable insolvency law, and not the provisions of 
    this title, shall apply to financial companies that are not covered 
    financial companies for which the Corporation has been appointed as 
    receiver.
        (2) This title.--The provisions of this title shall exclusively 
    apply to and govern all matters relating to covered financial 
    companies for which the Corporation is appointed as receiver, and 
    no provisions of the Bankruptcy Code or the rules issued thereunder 
    shall apply in such cases, except as expressly provided in this 
    title.
    (d) Time Limit on Receivership Authority.--
        (1) Baseline period.--Any appointment of the Corporation as 
    receiver under this section shall terminate at the end of the 3-
    year period beginning on the date on which such appointment is 
    made.
        (2) Extension of time limit.--The time limit established in 
    paragraph (1) may be extended by the Corporation for up to 1 
    additional year, if the Chairperson of the Corporation determines 
    and certifies in writing to the Committee on Banking, Housing, and 
    Urban Affairs of the Senate and the Committee on Financial Services 
    of the House of Representatives that continuation of the 
    receivership is necessary--
            (A) to--
                (i) maximize the net present value return from the sale 
            or other disposition of the assets of the covered financial 
            company; or
                (ii) minimize the amount of loss realized upon the sale 
            or other disposition of the assets of the covered financial 
            company; and
            (B) to protect the stability of the financial system of the 
        United States.
        (3) Second extension of time limit.--
            (A) In general.--The time limit under this subsection, as 
        extended under paragraph (2), may be extended for up to 1 
        additional year, if the Chairperson of the Corporation, with 
        the concurrence of the Secretary, submits the certifications 
        described in paragraph (2).
            (B) Additional report required.--Not later than 30 days 
        after the date of commencement of the extension under 
        subparagraph (A), the Corporation shall submit a report to the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        and the Committee on Financial Services of the House of 
        Representatives describing the need for the extension and the 
        specific plan of the Corporation to conclude the receivership 
        before the end of the second extension.
        (4) Ongoing litigation.--The time limit under this subsection, 
    as extended under paragraph (3), may be further extended solely for 
    the purpose of completing ongoing litigation in which the 
    Corporation as receiver is a party, provided that the appointment 
    of the Corporation as receiver shall terminate not later than 90 
    days after the date of completion of such litigation, if--
            (A) the Council determines that the Corporation used its 
        best efforts to conclude the receivership in accordance with 
        its plan before the end of the time limit described in 
        paragraph (3);
            (B) the Council determines that the completion of longer-
        term responsibilities in the form of ongoing litigation 
        justifies the need for an extension; and
            (C) the Corporation submits a report approved by the 
        Council not later than 30 days after the date of the 
        determinations by the Council under subparagraphs (A) and (B) 
        to the Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Financial Services of the House of 
        Representatives, describing--
                (i) the ongoing litigation justifying the need for an 
            extension; and
                (ii) the specific plan of the Corporation to complete 
            the litigation and conclude the receivership.
        (5) Regulations.--The Corporation may issue regulations 
    governing the termination of receiverships under this title.
        (6) No liability.--The Corporation and the Deposit Insurance 
    Fund shall not be liable for unresolved claims arising from the 
    receivership after the termination of the receivership.
    (e) Study of Bankruptcy and Orderly Liquidation Process for 
Financial Companies.--
        (1) Study.--
            (A) In general.--The Administrative Office of the United 
        States Courts and the Comptroller General of the United States 
        shall each monitor the activities of the Court, and each such 
        Office shall conduct separate studies regarding the bankruptcy 
        and orderly liquidation process for financial companies under 
        the Bankruptcy Code.
            (B) Issues to be studied.--In conducting the study under 
        subparagraph (A), the Administrative Office of the United 
        States Courts and the Comptroller General of the United States 
        each shall evaluate--
                (i) the effectiveness of chapter 7 or chapter 11 of the 
            Bankruptcy Code in facilitating the orderly liquidation or 
            reorganization of financial companies;
                (ii) ways to maximize the efficiency and effectiveness 
            of the Court; and
                (iii) ways to make the orderly liquidation process 
            under the Bankruptcy Code for financial companies more 
            effective.
        (2) Reports.--Not later than 1 year after the date of enactment 
    of this Act, in each successive year until the third year, and 
    every fifth year after that date of enactment, the Administrative 
    Office of the United States Courts and the Comptroller General of 
    the United States shall submit to the Committee on Banking, 
    Housing, and Urban Affairs and the Committee on the Judiciary of 
    the Senate and the Committee on Financial Services and the 
    Committee on the Judiciary of the House of Representatives separate 
    reports summarizing the results of the studies conducted under 
    paragraph (1).
    (f) Study of International Coordination Relating to Bankruptcy 
Process for Financial Companies.--
        (1) Study.--
            (A) In general.--The Comptroller General of the United 
        States shall conduct a study regarding international 
        coordination relating to the orderly liquidation of financial 
        companies under the Bankruptcy Code.
            (B) Issues to be studied.--In conducting the study under 
        subparagraph (A), the Comptroller General of the United States 
        shall evaluate, with respect to the bankruptcy process for 
        financial companies--
                (i) the extent to which international coordination 
            currently exists;
                (ii) current mechanisms and structures for facilitating 
            international cooperation;
                (iii) barriers to effective international coordination; 
            and
                (iv) ways to increase and make more effective 
            international coordination.
        (2) Report.--Not later than 1 year after the date of enactment 
    of this Act, the Comptroller General of the United States shall 
    submit to the Committee on Banking, Housing, and Urban Affairs and 
    the Committee on the Judiciary of the Senate and the Committee on 
    Financial Services and the Committee on the Judiciary of the House 
    of Representatives and the Secretary a report summarizing the 
    results of the study conducted under paragraph (1).
    (g) Study of Prompt Corrective Action Implementation by the 
Appropriate Federal Agencies.--
        (1) Study.--The Comptroller General of the United States shall 
    conduct a study regarding the implementation of prompt corrective 
    action by the appropriate Federal banking agencies.
        (2) Issues to be studied.--In conducting the study under 
    paragraph (1), the Comptroller General shall evaluate--
            (A) the effectiveness of implementation of prompt 
        corrective action by the appropriate Federal banking agencies 
        and the resolution of insured depository institutions by the 
        Corporation; and
            (B) ways to make prompt corrective action a more effective 
        tool to resolve the insured depository institutions at the 
        least possible long-term cost to the Deposit Insurance Fund.
        (3) Report to council.--Not later than 1 year after the date of 
    enactment of this Act, the Comptroller General shall submit a 
    report to the Council on the results of the study conducted under 
    this subsection.
        (4) Council report of action.--Not later than 6 months after 
    the date of receipt of the report from the Comptroller General 
    under paragraph (3), the Council shall submit a report to the 
    Committee on Banking, Housing, and Urban Affairs of the Senate and 
    the Committee on Financial Services of the House of Representatives 
    on actions taken in response to the report, including any 
    recommendations made to the Federal primary financial regulatory 
    agencies under section 120.
    SEC. 203. SYSTEMIC RISK DETERMINATION.
    (a) Written Recommendation and Determination.--
        (1) Vote required.--
            (A) In general.--On their own initiative, or at the request 
        of the Secretary, the Corporation and the Board of Governors 
        shall consider whether to make a written recommendation 
        described in paragraph (2) with respect to whether the 
        Secretary should appoint the Corporation as receiver for a 
        financial company. Such recommendation shall be made upon a 
        vote of not fewer than \2/3\ of the members of the Board of 
        Governors then serving and \2/3\ of the members of the board of 
        directors of the Corporation then serving.
            (B) Cases involving brokers or dealers.--In the case of a 
        broker or dealer, or in which the largest United States 
        subsidiary (as measured by total assets as of the end of the 
        previous calendar quarter) of a financial company is a broker 
        or dealer, the Commission and the Board of Governors, at the 
        request of the Secretary, or on their own initiative, shall 
        consider whether to make the written recommendation described 
        in paragraph (2) with respect to the financial company. Subject 
        to the requirements in paragraph (2), such recommendation shall 
        be made upon a vote of not fewer than \2/3\ of the members of 
        the Board of Governors then serving and \2/3\ of the members of 
        the Commission then serving, and in consultation with the 
        Corporation.
            (C) Cases involving insurance companies.--In the case of an 
        insurance company, or in which the largest United States 
        subsidiary (as measured by total assets as of the end of the 
        previous calendar quarter) of a financial company is an 
        insurance company, the Director of the Federal Insurance Office 
        and the Board of Governors, at the request of the Secretary or 
        on their own initiative, shall consider whether to make the 
        written recommendation described in paragraph (2) with respect 
        to the financial company. Subject to the requirements in 
        paragraph (2), such recommendation shall be made upon a vote of 
        not fewer than \2/3\ of the Board of Governors then serving and 
        the affirmative approval of the Director of the Federal 
        Insurance Office, and in consultation with the Corporation.
        (2) Recommendation required.--Any written recommendation 
    pursuant to paragraph (1) shall contain--
            (A) an evaluation of whether the financial company is in 
        default or in danger of default;
            (B) a description of the effect that the default of the 
        financial company would have on financial stability in the 
        United States;
            (C) a description of the effect that the default of the 
        financial company would have on economic conditions or 
        financial stability for low income, minority, or underserved 
        communities;
            (D) a recommendation regarding the nature and the extent of 
        actions to be taken under this title regarding the financial 
        company;
            (E) an evaluation of the likelihood of a private sector 
        alternative to prevent the default of the financial company;
            (F) an evaluation of why a case under the Bankruptcy Code 
        is not appropriate for the financial company;
            (G) an evaluation of the effects on creditors, 
        counterparties, and shareholders of the financial company and 
        other market participants; and
            (H) an evaluation of whether the company satisfies the 
        definition of a financial company under section 201.
    (b) Determination by the Secretary.--Notwithstanding any other 
provision of Federal or State law, the Secretary shall take action in 
accordance with section 202(a)(1)(A), if, upon the written 
recommendation under subsection (a), the Secretary (in consultation 
with the President) determines that--
        (1) the financial company is in default or in danger of 
    default;
        (2) the failure of the financial company and its resolution 
    under otherwise applicable Federal or State law would have serious 
    adverse effects on financial stability in the United States;
        (3) no viable private sector alternative is available to 
    prevent the default of the financial company;
        (4) any effect on the claims or interests of creditors, 
    counterparties, and shareholders of the financial company and other 
    market participants as a result of actions to be taken under this 
    title is appropriate, given the impact that any action taken under 
    this title would have on financial stability in the United States;
        (5) any action under section 204 would avoid or mitigate such 
    adverse effects, taking into consideration the effectiveness of the 
    action in mitigating potential adverse effects on the financial 
    system, the cost to the general fund of the Treasury, and the 
    potential to increase excessive risk taking on the part of 
    creditors, counterparties, and shareholders in the financial 
    company;
        (6) a Federal regulatory agency has ordered the financial 
    company to convert all of its convertible debt instruments that are 
    subject to the regulatory order; and
        (7) the company satisfies the definition of a financial company 
    under section 201.
    (c) Documentation and Review.--
        (1) In general.--The Secretary shall--
            (A) document any determination under subsection (b);
            (B) retain the documentation for review under paragraph 
        (2); and
            (C) notify the covered financial company and the 
        Corporation of such determination.
        (2) Report to congress.--Not later than 24 hours after the date 
    of appointment of the Corporation as receiver for a covered 
    financial company, the Secretary shall provide written notice of 
    the recommendations and determinations reached in accordance with 
    subsections (a) and (b) to the Majority Leader and the Minority 
    Leader of the Senate and the Speaker and the Minority Leader of the 
    House of Representatives, the Committee on Banking, Housing, and 
    Urban Affairs of the Senate, and the Committee on Financial 
    Services of the House of Representatives, which shall consist of a 
    summary of the basis for the determination, including, to the 
    extent available at the time of the determination--
            (A) the size and financial condition of the covered 
        financial company;
            (B) the sources of capital and credit support that were 
        available to the covered financial company;
            (C) the operations of the covered financial company that 
        could have had a significant impact on financial stability, 
        markets, or both;
            (D) identification of the banks and financial companies 
        which may be able to provide the services offered by the 
        covered financial company;
            (E) any potential international ramifications of resolution 
        of the covered financial company under other applicable 
        insolvency law;
            (F) an estimate of the potential effect of the resolution 
        of the covered financial company under other applicable 
        insolvency law on the financial stability of the United States;
            (G) the potential effect of the appointment of a receiver 
        by the Secretary on consumers;
            (H) the potential effect of the appointment of a receiver 
        by the Secretary on the financial system, financial markets, 
        and banks and other financial companies; and
            (I) whether resolution of the covered financial company 
        under other applicable insolvency law would cause banks or 
        other financial companies to experience severe liquidity 
        distress.
        (3) Reports to congress and the public.--
            (A) In general.--Not later than 60 days after the date of 
        appointment of the Corporation as receiver for a covered 
        financial company, the Corporation shall file a report with the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        and the Committee on Financial Services of the House of 
        Representatives--
                (i) setting forth information on the financial 
            condition of the covered financial company as of the date 
            of the appointment, including a description of its assets 
            and liabilities;
                (ii) describing the plan of, and actions taken by, the 
            Corporation to wind down the covered financial company;
                (iii) explaining each instance in which the Corporation 
            waived any applicable requirements of part 366 of title 12, 
            Code of Federal Regulations (or any successor thereto) with 
            respect to conflicts of interest by any person in the 
            private sector who was retained to provide services to the 
            Corporation in connection with such receivership;
                (iv) describing the reasons for the provision of any 
            funding to the receivership out of the Fund;
                (v) setting forth the expected costs of the orderly 
            liquidation of the covered financial company;
                (vi) setting forth the identity of any claimant that is 
            treated in a manner different from other similarly situated 
            claimants under subsection (b)(4), (d)(4), or (h)(5)(E), 
            the amount of any additional payment to such claimant under 
            subsection (d)(4), and the reason for any such action; and
                (vii) which report the Corporation shall publish on an 
            online website maintained by the Corporation, subject to 
            maintaining appropriate confidentiality.
            (B) Amendments.--The Corporation shall, on a timely basis, 
        not less frequently than quarterly, amend or revise and 
        resubmit the reports prepared under this paragraph, as 
        necessary.
            (C) Congressional testimony.--The Corporation and the 
        primary financial regulatory agency, if any, of the financial 
        company for which the Corporation was appointed receiver under 
        this title shall appear before Congress, if requested, not 
        later than 30 days after the date on which the Corporation 
        first files the reports required under subparagraph (A).
        (4) Default or in danger of default.--For purposes of this 
    title, a financial company shall be considered to be in default or 
    in danger of default if, as determined in accordance with 
    subsection (b)--
            (A) a case has been, or likely will promptly be, commenced 
        with respect to the financial company under the Bankruptcy 
        Code;
            (B) the financial company has incurred, or is likely to 
        incur, losses that will deplete all or substantially all of its 
        capital, and there is no reasonable prospect for the company to 
        avoid such depletion;
            (C) the assets of the financial company are, or are likely 
        to be, less than its obligations to creditors and others; or
            (D) the financial company is, or is likely to be, unable to 
        pay its obligations (other than those subject to a bona fide 
        dispute) in the normal course of business.
        (5) GAO review.--The Comptroller General of the United States 
    shall review and report to Congress on any determination under 
    subsection (b), that results in the appointment of the Corporation 
    as receiver, including--
            (A) the basis for the determination;
            (B) the purpose for which any action was taken pursuant 
        thereto;
            (C) the likely effect of the determination and such action 
        on the incentives and conduct of financial companies and their 
        creditors, counterparties, and shareholders; and
            (D) the likely disruptive effect of the determination and 
        such action on the reasonable expectations of creditors, 
        counterparties, and shareholders, taking into account the 
        impact any action under this title would have on financial 
        stability in the United States, including whether the rights of 
        such parties will be disrupted.
    (d) Corporation Policies and Procedures.--As soon as is practicable 
after the date of enactment of this Act, the Corporation shall 
establish policies and procedures that are acceptable to the Secretary 
governing the use of funds available to the Corporation to carry out 
this title, including the terms and conditions for the provision and 
use of funds under sections 204(d), 210(h)(2)(G)(iv), and 210(h)(9).
    (e) Treatment of Insurance Companies and Insurance Company 
Subsidiaries.--
        (1) In general.--Notwithstanding subsection (b), if an 
    insurance company is a covered financial company or a subsidiary or 
    affiliate of a covered financial company, the liquidation or 
    rehabilitation of such insurance company, and any subsidiary or 
    affiliate of such company that is not excepted under paragraph (2), 
    shall be conducted as provided under applicable State law.
        (2) Exception for subsidiaries and affiliates.--The requirement 
    of paragraph (1) shall not apply with respect to any subsidiary or 
    affiliate of an insurance company that is not itself an insurance 
    company.
        (3) Backup authority.--Notwithstanding paragraph (1), with 
    respect to a covered financial company described in paragraph (1), 
    if, after the end of the 60-day period beginning on the date on 
    which a determination is made under section 202(a) with respect to 
    such company, the appropriate regulatory agency has not filed the 
    appropriate judicial action in the appropriate State court to place 
    such company into orderly liquidation under the laws and 
    requirements of the State, the Corporation shall have the authority 
    to stand in the place of the appropriate regulatory agency and file 
    the appropriate judicial action in the appropriate State court to 
    place such company into orderly liquidation under the laws and 
    requirements of the State.
    SEC. 204. ORDERLY LIQUIDATION OF COVERED FINANCIAL COMPANIES.
    (a) Purpose of Orderly Liquidation Authority.--It is the purpose of 
this title to provide the necessary authority to liquidate failing 
financial companies that pose a significant risk to the financial 
stability of the United States in a manner that mitigates such risk and 
minimizes moral hazard. The authority provided in this title shall be 
exercised in the manner that best fulfills such purpose, so that--
        (1) creditors and shareholders will bear the losses of the 
    financial company;
        (2) management responsible for the condition of the financial 
    company will not be retained; and
        (3) the Corporation and other appropriate agencies will take 
    all steps necessary and appropriate to assure that all parties, 
    including management, directors, and third parties, having 
    responsibility for the condition of the financial company bear 
    losses consistent with their responsibility, including actions for 
    damages, restitution, and recoupment of compensation and other 
    gains not compatible with such responsibility.
    (b) Corporation as Receiver.--Upon the appointment of the 
Corporation under section 202, the Corporation shall act as the 
receiver for the covered financial company, with all of the rights and 
obligations set forth in this title.
    (c) Consultation.--The Corporation, as receiver--
        (1) shall consult with the primary financial regulatory agency 
    or agencies of the covered financial company and its covered 
    subsidiaries for purposes of ensuring an orderly liquidation of the 
    covered financial company;
        (2) may consult with, or under subsection (a)(1)(B)(v) or 
    (a)(1)(L) of section 210, acquire the services of, any outside 
    experts, as appropriate to inform and aid the Corporation in the 
    orderly liquidation process;
        (3) shall consult with the primary financial regulatory agency 
    or agencies of any subsidiaries of the covered financial company 
    that are not covered subsidiaries, and coordinate with such 
    regulators regarding the treatment of such solvent subsidiaries and 
    the separate resolution of any such insolvent subsidiaries under 
    other governmental authority, as appropriate; and
        (4) shall consult with the Commission and the Securities 
    Investor Protection Corporation in the case of any covered 
    financial company for which the Corporation has been appointed as 
    receiver that is a broker or dealer registered with the Commission 
    under section 15(b) of the Securities Exchange Act of 1934 (15 
    U.S.C. 78o(b)) and is a member of the Securities Investor 
    Protection Corporation, for the purpose of determining whether to 
    transfer to a bridge financial company organized by the Corporation 
    as receiver, without consent of any customer, customer accounts of 
    the covered financial company.
    (d) Funding for Orderly Liquidation.--Upon its appointment as 
receiver for a covered financial company, and thereafter as the 
Corporation may, in its discretion, determine to be necessary or 
appropriate, the Corporation may make available to the receivership, 
subject to the conditions set forth in section 206 and subject to the 
plan described in section 210(n)(9), funds for the orderly liquidation 
of the covered financial company. All funds provided by the Corporation 
under this subsection shall have a priority of claims under 
subparagraph (A) or (B) of section 210(b)(1), as applicable, including 
funds used for--
        (1) making loans to, or purchasing any debt obligation of, the 
    covered financial company or any covered subsidiary;
        (2) purchasing or guaranteeing against loss the assets of the 
    covered financial company or any covered subsidiary, directly or 
    through an entity established by the Corporation for such purpose;
        (3) assuming or guaranteeing the obligations of the covered 
    financial company or any covered subsidiary to 1 or more third 
    parties;
        (4) taking a lien on any or all assets of the covered financial 
    company or any covered subsidiary, including a first priority lien 
    on all unencumbered assets of the covered financial company or any 
    covered subsidiary to secure repayment of any transactions 
    conducted under this subsection;
        (5) selling or transferring all, or any part, of such acquired 
    assets, liabilities, or obligations of the covered financial 
    company or any covered subsidiary; and
        (6) making payments pursuant to subsections (b)(4), (d)(4), and 
    (h)(5)(E) of section 210.
    SEC. 205. ORDERLY LIQUIDATION OF COVERED BROKERS AND DEALERS.
    (a) Appointment of SIPC as Trustee.--
        (1) Appointment.--Upon the appointment of the Corporation as 
    receiver for any covered broker or dealer, the Corporation shall 
    appoint, without any need for court approval, the Securities 
    Investor Protection Corporation to act as trustee for the 
    liquidation under the Securities Investor Protection Act of 1970 
    (15 U.S.C. 78aaa et seq.) of the covered broker or dealer.
        (2) Actions by sipc.--
            (A) Filing.--Upon appointment of SIPC under paragraph (1), 
        SIPC shall promptly file with any Federal district court of 
        competent jurisdiction specified in section 21 or 27 of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78u, 78aa), an 
        application for a protective decree under the Securities 
        Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) as to 
        the covered broker or dealer. The Federal district court shall 
        accept and approve the filing, including outside of normal 
        business hours, and shall immediately issue the protective 
        decree as to the covered broker or dealer.
            (B) Administration by sipc.--Following entry of the 
        protective decree, and except as otherwise provided in this 
        section, the determination of claims and the liquidation of 
        assets retained in the receivership of the covered broker or 
        dealer and not transferred to the bridge financial company 
        shall be administered under the Securities Investor Protection 
        Act of 1970 (15 U.S.C. 78aaa et seq.) by SIPC, as trustee for 
        the covered broker or dealer.
            (C) Definition of filing date.--For purposes of the 
        liquidation proceeding, the term ``filing date'' means the date 
        on which the Corporation is appointed as receiver of the 
        covered broker or dealer.
            (D) Determination of claims.--As trustee for the covered 
        broker or dealer, SIPC shall determine and satisfy, consistent 
        with this title and with the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.), all claims against the 
        covered broker or dealer arising on or before the filing date.
    (b) Powers and Duties of SIPC.--
        (1) In general.--Except as provided in this section, upon its 
    appointment as trustee for the liquidation of a covered broker or 
    dealer, SIPC shall have all of the powers and duties provided by 
    the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et 
    seq.), including, without limitation, all rights of action against 
    third parties, and shall conduct such liquidation in accordance 
    with the terms of the Securities Investor Protection Act of 1970 
    (15 U.S.C. 78aaa et seq.), except that SIPC shall have no powers or 
    duties with respect to assets and liabilities transferred by the 
    Corporation from the covered broker or dealer to any bridge 
    financial company established in accordance with this title.
        (2) Limitation of powers.--The exercise by SIPC of powers and 
    functions as trustee under subsection (a) shall not impair or 
    impede the exercise of the powers and duties of the Corporation 
    with regard to--
            (A) any action, except as otherwise provided in this 
        title--
                (i) to make funds available under section 204(d);
                (ii) to organize, establish, operate, or terminate any 
            bridge financial company;
                (iii) to transfer assets and liabilities;
                (iv) to enforce or repudiate contracts; or
                (v) to take any other action relating to such bridge 
            financial company under section 210; or
            (B) determining claims under subsection (e).
        (3) Protective decree.--SIPC and the Corporation, in 
    consultation with the Commission, shall jointly determine the terms 
    of the protective decree to be filed by SIPC with any court of 
    competent jurisdiction under section 21 or 27 of the Securities 
    Exchange Act of 1934 (15 U.S.C. 78u, 78aa), as required by 
    subsection (a).
        (4) Qualified financial contracts.--Notwithstanding any 
    provision of the Securities Investor Protection Act of 1970 (15 
    U.S.C. 78aaa et seq.) to the contrary (including section 5(b)(2)(C) 
    of that Act (15 U.S.C. 78eee(b)(2)(C))), the rights and obligations 
    of any party to a qualified financial contract (as that term is 
    defined in section 210(c)(8)) to which a covered broker or dealer 
    for which the Corporation has been appointed receiver is a party 
    shall be governed exclusively by section 210, including the 
    limitations and restrictions contained in section 210(c)(10)(B).
    (c) Limitation on Court Action.--Except as otherwise provided in 
this title, no court may take any action, including any action pursuant 
to the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et 
seq.) or the Bankruptcy Code, to restrain or affect the exercise of 
powers or functions of the Corporation as receiver for a covered broker 
or dealer and any claims against the Corporation as such receiver shall 
be determined in accordance with subsection (e) and such claims shall 
be limited to money damages.
    (d) Actions by Corporation as Receiver.--
        (1) In general.--Notwithstanding any other provision of this 
    title, no action taken by the Corporation as receiver with respect 
    to a covered broker or dealer shall--
            (A) adversely affect the rights of a customer to customer 
        property or customer name securities;
            (B) diminish the amount or timely payment of net equity 
        claims of customers; or
            (C) otherwise impair the recoveries provided to a customer 
        under the Securities Investor Protection Act of 1970 (15 U.S.C. 
        78aaa et seq.).
        (2) Net proceeds.--The net proceeds from any transfer, sale, or 
    disposition of assets of the covered broker or dealer, or proceeds 
    thereof by the Corporation as receiver for the covered broker or 
    dealer shall be for the benefit of the estate of the covered broker 
    or dealer, as provided in this title.
    (e) Claims Against the Corporation as Receiver.--Any claim against 
the Corporation as receiver for a covered broker or dealer for assets 
transferred to a bridge financial company established with respect to 
such covered broker or dealer--
        (1) shall be determined in accordance with section 210(a)(2); 
    and
        (2) may be reviewed by the appropriate district or territorial 
    court of the United States in accordance with section 210(a)(5).
    (f) Satisfaction of Customer Claims.--
        (1) Obligations to customers.--Notwithstanding any other 
    provision of this title, all obligations of a covered broker or 
    dealer or of any bridge financial company established with respect 
    to such covered broker or dealer to a customer relating to, or net 
    equity claims based upon, customer property or customer name 
    securities shall be promptly discharged by SIPC, the Corporation, 
    or the bridge financial company, as applicable, by the delivery of 
    securities or the making of payments to or for the account of such 
    customer, in a manner and in an amount at least as beneficial to 
    the customer as would have been the case had the actual proceeds 
    realized from the liquidation of the covered broker or dealer under 
    this title been distributed in a proceeding under the Securities 
    Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) without 
    the appointment of the Corporation as receiver and without any 
    transfer of assets or liabilities to a bridge financial company, 
    and with a filing date as of the date on which the Corporation is 
    appointed as receiver.
        (2) Satisfaction of claims by sipc.--SIPC, as trustee for a 
    covered broker or dealer, shall satisfy customer claims in the 
    manner and amount provided under the Securities Investor Protection 
    Act of 1970 (15 U.S.C. 78aaa et seq.), as if the appointment of the 
    Corporation as receiver had not occurred, and with a filing date as 
    of the date on which the Corporation is appointed as receiver. The 
    Corporation shall satisfy customer claims, to the extent that a 
    customer would have received more securities or cash with respect 
    to the allocation of customer property had the covered financial 
    company been subject to a proceeding under the Securities Investor 
    Protection Act (15 U.S.C. 78aaa et seq.) without the appointment of 
    the Corporation as receiver, and with a filing date as of the date 
    on which the Corporation is appointed as receiver.
    (g) Priorities.--
        (1) Customer property.--As trustee for a covered broker or 
    dealer, SIPC shall allocate customer property and deliver customer 
    name securities in accordance with section 8(c) of the Securities 
    Investor Protection Act of 1970 (15 U.S.C. 78fff-2(c)).
        (2) Other claims.--All claims other than those described in 
    paragraph (1) (including any unpaid claim by a customer for the 
    allowed net equity claim of such customer from customer property) 
    shall be paid in accordance with the priorities in section 210(b).
    (h) Rulemaking.--The Commission and the Corporation, after 
consultation with SIPC, shall jointly issue rules to implement this 
section.
    SEC. 206. MANDATORY TERMS AND CONDITIONS FOR ALL ORDERLY 
      LIQUIDATION ACTIONS.
    In taking action under this title, the Corporation shall--
        (1) determine that such action is necessary for purposes of the 
    financial stability of the United States, and not for the purpose 
    of preserving the covered financial company;
        (2) ensure that the shareholders of a covered financial company 
    do not receive payment until after all other claims and the Fund 
    are fully paid;
        (3) ensure that unsecured creditors bear losses in accordance 
    with the priority of claim provisions in section 210;
        (4) ensure that management responsible for the failed condition 
    of the covered financial company is removed (if such management has 
    not already been removed at the time at which the Corporation is 
    appointed receiver);
        (5) ensure that the members of the board of directors (or body 
    performing similar functions) responsible for the failed condition 
    of the covered financial company are removed, if such members have 
    not already been removed at the time the Corporation is appointed 
    as receiver; and
        (6) not take an equity interest in or become a shareholder of 
    any covered financial company or any covered subsidiary.
    SEC. 207. DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINTMENT OF 
      RECEIVER.
    The members of the board of directors (or body performing similar 
functions) of a covered financial company shall not be liable to the 
shareholders or creditors thereof for acquiescing in or consenting in 
good faith to the appointment of the Corporation as receiver for the 
covered financial company under section 203.
    SEC. 208. DISMISSAL AND EXCLUSION OF OTHER ACTIONS.
    (a) In General.--Effective as of the date of the appointment of the 
Corporation as receiver for the covered financial company under section 
202 or the appointment of SIPC as trustee for a covered broker or 
dealer under section 205, as applicable, any case or proceeding 
commenced with respect to the covered financial company under the 
Bankruptcy Code or the Securities Investor Protection Act of 1970 (15 
U.S.C. 78aaa et seq.) shall be dismissed, upon notice to the bankruptcy 
court (with respect to a case commenced under the Bankruptcy Code), and 
upon notice to SIPC (with respect to a covered broker or dealer) and no 
such case or proceeding may be commenced with respect to a covered 
financial company at any time while the orderly liquidation is pending.
    (b) Revesting of Assets.--Effective as of the date of appointment 
of the Corporation as receiver, the assets of a covered financial 
company shall, to the extent they have vested in any entity other than 
the covered financial company as a result of any case or proceeding 
commenced with respect to the covered financial company under the 
Bankruptcy Code, the Securities Investor Protection Act of 1970 (15 
U.S.C. 78aaa et seq.), or any similar provision of State liquidation or 
insolvency law applicable to the covered financial company, revest in 
the covered financial company.
    (c) Limitation.--Notwithstanding subsections (a) and (b), any order 
entered or other relief granted by a bankruptcy court prior to the date 
of appointment of the Corporation as receiver shall continue with the 
same validity as if an orderly liquidation had not been commenced.
    SEC. 209. RULEMAKING; NON-CONFLICTING LAW.
    The Corporation shall, in consultation with the Council, prescribe 
such rules or regulations as the Corporation considers necessary or 
appropriate to implement this title, including rules and regulations 
with respect to the rights, interests, and priorities of creditors, 
counterparties, security entitlement holders, or other persons with 
respect to any covered financial company or any assets or other 
property of or held by such covered financial company, and address the 
potential for conflicts of interest between or among individual 
receiverships established under this title or under the Federal Deposit 
Insurance Act. To the extent possible, the Corporation shall seek to 
harmonize applicable rules and regulations promulgated under this 
section with the insolvency laws that would otherwise apply to a 
covered financial company.
    SEC. 210. POWERS AND DUTIES OF THE CORPORATION.
    (a) Powers and Authorities.--
        (1) General powers.--
            (A) Successor to covered financial company.--The 
        Corporation shall, upon appointment as receiver for a covered 
        financial company under this title, succeed to--
                (i) all rights, titles, powers, and privileges of the 
            covered financial company and its assets, and of any 
            stockholder, member, officer, or director of such company; 
            and
                (ii) title to the books, records, and assets of any 
            previous receiver or other legal custodian of such covered 
            financial company.
            (B) Operation of the covered financial company during the 
        period of orderly liquidation.--The Corporation, as receiver 
        for a covered financial company, may--
                (i) take over the assets of and operate the covered 
            financial company with all of the powers of the members or 
            shareholders, the directors, and the officers of the 
            covered financial company, and conduct all business of the 
            covered financial company;
                (ii) collect all obligations and money owed to the 
            covered financial company;
                (iii) perform all functions of the covered financial 
            company, in the name of the covered financial company;
                (iv) manage the assets and property of the covered 
            financial company, consistent with maximization of the 
            value of the assets in the context of the orderly 
            liquidation; and
                (v) provide by contract for assistance in fulfilling 
            any function, activity, action, or duty of the Corporation 
            as receiver.
            (C) Functions of covered financial company officers, 
        directors, and shareholders.--The Corporation may provide for 
        the exercise of any function by any member or stockholder, 
        director, or officer of any covered financial company for which 
        the Corporation has been appointed as receiver under this 
        title.
            (D) Additional powers as receiver.--The Corporation shall, 
        as receiver for a covered financial company, and subject to all 
        legally enforceable and perfected security interests and all 
        legally enforceable security entitlements in respect of assets 
        held by the covered financial company, liquidate, and wind-up 
        the affairs of a covered financial company, including taking 
        steps to realize upon the assets of the covered financial 
        company, in such manner as the Corporation deems appropriate, 
        including through the sale of assets, the transfer of assets to 
        a bridge financial company established under subsection (h), or 
        the exercise of any other rights or privileges granted to the 
        receiver under this section.
            (E) Additional powers with respect to failing subsidiaries 
        of a covered financial company.--
                (i) In general.--In any case in which a receiver is 
            appointed for a covered financial company under section 
            202, the Corporation may appoint itself as receiver of any 
            covered subsidiary of the covered financial company that is 
            organized under Federal law or the laws of any State, if 
            the Corporation and the Secretary jointly determine that--

                    (I) the covered subsidiary is in default or in 
                danger of default;
                    (II) such action would avoid or mitigate serious 
                adverse effects on the financial stability or economic 
                conditions of the United States; and
                    (III) such action would facilitate the orderly 
                liquidation of the covered financial company.

                (ii) Treatment as covered financial company.--If the 
            Corporation is appointed as receiver of a covered 
            subsidiary of a covered financial company under clause (i), 
            the covered subsidiary shall thereafter be considered a 
            covered financial company under this title, and the 
            Corporation shall thereafter have all the powers and rights 
            with respect to that covered subsidiary as it has with 
            respect to a covered financial company under this title.
            (F) Organization of bridge companies.--The Corporation, as 
        receiver for a covered financial company, may organize a bridge 
        financial company under subsection (h).
            (G) Merger; transfer of assets and liabilities.--
                (i) In general.--Subject to clauses (ii) and (iii), the 
            Corporation, as receiver for a covered financial company, 
            may--

                    (I) merge the covered financial company with 
                another company; or
                    (II) transfer any asset or liability of the covered 
                financial company (including any assets and liabilities 
                held by the covered financial company for security 
                entitlement holders, any customer property, or any 
                assets and liabilities associated with any trust or 
                custody business) without obtaining any approval, 
                assignment, or consent with respect to such transfer.

                (ii) Federal agency approval; antitrust review.--With 
            respect to a transaction described in clause (i)(I) that 
            requires approval by a Federal agency--

                    (I) the transaction may not be consummated before 
                the 5th calendar day after the date of approval by the 
                Federal agency responsible for such approval;
                    (II) if, in connection with any such approval, a 
                report on competitive factors is required, the Federal 
                agency responsible for such approval shall promptly 
                notify the Attorney General of the United States of the 
                proposed transaction, and the Attorney General shall 
                provide the required report not later than 10 days 
                after the date of the request; and
                    (III) if notification under section 7A of the 
                Clayton Act is required with respect to such 
                transaction, then the required waiting period shall end 
                on the 15th day after the date on which the Attorney 
                General and the Federal Trade Commission receive such 
                notification, unless the waiting period is terminated 
                earlier under subsection (b)(2) of such section 7A, or 
                is extended pursuant to subsection (e)(2) of such 
                section 7A.

                (iii) Setoff.--Subject to the other provisions of this 
            title, any transferee of assets from a receiver, including 
            a bridge financial company, shall be subject to such claims 
            or rights as would prevail over the rights of such 
            transferee in such assets under applicable noninsolvency 
            law.
            (H) Payment of valid obligations.--The Corporation, as 
        receiver for a covered financial company, shall, to the extent 
        that funds are available, pay all valid obligations of the 
        covered financial company that are due and payable at the time 
        of the appointment of the Corporation as receiver, in 
        accordance with the prescriptions and limitations of this 
        title.
            (I) Applicable noninsolvency law.--Except as may otherwise 
        be provided in this title, the applicable noninsolvency law 
        shall be determined by the noninsolvency choice of law rules 
        otherwise applicable to the claims, rights, titles, persons, or 
        entities at issue.
            (J) Subpoena authority.--
                (i) In general.--The Corporation, as receiver for a 
            covered financial company, may, for purposes of carrying 
            out any power, authority, or duty with respect to the 
            covered financial company (including determining any claim 
            against the covered financial company and determining and 
            realizing upon any asset of any person in the course of 
            collecting money due the covered financial company), 
            exercise any power established under section 8(n) of the 
            Federal Deposit Insurance Act, as if the Corporation were 
            the appropriate Federal banking agency for the covered 
            financial company, and the covered financial company were 
            an insured depository institution.
                (ii) Rule of construction.--This subparagraph may not 
            be construed as limiting any rights that the Corporation, 
            in any capacity, might otherwise have to exercise any 
            powers described in clause (i) or under any other provision 
            of law.
            (K) Incidental powers.--The Corporation, as receiver for a 
        covered financial company, may exercise all powers and 
        authorities specifically granted to receivers under this title, 
        and such incidental powers as shall be necessary to carry out 
        such powers under this title.
            (L) Utilization of private sector.--In carrying out its 
        responsibilities in the management and disposition of assets 
        from the covered financial company, the Corporation, as 
        receiver for a covered financial company, may utilize the 
        services of private persons, including real estate and loan 
        portfolio asset management, property management, auction 
        marketing, legal, and brokerage services, if such services are 
        available in the private sector, and the Corporation determines 
        that utilization of such services is practicable, efficient, 
        and cost effective.
            (M) Shareholders and creditors of covered financial 
        company.--Notwithstanding any other provision of law, the 
        Corporation, as receiver for a covered financial company, shall 
        succeed by operation of law to the rights, titles, powers, and 
        privileges described in subparagraph (A), and shall terminate 
        all rights and claims that the stockholders and creditors of 
        the covered financial company may have against the assets of 
        the covered financial company or the Corporation arising out of 
        their status as stockholders or creditors, except for their 
        right to payment, resolution, or other satisfaction of their 
        claims, as permitted under this section. The Corporation shall 
        ensure that shareholders and unsecured creditors bear losses, 
        consistent with the priority of claims provisions under this 
        section.
            (N) Coordination with foreign financial authorities.--The 
        Corporation, as receiver for a covered financial company, shall 
        coordinate, to the maximum extent possible, with the 
        appropriate foreign financial authorities regarding the orderly 
        liquidation of any covered financial company that has assets or 
        operations in a country other than the United States.
            (O) Restriction on transfers.--
                (i) Selection of accounts for transfer.--If the 
            Corporation establishes one or more bridge financial 
            companies with respect to a covered broker or dealer, the 
            Corporation shall transfer to one of such bridge financial 
            companies, all customer accounts of the covered broker or 
            dealer, and all associated customer name securities and 
            customer property, unless the Corporation, after consulting 
            with the Commission and SIPC, determines that--

                    (I) the customer accounts, customer name 
                securities, and customer property are likely to be 
                promptly transferred to another broker or dealer that 
                is registered with the Commission under section 15(b) 
                of the Securities Exchange Act of 1934 (15 U.S.C. 
                73o(b)) and is a member of SIPC; or
                    (II) the transfer of the accounts to a bridge 
                financial company would materially interfere with the 
                ability of the Corporation to avoid or mitigate serious 
                adverse effects on financial stability or economic 
                conditions in the United States.

                (ii) Transfer of property.--SIPC, as trustee for the 
            liquidation of the covered broker or dealer, and the 
            Commission shall provide any and all reasonable assistance 
            necessary to complete such transfers by the Corporation.
                (iii) Customer consent and court approval not 
            required.--Neither customer consent nor court approval 
            shall be required to transfer any customer accounts or 
            associated customer name securities or customer property to 
            a bridge financial company in accordance with this section.
                (iv) Notification of sipc and sharing of information.--
            The Corporation shall identify to SIPC the customer 
            accounts and associated customer name securities and 
            customer property transferred to the bridge financial 
            company. The Corporation and SIPC shall cooperate in the 
            sharing of any information necessary for each entity to 
            discharge its obligations under this title and under the 
            Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa 
            et seq.) including by providing access to the books and 
            records of the covered financial company and any bridge 
            financial company established in accordance with this 
            title.
        (2) Determination of claims.--
            (A) In general.--The Corporation, as receiver for a covered 
        financial company, shall report on claims, as set forth in 
        section 203(c)(3). Subject to paragraph (4) of this subsection, 
        the Corporation, as receiver for a covered financial company, 
        shall determine claims in accordance with the requirements of 
        this subsection and regulations prescribed under section 209.
            (B) Notice requirements.--The Corporation, as receiver for 
        a covered financial company, in any case involving the 
        liquidation or winding up of the affairs of a covered financial 
        company, shall--
                (i) promptly publish a notice to the creditors of the 
            covered financial company to present their claims, together 
            with proof, to the receiver by a date specified in the 
            notice, which shall be not earlier than 90 days after the 
            date of publication of such notice; and
                (ii) republish such notice 1 month and 2 months, 
            respectively, after the date of publication under clause 
            (i).
            (C) Mailing required.--The Corporation as receiver shall 
        mail a notice similar to the notice published under clause (i) 
        or (ii) of subparagraph (B), at the time of such publication, 
        to any creditor shown on the books and records of the covered 
        financial company--
                (i) at the last address of the creditor appearing in 
            such books;
                (ii) in any claim filed by the claimant; or
                (iii) upon discovery of the name and address of a 
            claimant not appearing on the books and records of the 
            covered financial company, not later than 30 days after the 
            date of the discovery of such name and address.
        (3) Procedures for resolution of claims.--
            (A) Decision period.--
                (i) In general.--Prior to the 180th day after the date 
            on which a claim against a covered financial company is 
            filed with the Corporation as receiver, or such later date 
            as may be agreed as provided in clause (ii), the 
            Corporation shall notify the claimant whether it allows or 
            disallows the claim, in accordance with subparagraphs (B), 
            (C), and (D).
                (ii) Extension of time.--By written agreement executed 
            not later than 180 days after the date on which a claim 
            against a covered financial company is filed with the 
            Corporation, the period described in clause (i) may be 
            extended by written agreement between the claimant and the 
            Corporation. Failure to notify the claimant of any 
            disallowance within the time period set forth in clause 
            (i), as it may be extended by agreement under this clause, 
            shall be deemed to be a disallowance of such claim, and the 
            claimant may file or continue an action in court, as 
            provided in paragraph (4).
                (iii) Mailing of notice sufficient.--The requirements 
            of clause (i) shall be deemed to be satisfied if the notice 
            of any decision with respect to any claim is mailed to the 
            last address of the claimant which appears--

                    (I) on the books, records, or both of the covered 
                financial company;
                    (II) in the claim filed by the claimant; or
                    (III) in documents submitted in proof of the claim.

                (iv) Contents of notice of disallowance.--If the 
            Corporation as receiver disallows any claim filed under 
            clause (i), the notice to the claimant shall contain--

                    (I) a statement of each reason for the 
                disallowance; and
                    (II) the procedures required to file or continue an 
                action in court, as provided in paragraph (4).

            (B) Allowance of proven claim.--The receiver shall allow 
        any claim received by the receiver on or before the date 
        specified in the notice under paragraph (2)(B)(i), which is 
        proved to the satisfaction of the receiver.
            (C) Disallowance of claims filed after end of filing 
        period.--
                (i) In general.--Except as provided in clause (ii), 
            claims filed after the date specified in the notice 
            published under paragraph (2)(B)(i) shall be disallowed, 
            and such disallowance shall be final.
                (ii) Certain exceptions.--Clause (i) shall not apply 
            with respect to any claim filed by a claimant after the 
            date specified in the notice published under paragraph 
            (2)(B)(i), and such claim may be considered by the receiver 
            under subparagraph (B), if--

                    (I) the claimant did not receive notice of the 
                appointment of the receiver in time to file such claim 
                before such date; and
                    (II) such claim is filed in time to permit payment 
                of such claim.

            (D) Authority to disallow claims.--
                (i) In general.--The Corporation may disallow any 
            portion of any claim by a creditor or claim of a security, 
            preference, setoff, or priority which is not proved to the 
            satisfaction of the Corporation.
                (ii) Payments to undersecured creditors.--In the case 
            of a claim against a covered financial company that is 
            secured by any property or other asset of such covered 
            financial company, the receiver--

                    (I) may treat the portion of such claim which 
                exceeds an amount equal to the fair market value of 
                such property or other asset as an unsecured claim; and
                    (II) may not make any payment with respect to such 
                unsecured portion of the claim, other than in 
                connection with the disposition of all claims of 
                unsecured creditors of the covered financial company.

                (iii) Exceptions.--No provision of this paragraph shall 
            apply with respect to--

                    (I) any extension of credit from any Federal 
                reserve bank, or the Corporation, to any covered 
                financial company; or
                    (II) subject to clause (ii), any legally 
                enforceable and perfected security interest in the 
                assets of the covered financial company securing any 
                such extension of credit.

            (E) Legal effect of filing.--
                (i) Statute of limitations tolled.--For purposes of any 
            applicable statute of limitations, the filing of a claim 
            with the receiver shall constitute a commencement of an 
            action.
                (ii) No prejudice to other actions.--Subject to 
            paragraph (8), the filing of a claim with the receiver 
            shall not prejudice any right of the claimant to continue 
            any action which was filed before the date of appointment 
            of the receiver for the covered financial company.
        (4) Judicial determination of claims.--
            (A) In general.--Subject to subparagraph (B), a claimant 
        may file suit on a claim (or continue an action commenced 
        before the date of appointment of the Corporation as receiver) 
        in the district or territorial court of the United States for 
        the district within which the principal place of business of 
        the covered financial company is located (and such court shall 
        have jurisdiction to hear such claim).
            (B) Timing.--A claim under subparagraph (A) may be filed 
        before the end of the 60-day period beginning on the earlier 
        of--
                (i) the end of the period described in paragraph 
            (3)(A)(i) (or, if extended by agreement of the Corporation 
            and the claimant, the period described in paragraph 
            (3)(A)(ii)) with respect to any claim against a covered 
            financial company for which the Corporation is receiver; or
                (ii) the date of any notice of disallowance of such 
            claim pursuant to paragraph (3)(A)(i).
            (C) Statute of limitations.--If any claimant fails to file 
        suit on such claim (or to continue an action on such claim 
        commenced before the date of appointment of the Corporation as 
        receiver) prior to the end of the 60-day period described in 
        subparagraph (B), the claim shall be deemed to be disallowed 
        (other than any portion of such claim which was allowed by the 
        receiver) as of the end of such period, such disallowance shall 
        be final, and the claimant shall have no further rights or 
        remedies with respect to such claim.
        (5) Expedited determination of claims.--
            (A) Procedure required.--The Corporation shall establish a 
        procedure for expedited relief outside of the claims process 
        established under paragraph (3), for any claimant that 
        alleges--
                (i) having a legally valid and enforceable or perfected 
            security interest in property of a covered financial 
            company or control of any legally valid and enforceable 
            security entitlement in respect of any asset held by the 
            covered financial company for which the Corporation has 
            been appointed receiver; and
                (ii) that irreparable injury will occur if the claims 
            procedure established under paragraph (3) is followed.
            (B) Determination period.--Prior to the end of the 90-day 
        period beginning on the date on which a claim is filed in 
        accordance with the procedures established pursuant to 
        subparagraph (A), the Corporation shall--
                (i) determine--

                    (I) whether to allow or disallow such claim, or any 
                portion thereof; or
                    (II) whether such claim should be determined 
                pursuant to the procedures established pursuant to 
                paragraph (3);

                (ii) notify the claimant of the determination; and
                (iii) if the claim is disallowed, provide a statement 
            of each reason for the disallowance and the procedure for 
            obtaining a judicial determination.
            (C) Period for filing or renewing suit.--Any claimant who 
        files a request for expedited relief shall be permitted to file 
        suit (or continue a suit filed before the date of appointment 
        of the Corporation as receiver seeking a determination of the 
        rights of the claimant with respect to such security interest 
        (or such security entitlement) after the earlier of--
                (i) the end of the 90-day period beginning on the date 
            of the filing of a request for expedited relief; or
                (ii) the date on which the Corporation denies the claim 
            or a portion thereof.
            (D) Statute of limitations.--If an action described in 
        subparagraph (C) is not filed, or the motion to renew a 
        previously filed suit is not made, before the end of the 30-day 
        period beginning on the date on which such action or motion may 
        be filed in accordance with subparagraph (C), the claim shall 
        be deemed to be disallowed as of the end of such period (other 
        than any portion of such claim which was allowed by the 
        receiver), such disallowance shall be final, and the claimant 
        shall have no further rights or remedies with respect to such 
        claim.
            (E) Legal effect of filing.--
                (i) Statute of limitations tolled.--For purposes of any 
            applicable statute of limitations, the filing of a claim 
            with the receiver shall constitute a commencement of an 
            action.
                (ii) No prejudice to other actions.--Subject to 
            paragraph (8), the filing of a claim with the receiver 
            shall not prejudice any right of the claimant to continue 
            any action which was filed before the appointment of the 
            Corporation as receiver for the covered financial company.
        (6) Agreements against interest of the receiver.--No agreement 
    that tends to diminish or defeat the interest of the Corporation as 
    receiver in any asset acquired by the receiver under this section 
    shall be valid against the receiver, unless such agreement--
            (A) is in writing;
            (B) was executed by an authorized officer or representative 
        of the covered financial company, or confirmed in the ordinary 
        course of business by the covered financial company; and
            (C) has been, since the time of its execution, an official 
        record of the company or the party claiming under the agreement 
        provides documentation, acceptable to the receiver, of such 
        agreement and its authorized execution or confirmation by the 
        covered financial company.
        (7) Payment of claims.--
            (A) In general.--Subject to subparagraph (B), the 
        Corporation as receiver may, in its discretion and to the 
        extent that funds are available, pay creditor claims, in such 
        manner and amounts as are authorized under this section, which 
        are--
                (i) allowed by the receiver;
                (ii) approved by the receiver pursuant to a final 
            determination pursuant to paragraph (3) or (5), as 
            applicable; or
                (iii) determined by the final judgment of a court of 
            competent jurisdiction.
            (B) Limitation.--A creditor shall, in no event, receive 
        less than the amount that the creditor is entitled to receive 
        under paragraphs (2) and (3) of subsection (d), as applicable.
            (C) Payment of dividends on claims.--The Corporation as 
        receiver may, in its sole discretion, and to the extent 
        otherwise permitted by this section, pay dividends on proven 
        claims at any time, and no liability shall attach to the 
        Corporation as receiver, by reason of any such payment or for 
        failure to pay dividends to a claimant whose claim is not 
        proved at the time of any such payment.
            (D) Rulemaking by the corporation.--The Corporation may 
        prescribe such rules, including definitions of terms, as the 
        Corporation deems appropriate to establish an interest rate for 
        or to make payments of post-insolvency interest to creditors 
        holding proven claims against the receivership estate of a 
        covered financial company, except that no such interest shall 
        be paid until the Corporation as receiver has satisfied the 
        principal amount of all creditor claims.
        (8) Suspension of legal actions.--
            (A) In general.--After the appointment of the Corporation 
        as receiver for a covered financial company, the Corporation 
        may request a stay in any judicial action or proceeding in 
        which such covered financial company is or becomes a party, for 
        a period of not to exceed 90 days.
            (B) Grant of stay by all courts required.--Upon receipt of 
        a request by the Corporation pursuant to subparagraph (A), the 
        court shall grant such stay as to all parties.
        (9) Additional rights and duties.--
            (A) Prior final adjudication.--The Corporation shall abide 
        by any final, non-appealable judgment of any court of competent 
        jurisdiction that was rendered before the appointment of the 
        Corporation as receiver.
            (B) Rights and remedies of receiver.--In the event of any 
        appealable judgment, the Corporation as receiver shall--
                (i) have all the rights and remedies available to the 
            covered financial company (before the date of appointment 
            of the Corporation as receiver under section 202) and the 
            Corporation, including removal to Federal court and all 
            appellate rights; and
                (ii) not be required to post any bond in order to 
            pursue such remedies.
            (C) No attachment or execution.--No attachment or execution 
        may be issued by any court upon assets in the possession of the 
        Corporation as receiver for a covered financial company.
            (D) Limitation on judicial review.--Except as otherwise 
        provided in this title, no court shall have jurisdiction over--
                (i) any claim or action for payment from, or any action 
            seeking a determination of rights with respect to, the 
            assets of any covered financial company for which the 
            Corporation has been appointed receiver, including any 
            assets which the Corporation may acquire from itself as 
            such receiver; or
                (ii) any claim relating to any act or omission of such 
            covered financial company or the Corporation as receiver.
            (E) Disposition of assets.--In exercising any right, power, 
        privilege, or authority as receiver in connection with any 
        covered financial company for which the Corporation is acting 
        as receiver under this section, the Corporation shall, to the 
        greatest extent practicable, conduct its operations in a manner 
        that--
                (i) maximizes the net present value return from the 
            sale or disposition of such assets;
                (ii) minimizes the amount of any loss realized in the 
            resolution of cases;
                (iii) mitigates the potential for serious adverse 
            effects to the financial system;
                (iv) ensures timely and adequate competition and fair 
            and consistent treatment of offerors; and
                (v) prohibits discrimination on the basis of race, sex, 
            or ethnic group in the solicitation and consideration of 
            offers.
        (10) Statute of limitations for actions brought by receiver.--
            (A) In general.--Notwithstanding any provision of any 
        contract, the applicable statute of limitations with regard to 
        any action brought by the Corporation as receiver for a covered 
        financial company shall be--
                (i) in the case of any contract claim, the longer of--

                    (I) the 6-year period beginning on the date on 
                which the claim accrues; or
                    (II) the period applicable under State law; and

                (ii) in the case of any tort claim, the longer of--

                    (I) the 3-year period beginning on the date on 
                which the claim accrues; or
                    (II) the period applicable under State law.

            (B) Date on which a claim accrues.--For purposes of 
        subparagraph (A), the date on which the statute of limitations 
        begins to run on any claim described in subparagraph (A) shall 
        be the later of--
                (i) the date of the appointment of the Corporation as 
            receiver under this title; or
                (ii) the date on which the cause of action accrues.
            (C) Revival of expired state causes of action.--
                (i) In general.--In the case of any tort claim 
            described in clause (ii) for which the applicable statute 
            of limitations under State law has expired not more than 5 
            years before the date of appointment of the Corporation as 
            receiver for a covered financial company, the Corporation 
            may bring an action as receiver on such claim without 
            regard to the expiration of the statute of limitations.
                (ii) Claims described.--A tort claim referred to in 
            clause (i) is a claim arising from fraud, intentional 
            misconduct resulting in unjust enrichment, or intentional 
            misconduct resulting in substantial loss to the covered 
            financial company.
        (11) Avoidable transfers.--
            (A) Fraudulent transfers.--The Corporation, as receiver for 
        any covered financial company, may avoid a transfer of any 
        interest of the covered financial company in property, or any 
        obligation incurred by the covered financial company, that was 
        made or incurred at or within 2 years before the date on which 
        the Corporation was appointed receiver, if--
                (i) the covered financial company voluntarily or 
            involuntarily--

                    (I) made such transfer or incurred such obligation 
                with actual intent to hinder, delay, or defraud any 
                entity to which the covered financial company was or 
                became, on or after the date on which such transfer was 
                made or such obligation was incurred, indebted; or
                    (II) received less than a reasonably equivalent 
                value in exchange for such transferor obligation; and

                (ii) the covered financial company voluntarily or 
            involuntarily--

                    (I) was insolvent on the date that such transfer 
                was made or such obligation was incurred, or became 
                insolvent as a result of such transfer or obligation;
                    (II) was engaged in business or a transaction, or 
                was about to engage in business or a transaction, for 
                which any property remaining with the covered financial 
                company was an unreasonably small capital;
                    (III) intended to incur, or believed that the 
                covered financial company would incur, debts that would 
                be beyond the ability of the covered financial company 
                to pay as such debts matured; or
                    (IV) made such transfer to or for the benefit of an 
                insider, or incurred such obligation to or for the 
                benefit of an insider, under an employment contract and 
                not in the ordinary course of business.

            (B) Preferential transfers.--The Corporation as receiver 
        for any covered financial company may avoid a transfer of an 
        interest of the covered financial company in property--
                (i) to or for the benefit of a creditor;
                (ii) for or on account of an antecedent debt that was 
            owed by the covered financial company before the transfer 
            was made;
                (iii) that was made while the covered financial company 
            was insolvent;
                (iv) that was made--

                    (I) 90 days or less before the date on which the 
                Corporation was appointed receiver; or
                    (II) more than 90 days, but less than 1 year before 
                the date on which the Corporation was appointed 
                receiver, if such creditor at the time of the transfer 
                was an insider; and

                (v) that enables the creditor to receive more than the 
            creditor would receive if--

                    (I) the covered financial company had been 
                liquidated under chapter 7 of the Bankruptcy Code;
                    (II) the transfer had not been made; and
                    (III) the creditor received payment of such debt to 
                the extent provided by the provisions of chapter 7 of 
                the Bankruptcy Code.

            (C) Post-receivership transactions.--The Corporation as 
        receiver for any covered financial company may avoid a transfer 
        of property of the receivership that occurred after the 
        Corporation was appointed receiver that was not authorized 
        under this title by the Corporation as receiver.
            (D) Right of recovery.--To the extent that a transfer is 
        avoided under subparagraph (A), (B), or (C), the Corporation 
        may recover, for the benefit of the covered financial company, 
        the property transferred or, if a court so orders, the value of 
        such property (at the time of such transfer) from--
                (i) the initial transferee of such transfer or the 
            person for whose benefit such transfer was made; or
                (ii) any immediate or mediate transferee of any such 
            initial transferee.
            (E) Rights of transferee or obligee.--The Corporation may 
        not recover under subparagraph (D)(ii) from--
                (i) any transferee that takes for value, including in 
            satisfaction of or to secure a present or antecedent debt, 
            in good faith, and without knowledge of the voidability of 
            the transfer avoided; or
                (ii) any immediate or mediate good faith transferee of 
            such transferee.
            (F) Defenses.--Subject to the other provisions of this 
        title--
                (i) a transferee or obligee from which the Corporation 
            seeks to recover a transfer or to avoid an obligation under 
            subparagraph (A), (B), (C), or (D) shall have the same 
            defenses available to a transferee or obligee from which a 
            trustee seeks to recover a transfer or avoid an obligation 
            under sections 547, 548, and 549 of the Bankruptcy Code; 
            and
                (ii) the authority of the Corporation to recover a 
            transfer or avoid an obligation shall be subject to 
            subsections (b) and (c) of section 546, section 547(c), and 
            section 548(c) of the Bankruptcy Code.
            (G) Rights under this section.--The rights of the 
        Corporation as receiver under this section shall be superior to 
        any rights of a trustee or any other party (other than a 
        Federal agency) under the Bankruptcy Code.
            (H) Rules of construction; definitions.--For purposes of--
                (i) subparagraphs (A) and (B)--

                    (I) the term ``insider'' has the same meaning as in 
                section 101(31) of the Bankruptcy Code;
                    (II) a transfer is made when such transfer is so 
                perfected that a bona fide purchaser from the covered 
                financial company against whom applicable law permits 
                such transfer to be perfected cannot acquire an 
                interest in the property transferred that is superior 
                to the interest in such property of the transferee, but 
                if such transfer is not so perfected before the date on 
                which the Corporation is appointed as receiver for the 
                covered financial company, such transfer is made 
                immediately before the date of such appointment; and
                    (III) the term ``value'' means property, or 
                satisfaction or securing of a present or antecedent 
                debt of the covered financial company, but does not 
                include an unperformed promise to furnish support to 
                the covered financial company; and

                (ii) subparagraph (B)--

                    (I) the covered financial company is presumed to 
                have been insolvent on and during the 90-day period 
                immediately preceding the date of appointment of the 
                Corporation as receiver; and
                    (II) the term ``insolvent'' has the same meaning as 
                in section 101(32) of the Bankruptcy Code.

        (12) Setoff.--
            (A) Generally.--Except as otherwise provided in this title, 
        any right of a creditor to offset a mutual debt owed by the 
        creditor to any covered financial company that arose before the 
        Corporation was appointed as receiver for the covered financial 
        company against a claim of such creditor may be asserted if 
        enforceable under applicable noninsolvency law, except to the 
        extent that--
                (i) the claim of the creditor against the covered 
            financial company is disallowed;
                (ii) the claim was transferred, by an entity other than 
            the covered financial company, to the creditor--

                    (I) after the Corporation was appointed as receiver 
                of the covered financial company; or
                    (II)(aa) after the 90-day period preceding the date 
                on which the Corporation was appointed as receiver for 
                the covered financial company; and
                    (bb) while the covered financial company was 
                insolvent (except for a setoff in connection with a 
                qualified financial contract); or

                (iii) the debt owed to the covered financial company 
            was incurred by the covered financial company--

                    (I) after the 90-day period preceding the date on 
                which the Corporation was appointed as receiver for the 
                covered financial company;
                    (II) while the covered financial company was 
                insolvent; and
                    (III) for the purpose of obtaining a right of 
                setoff against the covered financial company (except 
                for a setoff in connection with a qualified financial 
                contract).

            (B) Insufficiency.--
                (i) In general.--Except with respect to a setoff in 
            connection with a qualified financial contract, if a 
            creditor offsets a mutual debt owed to the covered 
            financial company against a claim of the covered financial 
            company on or within the 90-day period preceding the date 
            on which the Corporation is appointed as receiver for the 
            covered financial company, the Corporation may recover from 
            the creditor the amount so offset, to the extent that any 
            insufficiency on the date of such setoff is less than the 
            insufficiency on the later of--

                    (I) the date that is 90 days before the date on 
                which the Corporation is appointed as receiver for the 
                covered financial company; or
                    (II) the first day on which there is an 
                insufficiency during the 90-day period preceding the 
                date on which the Corporation is appointed as receiver 
                for the covered financial company.

                (ii) Definition of insufficiency.--In this 
            subparagraph, the term ``insufficiency'' means the amount, 
            if any, by which a claim against the covered financial 
            company exceeds a mutual debt owed to the covered financial 
            company by the holder of such claim.
            (C) Insolvency.--The term ``insolvent'' has the same 
        meaning as in section 101(32) of the Bankruptcy Code.
            (D) Presumption of insolvency.--For purposes of this 
        paragraph, the covered financial company is presumed to have 
        been insolvent on and during the 90-day period preceding the 
        date of appointment of the Corporation as receiver.
            (E) Limitation.--Nothing in this paragraph (12) shall be 
        the basis for any right of setoff where no such right exists 
        under applicable noninsolvency law.
            (F) Priority claim.--Except as otherwise provided in this 
        title, the Corporation as receiver for the covered financial 
        company may sell or transfer any assets free and clear of the 
        setoff rights of any party, except that such party shall be 
        entitled to a claim, subordinate to the claims payable under 
        subparagraphs (A), (B), (C), and (D) of subsection (b)(1), but 
        senior to all other unsecured liabilities defined in subsection 
        (b)(1)(E), in an amount equal to the value of such setoff 
        rights.
        (13) Attachment of assets and other injunctive relief.--Subject 
    to paragraph (14), any court of competent jurisdiction may, at the 
    request of the Corporation as receiver for a covered financial 
    company, issue an order in accordance with Rule 65 of the Federal 
    Rules of Civil Procedure, including an order placing the assets of 
    any person designated by the Corporation under the control of the 
    court and appointing a trustee to hold such assets.
        (14) Standards.--
            (A) Showing.--Rule 65 of the Federal Rules of Civil 
        Procedure shall apply with respect to any proceeding under 
        paragraph (13), without regard to the requirement that the 
        applicant show that the injury, loss, or damage is irreparable 
        and immediate.
            (B) State proceeding.--If, in the case of any proceeding in 
        a State court, the court determines that rules of civil 
        procedure available under the laws of the State provide 
        substantially similar protections of the right of the parties 
        to due process as provided under Rule 65 (as modified with 
        respect to such proceeding by subparagraph (A)), the relief 
        sought by the Corporation pursuant to paragraph (14) may be 
        requested under the laws of such State.
        (15) Treatment of claims arising from breach of contracts 
    executed by the corporation as receiver.--Notwithstanding any other 
    provision of this title, any final and non-appealable judgment for 
    monetary damages entered against the Corporation as receiver for a 
    covered financial company for the breach of an agreement executed 
    or approved by the Corporation after the date of its appointment 
    shall be paid as an administrative expense of the receiver. Nothing 
    in this paragraph shall be construed to limit the power of a 
    receiver to exercise any rights under contract or law, including to 
    terminate, breach, cancel, or otherwise discontinue such agreement.
        (16) Accounting and recordkeeping requirements.--
            (A) In general.--The Corporation as receiver for a covered 
        financial company shall, consistent with the accounting and 
        reporting practices and procedures established by the 
        Corporation, maintain a full accounting of each receivership or 
        other disposition of any covered financial company.
            (B) Annual accounting or report.--With respect to each 
        receivership to which the Corporation is appointed, the 
        Corporation shall make an annual accounting or report, as 
        appropriate, available to the Secretary and the Comptroller 
        General of the United States.
            (C) Availability of reports.--Any report prepared pursuant 
        to subparagraph (B) and section 203(c)(3) shall be made 
        available to the public by the Corporation.
            (D) Recordkeeping requirement.--
                (i) In general.--The Corporation shall prescribe such 
            regulations and establish such retention schedules as are 
            necessary to maintain the documents and records of the 
            Corporation generated in exercising the authorities of this 
            title and the records of a covered financial company for 
            which the Corporation is appointed receiver, with due 
            regard for--

                    (I) the avoidance of duplicative record retention; 
                and
                    (II) the expected evidentiary needs of the 
                Corporation as receiver for a covered financial company 
                and the public regarding the records of covered 
                financial companies.

                (ii) Retention of records.--Unless otherwise required 
            by applicable Federal law or court order, the Corporation 
            may not, at any time, destroy any records that are subject 
            to clause (i).
                (iii) Records defined.--As used in this subparagraph, 
            the terms ``records'' and ``records of a covered financial 
            company'' mean any document, book, paper, map, photograph, 
            microfiche, microfilm, computer or electronically-created 
            record generated or maintained by the covered financial 
            company in the course of and necessary to its transaction 
            of business.
    (b) Priority of Expenses and Unsecured Claims.--
        (1) In general.--Unsecured claims against a covered financial 
    company, or the Corporation as receiver for such covered financial 
    company under this section, that are proven to the satisfaction of 
    the receiver shall have priority in the following order:
            (A) Administrative expenses of the receiver.
            (B) Any amounts owed to the United States, unless the 
        United States agrees or consents otherwise.
            (C) Wages, salaries, or commissions, including vacation, 
        severance, and sick leave pay earned by an individual (other 
        than an individual described in subparagraph (G)), but only to 
        the extent of $11,725 for each individual (as indexed for 
        inflation, by regulation of the Corporation) earned not later 
        than 180 days before the date of appointment of the Corporation 
        as receiver.
            (D) Contributions owed to employee benefit plans arising 
        from services rendered not later than 180 days before the date 
        of appointment of the Corporation as receiver, to the extent of 
        the number of employees covered by each such plan, multiplied 
        by $11,725 (as indexed for inflation, by regulation of the 
        Corporation), less the aggregate amount paid to such employees 
        under subparagraph (C), plus the aggregate amount paid by the 
        receivership on behalf of such employees to any other employee 
        benefit plan.
            (E) Any other general or senior liability of the covered 
        financial company (which is not a liability described under 
        subparagraph (F), (G), or (H)).
            (F) Any obligation subordinated to general creditors (which 
        is not an obligation described under subparagraph (G) or (H)).
            (G) Any wages, salaries, or commissions, including 
        vacation, severance, and sick leave pay earned, owed to senior 
        executives and directors of the covered financial company.
            (H) Any obligation to shareholders, members, general 
        partners, limited partners, or other persons, with interests in 
        the equity of the covered financial company arising as a result 
        of their status as shareholders, members, general partners, 
        limited partners, or other persons with interests in the equity 
        of the covered financial company.
        (2) Post-receivership financing priority.--In the event that 
    the Corporation, as receiver for a covered financial company, is 
    unable to obtain unsecured credit for the covered financial company 
    from commercial sources, the Corporation as receiver may obtain 
    credit or incur debt on the part of the covered financial company, 
    which shall have priority over any or all administrative expenses 
    of the receiver under paragraph (1)(A).
        (3) Claims of the united states.--Unsecured claims of the 
    United States shall, at a minimum, have a higher priority than 
    liabilities of the covered financial company that count as 
    regulatory capital.
        (4) Creditors similarly situated.--All claimants of a covered 
    financial company that are similarly situated under paragraph (1) 
    shall be treated in a similar manner, except that the Corporation 
    may take any action (including making payments, subject to 
    subsection (o)(1)(D)(i)) that does not comply with this subsection, 
    if--
            (A) the Corporation determines that such action is 
        necessary--
                (i) to maximize the value of the assets of the covered 
            financial company;
                (ii) to initiate and continue operations essential to 
            implementation of the receivership or any bridge financial 
            company;
                (iii) to maximize the present value return from the 
            sale or other disposition of the assets of the covered 
            financial company; or
                (iv) to minimize the amount of any loss realized upon 
            the sale or other disposition of the assets of the covered 
            financial company; and
            (B) all claimants that are similarly situated under 
        paragraph (1) receive not less than the amount provided in 
        paragraphs (2) and (3) of subsection (d).
        (5) Secured claims unaffected.--This section shall not affect 
    secured claims or security entitlements in respect of assets or 
    property held by the covered financial company, except to the 
    extent that the security is insufficient to satisfy the claim, and 
    then only with regard to the difference between the claim and the 
    amount realized from the security.
        (6) Priority of expenses and unsecured claims in the orderly 
    liquidation of sipc member.--Where the Corporation is appointed as 
    receiver for a covered broker or dealer, unsecured claims against 
    such covered broker or dealer, or the Corporation as receiver for 
    such covered broker or dealer under this section, that are proven 
    to the satisfaction of the receiver under section 205(e), shall 
    have the priority prescribed in paragraph (1), except that--
            (A) SIPC shall be entitled to recover administrative 
        expenses incurred in performing its responsibilities under 
        section 205 on an equal basis with the Corporation, in 
        accordance with paragraph (1)(A);
            (B) the Corporation shall be entitled to recover any 
        amounts paid to customers or to SIPC pursuant to section 
        205(f), in accordance with paragraph (1)(B);
            (C) SIPC shall be entitled to recover any amounts paid out 
        of the SIPC Fund to meet its obligations under section 205 and 
        under the Securities Investor Protection Act of 1970 (15 U.S.C. 
        78aaa et seq.), which claim shall be subordinate to the claims 
        payable under subparagraphs (A) and (B) of paragraph (1), but 
        senior to all other claims; and
            (D) the Corporation may, after paying any proven claims to 
        customers under section 205 and the Securities Investor 
        Protection Act of 1970 (15 U.S.C. 78aaa et seq.), and as 
        provided above, pay dividends on other proven claims, in its 
        discretion, and to the extent that funds are available, in 
        accordance with the priorities set forth in paragraph (1).
    (c) Provisions Relating to Contracts Entered Into Before 
Appointment of Receiver.--
        (1) Authority to repudiate contracts.--In addition to any other 
    rights that a receiver may have, the Corporation as receiver for 
    any covered financial company may disaffirm or repudiate any 
    contract or lease--
            (A) to which the covered financial company is a party;
            (B) the performance of which the Corporation as receiver, 
        in the discretion of the Corporation, determines to be 
        burdensome; and
            (C) the disaffirmance or repudiation of which the 
        Corporation as receiver determines, in the discretion of the 
        Corporation, will promote the orderly administration of the 
        affairs of the covered financial company.
        (2) Timing of repudiation.--The Corporation, as receiver for 
    any covered financial company, shall determine whether or not to 
    exercise the rights of repudiation under this section within a 
    reasonable period of time.
        (3) Claims for damages for repudiation.--
            (A) In general.--Except as provided in paragraphs (4), (5), 
        and (6) and in subparagraphs (C), (D), and (E) of this 
        paragraph, the liability of the Corporation as receiver for a 
        covered financial company for the disaffirmance or repudiation 
        of any contract pursuant to paragraph (1) shall be--
                (i) limited to actual direct compensatory damages; and
                (ii) determined as of--

                    (I) the date of the appointment of the Corporation 
                as receiver; or
                    (II) in the case of any contract or agreement 
                referred to in paragraph (8), the date of the 
                disaffirmance or repudiation of such contract or 
                agreement.

            (B) No liability for other damages.--For purposes of 
        subparagraph (A), the term ``actual direct compensatory 
        damages'' does not include--
                (i) punitive or exemplary damages;
                (ii) damages for lost profits or opportunity; or
                (iii) damages for pain and suffering.
            (C) Measure of damages for repudiation of qualified 
        financial contracts.--In the case of any qualified financial 
        contract or agreement to which paragraph (8) applies, 
        compensatory damages shall be--
                (i) deemed to include normal and reasonable costs of 
            cover or other reasonable measures of damages utilized in 
            the industries for such contract and agreement claims; and
                (ii) paid in accordance with this paragraph and 
            subsection (d), except as otherwise specifically provided 
            in this subsection.
            (D) Measure of damages for repudiation or disaffirmance of 
        debt obligation.--In the case of any debt for borrowed money or 
        evidenced by a security, actual direct compensatory damages 
        shall be no less than the amount lent plus accrued interest 
        plus any accreted original issue discount as of the date the 
        Corporation was appointed receiver of the covered financial 
        company and, to the extent that an allowed secured claim is 
        secured by property the value of which is greater than the 
        amount of such claim and any accrued interest through the date 
        of repudiation or disaffirmance, such accrued interest pursuant 
        to paragraph (1).
            (E) Measure of damages for repudiation or disaffirmance of 
        contingent obligation.--In the case of any contingent 
        obligation of a covered financial company consisting of any 
        obligation under a guarantee, letter of credit, loan 
        commitment, or similar credit obligation, the Corporation may, 
        by rule or regulation, prescribe that actual direct 
        compensatory damages shall be no less than the estimated value 
        of the claim as of the date the Corporation was appointed 
        receiver of the covered financial company, as such value is 
        measured based on the likelihood that such contingent claim 
        would become fixed and the probable magnitude thereof.
        (4) Leases under which the covered financial company is the 
    lessee.--
            (A) In general.--If the Corporation as receiver disaffirms 
        or repudiates a lease under which the covered financial company 
        is the lessee, the receiver shall not be liable for any damages 
        (other than damages determined pursuant to subparagraph (B)) 
        for the disaffirmance or repudiation of such lease.
            (B) Payments of rent.--Notwithstanding subparagraph (A), 
        the lessor under a lease to which subparagraph (A) would 
        otherwise apply shall--
                (i) be entitled to the contractual rent accruing before 
            the later of the date on which--

                    (I) the notice of disaffirmance or repudiation is 
                mailed; or
                    (II) the disaffirmance or repudiation becomes 
                effective, unless the lessor is in default or breach of 
                the terms of the lease;

                (ii) have no claim for damages under any acceleration 
            clause or other penalty provision in the lease; and
                (iii) have a claim for any unpaid rent, subject to all 
            appropriate offsets and defenses, due as of the date of the 
            appointment which shall be paid in accordance with this 
            paragraph and subsection (d).
        (5) Leases under which the covered financial company is the 
    lessor.--
            (A) In general.--If the Corporation as receiver for a 
        covered financial company repudiates an unexpired written lease 
        of real property of the covered financial company under which 
        the covered financial company is the lessor and the lessee is 
        not, as of the date of such repudiation, in default, the lessee 
        under such lease may either--
                (i) treat the lease as terminated by such repudiation; 
            or
                (ii) remain in possession of the leasehold interest for 
            the balance of the term of the lease, unless the lessee 
            defaults under the terms of the lease after the date of 
            such repudiation.
            (B) Provisions applicable to lessee remaining in 
        possession.--If any lessee under a lease described in 
        subparagraph (A) remains in possession of a leasehold interest 
        pursuant to clause (ii) of subparagraph (A)--
                (i) the lessee--

                    (I) shall continue to pay the contractual rent 
                pursuant to the terms of the lease after the date of 
                the repudiation of such lease; and
                    (II) may offset against any rent payment which 
                accrues after the date of the repudiation of the lease, 
                any damages which accrue after such date due to the 
                nonperformance of any obligation of the covered 
                financial company under the lease after such date; and

                (ii) the Corporation as receiver shall not be liable to 
            the lessee for any damages arising after such date as a 
            result of the repudiation, other than the amount of any 
            offset allowed under clause (i)(II).
        (6) Contracts for the sale of real property.--
            (A) In general.--If the receiver repudiates any contract 
        (which meets the requirements of subsection (a)(6)) for the 
        sale of real property, and the purchaser of such real property 
        under such contract is in possession and is not, as of the date 
        of such repudiation, in default, such purchaser may either--
                (i) treat the contract as terminated by such 
            repudiation; or
                (ii) remain in possession of such real property.
            (B) Provisions applicable to purchaser remaining in 
        possession.--If any purchaser of real property under any 
        contract described in subparagraph (A) remains in possession of 
        such property pursuant to clause (ii) of subparagraph (A)--
                (i) the purchaser--

                    (I) shall continue to make all payments due under 
                the contract after the date of the repudiation of the 
                contract; and
                    (II) may offset against any such payments any 
                damages which accrue after such date due to the 
                nonperformance (after such date) of any obligation of 
                the covered financial company under the contract; and

                (ii) the Corporation as receiver shall--

                    (I) not be liable to the purchaser for any damages 
                arising after such date as a result of the repudiation, 
                other than the amount of any offset allowed under 
                clause (i)(II);
                    (II) deliver title to the purchaser in accordance 
                with the provisions of the contract; and
                    (III) have no obligation under the contract other 
                than the performance required under subclause (II).

            (C) Assignment and sale allowed.--
                (i) In general.--No provision of this paragraph shall 
            be construed as limiting the right of the Corporation as 
            receiver to assign the contract described in subparagraph 
            (A) and sell the property, subject to the contract and the 
            provisions of this paragraph.
                (ii) No liability after assignment and sale.--If an 
            assignment and sale described in clause (i) is consummated, 
            the Corporation as receiver shall have no further liability 
            under the contract described in subparagraph (A) or with 
            respect to the real property which was the subject of such 
            contract.
        (7) Provisions applicable to service contracts.--
            (A) Services performed before appointment.--In the case of 
        any contract for services between any person and any covered 
        financial company for which the Corporation has been appointed 
        receiver, any claim of such person for services performed 
        before the date of appointment shall be--
                (i) a claim to be paid in accordance with subsections 
            (a), (b), and (d); and
                (ii) deemed to have arisen as of the date on which the 
            receiver was appointed.
            (B) Services performed after appointment and prior to 
        repudiation.--If, in the case of any contract for services 
        described in subparagraph (A), the Corporation as receiver 
        accepts performance by the other person before making any 
        determination to exercise the right of repudiation of such 
        contract under this section--
                (i) the other party shall be paid under the terms of 
            the contract for the services performed; and
                (ii) the amount of such payment shall be treated as an 
            administrative expense of the receivership.
            (C) Acceptance of performance no bar to subsequent 
        repudiation.--The acceptance by the Corporation as receiver for 
        services referred to in subparagraph (B) in connection with a 
        contract described in subparagraph (B) shall not affect the 
        right of the Corporation as receiver to repudiate such contract 
        under this section at any time after such performance.
        (8) Certain qualified financial contracts.--
            (A) Rights of parties to contracts.--Subject to subsection 
        (a)(8) and paragraphs (9) and (10) of this subsection, and 
        notwithstanding any other provision of this section, any other 
        provision of Federal law, or the law of any State, no person 
        shall be stayed or prohibited from exercising--
                (i) any right that such person has to cause the 
            termination, liquidation, or acceleration of any qualified 
            financial contract with a covered financial company which 
            arises upon the date of appointment of the Corporation as 
            receiver for such covered financial company or at any time 
            after such appointment;
                (ii) any right under any security agreement or 
            arrangement or other credit enhancement related to one or 
            more qualified financial contracts described in clause (i); 
            or
                (iii) any right to offset or net out any termination 
            value, payment amount, or other transfer obligation arising 
            under or in connection with 1 or more contracts or 
            agreements described in clause (i), including any master 
            agreement for such contracts or agreements.
            (B) Applicability of other provisions.--Subsection (a)(8) 
        shall apply in the case of any judicial action or proceeding 
        brought against the Corporation as receiver referred to in 
        subparagraph (A), or the subject covered financial company, by 
        any party to a contract or agreement described in subparagraph 
        (A)(i) with such covered financial company.
            (C) Certain transfers not avoidable.--
                (i) In general.--Notwithstanding subsection (a)(11), 
            (a)(12), or (c)(12), section 5242 of the Revised Statutes 
            of the United States, or any other provision of Federal or 
            State law relating to the avoidance of preferential or 
            fraudulent transfers, the Corporation, whether acting as 
            the Corporation or as receiver for a covered financial 
            company, may not avoid any transfer of money or other 
            property in connection with any qualified financial 
            contract with a covered financial company.
                (ii) Exception for certain transfers.--Clause (i) shall 
            not apply to any transfer of money or other property in 
            connection with any qualified financial contract with a 
            covered financial company if the transferee had actual 
            intent to hinder, delay, or defraud such company, the 
            creditors of such company, or the Corporation as receiver 
            appointed for such company.
            (D) Certain contracts and agreements defined.--For purposes 
        of this subsection, the following definitions shall apply:
                (i) Qualified financial contract.--The term ``qualified 
            financial contract'' means any securities contract, 
            commodity contract, forward contract, repurchase agreement, 
            swap agreement, and any similar agreement that the 
            Corporation determines by regulation, resolution, or order 
            to be a qualified financial contract for purposes of this 
            paragraph.
                (ii) Securities contract.--The term ``securities 
            contract''--

                    (I) means a contract for the purchase, sale, or 
                loan of a security, a certificate of deposit, a 
                mortgage loan, any interest in a mortgage loan, a group 
                or index of securities, certificates of deposit, or 
                mortgage loans or interests therein (including any 
                interest therein or based on the value thereof), or any 
                option on any of the foregoing, including any option to 
                purchase or sell any such security, certificate of 
                deposit, mortgage loan, interest, group or index, or 
                option, and including any repurchase or reverse 
                repurchase transaction on any such security, 
                certificate of deposit, mortgage loan, interest, group 
                or index, or option (whether or not such repurchase or 
                reverse repurchase transaction is a ``repurchase 
                agreement'', as defined in clause (v));
                    (II) does not include any purchase, sale, or 
                repurchase obligation under a participation in a 
                commercial mortgage loan unless the Corporation 
                determines by regulation, resolution, or order to 
                include any such agreement within the meaning of such 
                term;
                    (III) means any option entered into on a national 
                securities exchange relating to foreign currencies;
                    (IV) means the guarantee (including by novation) by 
                or to any securities clearing agency of any settlement 
                of cash, securities, certificates of deposit, mortgage 
                loans or interests therein, group or index of 
                securities, certificates of deposit or mortgage loans 
                or interests therein (including any interest therein or 
                based on the value thereof) or an option on any of the 
                foregoing, including any option to purchase or sell any 
                such security, certificate of deposit, mortgage loan, 
                interest, group or index, or option (whether or not 
                such settlement is in connection with any agreement or 
                transaction referred to in subclauses (I) through (XII) 
                (other than subclause (II)));
                    (V) means any margin loan;
                    (VI) means any extension of credit for the 
                clearance or settlement of securities transactions;
                    (VII) means any loan transaction coupled with a 
                securities collar transaction, any prepaid securities 
                forward transaction, or any total return swap 
                transaction coupled with a securities sale transaction;
                    (VIII) means any other agreement or transaction 
                that is similar to any agreement or transaction 
                referred to in this clause;
                    (IX) means any combination of the agreements or 
                transactions referred to in this clause;
                    (X) means any option to enter into any agreement or 
                transaction referred to in this clause;
                    (XI) means a master agreement that provides for an 
                agreement or transaction referred to in any of 
                subclauses (I) through (X), other than subclause (II), 
                together with all supplements to any such master 
                agreement, without regard to whether the master 
                agreement provides for an agreement or transaction that 
                is not a securities contract under this clause, except 
                that the master agreement shall be considered to be a 
                securities contract under this clause only with respect 
                to each agreement or transaction under the master 
                agreement that is referred to in any of subclauses (I) 
                through (X), other than subclause (II); and
                    (XII) means any security agreement or arrangement 
                or other credit enhancement related to any agreement or 
                transaction referred to in this clause, including any 
                guarantee or reimbursement obligation in connection 
                with any agreement or transaction referred to in this 
                clause.

                (iii) Commodity contract.--The term ``commodity 
            contract'' means--

                    (I) with respect to a futures commission merchant, 
                a contract for the purchase or sale of a commodity for 
                future delivery on, or subject to the rules of, a 
                contract market or board of trade;
                    (II) with respect to a foreign futures commission 
                merchant, a foreign future;
                    (III) with respect to a leverage transaction 
                merchant, a leverage transaction;
                    (IV) with respect to a clearing organization, a 
                contract for the purchase or sale of a commodity for 
                future delivery on, or subject to the rules of, a 
                contract market or board of trade that is cleared by 
                such clearing organization, or commodity option traded 
                on, or subject to the rules of, a contract market or 
                board of trade that is cleared by such clearing 
                organization;
                    (V) with respect to a commodity options dealer, a 
                commodity option;
                    (VI) any other agreement or transaction that is 
                similar to any agreement or transaction referred to in 
                this clause;
                    (VII) any combination of the agreements or 
                transactions referred to in this clause;
                    (VIII) any option to enter into any agreement or 
                transaction referred to in this clause;
                    (IX) a master agreement that provides for an 
                agreement or transaction referred to in any of 
                subclauses (I) through (VIII), together with all 
                supplements to any such master agreement, without 
                regard to whether the master agreement provides for an 
                agreement or transaction that is not a commodity 
                contract under this clause, except that the master 
                agreement shall be considered to be a commodity 
                contract under this clause only with respect to each 
                agreement or transaction under the master agreement 
                that is referred to in any of subclauses (I) through 
                (VIII); or
                    (X) any security agreement or arrangement or other 
                credit enhancement related to any agreement or 
                transaction referred to in this clause, including any 
                guarantee or reimbursement obligation in connection 
                with any agreement or transaction referred to in this 
                clause.

                (iv) Forward contract.--The term ``forward contract'' 
            means--

                    (I) a contract (other than a commodity contract) 
                for the purchase, sale, or transfer of a commodity or 
                any similar good, article, service, right, or interest 
                which is presently or in the future becomes the subject 
                of dealing in the forward contract trade, or product or 
                byproduct thereof, with a maturity date that is more 
                than 2 days after the date on which the contract is 
                entered into, including a repurchase or reverse 
                repurchase transaction (whether or not such repurchase 
                or reverse repurchase transaction is a ``repurchase 
                agreement'', as defined in clause (v)), consignment, 
                lease, swap, hedge transaction, deposit, loan, option, 
                allocated transaction, unallocated transaction, or any 
                other similar agreement;
                    (II) any combination of agreements or transactions 
                referred to in subclauses (I) and (III);
                    (III) any option to enter into any agreement or 
                transaction referred to in subclause (I) or (II);
                    (IV) a master agreement that provides for an 
                agreement or transaction referred to in subclause (I), 
                (II), or (III), together with all supplements to any 
                such master agreement, without regard to whether the 
                master agreement provides for an agreement or 
                transaction that is not a forward contract under this 
                clause, except that the master agreement shall be 
                considered to be a forward contract under this clause 
                only with respect to each agreement or transaction 
                under the master agreement that is referred to in 
                subclause (I), (II), or (III); or
                    (V) any security agreement or arrangement or other 
                credit enhancement related to any agreement or 
                transaction referred to in subclause (I), (II), (III), 
                or (IV), including any guarantee or reimbursement 
                obligation in connection with any agreement or 
                transaction referred to in any such subclause.

                (v) Repurchase agreement.--The term ``repurchase 
            agreement'' (which definition also applies to a reverse 
            repurchase agreement)--

                    (I) means an agreement, including related terms, 
                which provides for the transfer of one or more 
                certificates of deposit, mortgage related securities 
                (as such term is defined in section 3 of the Securities 
                Exchange Act of 1934), mortgage loans, interests in 
                mortgage-related securities or mortgage loans, eligible 
                bankers' acceptances, qualified foreign government 
                securities (which, for purposes of this clause, means a 
                security that is a direct obligation of, or that is 
                fully guaranteed by, the central government of a member 
                of the Organization for Economic Cooperation and 
                Development, as determined by regulation or order 
                adopted by the Board of Governors), or securities that 
                are direct obligations of, or that are fully guaranteed 
                by, the United States or any agency of the United 
                States against the transfer of funds by the transferee 
                of such certificates of deposit, eligible bankers' 
                acceptances, securities, mortgage loans, or interests 
                with a simultaneous agreement by such transferee to 
                transfer to the transferor thereof certificates of 
                deposit, eligible bankers' acceptances, securities, 
                mortgage loans, or interests as described above, at a 
                date certain not later than 1 year after such transfers 
                or on demand, against the transfer of funds, or any 
                other similar agreement;
                    (II) does not include any repurchase obligation 
                under a participation in a commercial mortgage loan, 
                unless the Corporation determines, by regulation, 
                resolution, or order to include any such participation 
                within the meaning of such term;
                    (III) means any combination of agreements or 
                transactions referred to in subclauses (I) and (IV);
                    (IV) means any option to enter into any agreement 
                or transaction referred to in subclause (I) or (III);
                    (V) means a master agreement that provides for an 
                agreement or transaction referred to in subclause (I), 
                (III), or (IV), together with all supplements to any 
                such master agreement, without regard to whether the 
                master agreement provides for an agreement or 
                transaction that is not a repurchase agreement under 
                this clause, except that the master agreement shall be 
                considered to be a repurchase agreement under this 
                subclause only with respect to each agreement or 
                transaction under the master agreement that is referred 
                to in subclause (I), (III), or (IV); and
                    (VI) means any security agreement or arrangement or 
                other credit enhancement related to any agreement or 
                transaction referred to in subclause (I), (III), (IV), 
                or (V), including any guarantee or reimbursement 
                obligation in connection with any agreement or 
                transaction referred to in any such subclause.

                (vi) Swap agreement.--The term ``swap agreement'' 
            means--

                    (I) any agreement, including the terms and 
                conditions incorporated by reference in any such 
                agreement, which is an interest rate swap, option, 
                future, or forward agreement, including a rate floor, 
                rate cap, rate collar, cross-currency rate swap, and 
                basis swap; a spot, same day-tomorrow, tomorrow-next, 
                forward, or other foreign exchange, precious metals, or 
                other commodity agreement; a currency swap, option, 
                future, or forward agreement; an equity index or equity 
                swap, option, future, or forward agreement; a debt 
                index or debt swap, option, future, or forward 
                agreement; a total return, credit spread or credit 
                swap, option, future, or forward agreement; a commodity 
                index or commodity swap, option, future, or forward 
                agreement; weather swap, option, future, or forward 
                agreement; an emissions swap, option, future, or 
                forward agreement; or an inflation swap, option, 
                future, or forward agreement;
                    (II) any agreement or transaction that is similar 
                to any other agreement or transaction referred to in 
                this clause and that is of a type that has been, is 
                presently, or in the future becomes, the subject of 
                recurrent dealings in the swap or other derivatives 
                markets (including terms and conditions incorporated by 
                reference in such agreement) and that is a forward, 
                swap, future, option, or spot transaction on one or 
                more rates, currencies, commodities, equity securities 
                or other equity instruments, debt securities or other 
                debt instruments, quantitative measures associated with 
                an occurrence, extent of an occurrence, or contingency 
                associated with a financial, commercial, or economic 
                consequence, or economic or financial indices or 
                measures of economic or financial risk or value;
                    (III) any combination of agreements or transactions 
                referred to in this clause;
                    (IV) any option to enter into any agreement or 
                transaction referred to in this clause;
                    (V) a master agreement that provides for an 
                agreement or transaction referred to in subclause (I), 
                (II), (III), or (IV), together with all supplements to 
                any such master agreement, without regard to whether 
                the master agreement contains an agreement or 
                transaction that is not a swap agreement under this 
                clause, except that the master agreement shall be 
                considered to be a swap agreement under this clause 
                only with respect to each agreement or transaction 
                under the master agreement that is referred to in 
                subclause (I), (II), (III), or (IV); and
                    (VI) any security agreement or arrangement or other 
                credit enhancement related to any agreement or 
                transaction referred to in any of subclauses (I) 
                through (V), including any guarantee or reimbursement 
                obligation in connection with any agreement or 
                transaction referred to in any such clause.

                (vii) Definitions relating to default.--When used in 
            this paragraph and paragraphs (9) and (10)--

                    (I) the term ``default'' means, with respect to a 
                covered financial company, any adjudication or other 
                official decision by any court of competent 
                jurisdiction, or other public authority pursuant to 
                which the Corporation has been appointed receiver; and
                    (II) the term ``in danger of default'' means a 
                covered financial company with respect to which the 
                Corporation or appropriate State authority has 
                determined that--

                        (aa) in the opinion of the Corporation or such 
                    authority--
                            (AA) the covered financial company is not 
                        likely to be able to pay its obligations in the 
                        normal course of business; and
                            (BB) there is no reasonable prospect that 
                        the covered financial company will be able to 
                        pay such obligations without Federal 
                        assistance; or
                        (bb) in the opinion of the Corporation or such 
                    authority--
                            (AA) the covered financial company has 
                        incurred or is likely to incur losses that will 
                        deplete all or substantially all of its 
                        capital; and
                            (BB) there is no reasonable prospect that 
                        the capital will be replenished without Federal 
                        assistance.
                (viii) Treatment of master agreement as one 
            agreement.--Any master agreement for any contract or 
            agreement described in any of clauses (i) through (vi) (or 
            any master agreement for such master agreement or 
            agreements), together with all supplements to such master 
            agreement, shall be treated as a single agreement and a 
            single qualified financial contact. If a master agreement 
            contains provisions relating to agreements or transactions 
            that are not themselves qualified financial contracts, the 
            master agreement shall be deemed to be a qualified 
            financial contract only with respect to those transactions 
            that are themselves qualified financial contracts.
                (ix) Transfer.--The term ``transfer'' means every mode, 
            direct or indirect, absolute or conditional, voluntary or 
            involuntary, of disposing of or parting with property or 
            with an interest in property, including retention of title 
            as a security interest and foreclosure of the equity of 
            redemption of the covered financial company.
                (x) Person.--The term ``person'' includes any 
            governmental entity in addition to any entity included in 
            the definition of such term in section 1, title 1, United 
            States Code.
            (E) Clarification.--No provision of law shall be construed 
        as limiting the right or power of the Corporation, or 
        authorizing any court or agency to limit or delay, in any 
        manner, the right or power of the Corporation to transfer any 
        qualified financial contract or to disaffirm or repudiate any 
        such contract in accordance with this subsection.
            (F) Walkaway clauses not effective.--
                (i) In general.--Notwithstanding the provisions of 
            subparagraph (A) of this paragraph and sections 403 and 404 
            of the Federal Deposit Insurance Corporation Improvement 
            Act of 1991, no walkaway clause shall be enforceable in a 
            qualified financial contract of a covered financial company 
            in default.
                (ii) Limited suspension of certain obligations.--In the 
            case of a qualified financial contract referred to in 
            clause (i), any payment or delivery obligations otherwise 
            due from a party pursuant to the qualified financial 
            contract shall be suspended from the time at which the 
            Corporation is appointed as receiver until the earlier of--

                    (I) the time at which such party receives notice 
                that such contract has been transferred pursuant to 
                paragraph (10)(A); or
                    (II) 5:00 p.m. (eastern time) on the business day 
                following the date of the appointment of the 
                Corporation as receiver.

                (iii) Walkaway clause defined.--For purposes of this 
            subparagraph, the term ``walkaway clause'' means any 
            provision in a qualified financial contract that suspends, 
            conditions, or extinguishes a payment obligation of a 
            party, in whole or in part, or does not create a payment 
            obligation of a party that would otherwise exist, solely 
            because of the status of such party as a nondefaulting 
            party in connection with the insolvency of a covered 
            financial company that is a party to the contract or the 
            appointment of or the exercise of rights or powers by the 
            Corporation as receiver for such covered financial company, 
            and not as a result of the exercise by a party of any right 
            to offset, setoff, or net obligations that exist under the 
            contract, any other contract between those parties, or 
            applicable law.
            (G) Certain obligations to clearing organizations.--In the 
        event that the Corporation has been appointed as receiver for a 
        covered financial company which is a party to any qualified 
        financial contract cleared by or subject to the rules of a 
        clearing organization (as defined in paragraph (9)(D)), the 
        receiver shall use its best efforts to meet all margin, 
        collateral, and settlement obligations of the covered financial 
        company that arise under qualified financial contracts (other 
        than any margin, collateral, or settlement obligation that is 
        not enforceable against the receiver under paragraph (8)(F)(i) 
        or paragraph (10)(B)), as required by the rules of the clearing 
        organization when due. Notwithstanding any other provision of 
        this title, if the receiver fails to satisfy any such margin, 
        collateral, or settlement obligations under the rules of the 
        clearing organization, the clearing organization shall have the 
        immediate right to exercise, and shall not be stayed from 
        exercising, all of its rights and remedies under its rules and 
        applicable law with respect to any qualified financial contract 
        of the covered financial company, including, without 
        limitation, the right to liquidate all positions and collateral 
        of such covered financial company under the company's qualified 
        financial contracts, and suspend or cease to act for such 
        covered financial company, all in accordance with the rules of 
        the clearing organization.
            (H) Recordkeeping.--
                (i) Joint rulemaking.--The Federal primary financial 
            regulatory agencies shall jointly prescribe regulations 
            requiring that financial companies maintain such records 
            with respect to qualified financial contracts (including 
            market valuations) that the Federal primary financial 
            regulatory agencies determine to be necessary or 
            appropriate in order to assist the Corporation as receiver 
            for a covered financial company in being able to exercise 
            its rights and fulfill its obligations under this paragraph 
            or paragraph (9) or (10).
                (ii) Time frame.--The Federal primary financial 
            regulatory agencies shall prescribe joint final or interim 
            final regulations not later than 24 months after the date 
            of enactment of this Act.
                (iii) Back-up rulemaking authority.--If the Federal 
            primary financial regulatory agencies do not prescribe 
            joint final or interim final regulations within the time 
            frame in clause (ii), the Chairperson of the Council shall 
            prescribe, in consultation with the Corporation, the 
            regulations required by clause (i).
                (iv) Categorization and tiering.--The joint regulations 
            prescribed under clause (i) shall, as appropriate, 
            differentiate among financial companies by taking into 
            consideration their size, risk, complexity, leverage, 
            frequency and dollar amount of qualified financial 
            contracts, interconnectedness to the financial system, and 
            any other factors deemed appropriate.
        (9) Transfer of qualified financial contracts.--
            (A) In general.--In making any transfer of assets or 
        liabilities of a covered financial company in default, which 
        includes any qualified financial contract, the Corporation as 
        receiver for such covered financial company shall either--
                (i) transfer to one financial institution, other than a 
            financial institution for which a conservator, receiver, 
            trustee in bankruptcy, or other legal custodian has been 
            appointed or which is otherwise the subject of a bankruptcy 
            or insolvency proceeding--

                    (I) all qualified financial contracts between any 
                person or any affiliate of such person and the covered 
                financial company in default;
                    (II) all claims of such person or any affiliate of 
                such person against such covered financial company 
                under any such contract (other than any claim which, 
                under the terms of any such contract, is subordinated 
                to the claims of general unsecured creditors of such 
                company);
                    (III) all claims of such covered financial company 
                against such person or any affiliate of such person 
                under any such contract; and
                    (IV) all property securing or any other credit 
                enhancement for any contract described in subclause (I) 
                or any claim described in subclause (II) or (III) under 
                any such contract; or

                (ii) transfer none of the qualified financial 
            contracts, claims, property or other credit enhancement 
            referred to in clause (i) (with respect to such person and 
            any affiliate of such person).
            (B) Transfer to foreign bank, financial institution, or 
        branch or agency thereof.--In transferring any qualified 
        financial contracts and related claims and property under 
        subparagraph (A)(i), the Corporation as receiver for the 
        covered financial company shall not make such transfer to a 
        foreign bank, financial institution organized under the laws of 
        a foreign country, or a branch or agency of a foreign bank or 
        financial institution unless, under the law applicable to such 
        bank, financial institution, branch or agency, to the qualified 
        financial contracts, and to any netting contract, any security 
        agreement or arrangement or other credit enhancement related to 
        one or more qualified financial contracts, the contractual 
        rights of the parties to such qualified financial contracts, 
        netting contracts, security agreements or arrangements, or 
        other credit enhancements are enforceable substantially to the 
        same extent as permitted under this section.
            (C) Transfer of contracts subject to the rules of a 
        clearing organization.--In the event that the Corporation as 
        receiver for a financial institution transfers any qualified 
        financial contract and related claims, property, or credit 
        enhancement pursuant to subparagraph (A)(i) and such contract 
        is cleared by or subject to the rules of a clearing 
        organization, the clearing organization shall not be required 
        to accept the transferee as a member by virtue of the transfer.
            (D) Definitions.--For purposes of this paragraph--
                (i) the term ``financial institution'' means a broker 
            or dealer, a depository institution, a futures commission 
            merchant, a bridge financial company, or any other 
            institution determined by the Corporation, by regulation, 
            to be a financial institution; and
                (ii) the term ``clearing organization'' has the same 
            meaning as in section 402 of the Federal Deposit Insurance 
            Corporation Improvement Act of 1991.
        (10) Notification of transfer.--
            (A) In general.--
                (i) Notice.--The Corporation shall provide notice in 
            accordance with clause (ii), if--

                    (I) the Corporation as receiver for a covered 
                financial company in default or in danger of default 
                transfers any assets or liabilities of the covered 
                financial company; and
                    (II) the transfer includes any qualified financial 
                contract.

                (ii) Timing.--The Corporation as receiver for a covered 
            financial company shall notify any person who is a party to 
            any contract described in clause (i) of such transfer not 
            later than 5:00 p.m. (eastern time) on the business day 
            following the date of the appointment of the Corporation as 
            receiver.
            (B) Certain rights not enforceable.--
                (i) Receivership.--A person who is a party to a 
            qualified financial contract with a covered financial 
            company may not exercise any right that such person has to 
            terminate, liquidate, or net such contract under paragraph 
            (8)(A) solely by reason of or incidental to the appointment 
            under this section of the Corporation as receiver for the 
            covered financial company (or the insolvency or financial 
            condition of the covered financial company for which the 
            Corporation has been appointed as receiver)--

                    (I) until 5:00 p.m. (eastern time) on the business 
                day following the date of the appointment; or
                    (II) after the person has received notice that the 
                contract has been transferred pursuant to paragraph 
                (9)(A).

                (ii) Notice.--For purposes of this paragraph, the 
            Corporation as receiver for a covered financial company 
            shall be deemed to have notified a person who is a party to 
            a qualified financial contract with such covered financial 
            company, if the Corporation has taken steps reasonably 
            calculated to provide notice to such person by the time 
            specified in subparagraph (A).
            (C) Treatment of bridge financial company.--For purposes of 
        paragraph (9), a bridge financial company shall not be 
        considered to be a financial institution for which a 
        conservator, receiver, trustee in bankruptcy, or other legal 
        custodian has been appointed, or which is otherwise the subject 
        of a bankruptcy or insolvency proceeding.
            (D) Business day defined.--For purposes of this paragraph, 
        the term ``business day'' means any day other than any 
        Saturday, Sunday, or any day on which either the New York Stock 
        Exchange or the Federal Reserve Bank of New York is closed.
        (11) Disaffirmance or repudiation of qualified financial 
    contracts.--In exercising the rights of disaffirmance or 
    repudiation of the Corporation as receiver with respect to any 
    qualified financial contract to which a covered financial company 
    is a party, the Corporation shall either--
            (A) disaffirm or repudiate all qualified financial 
        contracts between--
                (i) any person or any affiliate of such person; and
                (ii) the covered financial company in default; or
            (B) disaffirm or repudiate none of the qualified financial 
        contracts referred to in subparagraph (A) (with respect to such 
        person or any affiliate of such person).
        (12) Certain security and customer interests not avoidable.--No 
    provision of this subsection shall be construed as permitting the 
    avoidance of any--
            (A) legally enforceable or perfected security interest in 
        any of the assets of any covered financial company, except in 
        accordance with subsection (a)(11); or
            (B) legally enforceable interest in customer property, 
        security entitlements in respect of assets or property held by 
        the covered financial company for any security entitlement 
        holder.
        (13) Authority to enforce contracts.--
            (A) In general.--The Corporation, as receiver for a covered 
        financial company, may enforce any contract, other than a 
        liability insurance contract of a director or officer, a 
        financial institution bond entered into by the covered 
        financial company, notwithstanding any provision of the 
        contract providing for termination, default, acceleration, or 
        exercise of rights upon, or solely by reason of, insolvency, 
        the appointment of or the exercise of rights or powers by the 
        Corporation as receiver, the filing of the petition pursuant to 
        section 202(a)(1), or the issuance of the recommendations or 
        determination, or any actions or events occurring in connection 
        therewith or as a result thereof, pursuant to section 203.
            (B) Certain rights not affected.--No provision of this 
        paragraph may be construed as impairing or affecting any right 
        of the Corporation as receiver to enforce or recover under a 
        liability insurance contract of a director or officer or 
        financial institution bond under other applicable law.
            (C) Consent requirement and ipso facto clauses.--
                (i) In general.--Except as otherwise provided by this 
            section, no person may exercise any right or power to 
            terminate, accelerate, or declare a default under any 
            contract to which the covered financial company is a party 
            (and no provision in any such contract providing for such 
            default, termination, or acceleration shall be 
            enforceable), or to obtain possession of or exercise 
            control over any property of the covered financial company 
            or affect any contractual rights of the covered financial 
            company, without the consent of the Corporation as receiver 
            for the covered financial company during the 90 day period 
            beginning from the appointment of the Corporation as 
            receiver.
                (ii) Exceptions.--No provision of this subparagraph 
            shall apply to a director or officer liability insurance 
            contract or a financial institution bond, to the rights of 
            parties to certain qualified financial contracts pursuant 
            to paragraph (8), or to the rights of parties to netting 
            contracts pursuant to subtitle A of title IV of the Federal 
            Deposit Insurance Corporation Improvement Act of 1991 (12 
            U.S.C. 4401 et seq.), or shall be construed as permitting 
            the Corporation as receiver to fail to comply with 
            otherwise enforceable provisions of such contract.
            (D) Contracts to extend credit.--Notwithstanding any other 
        provision in this title, if the Corporation as receiver 
        enforces any contract to extend credit to the covered financial 
        company or bridge financial company, any valid and enforceable 
        obligation to repay such debt shall be paid by the Corporation 
        as receiver, as an administrative expense of the receivership.
        (14) Exception for federal reserve banks and corporation 
    security interest.--No provision of this subsection shall apply 
    with respect to--
            (A) any extension of credit from any Federal reserve bank 
        or the Corporation to any covered financial company; or
            (B) any security interest in the assets of the covered 
        financial company securing any such extension of credit.
        (15) Savings clause.--The meanings of terms used in this 
    subsection are applicable for purposes of this subsection only, and 
    shall not be construed or applied so as to challenge or affect the 
    characterization, definition, or treatment of any similar terms 
    under any other statute, regulation, or rule, including the Gramm-
    Leach-Bliley Act, the Legal Certainty for Bank Products Act of 
    2000, the securities laws (as that term is defined in section 
    3(a)(47) of the Securities Exchange Act of 1934), and the Commodity 
    Exchange Act.
        (16) Enforcement of contracts guaranteed by the covered 
    financial company.--
            (A) In general.--The Corporation, as receiver for a covered 
        financial company or as receiver for a subsidiary of a covered 
        financial company (including an insured depository institution) 
        shall have the power to enforce contracts of subsidiaries or 
        affiliates of the covered financial company, the obligations 
        under which are guaranteed or otherwise supported by or linked 
        to the covered financial company, notwithstanding any 
        contractual right to cause the termination, liquidation, or 
        acceleration of such contracts based solely on the insolvency, 
        financial condition, or receivership of the covered financial 
        company, if--
                (i) such guaranty or other support and all related 
            assets and liabilities are transferred to and assumed by a 
            bridge financial company or a third party (other than a 
            third party for which a conservator, receiver, trustee in 
            bankruptcy, or other legal custodian has been appointed, or 
            which is otherwise the subject of a bankruptcy or 
            insolvency proceeding) within the same period of time as 
            the Corporation is entitled to transfer the qualified 
            financial contracts of such covered financial company; or
                (ii) the Corporation, as receiver, otherwise provides 
            adequate protection with respect to such obligations.
            (B) Rule of construction.--For purposes of this paragraph, 
        a bridge financial company shall not be considered to be a 
        third party for which a conservator, receiver, trustee in 
        bankruptcy, or other legal custodian has been appointed, or 
        which is otherwise the subject of a bankruptcy or insolvency 
        proceeding.
    (d) Valuation of Claims in Default.--
        (1) In general.--Notwithstanding any other provision of Federal 
    law or the law of any State, and regardless of the method utilized 
    by the Corporation for a covered financial company, including 
    transactions authorized under subsection (h), this subsection shall 
    govern the rights of the creditors of any such covered financial 
    company.
        (2) Maximum liability.--The maximum liability of the 
    Corporation, acting as receiver for a covered financial company or 
    in any other capacity, to any person having a claim against the 
    Corporation as receiver or the covered financial company for which 
    the Corporation is appointed shall equal the amount that such 
    claimant would have received if--
            (A) the Corporation had not been appointed receiver with 
        respect to the covered financial company; and
            (B) the covered financial company had been liquidated under 
        chapter 7 of the Bankruptcy Code, or any similar provision of 
        State insolvency law applicable to the covered financial 
        company.
        (3) Special provision for orderly liquidation by sipc.--The 
    maximum liability of the Corporation, acting as receiver or in its 
    corporate capacity for any covered broker or dealer to any customer 
    of such covered broker or dealer, with respect to customer property 
    of such customer, shall be--
            (A) equal to the amount that such customer would have 
        received with respect to such customer property in a case 
        initiated by SIPC under the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.); and
            (B) determined as of the close of business on the date on 
        which the Corporation is appointed as receiver.
        (4) Additional payments authorized.--
            (A) In general.--Subject to subsection (o)(1)(D)(i), the 
        Corporation, with the approval of the Secretary, may make 
        additional payments or credit additional amounts to or with 
        respect to or for the account of any claimant or category of 
        claimants of the covered financial company, if the Corporation 
        determines that such payments or credits are necessary or 
        appropriate to minimize losses to the Corporation as receiver 
        from the orderly liquidation of the covered financial company 
        under this section.
            (B) Limitations.--
                (i) Prohibition.--The Corporation shall not make any 
            payments or credit amounts to any claimant or category of 
            claimants that would result in any claimant receiving more 
            than the face value amount of any claim that is proven to 
            the satisfaction of the Corporation.
                (ii) No obligation.--Notwithstanding any other 
            provision of Federal or State law, or the Constitution of 
            any State, the Corporation shall not be obligated, as a 
            result of having made any payment under subparagraph (A) or 
            credited any amount described in subparagraph (A) to or 
            with respect to, or for the account, of any claimant or 
            category of claimants, to make payments to any other 
            claimant or category of claimants.
            (C) Manner of payment.--The Corporation may make payments 
        or credit amounts under subparagraph (A) directly to the 
        claimants or may make such payments or credit such amounts to a 
        company other than a covered financial company or a bridge 
        financial company established with respect thereto in order to 
        induce such other company to accept liability for such claims.
    (e) Limitation on Court Action.--Except as provided in this title, 
no court may take any action to restrain or affect the exercise of 
powers or functions of the receiver hereunder, and any remedy against 
the Corporation or receiver shall be limited to money damages 
determined in accordance with this title.
    (f) Liability of Directors and Officers.--
        (1) In general.--A director or officer of a covered financial 
    company may be held personally liable for monetary damages in any 
    civil action described in paragraph (2) by, on behalf of, or at the 
    request or direction of the Corporation, which action is prosecuted 
    wholly or partially for the benefit of the Corporation--
            (A) acting as receiver for such covered financial company;
            (B) acting based upon a suit, claim, or cause of action 
        purchased from, assigned by, or otherwise conveyed by the 
        Corporation as receiver; or
            (C) acting based upon a suit, claim, or cause of action 
        purchased from, assigned by, or otherwise conveyed in whole or 
        in part by a covered financial company or its affiliate in 
        connection with assistance provided under this title.
        (2) Actions covered.--Paragraph (1) shall apply with respect to 
    actions for gross negligence, including any similar conduct or 
    conduct that demonstrates a greater disregard of a duty of care 
    (than gross negligence) including intentional tortious conduct, as 
    such terms are defined and determined under applicable State law.
        (3) Savings clause.--Nothing in this subsection shall impair or 
    affect any right of the Corporation under other applicable law.
    (g) Damages.--In any proceeding related to any claim against a 
director, officer, employee, agent, attorney, accountant, or appraiser 
of a covered financial company, or any other party employed by or 
providing services to a covered financial company, recoverable damages 
determined to result from the improvident or otherwise improper use or 
investment of any assets of the covered financial company shall include 
principal losses and appropriate interest.
    (h) Bridge Financial Companies.--
        (1) Organization.--
            (A) Purpose.--The Corporation, as receiver for one or more 
        covered financial companies or in anticipation of being 
        appointed receiver for one or more covered financial companies, 
        may organize one or more bridge financial companies in 
        accordance with this subsection.
            (B) Authorities.--Upon the creation of a bridge financial 
        company under subparagraph (A) with respect to a covered 
        financial company, such bridge financial company may--
                (i) assume such liabilities (including liabilities 
            associated with any trust or custody business, but 
            excluding any liabilities that count as regulatory capital) 
            of such covered financial company as the Corporation may, 
            in its discretion, determine to be appropriate;
                (ii) purchase such assets (including assets associated 
            with any trust or custody business) of such covered 
            financial company as the Corporation may, in its 
            discretion, determine to be appropriate; and
                (iii) perform any other temporary function which the 
            Corporation may, in its discretion, prescribe in accordance 
            with this section.
        (2) Charter and establishment.--
            (A) Establishment.--Except as provided in subparagraph (H), 
        where the covered financial company is a covered broker or 
        dealer, the Corporation, as receiver for a covered financial 
        company, may grant a Federal charter to and approve articles of 
        association for one or more bridge financial company or 
        companies, with respect to such covered financial company which 
        shall, by operation of law and immediately upon issuance of its 
        charter and approval of its articles of association, be 
        established and operate in accordance with, and subject to, 
        such charter, articles, and this section.
            (B) Management.--Upon its establishment, a bridge financial 
        company shall be under the management of a board of directors 
        appointed by the Corporation.
            (C) Articles of association.--The articles of association 
        and organization certificate of a bridge financial company 
        shall have such terms as the Corporation may provide, and shall 
        be executed by such representatives as the Corporation may 
        designate.
            (D) Terms of charter; rights and privileges.--Subject to 
        and in accordance with the provisions of this subsection, the 
        Corporation shall--
                (i) establish the terms of the charter of a bridge 
            financial company and the rights, powers, authorities, and 
            privileges of a bridge financial company granted by the 
            charter or as an incident thereto; and
                (ii) provide for, and establish the terms and 
            conditions governing, the management (including the bylaws 
            and the number of directors of the board of directors) and 
            operations of the bridge financial company.
            (E) Transfer of rights and privileges of covered financial 
        company.--
                (i) In general.--Notwithstanding any other provision of 
            Federal or State law, the Corporation may provide for a 
            bridge financial company to succeed to and assume any 
            rights, powers, authorities, or privileges of the covered 
            financial company with respect to which the bridge 
            financial company was established and, upon such 
            determination by the Corporation, the bridge financial 
            company shall immediately and by operation of law succeed 
            to and assume such rights, powers, authorities, and 
            privileges.
                (ii) Effective without approval.--Any succession to or 
            assumption by a bridge financial company of rights, powers, 
            authorities, or privileges of a covered financial company 
            under clause (i) or otherwise shall be effective without 
            any further approval under Federal or State law, 
            assignment, or consent with respect thereto.
            (F) Corporate governance and election and designation of 
        body of law.--To the extent permitted by the Corporation and 
        consistent with this section and any rules, regulations, or 
        directives issued by the Corporation under this section, a 
        bridge financial company may elect to follow the corporate 
        governance practices and procedures that are applicable to a 
        corporation incorporated under the general corporation law of 
        the State of Delaware, or the State of incorporation or 
        organization of the covered financial company with respect to 
        which the bridge financial company was established, as such law 
        may be amended from time to time.
            (G) Capital.--
                (i) Capital not required.--Notwithstanding any other 
            provision of Federal or State law, a bridge financial 
            company may, if permitted by the Corporation, operate 
            without any capital or surplus, or with such capital or 
            surplus as the Corporation may in its discretion determine 
            to be appropriate.
                (ii) No contribution by the corporation required.--The 
            Corporation is not required to pay capital into a bridge 
            financial company or to issue any capital stock on behalf 
            of a bridge financial company established under this 
            subsection.
                (iii) Authority.--If the Corporation determines that 
            such action is advisable, the Corporation may cause capital 
            stock or other securities of a bridge financial company 
            established with respect to a covered financial company to 
            be issued and offered for sale in such amounts and on such 
            terms and conditions as the Corporation may, in its 
            discretion, determine.
                (iv) Operating funds in lieu of capital and 
            implementation plan.--Upon the organization of a bridge 
            financial company, and thereafter as the Corporation may, 
            in its discretion, determine to be necessary or advisable, 
            the Corporation may make available to the bridge financial 
            company, subject to the plan described in subsection 
            (n)(9), funds for the operation of the bridge financial 
            company in lieu of capital.
            (H) Bridge brokers or dealers.--
                (i) In general.--The Corporation, as receiver for a 
            covered broker or dealer, may approve articles of 
            association for one or more bridge financial companies with 
            respect to such covered broker or dealer, which bridge 
            financial company or companies shall, by operation of law 
            and immediately upon approval of its articles of 
            association--

                    (I) be established and deemed registered with the 
                Commission under the Securities Exchange Act of 1934 
                and a member of SIPC;
                    (II) operate in accordance with such articles and 
                this section; and
                    (III) succeed to any and all registrations and 
                memberships of the covered financial company with or in 
                any self-regulatory organizations.

                (ii) Other requirements.--Except as provided in clause 
            (i), and notwithstanding any other provision of this 
            section, the bridge financial company shall be subject to 
            the Federal securities laws and all requirements with 
            respect to being a member of a self-regulatory 
            organization, unless exempted from any such requirements by 
            the Commission, as is necessary or appropriate in the 
            public interest or for the protection of investors.
                (iii) Treatment of customers.--Except as otherwise 
            provided by this title, any customer of the covered broker 
            or dealer whose account is transferred to a bridge 
            financial company shall have all the rights, privileges, 
            and protections under section 205(f) and under the 
            Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa 
            et seq.), that such customer would have had if the account 
            were not transferred from the covered financial company 
            under this subparagraph.
                (iv) Operation of bridge brokers or dealers.--
            Notwithstanding any other provision of this title, the 
            Corporation shall not operate any bridge financial company 
            created by the Corporation under this title with respect to 
            a covered broker or dealer in such a manner as to adversely 
            affect the ability of customers to promptly access their 
            customer property in accordance with applicable law.
        (3) Interests in and assets and obligations of covered 
    financial company.--Notwithstanding paragraph (1) or (2) or any 
    other provision of law--
            (A) a bridge financial company shall assume, acquire, or 
        succeed to the assets or liabilities of a covered financial 
        company (including the assets or liabilities associated with 
        any trust or custody business) only to the extent that such 
        assets or liabilities are transferred by the Corporation to the 
        bridge financial company in accordance with, and subject to the 
        restrictions set forth in, paragraph (1)(B); and
            (B) a bridge financial company shall not assume, acquire, 
        or succeed to any obligation that a covered financial company 
        for which the Corporation has been appointed receiver may have 
        to any shareholder, member, general partner, limited partner, 
        or other person with an interest in the equity of the covered 
        financial company that arises as a result of the status of that 
        person having an equity claim in the covered financial company.
        (4) Bridge financial company treated as being in default for 
    certain purposes.--A bridge financial company shall be treated as a 
    covered financial company in default at such times and for such 
    purposes as the Corporation may, in its discretion, determine.
        (5) Transfer of assets and liabilities.--
            (A) Authority of corporation.--The Corporation, as receiver 
        for a covered financial company, may transfer any assets and 
        liabilities of a covered financial company (including any 
        assets or liabilities associated with any trust or custody 
        business) to one or more bridge financial companies, in 
        accordance with and subject to the restrictions of paragraph 
        (1).
            (B) Subsequent transfers.--At any time after the 
        establishment of a bridge financial company with respect to a 
        covered financial company, the Corporation, as receiver, may 
        transfer any assets and liabilities of such covered financial 
        company as the Corporation may, in its discretion, determine to 
        be appropriate in accordance with and subject to the 
        restrictions of paragraph (1).
            (C) Treatment of trust or custody business.--For purposes 
        of this paragraph, the trust or custody business, including 
        fiduciary appointments, held by any covered financial company 
        is included among its assets and liabilities.
            (D) Effective without approval.--The transfer of any assets 
        or liabilities, including those associated with any trust or 
        custody business of a covered financial company, to a bridge 
        financial company shall be effective without any further 
        approval under Federal or State law, assignment, or consent 
        with respect thereto.
            (E) Equitable treatment of similarly situated creditors.--
        The Corporation shall treat all creditors of a covered 
        financial company that are similarly situated under subsection 
        (b)(1), in a similar manner in exercising the authority of the 
        Corporation under this subsection to transfer any assets or 
        liabilities of the covered financial company to one or more 
        bridge financial companies established with respect to such 
        covered financial company, except that the Corporation may take 
        any action (including making payments, subject to subsection 
        (o)(1)(D)(i)) that does not comply with this subparagraph, if--
                (i) the Corporation determines that such action is 
            necessary--

                    (I) to maximize the value of the assets of the 
                covered financial company;
                    (II) to maximize the present value return from the 
                sale or other disposition of the assets of the covered 
                financial company; or
                    (III) to minimize the amount of any loss realized 
                upon the sale or other disposition of the assets of the 
                covered financial company; and

                (ii) all creditors that are similarly situated under 
            subsection (b)(1) receive not less than the amount provided 
            under paragraphs (2) and (3) of subsection (d).
            (F) Limitation on transfer of liabilities.--Notwithstanding 
        any other provision of law, the aggregate amount of liabilities 
        of a covered financial company that are transferred to, or 
        assumed by, a bridge financial company from a covered financial 
        company may not exceed the aggregate amount of the assets of 
        the covered financial company that are transferred to, or 
        purchased by, the bridge financial company from the covered 
        financial company.
        (6) Stay of judicial action.--Any judicial action to which a 
    bridge financial company becomes a party by virtue of its 
    acquisition of any assets or assumption of any liabilities of a 
    covered financial company shall be stayed from further proceedings 
    for a period of not longer than 45 days (or such longer period as 
    may be agreed to upon the consent of all parties) at the request of 
    the bridge financial company.
        (7) Agreements against interest of the bridge financial 
    company.--No agreement that tends to diminish or defeat the 
    interest of the bridge financial company in any asset of a covered 
    financial company acquired by the bridge financial company shall be 
    valid against the bridge financial company, unless such agreement--
            (A) is in writing;
            (B) was executed by an authorized officer or representative 
        of the covered financial company or confirmed in the ordinary 
        course of business by the covered financial company; and
            (C) has been on the official record of the company, since 
        the time of its execution, or with which, the party claiming 
        under the agreement provides documentation of such agreement 
        and its authorized execution or confirmation by the covered 
        financial company that is acceptable to the receiver.
        (8) No federal status.--
            (A) Agency status.--A bridge financial company is not an 
        agency, establishment, or instrumentality of the United States.
            (B) Employee status.--Representatives for purposes of 
        paragraph (1)(B), directors, officers, employees, or agents of 
        a bridge financial company are not, solely by virtue of service 
        in any such capacity, officers or employees of the United 
        States. Any employee of the Corporation or of any Federal 
        instrumentality who serves at the request of the Corporation as 
        a representative for purposes of paragraph (1)(B), director, 
        officer, employee, or agent of a bridge financial company shall 
        not--
                (i) solely by virtue of service in any such capacity 
            lose any existing status as an officer or employee of the 
            United States for purposes of title 5, United States Code, 
            or any other provision of law; or
                (ii) receive any salary or benefits for service in any 
            such capacity with respect to a bridge financial company in 
            addition to such salary or benefits as are obtained through 
            employment with the Corporation or such Federal 
            instrumentality.
        (9) Funding authorized.--The Corporation may, subject to the 
    plan described in subsection (n)(9), provide funding to facilitate 
    any transaction described in subparagraph (A), (B), (C), or (D) of 
    paragraph (13) with respect to any bridge financial company, or 
    facilitate the acquisition by a bridge financial company of any 
    assets, or the assumption of any liabilities, of a covered 
    financial company for which the Corporation has been appointed 
    receiver.
        (10) Exempt tax status.--Notwithstanding any other provision of 
    Federal or State law, a bridge financial company, its franchise, 
    property, and income shall be exempt from all taxation now or 
    hereafter imposed by the United States, by any territory, 
    dependency, or possession thereof, or by any State, county, 
    municipality, or local taxing authority.
        (11) Federal agency approval; antitrust review.--If a 
    transaction involving the merger or sale of a bridge financial 
    company requires approval by a Federal agency, the transaction may 
    not be consummated before the 5th calendar day after the date of 
    approval by the Federal agency responsible for such approval with 
    respect thereto. If, in connection with any such approval a report 
    on competitive factors from the Attorney General is required, the 
    Federal agency responsible for such approval shall promptly notify 
    the Attorney General of the proposed transaction and the Attorney 
    General shall provide the required report within 10 days of the 
    request. If a notification is required under section 7A of the 
    Clayton Act with respect to such transaction, the required waiting 
    period shall end on the 15th day after the date on which the 
    Attorney General and the Federal Trade Commission receive such 
    notification, unless the waiting period is terminated earlier under 
    section 7A(b)(2) of the Clayton Act, or extended under section 
    7A(e)(2) of that Act.
        (12) Duration of bridge financial company.--Subject to 
    paragraphs (13) and (14), the status of a bridge financial company 
    as such shall terminate at the end of the 2-year period following 
    the date on which it was granted a charter. The Corporation may, in 
    its discretion, extend the status of the bridge financial company 
    as such for no more than 3 additional 1-year periods.
        (13) Termination of bridge financial company status.--The 
    status of any bridge financial company as such shall terminate upon 
    the earliest of--
            (A) the date of the merger or consolidation of the bridge 
        financial company with a company that is not a bridge financial 
        company;
            (B) at the election of the Corporation, the sale of a 
        majority of the capital stock of the bridge financial company 
        to a company other than the Corporation and other than another 
        bridge financial company;
            (C) the sale of 80 percent, or more, of the capital stock 
        of the bridge financial company to a person other than the 
        Corporation and other than another bridge financial company;
            (D) at the election of the Corporation, either the 
        assumption of all or substantially all of the liabilities of 
        the bridge financial company by a company that is not a bridge 
        financial company, or the acquisition of all or substantially 
        all of the assets of the bridge financial company by a company 
        that is not a bridge financial company, or other entity as 
        permitted under applicable law; and
            (E) the expiration of the period provided in paragraph 
        (12), or the earlier dissolution of the bridge financial 
        company, as provided in paragraph (15).
        (14) Effect of termination events.--
            (A) Merger or consolidation.--A merger or consolidation, 
        described in paragraph (13)(A) shall be conducted in accordance 
        with, and shall have the effect provided in, the provisions of 
        applicable law. For the purpose of effecting such a merger or 
        consolidation, the bridge financial company shall be treated as 
        a corporation organized under the laws of the State of Delaware 
        (unless the law of another State has been selected by the 
        bridge financial company in accordance with paragraph (2)(F)), 
        and the Corporation shall be treated as the sole shareholder 
        thereof, notwithstanding any other provision of State or 
        Federal law.
            (B) Charter conversion.--Following the sale of a majority 
        of the capital stock of the bridge financial company, as 
        provided in paragraph (13)(B), the Corporation may amend the 
        charter of the bridge financial company to reflect the 
        termination of the status of the bridge financial company as 
        such, whereupon the company shall have all of the rights, 
        powers, and privileges under its constituent documents and 
        applicable Federal or State law. In connection therewith, the 
        Corporation may take such steps as may be necessary or 
        convenient to reincorporate the bridge financial company under 
        the laws of a State and, notwithstanding any provisions of 
        Federal or State law, such State-chartered corporation shall be 
        deemed to succeed by operation of law to such rights, titles, 
        powers, and interests of the bridge financial company as the 
        Corporation may provide, with the same effect as if the bridge 
        financial company had merged with the State-chartered 
        corporation under provisions of the corporate laws of such 
        State.
            (C) Sale of stock.--Following the sale of 80 percent or 
        more of the capital stock of a bridge financial company, as 
        provided in paragraph (13)(C), the company shall have all of 
        the rights, powers, and privileges under its constituent 
        documents and applicable Federal or State law. In connection 
        therewith, the Corporation may take such steps as may be 
        necessary or convenient to reincorporate the bridge financial 
        company under the laws of a State and, notwithstanding any 
        provisions of Federal or State law, the State-chartered 
        corporation shall be deemed to succeed by operation of law to 
        such rights, titles, powers and interests of the bridge 
        financial company as the Corporation may provide, with the same 
        effect as if the bridge financial company had merged with the 
        State-chartered corporation under provisions of the corporate 
        laws of such State.
            (D) Assumption of liabilities and sale of assets.--
        Following the assumption of all or substantially all of the 
        liabilities of the bridge financial company, or the sale of all 
        or substantially all of the assets of the bridge financial 
        company, as provided in paragraph (13)(D), at the election of 
        the Corporation, the bridge financial company may retain its 
        status as such for the period provided in paragraph (12) or may 
        be dissolved at the election of the Corporation.
            (E) Amendments to charter.--Following the consummation of a 
        transaction described in subparagraph (A), (B), (C), or (D) of 
        paragraph (13), the charter of the resulting company shall be 
        amended to reflect the termination of bridge financial company 
        status, if appropriate.
        (15) Dissolution of bridge financial company.--
            (A) In general.--Notwithstanding any other provision of 
        Federal or State law, if the status of a bridge financial 
        company as such has not previously been terminated by the 
        occurrence of an event specified in subparagraph (A), (B), (C), 
        or (D) of paragraph (13)--
                (i) the Corporation may, in its discretion, dissolve 
            the bridge financial company in accordance with this 
            paragraph at any time; and
                (ii) the Corporation shall promptly commence 
            dissolution proceedings in accordance with this paragraph 
            upon the expiration of the 2-year period following the date 
            on which the bridge financial company was chartered, or any 
            extension thereof, as provided in paragraph (12).
            (B) Procedures.--The Corporation shall remain the receiver 
        for a bridge financial company for the purpose of dissolving 
        the bridge financial company. The Corporation as receiver for a 
        bridge financial company shall wind up the affairs of the 
        bridge financial company in conformity with the provisions of 
        law relating to the liquidation of covered financial companies 
        under this title. With respect to any such bridge financial 
        company, the Corporation as receiver shall have all the rights, 
        powers, and privileges and shall perform the duties related to 
        the exercise of such rights, powers, or privileges granted by 
        law to the Corporation as receiver for a covered financial 
        company under this title and, notwithstanding any other 
        provision of law, in the exercise of such rights, powers, and 
        privileges, the Corporation shall not be subject to the 
        direction or supervision of any State agency or other Federal 
        agency.
        (16) Authority to obtain credit.--
            (A) In general.--A bridge financial company may obtain 
        unsecured credit and issue unsecured debt.
            (B) Inability to obtain credit.--If a bridge financial 
        company is unable to obtain unsecured credit or issue unsecured 
        debt, the Corporation may authorize the obtaining of credit or 
        the issuance of debt by the bridge financial company--
                (i) with priority over any or all of the obligations of 
            the bridge financial company;
                (ii) secured by a lien on property of the bridge 
            financial company that is not otherwise subject to a lien; 
            or
                (iii) secured by a junior lien on property of the 
            bridge financial company that is subject to a lien.
            (C) Limitations.--
                (i) In general.--The Corporation, after notice and a 
            hearing, may authorize the obtaining of credit or the 
            issuance of debt by a bridge financial company that is 
            secured by a senior or equal lien on property of the bridge 
            financial company that is subject to a lien, only if--

                    (I) the bridge financial company is unable to 
                otherwise obtain such credit or issue such debt; and
                    (II) there is adequate protection of the interest 
                of the holder of the lien on the property with respect 
                to which such senior or equal lien is proposed to be 
                granted.

                (ii) Hearing.--The hearing required pursuant to this 
            subparagraph shall be before a court of the United States, 
            which shall have jurisdiction to conduct such hearing and 
            to authorize a bridge financial company to obtain secured 
            credit under clause (i).
            (D) Burden of proof.--In any hearing under this paragraph, 
        the Corporation has the burden of proof on the issue of 
        adequate protection.
            (E) Qualified financial contracts.--No credit or debt 
        obtained or issued by a bridge financial company may contain 
        terms that impair the rights of a counterparty to a qualified 
        financial contract upon a default by the bridge financial 
        company, other than the priority of such counterparty's 
        unsecured claim (after the exercise of rights) relative to the 
        priority of the bridge financial company's obligations in 
        respect of such credit or debt, unless such counterparty 
        consents in writing to any such impairment.
        (17) Effect on debts and liens.--The reversal or modification 
    on appeal of an authorization under this subsection to obtain 
    credit or issue debt, or of a grant under this section of a 
    priority or a lien, does not affect the validity of any debt so 
    issued, or any priority or lien so granted, to an entity that 
    extended such credit in good faith, whether or not such entity knew 
    of the pendency of the appeal, unless such authorization and the 
    issuance of such debt, or the granting of such priority or lien, 
    were stayed pending appeal.
    (i) Sharing Records.--If the Corporation has been appointed as 
receiver for a covered financial company, other Federal regulators 
shall make all records relating to the covered financial company 
available to the Corporation, which may be used by the Corporation in 
any manner that the Corporation determines to be appropriate.
    (j) Expedited Procedures for Certain Claims.--
        (1) Time for filing notice of appeal.--The notice of appeal of 
    any order, whether interlocutory or final, entered in any case 
    brought by the Corporation against a director, officer, employee, 
    agent, attorney, accountant, or appraiser of the covered financial 
    company, or any other person employed by or providing services to a 
    covered financial company, shall be filed not later than 30 days 
    after the date of entry of the order. The hearing of the appeal 
    shall be held not later than 120 days after the date of the notice 
    of appeal. The appeal shall be decided not later than 180 days 
    after the date of the notice of appeal.
        (2) Scheduling.--The court shall expedite the consideration of 
    any case brought by the Corporation against a director, officer, 
    employee, agent, attorney, accountant, or appraiser of a covered 
    financial company or any other person employed by or providing 
    services to a covered financial company. As far as practicable, the 
    court shall give such case priority on its docket.
        (3) Judicial discretion.--The court may modify the schedule and 
    limitations stated in paragraphs (1) and (2) in a particular case, 
    based on a specific finding that the ends of justice that would be 
    served by making such a modification would outweigh the best 
    interest of the public in having the case resolved expeditiously.
    (k) Foreign Investigations.--The Corporation, as receiver for any 
covered financial company, and for purposes of carrying out any power, 
authority, or duty with respect to a covered financial company--
        (1) may request the assistance of any foreign financial 
    authority and provide assistance to any foreign financial authority 
    in accordance with section 8(v) of the Federal Deposit Insurance 
    Act, as if the covered financial company were an insured depository 
    institution, the Corporation were the appropriate Federal banking 
    agency for the company, and any foreign financial authority were 
    the foreign banking authority; and
        (2) may maintain an office to coordinate foreign investigations 
    or investigations on behalf of foreign financial authorities.
    (l) Prohibition on Entering Secrecy Agreements and Protective 
Orders.--The Corporation may not enter into any agreement or approve 
any protective order which prohibits the Corporation from disclosing 
the terms of any settlement of an administrative or other action for 
damages or restitution brought by the Corporation in its capacity as 
receiver for a covered financial company.
    (m) Liquidation of Certain Covered Financial Companies or Bridge 
Financial Companies.--
        (1) In general.--Except as specifically provided in this 
    section, and notwithstanding any other provision of law, the 
    Corporation, in connection with the liquidation of any covered 
    financial company or bridge financial company with respect to which 
    the Corporation has been appointed as receiver, shall--
            (A) in the case of any covered financial company or bridge 
        financial company that is a stockbroker, but is not a member of 
        the Securities Investor Protection Corporation, apply the 
        provisions of subchapter III of chapter 7 of the Bankruptcy 
        Code, in respect of the distribution to any customer of all 
        customer name security and customer property and member 
        property, as if such covered financial company or bridge 
        financial company were a debtor for purposes of such 
        subchapter; or
            (B) in the case of any covered financial company or bridge 
        financial company that is a commodity broker, apply the 
        provisions of subchapter IV of chapter 7 the Bankruptcy Code, 
        in respect of the distribution to any customer of all customer 
        property and member property, as if such covered financial 
        company or bridge financial company were a debtor for purposes 
        of such subchapter.
        (2) Definitions.--For purposes of this subsection--
            (A) the terms ``customer'', ``customer name security'', and 
        ``customer property and member property'' have the same 
        meanings as in sections 741 and 761 of title 11, United States 
        Code; and
            (B) the terms ``commodity broker'' and ``stockbroker'' have 
        the same meanings as in section 101 of the Bankruptcy Code.
    (n) Orderly Liquidation Fund.--
        (1) Establishment.--There is established in the Treasury of the 
    United States a separate fund to be known as the ``Orderly 
    Liquidation Fund'', which shall be available to the Corporation to 
    carry out the authorities contained in this title, for the cost of 
    actions authorized by this title, including the orderly liquidation 
    of covered financial companies, payment of administrative expenses, 
    the payment of principal and interest by the Corporation on 
    obligations issued under paragraph (5), and the exercise of the 
    authorities of the Corporation under this title.
        (2) Proceeds.--Amounts received by the Corporation, including 
    assessments received under subsection (o), proceeds of obligations 
    issued under paragraph (5), interest and other earnings from 
    investments, and repayments to the Corporation by covered financial 
    companies, shall be deposited into the Fund.
        (3) Management.--The Corporation shall manage the Fund in 
    accordance with this subsection and the policies and procedures 
    established under section 203(d).
        (4) Investments.--At the request of the Corporation, the 
    Secretary may invest such portion of amounts held in the Fund that 
    are not, in the judgment of the Corporation, required to meet the 
    current needs of the Corporation, in obligations of the United 
    States having suitable maturities, as determined by the 
    Corporation. The interest on and the proceeds from the sale or 
    redemption of such obligations shall be credited to the Fund.
        (5) Authority to issue obligations.--
            (A) Corporation authorized to issue obligations.--Upon 
        appointment by the Secretary of the Corporation as receiver for 
        a covered financial company, the Corporation is authorized to 
        issue obligations to the Secretary.
            (B) Secretary authorized to purchase obligations.--The 
        Secretary may, under such terms and conditions as the Secretary 
        may require, purchase or agree to purchase any obligations 
        issued under subparagraph (A), and for such purpose, the 
        Secretary is authorized to use as a public debt transaction the 
        proceeds of the sale of any securities issued under chapter 31 
        of title 31, United States Code, and the purposes for which 
        securities may be issued under chapter 31 of title 31, United 
        States Code, are extended to include such purchases.
            (C) Interest rate.--Each purchase of obligations by the 
        Secretary under this paragraph shall be upon such terms and 
        conditions as to yield a return at a rate determined by the 
        Secretary, taking into consideration the current average yield 
        on outstanding marketable obligations of the United States of 
        comparable maturity, plus an interest rate surcharge to be 
        determined by the Secretary, which shall be greater than the 
        difference between--
                (i) the current average rate on an index of corporate 
            obligations of comparable maturity; and
                (ii) the current average rate on outstanding marketable 
            obligations of the United States of comparable maturity.
            (D) Secretary authorized to sell obligations.--The 
        Secretary may sell, upon such terms and conditions as the 
        Secretary shall determine, any of the obligations acquired 
        under this paragraph.
            (E) Public debt transactions.--All purchases and sales by 
        the Secretary of such obligations under this paragraph shall be 
        treated as public debt transactions of the United States, and 
        the proceeds from the sale of any obligations acquired by the 
        Secretary under this paragraph shall be deposited into the 
        Treasury of the United States as miscellaneous receipts.
        (6) Maximum obligation limitation.--The Corporation may not, in 
    connection with the orderly liquidation of a covered financial 
    company, issue or incur any obligation, if, after issuing or 
    incurring the obligation, the aggregate amount of such obligations 
    outstanding under this subsection for each covered financial 
    company would exceed--
            (A) an amount that is equal to 10 percent of the total 
        consolidated assets of the covered financial company, based on 
        the most recent financial statement available, during the 30-
        day period immediately following the date of appointment of the 
        Corporation as receiver (or a shorter time period if the 
        Corporation has calculated the amount described under 
        subparagraph (B)); and
            (B) the amount that is equal to 90 percent of the fair 
        value of the total consolidated assets of each covered 
        financial company that are available for repayment, after the 
        time period described in subparagraph (A).
        (7) Rulemaking.--The Corporation and the Secretary shall 
    jointly, in consultation with the Council, prescribe regulations 
    governing the calculation of the maximum obligation limitation 
    defined in this paragraph.
        (8) Rule of construction.--
            (A) In general.--Nothing in this section shall be construed 
        to affect the authority of the Corporation under subsection (a) 
        or (b) of section 14 or section 15(c)(5) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1824, 1825(c)(5)), the management of 
        the Deposit Insurance Fund by the Corporation, or the 
        resolution of insured depository institutions, provided that--
                (i) the authorities of the Corporation contained in 
            this title shall not be used to assist the Deposit 
            Insurance Fund or to assist any financial company under 
            applicable law other than this Act;
                (ii) the authorities of the Corporation relating to the 
            Deposit Insurance Fund, or any other responsibilities of 
            the Corporation under applicable law other than this title, 
            shall not be used to assist a covered financial company 
            pursuant to this title; and
                (iii) the Deposit Insurance Fund may not be used in any 
            manner to otherwise circumvent the purposes of this title.
            (B) Valuation.--For purposes of determining the amount of 
        obligations under this subsection--
                (i) the Corporation shall include as an obligation any 
            contingent liability of the Corporation pursuant to this 
            title; and
                (ii) the Corporation shall value any contingent 
            liability at its expected cost to the Corporation.
        (9) Orderly liquidation and repayment plans.--
            (A) Orderly liquidation plan.--Amounts in the Fund shall be 
        available to the Corporation with regard to a covered financial 
        company for which the Corporation is appointed receiver after 
        the Corporation has developed an orderly liquidation plan that 
        is acceptable to the Secretary with regard to such covered 
        financial company, including the provision and use of funds, 
        including taking any actions specified under section 204(d) and 
        subsection (h)(2)(G)(iv) and (h)(9) of this section, and 
        payments to third parties. The orderly liquidation plan shall 
        take into account actions to avoid or mitigate potential 
        adverse effects on low income, minority, or underserved 
        communities affected by the failure of the covered financial 
        company, and shall provide for coordination with the primary 
        financial regulatory agencies, as appropriate, to ensure that 
        such actions are taken. The Corporation may, at any time, amend 
        any orderly liquidation plan approved by the Secretary with the 
        concurrence of the Secretary.
            (B) Mandatory repayment plan.--
                (i) In general.--No amount authorized under paragraph 
            (6)(B) may be provided by the Secretary to the Corporation 
            under paragraph (5), unless an agreement is in effect 
            between the Secretary and the Corporation that--

                    (I) provides a specific plan and schedule to 
                achieve the repayment of the outstanding amount of any 
                borrowing under paragraph (5); and
                    (II) demonstrates that income to the Corporation 
                from the liquidated assets of the covered financial 
                company and assessments under subsection (o) will be 
                sufficient to amortize the outstanding balance within 
                the period established in the repayment schedule and 
                pay the interest accruing on such balance within the 
                time provided in subsection (o)(1)(B).

                (ii) Consultation with and report to congress.--The 
            Secretary and the Corporation shall--

                    (I) consult with the Committee on Banking, Housing, 
                and Urban Affairs of the Senate and the Committee on 
                Financial Services of the House of Representatives on 
                the terms of any repayment schedule agreement; and
                    (II) submit a copy of the repayment schedule 
                agreement to the Committees described in subclause (I) 
                before the end of the 30-day period beginning on the 
                date on which any amount is provided by the Secretary 
                to the Corporation under paragraph (5).

        (10) Implementation expenses.--
            (A) In general.--Reasonable implementation expenses of the 
        Corporation incurred after the date of enactment of this Act 
        shall be treated as expenses of the Council.
            (B) Requests for reimbursement.--The Corporation shall 
        periodically submit a request for reimbursement for 
        implementation expenses to the Chairperson of the Council, who 
        shall arrange for prompt reimbursement to the Corporation of 
        reasonable implementation expenses.
            (C) Definition.--As used in this paragraph, the term 
        ``implementation expenses''--
                (i) means costs incurred by the Corporation beginning 
            on the date of enactment of this Act, as part of its 
            efforts to implement this title that do not relate to a 
            particular covered financial company; and
                (ii) includes the costs incurred in connection with the 
            development of policies, procedures, rules, and regulations 
            and other planning activities of the Corporation consistent 
            with carrying out this title.
    (o) Assessments.--
        (1) Risk-based assessments.--
            (A) Eligible financial companies defined.--For purposes of 
        this subsection, the term ``eligible financial company'' means 
        any bank holding company with total consolidated assets equal 
        to or greater than $50,000,000,000 and any nonbank financial 
        company supervised by the Board of Governors.
            (B) Assessments.--The Corporation shall charge one or more 
        risk-based assessments in accordance with the provisions of 
        subparagraph (D), if such assessments are necessary to pay in 
        full the obligations issued by the Corporation to the Secretary 
        under this title within 60 months of the date of issuance of 
        such obligations.
            (C) Extensions authorized.--The Corporation may, with the 
        approval of the Secretary, extend the time period under 
        subparagraph (B), if the Corporation determines that an 
        extension is necessary to avoid a serious adverse effect on the 
        financial system of the United States.
            (D) Application of assessments.--To meet the requirements 
        of subparagraph (B), the Corporation shall--
                (i) impose assessments, as soon as practicable, on any 
            claimant that received additional payments or amounts from 
            the Corporation pursuant to subsection (b)(4), (d)(4), or 
            (h)(5)(E), except for payments or amounts necessary to 
            initiate and continue operations essential to 
            implementation of the receivership or any bridge financial 
            company, to recover on a cumulative basis, the entire 
            difference between--

                    (I) the aggregate value the claimant received from 
                the Corporation on a claim pursuant to this title 
                (including pursuant to subsection (b)(4), (d)(4), and 
                (h)(5)(E)), as of the date on which such value was 
                received; and
                    (II) the value the claimant was entitled to receive 
                from the Corporation on such claim solely from the 
                proceeds of the liquidation of the covered financial 
                company under this title; and

                (ii) if the amounts to be recovered on a cumulative 
            basis under clause (i) are insufficient to meet the 
            requirements of subparagraph (B), after taking into account 
            the considerations set forth in paragraph (4), impose 
            assessments on--

                    (I) eligible financial companies; and
                    (II) financial companies with total consolidated 
                assets equal to or greater than $50,000,000,000 that 
                are not eligible financial companies.

            (E) Provision of financing.--Payments or amounts necessary 
        to initiate and continue operations essential to implementation 
        of the receivership or any bridge financial company described 
        in subparagraph (D)(i) shall not include the provision of 
        financing, as defined by rule of the Corporation, to third 
        parties.
        (2) Graduated assessment rate.--The Corporation shall impose 
    assessments on a graduated basis, with financial companies having 
    greater assets and risk being assessed at a higher rate.
        (3) Notification and payment.--The Corporation shall notify 
    each financial company of that company's assessment under this 
    subsection. Any financial company subject to assessment under this 
    subsection shall pay such assessment in accordance with the 
    regulations prescribed pursuant to paragraph (6).
        (4) Risk-based assessment considerations.--In imposing 
    assessments under paragraph (1)(D)(ii), the Corporation shall use a 
    risk matrix. The Council shall make a recommendation to the 
    Corporation on the risk matrix to be used in imposing such 
    assessments, and the Corporation shall take into account any such 
    recommendation in the establishment of the risk matrix to be used 
    to impose such assessments. In recommending or establishing such 
    risk matrix, the Council and the Corporation, respectively, shall 
    take into account--
            (A) economic conditions generally affecting financial 
        companies so as to allow assessments to increase during more 
        favorable economic conditions and to decrease during less 
        favorable economic conditions;
            (B) any assessments imposed on a financial company or an 
        affiliate of a financial company that--
                (i) is an insured depository institution, assessed 
            pursuant to section 7 or 13(c)(4)(G) of the Federal Deposit 
            Insurance Act;
                (ii) is a member of the Securities Investor Protection 
            Corporation, assessed pursuant to section 4 of the 
            Securities Investor Protection Act of 1970 (15 U.S.C. 
            78ddd);
                (iii) is an insured credit union, assessed pursuant to 
            section 202(c)(1)(A)(i) of the Federal Credit Union Act (12 
            U.S.C. 1782(c)(1)(A)(i)); or
                (iv) is an insurance company, assessed pursuant to 
            applicable State law to cover (or reimburse payments made 
            to cover) the costs of the rehabilitation, liquidation, or 
            other State insolvency proceeding with respect to 1 or more 
            insurance companies;
            (C) the risks presented by the financial company to the 
        financial system and the extent to which the financial company 
        has benefitted, or likely would benefit, from the orderly 
        liquidation of a financial company under this title, 
        including--
                (i) the amount, different categories, and 
            concentrations of assets of the financial company and its 
            affiliates, including both on-balance sheet and off-balance 
            sheet assets;
                (ii) the activities of the financial company and its 
            affiliates;
                (iii) the relevant market share of the financial 
            company and its affiliates;
                (iv) the extent to which the financial company is 
            leveraged;
                (v) the potential exposure to sudden calls on liquidity 
            precipitated by economic distress;
                (vi) the amount, maturity, volatility, and stability of 
            the company's financial obligations to, and relationship 
            with, other financial companies;
                (vii) the amount, maturity, volatility, and stability 
            of the liabilities of the company, including the degree of 
            reliance on short-term funding, taking into consideration 
            existing systems for measuring a company's risk-based 
            capital;
                (viii) the stability and variety of the company's 
            sources of funding;
                (ix) the company's importance as a source of credit for 
            households, businesses, and State and local governments and 
            as a source of liquidity for the financial system;
                (x) the extent to which assets are simply managed and 
            not owned by the financial company and the extent to which 
            ownership of assets under management is diffuse; and
                (xi) the amount, different categories, and 
            concentrations of liabilities, both insured and uninsured, 
            contingent and noncontingent, including both on-balance 
            sheet and off-balance sheet liabilities, of the financial 
            company and its affiliates;
            (D) any risks presented by the financial company during the 
        10-year period immediately prior to the appointment of the 
        Corporation as receiver for the covered financial company that 
        contributed to the failure of the covered financial company; 
        and
            (E) such other risk-related factors as the Corporation, or 
        the Council, as applicable, may determine to be appropriate.
        (5) Collection of information.--The Corporation may impose on 
    covered financial companies such collection of information 
    requirements as the Corporation deems necessary to carry out this 
    subsection after the appointment of the Corporation as receiver 
    under this title.
        (6) Rulemaking.--
            (A) In general.--The Corporation shall prescribe 
        regulations to carry out this subsection. The Corporation shall 
        consult with the Secretary in the development and finalization 
        of such regulations.
            (B) Equitable treatment.--The regulations prescribed under 
        subparagraph (A) shall take into account the differences in 
        risks posed to the financial stability of the United States by 
        financial companies, the differences in the liability 
        structures of financial companies, and the different bases for 
        other assessments that such financial companies may be required 
        to pay, to ensure that assessed financial companies are treated 
        equitably and that assessments under this subsection reflect 
        such differences.
    (p) Unenforceability of Certain Agreements.--
        (1) In general.--No provision described in paragraph (2) shall 
    be enforceable against or impose any liability on any person, as 
    such enforcement or liability shall be contrary to public policy.
        (2) Prohibited provisions.--A provision described in this 
    paragraph is any term contained in any existing or future 
    standstill, confidentiality, or other agreement that, directly or 
    indirectly--
            (A) affects, restricts, or limits the ability of any person 
        to offer to acquire or acquire;
            (B) prohibits any person from offering to acquire or 
        acquiring; or
            (C) prohibits any person from using any previously 
        disclosed information in connection with any such offer to 
        acquire or acquisition of,
    all or part of any covered financial company, including any 
    liabilities, assets, or interest therein, in connection with any 
    transaction in which the Corporation exercises its authority under 
    this title.
    (q) Other Exemptions.--
        (1) In general.--When acting as a receiver under this title--
            (A) the Corporation, including its franchise, its capital, 
        reserves and surplus, and its income, shall be exempt from all 
        taxation imposed by any State, county, municipality, or local 
        taxing authority, except that any real property of the 
        Corporation shall be subject to State, territorial, county, 
        municipal, or local taxation to the same extent according to 
        its value as other real property is taxed, except that, 
        notwithstanding the failure of any person to challenge an 
        assessment under State law of the value of such property, such 
        value, and the tax thereon, shall be determined as of the 
        period for which such tax is imposed;
            (B) no property of the Corporation shall be subject to 
        levy, attachment, garnishment, foreclosure, or sale without the 
        consent of the Corporation, nor shall any involuntary lien 
        attach to the property of the Corporation; and
            (C) the Corporation shall not be liable for any amounts in 
        the nature of penalties or fines, including those arising from 
        the failure of any person to pay any real property, personal 
        property, probate, or recording tax or any recording or filing 
        fees when due; and
            (D) the Corporation shall be exempt from all prosecution by 
        the United States or any State, county, municipality, or local 
        authority for any criminal offense arising under Federal, 
        State, county, municipal, or local law, which was allegedly 
        committed by the covered financial company, or persons acting 
        on behalf of the covered financial company, prior to the 
        appointment of the Corporation as receiver.
        (2) Limitation.--Paragraph (1) shall not apply with respect to 
    any tax imposed (or other amount arising) under the Internal 
    Revenue Code of 1986.
    (r) Certain Sales of Assets Prohibited.--
        (1) Persons who engaged in improper conduct with, or caused 
    losses to, covered financial companies.--The Corporation shall 
    prescribe regulations which, at a minimum, shall prohibit the sale 
    of assets of a covered financial company by the Corporation to--
            (A) any person who--
                (i) has defaulted, or was a member of a partnership or 
            an officer or director of a corporation that has defaulted, 
            on 1 or more obligations, the aggregate amount of which 
            exceeds $1,000,000, to such covered financial company;
                (ii) has been found to have engaged in fraudulent 
            activity in connection with any obligation referred to in 
            clause (i); and
                (iii) proposes to purchase any such asset in whole or 
            in part through the use of the proceeds of a loan or 
            advance of credit from the Corporation or from any covered 
            financial company;
            (B) any person who participated, as an officer or director 
        of such covered financial company or of any affiliate of such 
        company, in a material way in any transaction that resulted in 
        a substantial loss to such covered financial company; or
            (C) any person who has demonstrated a pattern or practice 
        of defalcation regarding obligations to such covered financial 
        company.
        (2) Convicted debtors.--Except as provided in paragraph (3), a 
    person may not purchase any asset of such institution from the 
    receiver, if that person--
            (A) has been convicted of an offense under section 215, 
        656, 657, 1005, 1006, 1007, 1008, 1014, 1032, 1341, 1343, or 
        1344 of title 18, United States Code, or of conspiring to 
        commit such an offense, affecting any covered financial 
        company; and
            (B) is in default on any loan or other extension of credit 
        from such covered financial company which, if not paid, will 
        cause substantial loss to the Fund or the Corporation.
        (3) Settlement of claims.--Paragraphs (1) and (2) shall not 
    apply to the sale or transfer by the Corporation of any asset of 
    any covered financial company to any person, if the sale or 
    transfer of the asset resolves or settles, or is part of the 
    resolution or settlement, of 1 or more claims that have been, or 
    could have been, asserted by the Corporation against the person.
        (4) Definition of default.--For purposes of this subsection, 
    the term ``default'' means a failure to comply with the terms of a 
    loan or other obligation to such an extent that the property 
    securing the obligation is foreclosed upon.
    (s) Recoupment of Compensation From Senior Executives and 
Directors.--
        (1) In general.--The Corporation, as receiver of a covered 
    financial company, may recover from any current or former senior 
    executive or director substantially responsible for the failed 
    condition of the covered financial company any compensation 
    received during the 2-year period preceding the date on which the 
    Corporation was appointed as the receiver of the covered financial 
    company, except that, in the case of fraud, no time limit shall 
    apply.
        (2) Cost considerations.--In seeking to recover any such 
    compensation, the Corporation shall weigh the financial and 
    deterrent benefits of such recovery against the cost of executing 
    the recovery.
        (3) Rulemaking.--The Corporation shall promulgate regulations 
    to implement the requirements of this subsection, including 
    defining the term ``compensation'' to mean any financial 
    remuneration, including salary, bonuses, incentives, benefits, 
    severance, deferred compensation, or golden parachute benefits, and 
    any profits realized from the sale of the securities of the covered 
    financial company.
    SEC. 211. MISCELLANEOUS PROVISIONS.
    (a) Clarification of Prohibition Regarding Concealment of Assets 
From Receiver or Liquidating Agent.--Section 1032(1) of title 18, 
United States Code, is amended by inserting ``the Federal Deposit 
Insurance Corporation acting as receiver for a covered financial 
company, in accordance with title II of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act,'' before ``or the National 
Credit''.
    (b) Conforming Amendment.--Section 1032 of title 18, United States 
Code, is amended in the section heading, by striking ``of financial 
institution''.
    (c) Federal Deposit Insurance Corporation Improvement Act of 
1991.--Section 403(a) of the Federal Deposit Insurance Corporation 
Improvement Act of 1991 (12 U.S.C. 4403(a)) is amended by inserting 
``section 210(c) of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act, section 1367 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617(d)),'' after 
``section 11(e) of the Federal Deposit Insurance Act,''.
    (d) FDIC Inspector General Reviews.--
        (1) Scope.--The Inspector General of the Corporation shall 
    conduct, supervise, and coordinate audits and investigations of the 
    liquidation of any covered financial company by the Corporation as 
    receiver under this title, including collecting and summarizing--
            (A) a description of actions taken by the Corporation as 
        receiver;
            (B) a description of any material sales, transfers, 
        mergers, obligations, purchases, and other material 
        transactions entered into by the Corporation;
            (C) an evaluation of the adequacy of the policies and 
        procedures of the Corporation under section 203(d) and orderly 
        liquidation plan under section 210(n)(14);
            (D) an evaluation of the utilization by the Corporation of 
        the private sector in carrying out its functions, including the 
        adequacy of any conflict-of-interest reviews; and
            (E) an evaluation of the overall performance of the 
        Corporation in liquidating the covered financial company, 
        including administrative costs, timeliness of liquidation 
        process, and impact on the financial system.
        (2) Frequency.--Not later than 6 months after the date of 
    appointment of the Corporation as receiver under this title and 
    every 6 months thereafter, the Inspector General of the Corporation 
    shall conduct the audit and investigation described in paragraph 
    (1).
        (3) Reports and testimony.--The Inspector General of the 
    Corporation shall include in the semiannual reports required by 
    section 5(a) of the Inspector General Act of 1978 (5 U.S.C. App.), 
    a summary of the findings and evaluations under paragraph (1), and 
    shall appear before the appropriate committees of Congress, if 
    requested, to present each such report.
        (4) Funding.--
            (A) Initial funding.--The expenses of the Inspector General 
        of the Corporation in carrying out this subsection shall be 
        considered administrative expenses of the receivership.
            (B) Additional funding.--If the maximum amount available to 
        the Corporation as receiver under this title is insufficient to 
        enable the Inspector General of the Corporation to carry out 
        the duties under this subsection, the Corporation shall pay 
        such additional amounts from assessments imposed under section 
        210.
        (5) Termination of responsibilities.--The duties and 
    responsibilities of the Inspector General of the Corporation under 
    this subsection shall terminate 1 year after the date of 
    termination of the receivership under this title.
    (e) Treasury Inspector General Reviews.--
        (1) Scope.--The Inspector General of the Department of the 
    Treasury shall conduct, supervise, and coordinate audits and 
    investigations of actions taken by the Secretary related to the 
    liquidation of any covered financial company under this title, 
    including collecting and summarizing--
            (A) a description of actions taken by the Secretary under 
        this title;
            (B) an analysis of the approval by the Secretary of the 
        policies and procedures of the Corporation under section 203 
        and acceptance of the orderly liquidation plan of the 
        Corporation under section 210; and
            (C) an assessment of the terms and conditions underlying 
        the purchase by the Secretary of obligations of the Corporation 
        under section 210.
        (2) Frequency.--Not later than 6 months after the date of 
    appointment of the Corporation as receiver under this title and 
    every 6 months thereafter, the Inspector General of the Department 
    of the Treasury shall conduct the audit and investigation described 
    in paragraph (1).
        (3) Reports and testimony.--The Inspector General of the 
    Department of the Treasury shall include in the semiannual reports 
    required by section 5(a) of the Inspector General Act of 1978 (5 
    U.S.C. App.), a summary of the findings and assessments under 
    paragraph (1), and shall appear before the appropriate committees 
    of Congress, if requested, to present each such report.
        (4) Termination of responsibilities.--The duties and 
    responsibilities of the Inspector General of the Department of the 
    Treasury under this subsection shall terminate 1 year after the 
    date on which the obligations purchased by the Secretary from the 
    Corporation under section 210 are fully redeemed.
    (f) Primary Financial Regulatory Agency Inspector General 
Reviews.--
        (1) Scope.--Upon the appointment of the Corporation as receiver 
    for a covered financial company supervised by a Federal primary 
    financial regulatory agency or the Board of Governors under section 
    165, the Inspector General of the agency or the Board of Governors 
    shall make a written report reviewing the supervision by the agency 
    or the Board of Governors of the covered financial company, which 
    shall--
            (A) evaluate the effectiveness of the agency or the Board 
        of Governors in carrying out its supervisory responsibilities 
        with respect to the covered financial company;
            (B) identify any acts or omissions on the part of agency or 
        Board of Governors officials that contributed to the covered 
        financial company being in default or in danger of default;
            (C) identify any actions that could have been taken by the 
        agency or the Board of Governors that would have prevented the 
        company from being in default or in danger of default; and
            (D) recommend appropriate administrative or legislative 
        action.
        (2) Reports and testimony.--Not later than 1 year after the 
    date of appointment of the Corporation as receiver under this 
    title, the Inspector General of the Federal primary financial 
    regulatory agency or the Board of Governors shall provide the 
    report required by paragraph (1) to such agency or the Board of 
    Governors, and along with such agency or the Board of Governors, as 
    applicable, shall appear before the appropriate committees of 
    Congress, if requested, to present the report required by paragraph 
    (1). Not later than 90 days after the date of receipt of the report 
    required by paragraph (1), such agency or the Board of Governors, 
    as applicable, shall provide a written report to Congress 
    describing any actions taken in response to the recommendations in 
    the report, and if no such actions were taken, describing the 
    reasons why no actions were taken.
    SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVENTION OF CONFLICTS 
      OF INTEREST.
    (a) No Other Funding.--Funds for the orderly liquidation of any 
covered financial company under this title shall only be provided as 
specified under this title.
    (b) Limit on Governmental Actions.--No governmental entity may take 
any action to circumvent the purposes of this title.
    (c) Conflict of Interest.--In the event that the Corporation is 
appointed receiver for more than 1 covered financial company or is 
appointed receiver for a covered financial company and receiver for any 
insured depository institution that is an affiliate of such covered 
financial company, the Corporation shall take appropriate action, as 
necessary to avoid any conflicts of interest that may arise in 
connection with multiple receiverships.
    SEC. 213. BAN ON CERTAIN ACTIVITIES BY SENIOR EXECUTIVES AND 
      DIRECTORS.
    (a) Prohibition Authority.--The Board of Governors or, if the 
covered financial company was not supervised by the Board of Governors, 
the Corporation, may exercise the authority provided by this section.
    (b) Authority To Issue Order.--The appropriate agency described in 
subsection (a) may take any action authorized by subsection (c), if the 
agency determines that--
        (1) a senior executive or a director of the covered financial 
    company, prior to the appointment of the Corporation as receiver, 
    has, directly or indirectly--
            (A) violated--
                (i) any law or regulation;
                (ii) any cease-and-desist order which has become final;
                (iii) any condition imposed in writing by a Federal 
            agency in connection with any action on any application, 
            notice, or request by such company or senior executive; or
                (iv) any written agreement between such company and 
            such agency;
            (B) engaged or participated in any unsafe or unsound 
        practice in connection with any financial company; or
            (C) committed or engaged in any act, omission, or practice 
        which constitutes a breach of the fiduciary duty of such senior 
        executive or director;
        (2) by reason of the violation, practice, or breach described 
    in any subparagraph of paragraph (1), such senior executive or 
    director has received financial gain or other benefit by reason of 
    such violation, practice, or breach and such violation, practice, 
    or breach contributed to the failure of the company; and
        (3) such violation, practice, or breach--
            (A) involves personal dishonesty on the part of such senior 
        executive or director; or
            (B) demonstrates willful or continuing disregard by such 
        senior executive or director for the safety or soundness of 
        such company.
    (c) Authorized Actions.--
        (1) In general.--The appropriate agency for a financial 
    company, as described in subsection (a), may serve upon a senior 
    executive or director described in subsection (b) a written notice 
    of the intention of the agency to prohibit any further 
    participation by such person, in any manner, in the conduct of the 
    affairs of any financial company for a period of time determined by 
    the appropriate agency to be commensurate with such violation, 
    practice, or breach, provided such period shall be not less than 2 
    years.
        (2) Procedures.--The due process requirements and other 
    procedures under section 8(e) of the Federal Deposit Insurance Act 
    (12 U.S.C. 1818(e)) shall apply to actions under this section as if 
    the covered financial company were an insured depository 
    institution and the senior executive or director were an 
    institution-affiliated party, as those terms are defined in that 
    Act.
    (d) Regulations.--The Corporation and the Board of Governors, in 
consultation with the Council, shall jointly prescribe rules or 
regulations to administer and carry out this section, including rules, 
regulations, or guidelines to further define the term senior executive 
for the purposes of this section.
    SEC. 214. PROHIBITION ON TAXPAYER FUNDING.
    (a) Liquidation Required.--All financial companies put into 
receivership under this title shall be liquidated. No taxpayer funds 
shall be used to prevent the liquidation of any financial company under 
this title.
    (b) Recovery of Funds.--All funds expended in the liquidation of a 
financial company under this title shall be recovered from the 
disposition of assets of such financial company, or shall be the 
responsibility of the financial sector, through assessments.
    (c) No Losses to Taxpayers.--Taxpayers shall bear no losses from 
the exercise of any authority under this title.
    SEC. 215. STUDY ON SECURED CREDITOR HAIRCUTS.
    (a) Study Required.--The Council shall conduct a study evaluating 
the importance of maximizing United States taxpayer protections and 
promoting market discipline with respect to the treatment of fully 
secured creditors in the utilization of the orderly liquidation 
authority authorized by this Act. In carrying out such study, the 
Council shall--
        (1) not be prejudicial to current or past laws or regulations 
    with respect to secured creditor treatment in a resolution process;
        (2) study the similarities and differences between the 
    resolution mechanisms authorized by the Bankruptcy Code, the 
    Federal Deposit Insurance Corporation Improvement Act of 1991, and 
    the orderly liquidation authority authorized by this Act;
        (3) determine how various secured creditors are treated in such 
    resolution mechanisms and examine how a haircut (of various 
    degrees) on secured creditors could improve market discipline and 
    protect taxpayers;
        (4) compare the benefits and dynamics of prudent lending 
    practices by depository institutions in secured loans for consumers 
    and small businesses to the lending practices of secured creditors 
    to large, interconnected financial firms;
        (5) consider whether credit differs according to different 
    types of collateral and different terms and timing of the extension 
    of credit; amd
        (6) include an examination of stakeholders who were unsecured 
    or under-collateralized and seek collateral when a firm is failing, 
    and the impact that such behavior has on financial stability and an 
    orderly resolution that protects taxpayers if the firm fails.
    (b) Report.--Not later than the end of the 1-year period beginning 
on the date of enactment of this Act, the Council shall issue a report 
to the Congress containing all findings and conclusions made by the 
Council in carrying out the study required under subsection (a).
    SEC. 216. STUDY ON BANKRUPTCY PROCESS FOR FINANCIAL AND NONBANK 
      FINANCIAL INSTITUTIONS.
    (a) Study.--
        (1) In general.--Upon enactment of this Act, the Board of 
    Governors, in consultation with the Administrative Office of the 
    United States Courts, shall conduct a study regarding the 
    resolution of financial companies under the Bankruptcy Code, under 
    chapter 7 or 11 thereof .
        (2) Issues to be studied.--Issues to be studied under this 
    section include--
            (A) the effectiveness of chapter 7 and chapter 11 of the 
        Bankruptcy Code in facilitating the orderly resolution or 
        reorganization of systemic financial companies;
            (B) whether a special financial resolution court or panel 
        of special masters or judges should be established to oversee 
        cases involving financial companies to provide for the 
        resolution of such companies under the Bankruptcy Code, in a 
        manner that minimizes adverse impacts on financial markets 
        without creating moral hazard;
            (C) whether amendments to the Bankruptcy Code should be 
        adopted to enhance the ability of the Code to resolve financial 
        companies in a manner that minimizes adverse impacts on 
        financial markets without creating moral hazard;
            (D) whether amendments should be made to the Bankruptcy 
        Code, the Federal Deposit Insurance Act, and other insolvency 
        laws to address the manner in which qualified financial 
        contracts of financial companies are treated; and
            (E) the implications, challenges, and benefits to creating 
        a new chapter or subchapter of the Bankruptcy Code to deal with 
        financial companies.
    (b) Reports to Congress.--Not later than 1 year after the date of 
enactment of this Act, and in each successive year until the fifth year 
after the date of enactment of this Act, the Administrative Office of 
the United States courts shall submit to the Committees on Banking, 
Housing, and Urban Affairs and the Judiciary of the Senate and the 
Committees on Financial Services and the Judiciary of the House of 
Representatives a report summarizing the results of the study conducted 
under subsection (a).
    SEC. 217. STUDY ON INTERNATIONAL COORDINATION RELATING TO 
      BANKRUPTCY PROCESS FOR NONBANK FINANCIAL INSTITUTIONS.
    (a) Study.--
        (1) In general.--The Board of Governors, in consultation with 
    the Administrative Office of the United States Courts, shall 
    conduct a study regarding international coordination relating to 
    the resolution of systemic financial companies under the United 
    States Bankruptcy Code and applicable foreign law.
        (2) Issues to be studied.--With respect to the bankruptcy 
    process for financial companies, issues to be studied under this 
    section include--
            (A) the extent to which international coordination 
        currently exists;
            (B) current mechanisms and structures for facilitating 
        international cooperation;
            (C) barriers to effective international coordination; and
            (D) ways to increase and make more effective international 
        coordination of the resolution of financial companies, so as to 
        minimize the impact on the financial system without creating 
        moral hazard.
    (b) Report to Congress.--Not later than 1 year after the date of 
enactment of this Act, the Administrative office of the United States 
Courts shall submit to the Committees on Banking, Housing, and Urban 
Affairs and the Judiciary of the Senate and the Committees on Financial 
Services and the Judiciary of the House of Representatives a report 
summarizing the results of the study conducted under subsection (a).

 TITLE III--TRANSFER OF POWERS TO THE COMPTROLLER OF THE CURRENCY, THE 
                CORPORATION, AND THE BOARD OF GOVERNORS

    SEC. 300. SHORT TITLE.
    This title may be cited as the ``Enhancing Financial Institution 
Safety and Soundness Act of 2010''.
    SEC. 301. PURPOSES.
    The purposes of this title are--
        (1) to provide for the safe and sound operation of the banking 
    system of the United States;
        (2) to preserve and protect the dual system of Federal and 
    State-chartered depository institutions;
        (3) to ensure the fair and appropriate supervision of each 
    depository institution, regardless of the size or type of charter 
    of the depository institution; and
        (4) to streamline and rationalize the supervision of depository 
    institutions and the holding companies of depository institutions.
    SEC. 302. DEFINITION.
    In this title, the term ``transferred employee'' means, as the 
context requires, an employee transferred to the Office of the 
Comptroller of the Currency or the Corporation under section 322.

               Subtitle A--Transfer of Powers and Duties

    SEC. 311. TRANSFER DATE.
    (a) Transfer Date.--Except as provided in subsection (b), the term 
``transfer date'' means the date that is 1 year after the date of 
enactment of this Act.
    (b) Extension Permitted.--
        (1) Notice required.--The Secretary, in consultation with the 
    Comptroller of the Currency, the Director of the Office of Thrift 
    Supervision, the Chairman of the Board of Governors, and the 
    Chairperson of the Corporation, may extend the period under 
    subsection (a) and designate a transfer date that is not later than 
    18 months after the date of enactment of this Act, if the Secretary 
    transmits to the Committee on Banking, Housing, and Urban Affairs 
    of the Senate and the Committee on Financial Services of the House 
    of Representatives--
            (A) a written determination that commencement of the 
        orderly process to implement this title is not feasible by the 
        date that is 1 year after the date of enactment of this Act;
            (B) an explanation of why an extension is necessary to 
        commence the process of orderly implementation of this title;
            (C) the transfer date designated under this subsection; and
            (D) a description of the steps that will be taken to 
        initiate the process of an orderly and timely implementation of 
        this title within the extended time period.
        (2) Publication of notice.--Not later than 270 days after the 
    date of enactment of this Act, the Secretary shall publish in the 
    Federal Register notice of any transfer date designated under 
    paragraph (1).
    SEC. 312. POWERS AND DUTIES TRANSFERRED.
    (a) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the transfer date.
    (b) Functions of the Office of Thrift Supervision.--
        (1) Savings and loan holding company functions transferred.--
            (A) Transfer of functions.--There are transferred to the 
        Board of Governors all functions of the Office of Thrift 
        Supervision and the Director of the Office of Thrift 
        Supervision (including the authority to issue orders) relating 
        to--
                (i) the supervision of--

                    (I) any savings and loan holding company; and
                    (II) any subsidiary (other than a depository 
                institution) of a savings and loan holding company; and

                (ii) all rulemaking authority of the Office of Thrift 
            Supervision and the Director of the Office of Thrift 
            Supervision relating to savings and loan holding companies.
            (B) Powers, authorities, rights, and duties.--The Board of 
        Governors shall succeed to all powers, authorities, rights, and 
        duties that were vested in the Office of Thrift Supervision and 
        the Director of the Office of Thrift Supervision on the day 
        before the transfer date relating to the functions and 
        authority transferred under subparagraph (A).
        (2) All other functions transferred.--
            (A) Board of governors.--All rulemaking authority of the 
        Office of Thrift Supervision and the Director of the Office of 
        Thrift Supervision under section 11 of the Home Owners' Loan 
        Act (12 U.S.C. 1468) relating to transactions with affiliates 
        and extensions of credit to executive officers, directors, and 
        principal shareholders and under section 5(q) of such Act 
        relating to tying arrangements is transferred to the Board of 
        Governors.
            (B) Comptroller of the currency.--Except as provided in 
        paragraph (1) and subparagraph (A)--
                (i) there are transferred to the Office of the 
            Comptroller of the Currency and the Comptroller of the 
            Currency--

                    (I) all functions of the Office of Thrift 
                Supervision and the Director of the Office of Thrift 
                Supervision, respectively, relating to Federal savings 
                associations; and
                    (II) all rulemaking authority of the Office of 
                Thrift Supervision and the Director of the Office of 
                Thrift Supervision, respectively, relating to savings 
                associations; and

                (ii) the Office of the Comptroller of the Currency and 
            the Comptroller of the Currency shall succeed to all 
            powers, authorities, rights, and duties that were vested in 
            the Office of Thrift Supervision and the Director of the 
            Office of Thrift Supervision, respectively, on the day 
            before the transfer date relating to the functions and 
            authority transferred under clause (i).
            (C) Corporation.--Except as provided in paragraph (1) and 
        subparagraphs (A) and (B)--
                (i) all functions of the Office of Thrift Supervision 
            and the Director of the Office of Thrift Supervision 
            relating to State savings associations are transferred to 
            the Corporation; and
                (ii) the Corporation shall succeed to all powers, 
            authorities, rights, and duties that were vested in the 
            Office of Thrift Supervision and the Director of the Office 
            of Thrift Supervision on the day before the transfer date 
            relating to the functions transferred under clause (i).
    (c) Conforming Amendments.--Section 3 of the Federal Deposit 
Insurance Act (12 U.S.C. 1813) is amended--
        (1) in subsection (q), by striking paragraphs (1) through (4) 
    and inserting the following:
        ``(1) the Office of the Comptroller of the Currency, in the 
    case of--
            ``(A) any national banking association;
            ``(B) any Federal branch or agency of a foreign bank; and
            ``(C) any Federal savings association;
        ``(2) the Federal Deposit Insurance Corporation, in the case 
    of--
            ``(A) any State nonmember insured bank;
            ``(B) any foreign bank having an insured branch; and
            ``(C) any State savings association;
        ``(3) the Board of Governors of the Federal Reserve System, in 
    the case of--
            ``(A) any State member bank;
            ``(B) any branch or agency of a foreign bank with respect 
        to any provision of the Federal Reserve Act which is made 
        applicable under the International Banking Act of 1978;
            ``(C) any foreign bank which does not operate an insured 
        branch;
            ``(D) any agency or commercial lending company other than a 
        Federal agency;
            ``(E) supervisory or regulatory proceedings arising from 
        the authority given to the Board of Governors under section 
        7(c)(1) of the International Banking Act of 1978, including 
        such proceedings under the Financial Institutions Supervisory 
        Act of 1966;
            ``(F) any bank holding company and any subsidiary (other 
        than a depository institution) of a bank holding company; and
            ``(G) any savings and loan holding company and any 
        subsidiary (other than a depository institution) of a savings 
        and loan holding company.''; and
        (2) in paragraphs (1) and (3) of subsection (u), by striking 
    ``(other than a bank holding company'' and inserting ``(other than 
    a bank holding company or savings and loan holding company''.
    (d) Consumer Protection.--Nothing in this section may be construed 
to limit or otherwise affect the transfer of powers under title X.
    SEC. 313. ABOLISHMENT.
    Effective 90 days after the transfer date, the Office of Thrift 
Supervision and the position of Director of the Office of Thrift 
Supervision are abolished.
    SEC. 314. AMENDMENTS TO THE REVISED STATUTES.
    (a) Amendment to Section 324.--Section 324 of the Revised Statutes 
of the United States (12 U.S.C. 1) is amended to read as follows:
    ``SEC. 324. COMPTROLLER OF THE CURRENCY.
    ``(a) Office of the Comptroller of the Currency Established.--There 
is established in the Department of the Treasury a bureau to be known 
as the `Office of the Comptroller of the Currency' which is charged 
with assuring the safety and soundness of, and compliance with laws and 
regulations, fair access to financial services, and fair treatment of 
customers by, the institutions and other persons subject to its 
jurisdiction.
    ``(b) Comptroller of the Currency.--
        ``(1) In general.--The chief officer of the Office of the 
    Comptroller of the Currency shall be known as the Comptroller of 
    the Currency. The Comptroller of the Currency shall perform the 
    duties of the Comptroller of the Currency under the general 
    direction of the Secretary of the Treasury. The Secretary of the 
    Treasury may not delay or prevent the issuance of any rule or the 
    promulgation of any regulation by the Comptroller of the Currency, 
    and may not intervene in any matter or proceeding before the 
    Comptroller of the Currency (including agency enforcement actions), 
    unless otherwise specifically provided by law.
        ``(2) Additional authority.--The Comptroller of the Currency 
    shall have the same authority with respect to functions transferred 
    to the Comptroller of the Currency under the Enhancing Financial 
    Institution Safety and Soundness Act of 2010 as was vested in the 
    Director of the Office of Thrift Supervision on the transfer date, 
    as defined in section 311 of that Act.''.
    (b) Supervision of Federal Savings Associations.--Chapter 9 of 
title VII of the Revised Statutes of the United States (12 U.S.C. 1 et 
seq.) is amended by inserting after section 327A (12 U.S.C. 4a) the 
following:
``SEC. 327B. DEPUTY COMPTROLLER FOR THE SUPERVISION AND EXAMINATION OF 
FEDERAL SAVINGS ASSOCIATIONS.
    ``The Comptroller of the Currency shall designate a Deputy 
Comptroller, who shall be responsible for the supervision and 
examination of Federal savings associations.''.
    (c) Amendment to Section 329.--Section 329 of the Revised Statutes 
of the United States (12 U.S.C. 11) is amended by inserting before the 
period at the end the following: ``or any Federal savings 
association''.
    (d) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the transfer date.
    SEC. 315. FEDERAL INFORMATION POLICY.
    Section 3502(5) of title 44, United States Code, is amended by 
inserting ``Office of the Comptroller of the Currency,'' after ``the 
Securities and Exchange Commission,''.
    SEC. 316. SAVINGS PROVISIONS.
    (a) Office of Thrift Supervision.--
        (1) Existing rights, duties, and obligations not affected.--
    Sections 312(b) and 313 shall not affect the validity of any right, 
    duty, or obligation of the United States, the Director of the 
    Office of Thrift Supervision, the Office of Thrift Supervision, or 
    any other person, that existed on the day before the transfer date.
        (2) Continuation of suits.--This title shall not abate any 
    action or proceeding commenced by or against the Director of the 
    Office of Thrift Supervision or the Office of Thrift Supervision 
    before the transfer date, except that--
            (A) for any action or proceeding arising out of a function 
        of the Office of Thrift Supervision or the Director of the 
        Office of Thrift Supervision transferred to the Board of 
        Governors by this title, the Board of Governors shall be 
        substituted for the Office of Thrift Supervision or the 
        Director of the Office of Thrift Supervision as a party to the 
        action or proceeding on and after the transfer date;
            (B) for any action or proceeding arising out of a function 
        of the Office of Thrift Supervision or the Director of the 
        Office of Thrift Supervision transferred to the Office of the 
        Comptroller of the Currency or the Comptroller of the Currency 
        by this title, the Office of the Comptroller of the Currency or 
        the Comptroller of the Currency shall be substituted for the 
        Office of Thrift Supervision or the Director of the Office of 
        Thrift Supervision, as the case may be, as a party to the 
        action or proceeding on and after the transfer date; and
            (C) for any action or proceeding arising out of a function 
        of the Office of Thrift Supervision or the Director of the 
        Office of Thrift Supervision transferred to the Corporation by 
        this title, the Corporation shall be substituted for the Office 
        of Thrift Supervision or the Director of the Office of Thrift 
        Supervision as a party to the action or proceeding on and after 
        the transfer date.
    (b) Continuation of Existing OTS Orders, Resolutions, 
Determinations, Agreements, Regulations, etc.--All orders, resolutions, 
determinations, agreements, and regulations, interpretative rules, 
other interpretations, guidelines, procedures, and other advisory 
materials, that have been issued, made, prescribed, or allowed to 
become effective by the Office of Thrift Supervision or the Director of 
the Office of Thrift Supervision, or by a court of competent 
jurisdiction, in the performance of functions that are transferred by 
this title and that are in effect on the day before the transfer date, 
shall continue in effect according to the terms of such orders, 
resolutions, determinations, agreements, and regulations, 
interpretative rules, other interpretations, guidelines, procedures, 
and other advisory materials, and shall be enforceable by or against--
        (1) the Board of Governors, in the case of a function of the 
    Office of Thrift Supervision or the Director of the Office of 
    Thrift Supervision transferred to the Board of Governors, until 
    modified, terminated, set aside, or superseded in accordance with 
    applicable law by the Board of Governors, by any court of competent 
    jurisdiction, or by operation of law;
        (2) the Office of the Comptroller of the Currency or the 
    Comptroller of the Currency, in the case of a function of the 
    Office of Thrift Supervision or the Director of the Office of 
    Thrift Supervision transferred to the Office of the Comptroller of 
    the Currency or the Comptroller of the Currency, respectively, 
    until modified, terminated, set aside, or superseded in accordance 
    with applicable law by the Office of the Comptroller of the 
    Currency or the Comptroller of the Currency, by any court of 
    competent jurisdiction, or by operation of law; and
        (3) the Corporation, in the case of a function of the Office of 
    Thrift Supervision or the Director of the Office of Thrift 
    Supervision transferred to the Corporation, until modified, 
    terminated, set aside, or superseded in accordance with applicable 
    law by the Corporation, by any court of competent jurisdiction, or 
    by operation of law.
    (c) Identification of Regulations Continued.--
        (1) By the board of governors.--Not later than the transfer 
    date, the Board of Governors shall--
            (A) identify the regulations continued under subsection (b) 
        that will be enforced by the Board of Governors; and
            (B) publish a list of the regulations identified under 
        subparagraph (A) in the Federal Register.
        (2) By office of the comptroller of the currency.--Not later 
    than the transfer date, the Office of the Comptroller of the 
    Currency shall--
            (A) after consultation with the Corporation, identify the 
        regulations continued under subsection (b) that will be 
        enforced by the Office of the Comptroller of the Currency; and
            (B) publish a list of the regulations identified under 
        subparagraph (A) in the Federal Register.
        (3) By the corporation.--Not later than the transfer date, the 
    Corporation shall--
            (A) after consultation with the Office of the Comptroller 
        of the Currency, identify the regulations continued under 
        subsection (b) that will be enforced by the Corporation; and
            (B) publish a list of the regulations identified under 
        subparagraph (A) in the Federal Register.
    (d) Status of Regulations Proposed or Not Yet Effective.--
        (1) Proposed regulations.--Any proposed regulation of the 
    Office of Thrift Supervision, which the Office of Thrift 
    Supervision in performing functions transferred by this title, has 
    proposed before the transfer date but has not published as a final 
    regulation before such date, shall be deemed to be a proposed 
    regulation of the Office of the Comptroller of the Currency or the 
    Board of Governors, as appropriate, according to the terms of the 
    proposed regulation.
        (2) Regulations not yet effective.--Any interim or final 
    regulation of the Office of Thrift Supervision, which the Office of 
    Thrift Supervision, in performing functions transferred by this 
    title, has published before the transfer date but which has not 
    become effective before that date, shall become effective as a 
    regulation of the Office of the Comptroller of the Currency or the 
    Board of Governors, as appropriate, according to the terms of the 
    interim or final regulation, unless modified, terminated, set 
    aside, or superseded in accordance with applicable law by the 
    Office of the Comptroller of the Currency or the Board of 
    Governors, as appropriate, by any court of competent jurisdiction, 
    or by operation of law.
    SEC. 317. REFERENCES IN FEDERAL LAW TO FEDERAL BANKING AGENCIES.
    On and after the transfer date, any reference in Federal law to the 
Director of the Office of Thrift Supervision or the Office of Thrift 
Supervision, in connection with any function of the Director of the 
Office of Thrift Supervision or the Office of Thrift Supervision 
transferred under section 312(b) or any other provision of this 
subtitle, shall be deemed to be a reference to the Comptroller of the 
Currency, the Office of the Comptroller of the Currency, the 
Chairperson of the Corporation, the Corporation, the Chairman of the 
Board of Governors, or the Board of Governors, as appropriate and 
consistent with the amendments made in subtitle E.
    SEC. 318. FUNDING.
    (a) Compensation of Examiners.--Section 5240 of the Revised 
Statutes of the United States (12 U.S.C. 481 et seq.) is amended--
        (1) in the second undesignated paragraph (12 U.S.C. 481), in 
    the fourth sentence, by striking ``without regard to the provisions 
    of other laws applicable to officers or employees of the United 
    States'' and inserting the following: ``set and adjusted subject to 
    chapter 71 of title 5, United States Code, and without regard to 
    the provisions of other laws applicable to officers or employees of 
    the United States''; and
        (2) in the third undesignated paragraph (12 U.S.C. 482), in the 
    first sentence, by striking ``shall fix'' and inserting ``shall, 
    subject to chapter 71 of title 5, United States Code, fix''.
    (b) Funding of Office of the Comptroller of the Currency.--Chapter 
4 of title LXII of the Revised Statutes is amended by inserting after 
section 5240 (12 U.S.C. 481, 482) the following:
    ``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 Office of the Comptroller of the Currency. In 
establishing the amount of an assessment, fee, or charge collected from 
an entity under this section, the Comptroller of the Currency may take 
into account the nature and scope of the activities of the entity, the 
amount and type of assets that the entity holds, the financial and 
managerial condition of the entity, and any other factor, as the 
Comptroller of the Currency determines is appropriate. Funds derived 
from any assessment, fee, or charge collected or payment made pursuant 
to this section may be deposited by the Comptroller of the Currency in 
accordance with the provisions of section 5234. Such funds shall not be 
construed to be Government funds or appropriated monies, and shall not 
be subject to apportionment for purposes of chapter 15 of title 31, 
United States Code, or any other provision of law. The authority of the 
Comptroller of the Currency under this section shall be in addition to 
the authority under section 5240.
    ``The Comptroller of the Currency shall have sole authority to 
determine the manner in which the obligations of the Office of the 
Comptroller of the Currency shall be incurred and its disbursements and 
expenses allowed and paid, in accordance with this section, except as 
provided in chapter 71 of title 5, United States Code (with respect to 
compensation).''.
    (c) Funding of Board of Governors.--Section 11 of the Federal 
Reserve Act (12 U.S.C. 248) is amended by adding at the end the 
following:
    ``(s) Assessments, Fees, and Other Charges for Certain Companies.--
        ``(1) In general.--The Board shall collect a total amount of 
    assessments, fees, or other charges from the companies described in 
    paragraph (2) that is equal to the total expenses the Board 
    estimates are necessary or appropriate to carry out the supervisory 
    and regulatory responsibilities of the Board with respect to such 
    companies.
        ``(2) Companies.--The companies described in this paragraph 
    are--
            ``(A) all bank holding companies having total consolidated 
        assets of $50,000,000,000 or more;
            ``(B) all savings and loan holding companies having total 
        consolidated assets of $50,000,000,000 or more; and
            ``(C) all nonbank financial companies supervised by the 
        Board under section 113 of the Dodd-Frank Wall Street Reform 
        and Consumer Protection Act.''.
    (d) Corporation Examination Fees.--Section 10(e) of the Federal 
Deposit Insurance Act (12 U.S.C. 1820(e)) is amended by striking 
paragraph (1) and inserting the following:
        ``(1) Regular and special examinations of depository 
    institutions.--The cost of conducting any regular examination or 
    special examination of any depository institution under subsection 
    (b)(2), (b)(3), or (d) or of any entity described in section 
    3(q)(2) may be assessed by the Corporation against the institution 
    or entity to meet the expenses of the Corporation in carrying out 
    such examinations.''.
    (e) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the transfer date.
    SEC. 319. CONTRACTING AND LEASING AUTHORITY.
    Notwithstanding the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 251 et seq.) or any other provision of law 
(except the full and open competition requirements of the Competition 
in Contracting Act), the Office of the Comptroller of the Currency 
may--
        (1) enter into and perform contracts, execute instruments, and 
    acquire real property (or property interest) as the Comptroller 
    deems necessary to carry out the duties and responsibilities of the 
    Office of the Comptroller of the Currency; and
        (2) hold, maintain, sell, lease, or otherwise dispose of the 
    property (or property interest) acquired under paragraph (1).

                  Subtitle B--Transitional Provisions

    SEC. 321. INTERIM USE OF FUNDS, PERSONNEL, AND PROPERTY OF THE 
      OFFICE OF THRIFT SUPERVISION.
    (a) In General.--Before the transfer date, the Office of the 
Comptroller of the Currency, the Corporation, and the Board of 
Governors shall--
        (1) consult and cooperate with the Office of Thrift Supervision 
    to facilitate the orderly transfer of functions to the Office of 
    the Comptroller of the Currency, the Corporation, and the Board of 
    Governors in accordance with this title;
        (2) determine jointly, from time to time--
            (A) the amount of funds necessary to pay any expenses 
        associated with the transfer of functions (including expenses 
        for personnel, property, and administrative services) during 
        the period beginning on the date of enactment of this Act and 
        ending on the transfer date;
            (B) which personnel are appropriate to facilitate the 
        orderly transfer of functions by this title; and
            (C) what property and administrative services are necessary 
        to support the Office of the Comptroller of the Currency, the 
        Corporation, and the Board of Governors during the period 
        beginning on the date of enactment of this Act and ending on 
        the transfer date; and
        (3) take such actions as may be necessary to provide for the 
    orderly implementation of this title.
    (b) Agency Consultation.--When requested jointly by the Office of 
the Comptroller of the Currency, the Corporation, and the Board of 
Governors to do so before the transfer date, the Office of Thrift 
Supervision shall--
        (1) pay to the Office of the Comptroller of the Currency, the 
    Corporation, or the Board of Governors, as applicable, from funds 
    obtained by the Office of Thrift Supervision through assessments, 
    fees, or other charges that the Office of Thrift Supervision is 
    authorized by law to impose, such amounts as the Office of the 
    Comptroller of the Currency, the Corporation, and the Board of 
    Governors jointly determine to be necessary under subsection (a);
        (2) detail to the Office of the Comptroller of the Currency, 
    the Corporation, or the Board of Governors, as applicable, such 
    personnel as the Office of the Comptroller of the Currency, the 
    Corporation, and the Board of Governors jointly determine to be 
    appropriate under subsection (a); and
        (3) make available to the Office of the Comptroller of the 
    Currency, the Corporation, or the Board of Governors, as 
    applicable, such property and provide to the Office of the 
    Comptroller of the Currency, the Corporation, or the Board of 
    Governors, as applicable, such administrative services as the 
    Office of the Comptroller of the Currency, the Corporation, and the 
    Board of Governors jointly determine to be necessary under 
    subsection (a).
    (c) Notice Required.--The Office of the Comptroller of the 
Currency, the Corporation, and the Board of Governors shall jointly 
give the Office of Thrift Supervision reasonable prior notice of any 
request that the Office of the Comptroller of the Currency, the 
Corporation, and the Board of Governors jointly intend to make under 
subsection (b).
    SEC. 322. TRANSFER OF EMPLOYEES.
    (a) In General.--
        (1) Office of thrift supervision employees.--
            (A) In general.--Except as provided in section 1064, all 
        employees of the Office of Thrift Supervision shall be 
        transferred to the Office of the Comptroller of the Currency or 
        the Corporation for employment in accordance with this section.
            (B) Allocating employees for transfer to receiving 
        agencies.--The Director of the Office of Thrift Supervision, 
        the Comptroller of the Currency, and the Chairperson of the 
        Corporation shall--
                (i) jointly determine the number of employees of the 
            Office of Thrift Supervision necessary to perform or 
            support the functions that are transferred to the Office of 
            the Comptroller of the Currency or the Corporation by this 
            title; and
                (ii) consistent with the determination under clause 
            (i), jointly identify employees of the Office of Thrift 
            Supervision for transfer to the Office of the Comptroller 
            of the Currency or the Corporation.
        (2) Employees transferred; service periods credited.--For 
    purposes of this section, periods of service with a Federal home 
    loan bank, a joint office of Federal home loan banks, or a Federal 
    reserve bank shall be credited as periods of service with a Federal 
    agency.
        (3) Appointment authority for excepted service transferred.--
            (A) In general.--Except as provided in subparagraph (B), 
        any appointment authority of the Office of Thrift Supervision 
        under Federal law that relates to the functions transferred 
        under section 312, including the regulations of the Office of 
        Personnel Management, for filling the positions of employees in 
        the excepted service shall be transferred to the Comptroller of 
        the Currency or the Chairperson of the Corporation, as 
        appropriate.
            (B) Declining transfers allowed.--The Comptroller of the 
        Currency or the Chairperson of the Corporation may decline to 
        accept a transfer of authority under subparagraph (A) (and the 
        employees appointed under that authority) to the extent that 
        such authority relates to positions excepted from the 
        competitive service because of their confidential, policy-
        making, policy-determining, or policy-advocating character.
        (4) Additional appointment authority.--Notwithstanding any 
    other provision of law, the Office of the Comptroller of the 
    Currency and the Corporation may appoint transferred employees to 
    positions in the Office of the Comptroller of the Currency or the 
    Corporation, respectively.
    (b) Timing of Transfers and Position Assignments.--Each employee to 
be transferred under subsection (a)(1) shall--
        (1) be transferred not later than 90 days after the transfer 
    date; and
        (2) receive notice of the position assignment of the employee 
    not later than 120 days after the effective date of the transfer of 
    the employee.
    (c) Transfer of Functions.--
        (1) In general.--Notwithstanding any other provision of law, 
    the transfer of employees under this subtitle shall be deemed a 
    transfer of functions for the purpose of section 3503 of title 5, 
    United States Code.
        (2) Priority.--If any provision of this subtitle conflicts with 
    any protection provided to a transferred employee under section 
    3503 of title 5, United States Code, the provisions of this 
    subtitle shall control.
    (d) Employee Status and Eligibility.--The transfer of functions and 
employees under this subtitle, and the abolishment of the Office of 
Thrift Supervision under section 313, shall not affect the status of 
the transferred employees as employees of an agency of the United 
States under any provision of law.
    (e) Equal Status and Tenure Positions.--
        (1) Status and tenure.--Each transferred employee from the 
    Office of Thrift Supervision shall be placed in a position at the 
    Office of the Comptroller of the Currency or the Corporation with 
    the same status and tenure as the transferred employee held on the 
    day before the date on which the employee was transferred.
        (2) Functions.--To the extent practicable, each transferred 
    employee shall be placed in a position at the Office of the 
    Comptroller of the Currency or the Corporation, as applicable, 
    responsible for the same functions and duties as the transferred 
    employee had on the day before the date on which the employee was 
    transferred, in accordance with the expertise and preferences of 
    the transferred employee.
    (f) No Additional Certification Requirements.--An examiner who is a 
transferred employee shall not be subject to any additional 
certification requirements before being placed in a comparable position 
at the Office of the Comptroller of the Currency or the Corporation, if 
the examiner carries out examinations of the same type of institutions 
as an employee of the Office of the Comptroller of the Currency or the 
Corporation as the employee was responsible for carrying out before the 
date on which the employee was transferred.
    (g) Personnel Actions Limited.--
        (1) Protection.--
            (A) In general.--Except as provided in paragraph (2), each 
        affected employee shall not, during the 30-month period 
        beginning on the transfer date, be involuntarily separated, or 
        involuntarily reassigned outside his or her locality pay area.
            (B) Affected employees.--For purposes of this paragraph, 
        the term ``affected employee'' means--
                (i) an employee transferred from the Office of Thrift 
            Supervision holding a permanent position on the day before 
            the transfer date; and
                (ii) an employee of the Office of the Comptroller of 
            the Currency or the Corporation holding a permanent 
            position on the day before the transfer date.
        (2) Exceptions.--Paragraph (1) does not limit the right of the 
    Office of the Comptroller of the Currency or the Corporation to--
            (A) separate an employee for cause or for unacceptable 
        performance;
            (B) terminate an appointment to a position excepted from 
        the competitive service because of its confidential policy-
        making, policy-determining, or policy-advocating character; or
            (C) reassign an employee outside such employee's locality 
        pay area when the Office of the Comptroller of the Currency or 
        the Corporation determines that the reassignment is necessary 
        for the efficient operation of the agency.
    (h) Pay.--
        (1) 30-month protection.--Except as provided in paragraph (2), 
    during the 30-month period beginning on the date on which the 
    employee was transferred under this subtitle, a transferred 
    employee shall be paid at a rate that is not less than the basic 
    rate of pay, including any geographic differential, that the 
    transferred employee received during the pay period immediately 
    preceding the date on which the employee was transferred. 
    Notwithstanding the preceding sentence, if the employee was 
    receiving a higher rate of basic pay on a temporary basis (because 
    of a temporary assignment, temporary promotion, or other temporary 
    action) immediately before the transfer, the Agency may reduce the 
    rate of basic pay on the date the rate would have been reduced but 
    for the transfer, and the protected rate for the remainder of the 
    30-month period will be the reduced rate that would have applied 
    but for the transfer.
        (2) Exceptions.--The Comptroller of the Currency or the 
    Corporation may reduce the rate of basic pay of a transferred 
    employee--
            (A) for cause, including for unacceptable performance; or
            (B) with the consent of the transferred employee.
        (3) Protection only while employed.--This subsection shall 
    apply to a transferred employee only during the period that the 
    transferred employee remains employed by Office of the Comptroller 
    of the Currency or the Corporation.
        (4) Pay increases permitted.--Nothing in this subsection shall 
    limit the authority of the Comptroller of the Currency or the 
    Chairperson of the Corporation to increase the pay of a transferred 
    employee.
    (i) Benefits.--
        (1) Retirement benefits for transferred employees.--
            (A) In general.--
                (i) Continuation of existing retirement plan.--Each 
            transferred employee shall remain enrolled in the 
            retirement plan of the transferred employee, for as long as 
            the transferred employee is employed by the Office of the 
            Comptroller of the Currency or the Corporation.
                (ii) Employer's contribution.--The Comptroller of the 
            Currency or the Chairperson of the Corporation, as 
            appropriate, shall pay any employer contributions to the 
            existing retirement plan of each transferred employee, as 
            required under each such existing retirement plan.
            (B) Definition.--In this paragraph, the term ``existing 
        retirement plan'' means, with respect to a transferred 
        employee, the retirement plan (including the Financial 
        Institutions Retirement Fund), and any associated thrift 
        savings plan, of the agency from which the employee was 
        transferred in which the employee was enrolled on the day 
        before the date on which the employee was transferred.
        (2) Benefits other than retirement benefits.--
            (A) During first year.--
                (i) Existing plans continue.--During the 1-year period 
            following the transfer date, each transferred employee may 
            retain membership in any employee benefit program (other 
            than a retirement benefit program) of the agency from which 
            the employee was transferred under this title, including 
            any dental, vision, long term care, or life insurance 
            program to which the employee belonged on the day before 
            the transfer date.
                (ii) Employer's contribution.--The Office of the 
            Comptroller of the Currency or the Corporation, as 
            appropriate, shall pay any employer cost required to extend 
            coverage in the benefit program to the transferred employee 
            as required under that program or negotiated agreements.
            (B) Dental, vision, or life insurance after first year.--
        If, after the 1-year period beginning on the transfer date, the 
        Office of the Comptroller of the Currency or the Corporation 
        determines that the Office of the Comptroller of the Currency 
        or the Corporation, as the case may be, will not continue to 
        participate in any dental, vision, or life insurance program of 
        an agency from which an employee was transferred, a transferred 
        employee who is a member of the program may, before the 
        decision takes effect and without regard to any regularly 
        scheduled open season, elect to enroll in--
                (i) the enhanced dental benefits program established 
            under chapter 89A of title 5, United States Code;
                (ii) the enhanced vision benefits established under 
            chapter 89B of title 5, United States Code; and
                (iii) the Federal Employees' Group Life Insurance 
            Program established under chapter 87 of title 5, United 
            States Code, without regard to any requirement of 
            insurability.
            (C) Long term care insurance after 1st year.--If, after the 
        1-year period beginning on the transfer date, the Office of the 
        Comptroller of the Currency or the Corporation determines that 
        the Office of the Comptroller of the Currency or the 
        Corporation, as appropriate, will not continue to participate 
        in any long term care insurance program of an agency from which 
        an employee transferred, a transferred employee who is a member 
        of such a program may, before the decision takes effect, elect 
        to apply for coverage under the Federal Long Term Care 
        Insurance Program established under chapter 90 of title 5, 
        United States Code, under the underwriting requirements 
        applicable to a new active workforce member, as described in 
        part 875 of title 5, Code of Federal Regulations (or any 
        successor thereto).
            (D) Contribution of transferred employee.--
                (i) In general.--Subject to clause (ii), a transferred 
            employee who is enrolled in a plan under the Federal 
            Employees Health Benefits Program shall pay any employee 
            contribution required under the plan.
                (ii) Cost differential.--The Office of the Comptroller 
            of the Currency or the Corporation, as applicable, shall 
            pay any difference in cost between the employee 
            contribution required under the plan provided to 
            transferred employees by the agency from which the employee 
            transferred on the date of enactment of this Act and the 
            plan provided by the Office of the Comptroller of the 
            Currency or the Corporation, as the case may be, under this 
            section.
                (iii) Funds transfer.--The Office of the Comptroller of 
            the Currency or the Corporation, as the case may be, shall 
            transfer to the Employees Health Benefits Fund established 
            under section 8909 of title 5, United States Code, an 
            amount determined by the Director of the Office of 
            Personnel Management, after consultation with the 
            Comptroller of the Currency or the Chairperson of the 
            Corporation, as the case may be, and the Office of 
            Management and Budget, to be necessary to reimburse the 
            Fund for the cost to the Fund of providing any benefits 
            under this subparagraph that are not otherwise paid for by 
            a transferred employee under clause (i).
            (E) Special provisions to ensure continuation of life 
        insurance benefits.--
                (i) In general.--An annuitant, as defined in section 
            8901 of title 5, United States Code, who is enrolled in a 
            life insurance plan administered by an agency from which 
            employees are transferred under this title on the day 
            before the transfer date shall be eligible for coverage by 
            a life insurance plan under sections 8706(b), 8714a, 8714b, 
            or 8714c of title 5, United States Code, or by a life 
            insurance plan established by the Office of the Comptroller 
            of the Currency or the Corporation, as applicable, without 
            regard to any regularly scheduled open season or any 
            requirement of insurability.
                (ii) Contribution of transferred employee.--

                    (I) In general.--Subject to subclause (II), a 
                transferred employee enrolled in a life insurance plan 
                under this subparagraph shall pay any employee 
                contribution required by the plan.
                    (II) Cost differential.--The Office of the 
                Comptroller of the Currency or the Corporation, as the 
                case may be, shall pay any difference in cost between 
                the benefits provided by the agency from which the 
                employee transferred on the date of enactment of this 
                Act and the benefits provided under this section.
                    (III) Funds transfer.--The Office of the 
                Comptroller of the Currency or the Corporation, as the 
                case may be, shall transfer to the Federal Employees' 
                Group Life Insurance Fund established under section 
                8714 of title 5, United States Code, an amount 
                determined by the Director of the Office of Personnel 
                Management, after consultation with the Comptroller of 
                the Currency or the Chairperson of the Corporation, as 
                the case may be, and the Office of Management and 
                Budget, to be necessary to reimburse the Federal 
                Employees' Group Life Insurance Fund for the cost to 
                the Federal Employees' Group Life Insurance Fund of 
                providing benefits under this subparagraph not 
                otherwise paid for by a transferred employee under 
                subclause (I).
                    (IV) Credit for time enrolled in other plans.--For 
                any transferred employee, enrollment in a life 
                insurance plan administered by the agency from which 
                the employee transferred, immediately before enrollment 
                in a life insurance plan under chapter 87 of title 5, 
                United States Code, shall be considered as enrollment 
                in a life insurance plan under that chapter for 
                purposes of section 8706(b)(1)(A) of title 5, United 
                States Code.

    (j) Incorporation Into Agency Pay System.--Not later than 30 months 
after the transfer date, the Comptroller of the Currency and the 
Chairperson of the Corporation shall place each transferred employee 
into the established pay system and structure of the appropriate 
employing agency.
    (k) Equitable Treatment.--In administering the provisions of this 
section, the Comptroller of the Currency and the Chairperson of the 
Corporation--
        (1) may not take any action that would unfairly disadvantage a 
    transferred employee relative to any other employee of the Office 
    of the Comptroller of the Currency or the Corporation on the basis 
    of prior employment by the Office of Thrift Supervision;
        (2) may take such action as is appropriate in an individual 
    case to ensure that a transferred employee receives equitable 
    treatment, with respect to the status, tenure, pay, benefits (other 
    than benefits under programs administered by the Office of 
    Personnel Management), and accrued leave or vacation time for prior 
    periods of service with any Federal agency of the transferred 
    employee;
        (3) shall, jointly with the Director of the Office of Thrift 
    Supervision, develop and adopt procedures and safeguards designed 
    to ensure that the requirements of this subsection are met; and
        (4) shall conduct a study detailing the position assignments of 
    all employees transferred pursuant to subsection (a), describing 
    the procedures and safeguards adopted pursuant to paragraph (3), 
    and demonstrating that the requirements of this subsection have 
    been met; and shall, not later than 365 days after the transfer 
    date, submit a copy of such study to Congress.
    (l) Reorganization.--
        (1) In general.--If the Comptroller of the Currency or the 
    Chairperson of the Corporation determines, during the 2-year period 
    beginning 1 year after the transfer date, that a reorganization of 
    the staff of the Office of the Comptroller of the Currency or the 
    Corporation, respectively, is required, the reorganization shall be 
    deemed a ``major reorganization'' for purposes of affording 
    affected employees retirement under section 8336(d)(2) or 
    8414(b)(1)(B) of title 5, United States Code.
        (2) Service credit.--For purposes of this subsection, periods 
    of service with a Federal home loan bank or a joint office of 
    Federal home loan banks shall be credited as periods of service 
    with a Federal agency.
    SEC. 323. PROPERTY TRANSFERRED.
    (a) Property Defined.--For purposes of this section, the term 
``property'' includes all real property (including leaseholds) and all 
personal property, including computers, furniture, fixtures, equipment, 
books, accounts, records, reports, files, memoranda, paper, reports of 
examination, work papers, and correspondence related to such reports, 
and any other information or materials.
    (b) Property of the Office of Thrift Supervision.--
        (1) In general.--No later than 90 days after the transfer date, 
    all property of the Office of Thrift Supervision (other than 
    property described under paragraph (b)(2)) that the Comptroller of 
    the Currency and the Chairperson of the Corporation jointly 
    determine is used, on the day before the transfer date, to perform 
    or support the functions of the Office of Thrift Supervision 
    transferred to the Office of the Comptroller of the Currency or the 
    Corporation under this title, shall be transferred to the Office of 
    the Comptroller of the Currency or the Corporation in a manner 
    consistent with the transfer of employees under this subtitle.
        (2) Personal property.--All books, accounts, records, reports, 
    files, memoranda, papers, documents, reports of examination, work 
    papers, and correspondence of the Office of Thrift Supervision that 
    the Comptroller of the Currency, the Chairperson of the 
    Corporation, and the Chairman of the Board of Governors jointly 
    determine is used, on the day before the transfer date, to perform 
    or support the functions of the Office of Thrift Supervision 
    transferred to the Board of Governors under this title shall be 
    transferred to the Board of Governors in a manner consistent with 
    the purposes of this title.
    (c) Contracts Related to Property Transferred.--Each contract, 
agreement, lease, license, permit, and similar arrangement relating to 
property transferred to the Office of the Comptroller of the Currency 
or the Corporation by this section shall be transferred to the Office 
of the Comptroller of the Currency or the Corporation, as appropriate, 
together with the property to which it relates.
    (d) Preservation of Property.--Property identified for transfer 
under this section shall not be altered, destroyed, or deleted before 
transfer under this section.
    SEC. 324. FUNDS TRANSFERRED.
    The funds that, on the day before the transfer date, the Director 
of the Office of Thrift Supervision (in consultation with the 
Comptroller of the Currency, the Chairperson of the Corporation, and 
the Chairman of the Board of Governors) determines are not necessary to 
dispose of the affairs of the Office of Thrift Supervision under 
section 325 and are available to the Office of Thrift Supervision to 
pay the expenses of the Office of Thrift Supervision--
        (1) relating to the functions of the Office of Thrift 
    Supervision transferred under section 312(b)(2)(B), shall be 
    transferred to the Office of the Comptroller of the Currency on the 
    transfer date;
        (2) relating to the functions of the Office of Thrift 
    Supervision transferred under section 312(b)(2)(C), shall be 
    transferred to the Corporation on the transfer date; and
        (3) relating to the functions of the Office of Thrift 
    Supervision transferred under section 312(b)(1)(A), shall be 
    transferred to the Board of Governors on the transfer date.
    SEC. 325. DISPOSITION OF AFFAIRS.
    (a) Authority of Director.--During the 90-day period beginning on 
the transfer date, the Director of the Office of Thrift Supervision--
        (1) shall, solely for the purpose of winding up the affairs of 
    the Office of Thrift Supervision relating to any function 
    transferred to the Office of the Comptroller of the Currency, the 
    Corporation, or the Board of Governors under this title--
            (A) manage the employees of the Office of Thrift 
        Supervision who have not yet been transferred and provide for 
        the payment of the compensation and benefits of the employees 
        that accrue before the date on which the employees are 
        transferred under this title; and
            (B) manage any property of the Office of Thrift 
        Supervision, until the date on which the property is 
        transferred under section 323; and
        (2) may take any other action necessary to wind up the affairs 
    of the Office of Thrift Supervision.
    (b) Status of Director.--
        (1) In general.--Notwithstanding the transfer of functions 
    under this subtitle, during the 90-day period beginning on the 
    transfer date, the Director of the Office of Thrift Supervision 
    shall retain and may exercise any authority vested in the Director 
    of the Office of Thrift Supervision on the day before the transfer 
    date, only to the extent necessary--
            (A) to wind up the Office of Thrift Supervision; and
            (B) to carry out the transfer under this subtitle during 
        such 90-day period.
        (2) Other provisions.--For purposes of paragraph (1), the 
    Director of the Office of Thrift Supervision shall, during the 90-
    day period beginning on the transfer date, continue to be--
            (A) treated as an officer of the United States; and
            (B) entitled to receive compensation at the same annual 
        rate of basic pay that the Director of the Office of Thrift 
        Supervision received on the day before the transfer date.
    SEC. 326. CONTINUATION OF SERVICES.
    Any agency, department, or other instrumentality of the United 
States, and any successor to any such agency, department, or 
instrumentality, that was, before the transfer date, providing support 
services to the Office of Thrift Supervision in connection with 
functions transferred to the Office of the Comptroller of the Currency, 
the Corporation or the Board of Governors under this title, shall--
        (1) continue to provide such services, subject to reimbursement 
    by the Office of the Comptroller of the Currency, the Corporation, 
    or the Board of Governors, until the transfer of functions under 
    this title is complete; and
        (2) consult with the Comptroller of the Currency, the 
    Chairperson of the Corporation, or the Chairman of the Board of 
    Governors, as appropriate, to coordinate and facilitate a prompt 
    and orderly transition.
    SEC. 327. IMPLEMENTATION PLAN AND REPORTS.
    (a) Plan Submission.--Within 180 days of the enactment of the Dodd-
Frank Wall Street Reform and Consumer Protection Act, the Board of 
Governors, the Corporation, the Office of the Comptroller of the 
Currency, and the Office of Thrift Supervision, shall jointly submit a 
plan to the Committee on Banking, Housing, and Urban Affairs of the 
Senate, the Committee on Financial Services of the House of 
Representatives, and the Inspectors General of the Department of the 
Treasury, the Corporation, and the Board of Governors detailing the 
steps the Board of Governors, the Corporation, the Office of the 
Comptroller of the Currency, and the Office of Thrift Supervision will 
take to implement the provisions of sections 301 through 326, and the 
provisions of the amendments made by such sections.
    (b) Inspectors General Review of the Plan.--Within 60 days of 
receiving the plan required under subsection (a), the Inspectors 
General of the Department of the Treasury, the Corporation, and the 
Board of Governors shall jointly provide a written report to the Board 
of Governors, the Corporation, the Office of the Comptroller of the 
Currency, and the Office of Thrift Supervision and shall submit a copy 
to the Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of Representatives 
detailing whether the plan conforms with the provisions of sections 301 
through 326, and the provisions of the amendments made by such 
sections, including--
        (1) whether the plan sufficiently takes into consideration the 
    orderly transfer of personnel;
        (2) whether the plan describes procedures and safeguards to 
    ensure that the Office of Thrift Supervision employees are not 
    unfairly disadvantaged relative to employees of the Office of the 
    Comptroller of the Currency and the Corporation;
        (3) whether the plan sufficiently takes into consideration the 
    orderly transfer of authority and responsibilities;
        (4) whether the plan sufficiently takes into consideration the 
    effective transfer of funds;
        (5) whether the plan sufficiently takes in consideration the 
    orderly transfer of property; and
        (6) any additional recommendations for an orderly and effective 
    process.
    (c) Implementation Reports.--Not later than 6 months after the date 
on which the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives receives the report required under subsection (b), and 
every 6 months thereafter until all aspects of the plan have been 
implemented, the Inspectors General of the Department of the Treasury, 
the Corporation, and the Board of Governors shall jointly provide a 
written report on the status of the implementation of the plan to the 
Board of Governors, the Corporation, the Office of the Comptroller of 
the Currency, and the Office of Thrift Supervision and shall submit a 
copy to the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives.

           Subtitle C--Federal Deposit Insurance Corporation

    SEC. 331. DEPOSIT INSURANCE REFORMS.
    (a) Size Distinctions.--Section 7(b)(2) of the Federal Deposit 
Insurance Act (12 U.S.C. 1817(b)(2)) is amended--
        (1) by striking subparagraph (D); and
        (2) by redesignating subparagraph (C) as subparagraph (D).
    (b) Assessment Base.--The Corporation shall amend the regulations 
issued by the Corporation under section 7(b)(2) of the Federal Deposit 
Insurance Act (12 U.S.C. 1817(b)(2)) to define the term ``assessment 
base'' with respect to an insured depository institution for purposes 
of that section 7(b)(2), as an amount equal to--
        (1) the average consolidated total assets of the insured 
    depository institution during the assessment period; minus
        (2) the sum of--
            (A) the average tangible equity of the insured depository 
        institution during the assessment period; and
            (B) in the case of an insured depository institution that 
        is a custodial bank (as defined by the Corporation, based on 
        factors including the percentage of total revenues generated by 
        custodial businesses and the level of assets under custody) or 
        a banker's bank (as that term is used in section 5136 of the 
        Revised Statutes (12 U.S.C. 24)), an amount that the 
        Corporation determines is necessary to establish assessments 
        consistent with the definition under section 7(b)(1) of the 
        Federal Deposit Insurance Act (12 U.S.C. 1817(b)(1)) for a 
        custodial bank or a banker's bank.
    SEC. 332. ELIMINATION OF PROCYCLICAL ASSESSMENTS.
    Section 7(e) of the Federal Deposit Insurance Act is amended--
        (1) in paragraph (2)--
            (A) by amending subparagraph (B) to read as follows:
            ``(B) Limitation.--The Board of Directors may, in its sole 
        discretion, suspend or limit the declaration of payment of 
        dividends under subparagraph (A).'';
            (B) by amending subparagraph (C) to read as follows:
            ``(C) Notice and opportunity for comment.--The Corporation 
        shall prescribe, by regulation, after notice and opportunity 
        for comment, the method for the declaration, calculation, 
        distribution, and payment of dividends under this paragraph''; 
        and
            (C) by striking subparagraphs (D) through (G); and
        (2) in paragraph (4)(A) by striking ``paragraphs (2)(D) and'' 
    and inserting ``paragraphs (2) and''.
    SEC. 333. ENHANCED ACCESS TO INFORMATION FOR DEPOSIT INSURANCE 
      PURPOSES.
    (a) Section 7(a)(2)(B) of the Federal Deposit Insurance Act is 
amended by striking ``agreement'' and inserting ``consultation''.
    (b) Section 7(b)(1)(E) of the Federal Deposit Insurance Act is 
amended--
        (1) in clause (i), by striking ``such as'' and inserting 
    ``including''; and
        (2) in clause (iii), by striking ``Corporation'' and inserting 
    ``Corporation, except as provided in section 7(a)(2)(B)''.
    SEC. 334. TRANSITION RESERVE RATIO REQUIREMENTS TO REFLECT NEW 
      ASSESSMENT BASE.
    (a) Section 7(b)(3)(B) of the Federal Deposit Insurance Act is 
amended to read as follows:
            ``(B) Minimum reserve ratio.--The reserve ratio designated 
        by the Board of Directors for any year may not be less than 
        1.35 percent of estimated insured deposits, or the comparable 
        percentage of the assessment base set forth in paragraph 
        (2)(C).''.
    (b) Section 3(y)(3) of the Federal Deposit Insurance Act is amended 
by inserting ``, or such comparable percentage of the assessment base 
set forth in section 7(b)(2)(C)'' before the period.
    (c) For a period of not less than 5 years after the date of the 
enactment of this title, the Federal Deposit Insurance Corporation 
shall make available to the public the reserve ratio and the designated 
reserve ratio using both estimated insured deposits and the assessment 
base under section 7(b)(2)(C) of the Federal Deposit Insurance Act.
    (d) Reserve Ratio.--Notwithstanding the timing requirements of 
section 7(b)(3)(E)(ii) of the Federal Deposit Insurance Act, the 
Corporation shall take such steps as may be necessary for the reserve 
ratio of the Deposit Insurance Fund to reach 1.35 percent of estimated 
insured deposits by September 30, 2020.
    (e) Offset.--In setting the assessments necessary to meet the 
requirements of subsection (d), the Corporation shall offset the effect 
of subsection (d) on insured depository institutions with total 
consolidated assets of less than $10,000,000,000.
    SEC. 335. PERMANENT INCREASE IN DEPOSIT AND SHARE INSURANCE.
    (a) Permanent Increase in Deposit Insurance.--Section 11(a)(1)(E) 
of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)(E)) is 
amended--
        (1) by striking ``$100,000'' and inserting ``$250,000''; and
        (2) by adding at the end the following new sentences: 
    ``Notwithstanding any other provision of law, the increase in the 
    standard maximum deposit insurance amount to $250,000 shall apply 
    to depositors in any institution for which the Corporation was 
    appointed as receiver or conservator on or after January 1, 2008, 
    and before October 3, 2008. The Corporation shall take such actions 
    as are necessary to carry out the requirements of this section with 
    respect to such depositors, without regard to any time limitations 
    under this Act. In implementing this and the preceding 2 sentences, 
    any payment on a deposit claim made by the Corporation as receiver 
    or conservator to a depositor above the standard maximum deposit 
    insurance amount in effect at the time of the appointment of the 
    Corporation as receiver or conservator shall be deemed to be part 
    of the net amount due to the depositor under subparagraph (B).''
    (b) Permanent Increase in Share Insurance.--Section 207(k)(5) of 
the Federal Credit Union Act (12 U.S.C. 1787(k)(5)) is amended by 
striking ``$100,000'' and inserting ``$250,000''.
    SEC. 336. MANAGEMENT OF THE FEDERAL DEPOSIT INSURANCE CORPORATION.
    (a) In General.--Section 2 of the Federal Deposit Insurance Act (12 
U.S.C. 1812) is amended--
        (1) in subsection (a)(1)(B), by striking ``Director of the 
    Office of Thrift Supervision'' and inserting ``Director of the 
    Consumer Financial Protection Bureau'';
        (2) by amending subsection (d)(2) to read as follows:
        ``(2) Acting officials may serve.--In the event of a vacancy in 
    the office of the Comptroller of the Currency or the office of 
    Director of the Consumer Financial Protection Bureau and pending 
    the appointment of a successor, or during the absence or disability 
    of the Comptroller of the Currency or the Director of the Consumer 
    Financial Protection Bureau, the acting Comptroller of the Currency 
    or the acting Director of the Consumer Financial Protection Bureau, 
    as the case may be, shall be a member of the Board of Directors in 
    the place of the Comptroller or Director.''; and
        (3) in subsection (f)(2), by striking ``Office of Thrift 
    Supervision'' and inserting ``Consumer Financial Protection 
    Bureau''.
    (b) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the transfer date.

                       Subtitle D--Other Matters

    SEC. 341. BRANCHING.
    Notwithstanding the Federal Deposit Insurance Act (12 U.S.C. 1811 
et seq.), the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et 
seq.), or any other provision of Federal or State law, a savings 
association that becomes a bank may--
        (1) continue to operate any branch or agency that the savings 
    association operated immediately before the savings association 
    became a bank; and
        (2) establish, acquire, and operate additional branches and 
    agencies at any location within any State in which the savings 
    association operated a branch immediately before the savings 
    association became a bank, if the law of the State in which the 
    branch is located, or is to be located, would permit establishment 
    of the branch if the bank were a State bank chartered by such 
    State.
    SEC. 342. OFFICE OF MINORITY AND WOMEN INCLUSION.
    (a) Office of Minority and Women Inclusion.--
        (1) Establishment.--
            (A) In general.--Except as provided in subparagraph (B), 
        not later than 6 months after the date of enactment of this 
        Act, each agency shall establish an Office of Minority and 
        Women Inclusion that shall be responsible for all matters of 
        the agency relating to diversity in management, employment, and 
        business activities.
            (B) Bureau.--The Bureau shall establish an Office of 
        Minority and Women Inclusion not later than 6 months after the 
        designated transfer date established under section 1062.
        (2) Transfer of responsibilities.--Each agency that, on the day 
    before the date of enactment of this Act, assigned the 
    responsibilities described in paragraph (1) (or comparable 
    responsibilities) to another office of the agency shall ensure that 
    such responsibilities are transferred to the Office.
        (3) Duties with respect to civil rights laws.--The 
    responsibilities described in paragraph (1) do not include 
    enforcement of statutes, regulations, or executive orders 
    pertaining to civil rights, except each Director shall coordinate 
    with the agency administrator, or the designee of the agency 
    administrator, regarding the design and implementation of any 
    remedies resulting from violations of such statutes, regulations, 
    or executive orders.
    (b) Director.--
        (1) In general.--The Director of each Office shall be appointed 
    by, and shall report to, the agency administrator. The position of 
    Director shall be a career reserved position in the Senior 
    Executive Service, as that position is defined in section 3132 of 
    title 5, United States Code, or an equivalent designation.
        (2) Duties.--Each Director shall develop standards for--
            (A) equal employment opportunity and the racial, ethnic, 
        and gender diversity of the workforce and senior management of 
        the agency;
            (B) increased participation of minority-owned and women-
        owned businesses in the programs and contracts of the agency, 
        including standards for coordinating technical assistance to 
        such businesses; and
            (C) assessing the diversity policies and practices of 
        entities regulated by the agency.
        (3) Other duties.--Each Director shall advise the agency 
    administrator on the impact of the policies and regulations of the 
    agency on minority-owned and women-owned businesses.
        (4) Rule of construction.--Nothing in paragraph (2)(C) may be 
    construed to mandate any requirement on or otherwise affect the 
    lending policies and practices of any regulated entity, or to 
    require any specific action based on the findings of the 
    assessment.
    (c) Inclusion in All Levels of Business Activities.--
        (1) In general.--The Director of each Office shall develop and 
    implement standards and procedures to ensure, to the maximum extent 
    possible, the fair inclusion and utilization of minorities, women, 
    and minority-owned and women-owned businesses in all business and 
    activities of the agency at all levels, including in procurement, 
    insurance, and all types of contracts.
        (2) Contracts.--The procedures established by each agency for 
    review and evaluation of contract proposals and for hiring service 
    providers shall include, to the extent consistent with applicable 
    law, a component that gives consideration to the diversity of the 
    applicant. Such procedure shall include a written statement, in a 
    form and with such content as the Director shall prescribe, that a 
    contractor shall ensure, to the maximum extent possible, the fair 
    inclusion of women and minorities in the workforce of the 
    contractor and, as applicable, subcontractors.
        (3) Termination.--
            (A) Determination.--The standards and procedures developed 
        and implemented under this subsection shall include a procedure 
        for the Director to make a determination whether an agency 
        contractor, and, as applicable, a subcontractor has failed to 
        make a good faith effort to include minorities and women in 
        their workforce.
            (B) Effect of determination.--
                (i) Recommendation to agency administrator.--Upon a 
            determination described in subparagraph (A), the Director 
            shall make a recommendation to the agency administrator 
            that the contract be terminated.
                (ii) Action by agency administrator.--Upon receipt of a 
            recommendation under clause (i), the agency administrator 
            may--

                    (I) terminate the contract;
                    (II) make a referral to the Office of Federal 
                Contract Compliance Programs of the Department of 
                Labor; or
                    (III) take other appropriate action.

    (d) Applicability.--This section shall apply to all contracts of an 
agency for services of any kind, including the services of financial 
institutions, investment banking firms, mortgage banking firms, asset 
management firms, brokers, dealers, financial services entities, 
underwriters, accountants, investment consultants, and providers of 
legal services. The contracts referred to in this subsection include 
all contracts for all business and activities of an agency, at all 
levels, including contracts for the issuance or guarantee of any debt, 
equity, or security, the sale of assets, the management of the assets 
of the agency, the making of equity investments by the agency, and the 
implementation by the agency of programs to address economic recovery.
    (e) Reports.--Each Office shall submit to Congress an annual report 
regarding the actions taken by the agency and the Office pursuant to 
this section, which shall include--
        (1) a statement of the total amounts paid by the agency to 
    contractors since the previous report;
        (2) the percentage of the amounts described in paragraph (1) 
    that were paid to contractors described in subsection (c)(1);
        (3) the successes achieved and challenges faced by the agency 
    in operating minority and women outreach programs;
        (4) the challenges the agency may face in hiring qualified 
    minority and women employees and contracting with qualified 
    minority-owned and women-owned businesses; and
        (5) any other information, findings, conclusions, and 
    recommendations for legislative or agency action, as the Director 
    determines appropriate.
    (f) Diversity in Agency Workforce.--Each agency shall take 
affirmative steps to seek diversity in the workforce of the agency at 
all levels of the agency in a manner consistent with applicable law. 
Such steps shall include--
        (1) recruiting at historically black colleges and universities, 
    Hispanic-serving institutions, women's colleges, and colleges that 
    typically serve majority minority populations;
        (2) sponsoring and recruiting at job fairs in urban 
    communities;
        (3) placing employment advertisements in newspapers and 
    magazines oriented toward minorities and women;
        (4) partnering with organizations that are focused on 
    developing opportunities for minorities and women to place talented 
    young minorities and women in industry internships, summer 
    employment, and full-time positions;
        (5) where feasible, partnering with inner-city high schools, 
    girls' high schools, and high schools with majority minority 
    populations to establish or enhance financial literacy programs and 
    provide mentoring; and
        (6) any other mass media communications that the Office 
    determines necessary.
    (g) Definitions.--For purposes of this section, the following 
definitions shall apply:
        (1) Agency.--The term ``agency'' means--
            (A) the Departmental Offices of the Department of the 
        Treasury;
            (B) the Corporation;
            (C) the Federal Housing Finance Agency;
            (D) each of the Federal reserve banks;
            (E) the Board;
            (F) the National Credit Union Administration;
            (G) the Office of the Comptroller of the Currency;
            (H) the Commission; and
            (I) the Bureau.
        (2) Agency administrator.--The term ``agency administrator'' 
    means the head of an agency.
        (3) Minority.--The term ``minority'' has the same meaning as in 
    section 1204(c) of the Financial Institutions Reform, Recovery, and 
    Enforcement Act of 1989 (12 U.S.C. 1811 note).
        (4) Minority-owned business.--The term ``minority-owned 
    business'' has the same meaning as in section 21A(r)(4)(A) of the 
    Federal Home Loan Bank Act (12 U.S.C. 1441a(r)(4)(A)), as in effect 
    on the day before the transfer date.
        (5) Office.--The term ``Office'' means the Office of Minority 
    and Women Inclusion established by an agency under subsection (a).
        (6) Women-owned business.--The term ``women-owned business'' 
    has the meaning given the term ``women's business'' in section 
    21A(r)(4)(B) of the Federal Home Loan Bank Act (12 U.S.C. 
    1441a(r)(4)(B)), as in effect on the day before the transfer date.
    SEC. 343. INSURANCE OF TRANSACTION ACCOUNTS.
    (a) Banks and Savings Associations.--
        (1) Amendments.--Section 11(a)(1) of the Federal Deposit 
    Insurance Act (12 U.S.C. 1821(a)(1)) is amended--
            (A) in subparagraph (B)--
                (i) by striking ``The net amount'' and inserting the 
            following:
                ``(i) In general.--Subject to clause (ii), the net 
            amount''; and
                (ii) by adding at the end the following new clauses:
                ``(ii) Insurance for noninterest-bearing transaction 
            accounts.--Notwithstanding clause (i), the Corporation 
            shall fully insure the net amount that any depositor at an 
            insured depository institution maintains in a noninterest-
            bearing transaction account. Such amount shall not be taken 
            into account when computing the net amount due to such 
            depositor under clause (i).
                ``(iii) Noninterest-bearing transaction account 
            defined.--For purposes of this subparagraph, the term 
            `noninterest-bearing transaction account' means a deposit 
            or account maintained at an insured depository 
            institution--

                    ``(I) with respect to which interest is neither 
                accrued nor paid;
                    ``(II) on which the depositor or account holder is 
                permitted to make withdrawals by negotiable or 
                transferable instrument, payment orders of withdrawal, 
                telephone or other electronic media transfers, or other 
                similar items for the purpose of making payments or 
                transfers to third parties or others; and
                    ``(III) on which the insured depository institution 
                does not reserve the right to require advance notice of 
                an intended withdrawal.''; and

            (B) in subparagraph (C), by striking ``subparagraph (B)'' 
        and inserting ``subparagraph (B)(i)''.
        (2) Effective date.--The amendments made by paragraph (1) shall 
    take effect on December 31, 2010.
        (3) Prospective repeal.--Effective January 1, 2013, section 
    11(a)(1) of the Federal Deposit Insurance Act (12 U.S.C. 
    1821(a)(1)), as amended by paragraph (1), is amended--
            (A) in subparagraph (B)--
                (i) by striking ``deposit.--'' and all that follows 
            through ``clause (ii), the net amount'' and insert 
            ``deposit.--The net amount''; and
                (ii) by striking clauses (ii) and (iii); and
            (B) in subparagraph (C), by striking ``subparagraph 
        (B)(i)'' and inserting ``subparagraph (B)''.
    (b) Credit Unions.--
        (1) Amendments.--Section 207(k)(1) of the Federal Credit Union 
    Act (12 U.S.C. 1787(k)(1)) is amended--
            (A) in subparagraph (A)--
                (i) by striking ``Subject to the provisions of 
            paragraph (2), the net amount'' and inserting the 
            following:
                ``(i) Net amount of insurance payable.--Subject to 
            clause (ii) and the provisions of paragraph (2), the net 
            amount''; and
                (ii) by adding at the end the following new clauses:
                ``(ii) Insurance for noninterest-bearing transaction 
            accounts.--Notwithstanding clause (i), the Board shall 
            fully insure the net amount that any member or depositor at 
            an insured credit union maintains in a noninterest-bearing 
            transaction account. Such amount shall not be taken into 
            account when computing the net amount due to such member or 
            depositor under clause (i).
                ``(iii) Noninterest-bearing transaction account 
            defined.--For purposes of this subparagraph, the term 
            `noninterest-bearing transaction account' means an account 
            or deposit maintained at an insured credit union--

                    ``(I) with respect to which interest is neither 
                accrued nor paid;
                    ``(II) on which the account holder or depositor is 
                permitted to make withdrawals by negotiable or 
                transferable instrument, payment orders of withdrawal, 
                telephone or other electronic media transfers, or other 
                similar items for the purpose of making payments or 
                transfers to third parties or others; and
                    ``(III) on which the insured credit union does not 
                reserve the right to require advance notice of an 
                intended withdrawal.''; and

            (B) in subparagraph (B), by striking ``subparagraph (A)'' 
        and inserting ``subparagraph (A)(i)''.
        (2) Effective date.--The amendments made by paragraph (1) shall 
    take effect upon the date of the enactment of this Act
        (3) Prospective repeal.--Effective January 1, 2013, section 
    207(k)(1) of the Federal Credit Union Act (12 U.S.C. 1787(k)(1)), 
    as amended by paragraph (1), is amended--
            (A) in subparagraph (A)--
                (i) by striking ``(i) net amount of insurance 
            payable.--'' and all that follows through ``paragraph (2), 
            the net amount'' and inserting ``Subject to the provisions 
            of paragraph (2), the net amount''; and
                (ii) by striking clauses (ii) and (iii); and
            (B) in subparagraph (B), by striking ``subparagraph 
        (A)(i)'' and inserting ``subparagraph (A)''.

            Subtitle E--Technical and Conforming Amendments

    SEC. 351. EFFECTIVE DATE.
    Except as provided in section 364(a), the amendments made by this 
subtitle shall take effect on the transfer date.
    SEC. 352. BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT OF 
      1985.
    Section 256(h) of the Balanced Budget and Emergency Deficit Control 
Act of 1985 (2 U.S.C. 906(h)) is amended--
        (1) in paragraph (4), by striking subparagraphs (C) and (G); 
    and
        (2) by redesignating subparagraphs (D), (E), (F), and (H) as 
    subparagraphs (C), (D), (E), and (F), respectively.
    SEC. 353. BANK ENTERPRISE ACT OF 1991.
    Section 232(a) of the Bank Enterprise Act of 1991 (12 U.S.C. 
1834(a)) is amended--
        (1) in the subsection heading, by striking ``by Federal Reserve 
    Board'';
        (2) in paragraph (1)--
            (A) by striking ``The Board of Governors of the Federal 
        Reserve System,'' and inserting ``The Comptroller of the 
        Currency''; and
            (B) by striking ``section 7(b)(2)(H)'' and inserting 
        ``section 7(b)(2)(E)'';
        (3) in paragraph (2)(A), by striking ``Board'' and inserting 
    ``Comptroller''; and
        (4) in paragraph (3)--
            (A) by redesignating subparagraphs (A) through (C) as 
        subparagraphs (B) through (D), respectively; and
            (B) by inserting before subparagraph (B) the following:
            ``(A) Comptroller.--The term `Comptroller' means the 
        Comptroller of the Currency.''.
    SEC. 354. BANK HOLDING COMPANY ACT OF 1956.
    The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is 
amended--
        (1) in section 2(j)(3) (12 U.S.C. 1841(j)(3)), strike 
    ``Director of the Office of Thrift Supervision'' and inserting 
    ``appropriate Federal banking agency'';
        (2) in section 4 (12 U.S.C. 1843)--
            (A) in subsection (i)--
                (i) in paragraph (4)--

                    (I) in subparagraph (A)--

                        (aa) in the subparagraph heading, by striking 
                    ``to director''; and
                        (bb) by striking ``Board'' and all that follows 
                    through the end of the subparagraph and inserting 
                    ``Board shall solicit comments and recommendations 
                    from--
                ``(i) the Comptroller of the Currency, with respect to 
            the acquisition of a Federal savings association; and
                ``(ii) the Federal Deposit Insurance Corporation, with 
            respect to the acquisition of a State savings 
            association.''.

                    (II) in subparagraph (B), by striking ``Director'' 
                each place that term appears and inserting 
                ``Comptroller of the Currency or the Federal Deposit 
                Insurance Corporation, as applicable,'';

                (ii) in paragraph (5)--

                    (I) in subparagraph (B), by striking ``Director 
                with'' and inserting ``Comptroller of the Currency or 
                the Federal Deposit Insurance Corporation, as 
                applicable, with''; and
                    (II) by striking ``Director'' each place that term 
                appears and inserting ``Comptroller of the Currency or 
                the Federal Deposit Insurance Corporation'';

                (iii) in paragraph (6), by striking ``Director'' and 
            inserting ``Comptroller of the Currency or the Federal 
            Deposit Insurance Corporation, as applicable,''; and
                (iv) by striking paragraph (7); and
        (3) in section 5(f) (12 U.S.C. 1844(f))--
            (A) by striking ``subpena'' each place that term appears 
        and inserting ``subpoena'';
            (B) by striking ``subpenas'' each place that term appears 
        and inserting ``subpoenas''; and
            (C) by striking ``subpenaed'' and inserting ``subpoenaed''.
    SEC. 355. 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 
following subparagraph (E) by inserting ``issue such regulations as are 
necessary to carry out this section, and, in consultation with the 
Comptroller of the Currency and the Federal Deposit Insurance Company, 
may'' after ``The Board may''.
    SEC. 356. BANK PROTECTION ACT OF 1968.
    The Bank Protection Act of 1968 (12 U.S.C. 1881 et seq.) is 
amended--
        (1) in section 2 (12 U.S.C. 1881), by striking ``the term'' and 
    all that follows through the end of the section and inserting ``the 
    term `Federal supervisory agency' means the appropriate Federal 
    banking agency, as defined in section 3(q) of the Federal Deposit 
    Insurance Act (12 U.S.C. 1813(q)).'';
        (2) in section 3 (12 U.S.C. 1882), by striking ``and loan'' 
    each place that term appears; and
        (3) in section 5 (12 U.S.C. 1884), by striking ``and loan''.
    SEC. 357. BANK SERVICE COMPANY ACT.
    The Bank Service Company Act (12 U.S.C. 1861 et seq.) is amended--
        (1) in section 1(b)(4) (12 U.S.C. 1861(b)(4))--
            (A) by inserting after ``an insured bank,'' the following: 
        ``a savings association,'';
            (B) by striking ``Director of the Office of Thrift 
        Supervision'' and inserting ``appropriate Federal banking 
        agency''; and
            (C) by striking ``, the Federal Savings and Loan Insurance 
        Corporation,'';
        (2) in section 1(b)(5), by striking ``term `insured depository 
    institution' has the same meaning as in section 3(c)'' and 
    inserting ``terms `depository institution' and `savings 
    association' have the same meanings as in section 3''; and
        (3) in section 7(c)(2) (12 U.S.C. 1867(c)(2)), by inserting 
    ``each'' after ``notify''.
    SEC. 358. COMMUNITY REINVESTMENT ACT OF 1977.
    The Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is 
amended--
        (1) in section 803 (12 U.S.C. 2902)--
            (A) in paragraph (1)--
                (i) in subparagraph (A), by inserting ``and Federal 
            savings associations (the deposits of which are insured by 
            the Federal Deposit Insurance Corporation)'' after 
            ``banks'';
                (ii) in subparagraph (B), by striking ``and bank 
            holding companies'' and inserting ``, bank holding 
            companies, and savings and loan holding companies''; and
                (iii) in subparagraph (C), by striking ``; and'' and 
            inserting ``, and State savings associations (the deposits 
            of which are insured by the Federal Deposit Insurance 
            Corporation).''; and
            (B) by striking paragraph (2) (relating to the Office of 
        Thrift Supervision), as added by section 744(q) of the 
        Financial Institutions Reform, Recovery, and Enforcement Act of 
        1989 (Public Law 101-73; 103 Stat. 440); and
        (2) in section 806 (12 U.S.C. 2905), by inserting ``, except 
    that the Comptroller of the Currency shall prescribe regulations 
    applicable to savings associations and the Board of Governors shall 
    prescribe regulations applicable to insured State member banks, 
    bank holding companies and savings and loan holding companies,'' 
    after ``supervisory agency''.
    SEC. 359. CRIME CONTROL ACT OF 1990.
    The Crime Control Act of 1990 is amended--
        (1) in section 2539(c)(2) (28 U.S.C. 509 note)--
            (A) by striking subparagraphs (C) and (D); and
            (B) by redesignating subparagraphs (E) through (H) as 
        subparagraphs (C) through (G), respectively; and
        (2) in section 2554(b)(2) (Public Law 101-647; 104 Stat. 
    4890)--
            (A) in subparagraph (A), by striking ``, the Director of 
        the Office of Thrift Supervision,'' and inserting ``the 
        Comptroller of the Currency''; and
            (B) in subparagraph (B), by striking ``, the Director'' and 
        all that follows through ``Trust Corporation'' and inserting 
        ``or the Federal Deposit Insurance Corporation''.
    SEC. 360. DEPOSITORY INSTITUTION MANAGEMENT INTERLOCKS ACT.
    The Depository Institution Management Interlocks Act (12 U.S.C. 
3201 et seq.) is amended--
        (1) in section 207 (12 U.S.C. 3206)--
            (A) in paragraph (1), by inserting before the comma at the 
        end the following: ``and Federal savings associations (the 
        deposits of which are insured by the Federal Deposit Insurance 
        Corporation)'';
            (B) in paragraph (2), by striking ``, and bank holding 
        companies'' and inserting ``, bank holding companies, and 
        savings and loan holding companies'';
            (C) in paragraph (3), by striking ``Corporation,'' and 
        inserting ``Corporation and State savings associations (the 
        deposits of which are insured by the Federal Deposit Insurance 
        Corporation),'';
            (D) by striking paragraph (4);
            (E) by redesignating paragraphs (5) and (6) as paragraphs 
        (4) and (5), respectively; and
            (F) in paragraph (5), as so redesignated, by striking 
        ``through (5)'' and inserting ``through (4)'';
        (2) in section 209 (12 U.S.C. 3207)--
            (A) in paragraph (1), by inserting before the comma at the 
        end the following: ``and Federal savings associations (the 
        deposits of which are insured by the Federal Deposit Insurance 
        Corporation)'';
            (B) in paragraph (2), by striking ``, and bank holding 
        companies'' and inserting ``, bank holding companies, and 
        savings and loan holding companies'';
            (C) in paragraph (3), by striking ``Corporation,'' and 
        inserting ``Corporation and State savings associations (the 
        deposits of which are insured by the Federal Deposit Insurance 
        Corporation),'';
            (D) by striking paragraph (4); and
            (E) by redesignating paragraph (5) as paragraph (4); and
        (3) in section 210(a) (12 U.S.C. 3208(a))--
            (A) by striking ``his'' and inserting ``the''; and
            (B) by inserting ``of the Attorney General'' after 
        ``enforcement functions''.
    SEC. 361. EMERGENCY HOMEOWNERS' RELIEF ACT.
    Section 110 of the Emergency Homeowners' Relief Act (12 U.S.C. 
2709) is amended in the second sentence, by striking ``Home Loan Bank 
Board, the Federal Savings and Loan Insurance Corporation'' and 
inserting ``Housing Finance Agency''.
    SEC. 362. FEDERAL CREDIT UNION ACT.
    The Federal Credit Union Act (12 U.S.C. 1751 et seq.) is amended--
        (1) in section 107(8) (12 U.S.C. 1757(8)), by striking ``or the 
    Federal Savings and Loan Insurance Corporation'';
        (2) in section 205 (12 U.S.C. 1785)--
            (A) in subsection (b)(2)(G)(i), by striking ``the Office of 
        Thrift Supervision and''; and
            (B) in subsection (i)(1), by striking ``or the Federal 
        Savings and Loan Insurance Corporation''; and
        (3) in section 206(g)(7) (12 U.S.C. 1786(g)(7))--
            (A) in subparagraph (A)--
                (i) in clause (ii), by striking ``(b)(8)'' and 
            inserting ``(b)(9)'';
                (ii) in clause (v)--

                    (I) by striking ``depository'' and inserting 
                ``financial''; and
                    (II) by adding ``and'' at the end;

                (iii) in clause (vi)--

                    (I) by striking ``Board'' and inserting ``Agency''; 
                and
                    (II) by striking ``; and'' and inserting a period; 
                and

                (iv) by striking clause (vii); and
            (B) in subparagraph (D)--
                (i) in clause (iii), by adding ``and'' at the end;
                (ii) in clause (iv)--

                    (I) by striking ``Board'' and inserting ``Agency''; 
                and
                    (II) by striking ``and'' at the end; and

                (iii) by striking clause (v).
    SEC. 363. FEDERAL DEPOSIT INSURANCE ACT.
    The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is 
amended--
        (1) in section 3 (12 U.S.C. 1813)--
            (A) in subsection (b)(1)(C), by striking ``Director of the 
        Office of Thrift Supervision'' and inserting ``Comptroller of 
        the Currency'';
            (B) in subsection (l)(5), in the matter preceding 
        subparagraph (A), by striking ``Director of the Office of 
        Thrift Supervision,''; and
            (C) in subsection (z), by striking ``the Director of the 
        Office of Thrift Supervision,'';
        (2) in section 7 (12 U.S.C. 1817)--
            (A) in subsection (a)--
                (i) in paragraph (2)--

                    (I) in subparagraph (A)--

                        (aa) in the first sentence, by striking ``the 
                    Director of the Office of Thrift Supervision,'';
                        (bb) in the second sentence--
                            (AA) by striking ``the Director of the 
                        Office of Thrift Supervision,'' and inserting 
                        ``to''; and
                            (BB) by inserting ``to'' before ``any 
                        Federal home''; and
                        (cc) by striking ``Finance Board'' each place 
                    that term appears and inserting ``Finance Agency''; 
                    and

                    (II) in subparagraph (B), by striking ``the 
                Comptroller of the Currency, the Board of Governors of 
                the Federal Reserve System, and the Director of the 
                Office of Thrift Supervision,'' and inserting ``the 
                Comptroller of the Currency and the Board of Governors 
                of the Federal Reserve System,'';

                (ii) in paragraph (3), in the first sentence, by 
            striking ``Comptroller of the Currency, the Chairman of the 
            Board of Governors of the Federal Reserve System, and the 
            Director of the Office of Thrift Supervision.'' and 
            inserting ``Comptroller of the Currency, and the Chairman 
            of the Board of Governors of the Federal Reserve System.'';
                (iii) in paragraph (6), by striking ``section 
            232(a)(3)(C)'' and inserting ``section 232(a)(3)(D)''; and
                (iv) in paragraph (7), by striking ``, the Director of 
            the Office of Thrift Supervision,''; and
            (B) in subsection (n)--
                (i) in the heading, by striking ``Director of the 
            Office of Thrift Supervision'' and inserting ``Comptroller 
            of the Currency'';
                (ii) in the first sentence--

                    (I) by striking ``the Director of the Office of 
                Thrift Supervision'' and inserting ``the Comptroller of 
                the Currency''; and
                    (II) by inserting ``Federal'' before ``savings 
                associations'';

                (iii) in the third sentence, by striking ``, the 
            Financing Corporation, and the Resolution Funding 
            Corporation''; and
                (iv) by striking ``the Director'' each place that term 
            appears and inserting ``the Comptroller'';
        (3) in section 8 (12 U.S.C. 1818)--
            (A) in subsection (a)(8)(B)(ii), in the last sentence, by 
        striking ``Director of the Office of Thrift Supervision'' each 
        place that term appears and inserting ``Comptroller of the 
        Currency'';
            (B) in subsection (b)(3)--
                (i) by inserting ``any savings and loan holding company 
            and any subsidiary (other than a depository institution) of 
            a savings and loan holding company (as such terms are 
            defined in section 10 of Home Owners' Loan Act)), any 
            noninsured State member bank'' after ``Bank Holding Company 
            Act of 1956,''; and
                (ii) by inserting ``or against a savings and loan 
            holding company or any subsidiary thereof (other than a 
            depository institution or a subsidiary of such depository 
            institution)'' before the period at the end;
            (C) by striking paragraph (9) of subsection (b) and 
        inserting the following new paragraph:
        ``(9) [Repealed]''.
            (D) in subsection (e)(7)--
                (i) in subparagraph (A)--

                    (I) in clause (v), by inserting ``and'' after the 
                semicolon;
                    (II) in clause (vi)--

                        (aa) by striking ``Board'' and inserting 
                    ``Agency''; and
                        (bb) by striking ``; and'' and inserting a 
                    period; and

                    (III) by striking clause (vii); and

                (ii) in subparagraph (D)--

                    (I) in clause (iii), by inserting ``and'' after the 
                semicolon;
                    (II) in clause (iv)--

                        (aa) by striking ``Board'' and inserting 
                    ``Agency''; and
                        (bb) by striking ``; and'' and inserting a 
                    period; and

                    (III) by striking clause (v);

            (E) in subsection (j)--
                (i) in paragraph (2), by striking ``, or as a savings 
            association under subsection (b)(9) of this section'';
                (ii) in paragraph (3), by inserting ``or'' after the 
            semicolon;
                (iii) in paragraph (4), by striking ``; or'' and 
            inserting a comma; and
                (iv) by striking paragraph (5);
            (F) in subsection (o), by striking ``Director of the Office 
        of Thrift Supervision'' and inserting ``Comptroller of the 
        Currency''; and
            (G) in subsection (w)(3)(A), by striking ``and the Office 
        of Thrift Supervision'';
        (4) in section 10 (12 U.S.C. 1820)--
            (A) in subsection (d)(5), by striking ``or the Resolution 
        Trust Corporation'' each place that term appears; and
            (B) in subsection (k)(5)(B)--
                (i) in clause (ii), by inserting ``and'' after the 
            semicolon;
                (ii) in clause (iii), by striking ``; and'' and 
            inserting a period; and
                (iii) by striking clause (iv);
        (5) in section 11 (12 U.S.C. 1821)--
            (A) in subsection (c)--
                (i) in paragraph (2)(A)(ii), by striking ``(other than 
            section 21A of the Federal Home Loan Bank Act)'';
                (ii) in paragraph (4), by striking ``Except as 
            otherwise provided in section 21A of the Federal Home Loan 
            Bank Act and notwithstanding'' and inserting 
            ``Notwithstanding'';
                (iii) in paragraph (6)--

                    (I) in the heading, by striking ``Director of the 
                office of thrift supervision'' and inserting 
                ``Comptroller of the currency'';
                    (II) in subparagraph (A)--

                        (aa) by striking ``or the Resolution Trust 
                    Corporation''; and
                        (bb) by striking ``Director of the Office of 
                    Thrift Supervision'' and inserting ``Comptroller of 
                    the Currency''; and

                    (III) by amending subparagraph (B) to read as 
                follows:

            ``(B) Receiver.--The Corporation may, at the discretion of 
        the Comptroller of the Currency, be appointed receiver and the 
        Corporation may accept any such appointment.'';
                (iv) in paragraph (12)(A), by striking ``or the 
            Resolution Trust Corporation'';
            (B) in subsection (d)--
                (i) in paragraph (17)(A), by striking ``or the Director 
            of the Office of Thrift Supervision''; and
                (ii) in paragraph (18)(B), by striking ``or the 
            Director of the Office of Thrift Supervision'';
            (C) in subsection (m)--
                (i) in paragraph (9), by striking ``or the Director of 
            the Office of Thrift Supervision, as appropriate'';
                (ii) in paragraph (16), by striking ``or the Director 
            of the Office of Thrift Supervision, as appropriate'' each 
            place that term appears; and
                (iii) in paragraph (18), by striking ``or the Director 
            of the Office of Thrift Supervision, as appropriate'' each 
            place that term appears;
            (D) in subsection (n)--
                (i) in paragraph (1)(A)--

                    (I) by striking ``, or the Director of the Office 
                of Thrift Supervision, with respect to'' and inserting 
                ``or''; and
                    (II) by striking ``applicable,,'' and inserting 
                ``applicable,'';

                (ii) in paragraph (2)(A), by striking ``or the Director 
            of the Office of Thrift Supervision'';
                (iii) in paragraph (4)(D), by striking ``and the 
            Director of the Office of Thrift Supervision, as 
            appropriate,'';
                (iv) in paragraph (4)(G), by striking ``and the 
            Director of the Office of Thrift Supervision, as 
            appropriate,''; and
                (v) in paragraph (12)(B)--

                    (I) by inserting ``as'' after ``shall appoint the 
                Corporation'';
                    (II) by striking ``or the Director of the Office of 
                Thrift Supervision, as appropriate,'' each place such 
                term appears;

            (E) in subsection (p)--
                (i) in paragraph (2)(B), by striking ``the Corporation, 
            the FSLIC Resolution Fund, or the Resolution Trust 
            Corporation,'' and inserting ``or the Corporation,''; and
                (ii) in paragraph (3)(B), by striking ``, the FSLIC 
            Resolution Fund, the Resolution Trust Corporation,''; and
            (F) in subsection (r), by striking ``and the Resolution 
        Trust Corporation'';
        (6) in section 13(k)(1)(A)(iv) (12 U.S.C. 1823(k)(1)(A)(iv)), 
    by striking ``Director of the Office of Thrift Supervision'' and 
    inserting ``Comptroller of the Currency'';
        (7) in section 18 (12 U.S.C. 1828)--
            (A) in subsection (c)(2)--
                (i) in subparagraph (A), by inserting ``or a Federal 
            savings association'' before the semicolon;
                (ii) in subparagraph (B), by adding ``and'' at the end;
                (iii) in subparagraph (C), by striking ``(except'' and 
            all that follows through ``; and'' and inserting ``or a 
            State savings association.''; and
                (iv) by striking subparagraph (D);
            (B) in subsection (g)(1), by striking ``the Director of the 
        Office of Thrift Supervision''and inserting ``the Comptroller 
        of the Currency'';
            (C) in subsection (i)(2)(C), by striking ``Director of the 
        Office of Thrift Supervision'' and inserting ``Corporation''; 
        and
            (D) in subsection (m)--
                (i) in paragraph (1)--

                    (I) in subparagraph (A), by striking ``and the 
                Director of the Office of Thrift Supervision'' and 
                inserting ``or the Comptroller of the Currency, as 
                appropriate,''; and
                    (II) in subparagraph (B), by striking ``and orders 
                of the Director of the Office of Thrift Supervision'' 
                and inserting ``of the Comptroller of the Currency and 
                orders of the Corporation and the Comptroller of the 
                Currency'';

                (ii) in paragraph (2)--

                    (I) in subparagraph (A), by striking ``Director of 
                the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency, as appropriate,''; and
                    (II) in subparagraph (B)--

                        (aa) in the matter before clause (i), by 
                    striking ``Director of the Office of Thrift 
                    Supervision'' and inserting ``Corporation or the 
                    Comptroller of the Currency, as appropriate,''; and
                        (bb) in the matter following clause (ii)--
                            (AA) in the first sentence, by striking 
                        ``Director of the Office of Thrift 
                        Supervision'' and inserting ``Office of the 
                        Comptroller of the Currency, as appropriate,''; 
                        and
                            (BB) by striking the second sentence and 
                        inserting the following: ``The Corporation or 
                        the Comptroller of the Currency, as 
                        appropriate, may take any other corrective 
                        measures with respect to the subsidiary, 
                        including the authority to require the 
                        subsidiary to terminate the activities or 
                        operations posing such risks, as the 
                        Corporation or the Comptroller of the Currency, 
                        respectively, may deem appropriate.''; and
                (iii) in paragraph (3)--

                    (I) in subparagraph (A), in the second sentence--

                        (aa) by inserting ``, in the case of a Federal 
                    savings association,'' before ``consult with''; and
                        (bb) by striking ``Director of the Office of 
                    Thrift Supervision'' and inserting ``Comptroller of 
                    the Currency''; and

                    (II) in subparagraph (B)--

                        (aa) in the subparagraph heading, by striking 
                    ``Director'' and inserting ``Comptroller of the 
                    currency'';
                        (bb) by striking ``Office of Thrift 
                    Supervision'' and inserting ``Comptroller of the 
                    Currency'';
                        (cc) by inserting a comma after ``soundness''; 
                    and
                        (dd) by inserting ``as to Federal savings 
                    associations'' after ``compliance'';
        (8) in section 19(e) (12 U.S.C. 1829(e))--
            (A) in paragraph (1), by striking ``Director of the Office 
        of Thrift Supervision'' and inserting ``Board of Governors of 
        the Federal Reserve System''; and
            (B) in paragraph (2), by striking ``Director of the Office 
        of Thrift Supervision'' and inserting ``Board of Governors of 
        the Federal Reserve System'';
        (9) in section 28 (12 U.S.C. 1831e)--
            (A) in subsection (e)--
                (i) in paragraph (2)--

                    (I) in subparagraph (A)(ii), by striking ``Director 
                of the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency or the Corporation, as 
                appropriate'';
                    (II) in subparagraph (C), by striking ``Director of 
                the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency or the Corporation, as 
                appropriate,''; and
                    (III) in subparagraph (F), by striking ``Director 
                of the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency or the Corporation, as 
                appropriate''; and

                (ii) in paragraph (3)--

                    (I) in subparagraph (A), by striking ``Director of 
                the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency or the Corporation, as 
                appropriate''; and
                    (II) in subparagraph (B), by striking ``Director of 
                the Office of Thrift Supervision'' and inserting 
                ``Comptroller of the Currency or the Corporation, as 
                appropriate,''; and

            (B) in subsection (h)(2), by striking ``Director of the 
        Office of Thrift Supervision'' and inserting ``Comptroller of 
        the Currency, of the Corporation,''; and
        (10) in section 33(e) (12 U.S.C. 1831j(e)), by striking 
    ``Federal Housing Finance Board, the Comptroller of the Currency, 
    and the Director of the Office of Thrift Supervision'' and 
    inserting ``Federal Housing Finance Agency and the Comptroller of 
    the Currency''.
    SEC. 364. FEDERAL HOME LOAN BANK ACT.
    (a) Repeal of Section 18(c).--Effective 90 days after the transfer 
date, section 18(c) of the Federal Home Loan Bank Act (12 U.S.C. 
1438(c)) is repealed.
    (b) Repeal of Section 21A.--Section 21A of the Federal Home Loan 
Bank Act (12 U.S.C. 1441a) is repealed.
    SEC. 365. FEDERAL HOUSING ENTERPRISES FINANCIAL SAFETY AND 
      SOUNDNESS ACT OF 1992.
    The Federal Housing Enterprises Financial Safety and Soundness Act 
of 1992 (12 U.S.C. 4501 et seq.) is amended--
        (1) in section 1315(b) (12 U.S.C. 4515(b)), by striking ``the 
    Federal Deposit Insurance Corporation, and the Office of Thrift 
    Supervision.'' and inserting ``and the Federal Deposit Insurance 
    Corporation.''; and
        (2) in section 1317(c) (12 U.S.C. 4517(c)), by striking ``the 
    Federal Deposit Insurance Corporation, or the Director of the 
    Office of Thrift Supervision'' and inserting ``or the Federal 
    Deposit Insurance Corporation''.
    SEC. 366. FEDERAL RESERVE ACT.
    The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended--
        (1) in section 11(a)(2) (12 U.S.C. 248(a)(2))--
            (A) by inserting ``State savings associations that are 
        insured depository institutions (as defined in section 3 of the 
        Federal Deposit Insurance Act),'' after ``case of insured'';
            (B) by striking ``Director of the Office of Thrift 
        Supervision'' and inserting ``Comptroller of the Currency'';
            (C) by inserting ``Federal'' before ``savings association 
        which''; and
            (D) by striking ``savings and loan association'' and 
        inserting ``savings association''; and
        (2) in section 19(b) (12 U.S.C. 461(b))--
            (A) in paragraph (1)(F), by striking ``Director of the 
        Office of Thrift Supervision'' and inserting ``Comptroller of 
        the Currency''; and
            (B) in paragraph (4)(B), by striking ``Director of the 
        Office of Thrift Supervision'' and inserting ``Comptroller of 
        the Currency''.
    SEC. 367. FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT 
      ACT OF 1989.
    The Financial Institutions Reform, Recovery, and Enforcement Act of 
1989 is amended--
        (1) in section 203 (12 U.S.C. 1812 note), by striking 
    subsection (b);
        (2) in section 302(1) (12 U.S.C. 1467a note), by striking 
    ``Director of the Office of Thrift Supervision'' and inserting 
    ``Comptroller of the Currency'';
        (3) in section 305(12 U.S.C. 1464 note), by striking subsection 
    (b);
        (4) in section 308 (12 U.S.C. 1463 note)--
            (A) in subsection (a), by striking ``Director of the Office 
        of Thrift Supervision'' and inserting ``Chairman of the Board 
        of Governors of the Federal Reserve System, the Comptroller of 
        the Currency, the Chairman of the National Credit Union 
        Administration,''; and
            (B) by adding at the end the following new subsection:
    ``(c) Reports.--The Secretary of the Treasury, the Chairman of the 
Board of Governors of the Federal Reserve System, the Comptroller of 
the Currency, the Chairman of the National Credit Union Administration, 
and the Chairperson of Board of Directors of the Federal Deposit 
Insurance Corporation shall each submit an annual report to the 
Congress containing a description of actions taken to carry out this 
section.'';
        (5) in section 402 (12 U.S.C. 1437 note)--
            (A) in subsection (a), by striking ``Director of the Office 
        of Thrift Supervision'' and inserting ``Comptroller of the 
        Currency'';
            (B) by striking subsection (b);
            (C) in subsection (e)--
                (i) in paragraph (1), by striking ``Office of Thrift 
            Supervision'' and inserting ``Comptroller of the 
            Currency''; and
                (ii) in each of paragraphs (2), (3), and (4), by 
            striking ``Director of the Office of Thrift Supervision'' 
            each place that term appears and inserting ``Comptroller of 
            the Currency''; and
            (D) by striking ``Federal Housing Finance Board'' each 
        place that term appears and inserting ``Federal Housing Finance 
        Agency'';
        (6) in section 1103(a) (12 U.S.C. 3332(a)), by striking ``and 
    the Resolution Trust Corporation'';
        (7) in section 1205(b) (12 U.S.C. 1818 note)--
            (A) in paragraph (1)--
                (i) by striking subparagraph (B); and
                (ii) by redesignating subparagraphs (C) through (F) as 
            subparagraphs (B) through (E), respectively; and
            (B) in paragraph (2), by striking ``paragraph (1)(F)'' and 
        inserting ``paragraph (1)(E)'';
        (8) in section 1206 (12 U.S.C. 1833b)--
            (A) by striking ``Board, the Oversight Board of the 
        Resolution Trust Corporation'' and inserting ``Agency, and''; 
        and
            (B) by striking ``, and the Office of Thrift Supervision'';
        (9) in section 1216 (12 U.S.C. 1833e)--
            (A) in subsection (a)--
                (i) in paragraph (3), by adding ``and'' at the end;
                (ii) in paragraph (4), by striking the semicolon at the 
            end and inserting a period;
                (iii) by striking paragraphs (2), (5), and (6); and
                (iv) by redesignating paragraphs (3) and (4), as 
            paragraphs (2) and (3), respectively;
            (B) in subsection (c)--
                (i) by striking ``the Director of the Office of Thrift 
            Supervision,'' and inserting ``and''; and
                (ii) by striking ``the Thrift Depositor Protection 
            Oversight Board of the Resolution Trust Corporation, and 
            the Resolution Trust Corporation''; and
            (C) in subsection (d)--
                (i) by striking paragraphs (3), (5), and (6); and
                (ii) by redesignating paragraphs (4), (7), and (8) as 
            paragraphs (3), (4), and (5), respectively.
    SEC. 368. FLOOD DISASTER PROTECTION ACT OF 1973.
    Section 3(a)(5) of the Flood Disaster Protection Act of 1973 (42 
U.S.C. 4003(a)(5)) is amended by striking ``, the Office of Thrift 
Supervision''.
    SEC. 369. HOME OWNERS' LOAN ACT.
    The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended--
        (1) in section 1 (12 U.S.C. 1461), by striking the table of 
    contents;
        (2) in section 2 (12 U.S.C. 1462), as amended by this Act--
            (A) by striking paragraphs (1) and (3);
            (B) by redesignating paragraph (2) as paragraph (1);
            (C) by redesignating paragraphs (4) through (9) as 
        paragraphs (2) through (7), respectively; and
            (D) by adding at the end the following:
        ``(8) Board.--The term `Board', other than in the context of 
    the Board of Directors of the Corporation, means the Board of 
    Governors of the Federal Reserve System.
        ``(9) Comptroller.--The term `Comptroller' means the 
    Comptroller of the Currency.'';
        (3) in section 3 (12 U.S.C. 1462a)--
            (A) by striking the section heading and inserting the 
        following:
``SEC. 3. ADMINISTRATIVE PROVISIONS.'';
            (B) by striking subsections (a), (b), (c), (d), (g), (h), 
        (i), and (j);
            (C) by redesignating subsections (e) and (f) as subsections 
        (a) and (b), respectively;
            (D) in subsection (a), as so redesignated--
                (i) in the heading by striking ``of the Director''; and
                (ii) in the matter preceding paragraph (1), by striking 
            ``The Director'' and inserting ``In accordance with 
            subtitle A of title III of the Dodd-Frank Wall Street 
            Reform and Consumer Protection Act, the appropriate Federal 
            banking agency''; and
            (E) in subsection (b), as so redesignated, by striking 
        ``Director'' and inserting ``appropriate Federal banking 
        agency'';
        (4) in section 4 (12 U.S.C. 1463)--
            (A) in subsection (a)--
                (i) in the subsection heading, by striking ``Federal'';
                (ii) by striking paragraphs (1) and (2) and inserting 
            the following:
        ``(1) Examination and safe and sound operation.--
            ``(A) Federal savings associations.--The Comptroller shall 
        provide for the examination and safe and sound operation of 
        Federal savings associations.
            ``(B) State savings associations.--The Corporation shall 
        provide for the examination and safe and sound operation of 
        State savings associations.
        ``(2) Regulations for savings associations.--The Comptroller 
    may prescribe regulations with respect to savings associations, as 
    the Comptroller determines to be appropriate to carry out the 
    purposes of this Act.''; and
                (iii) in paragraph (3), by striking ``Director'' each 
            place that term appears and inserting ``Comptroller and the 
            Corporation'';
            (B) in subsection (b)--
                (i) in paragraph (2)--

                    (I) in subparagraph (A), by adding ``and'' at the 
                end;
                    (II) in subparagraph (B), by striking ``; and'' and 
                inserting a period; and
                    (III) by striking subparagraph (C); and

                (ii) by striking ``Director'' each place that term 
            appears and inserting ``Comptroller'';
            (C) in subsection (c)--
                (i) by striking ``All regulations and policies of the 
            Director'' and inserting ``The regulations of the 
            Comptroller and the policies of the Comptroller and the 
            Corporation''; and
                (ii) by striking ``of the Currency'';
            (D) in subsection (e)(5), by striking ``Director'' and 
        inserting ``Comptroller'';
            (E) in subsection (f), by striking ``Director'' each place 
        that term appears and inserting ``appropriate Federal banking 
        agency''; and
            (F) in subsection (h), by striking ``Director'' each place 
        that term appears and inserting ``appropriate Federal banking 
        agency'';
        (5) in section 5 (12 U.S.C. 1464)--
            (A) in subsection (a), by striking ``Director'', each place 
        such term appears and inserting ``Comptroller of the 
        Currency'';
            (B) in subsection (b), by striking ``Director'', each place 
        such term appears and inserting ``Comptroller of the 
        Currency'';
            (C) in subsection (c)--
                (i) in paragraph (5)--

                    (I) in subparagraph (A), by striking ``Director'' 
                and inserting ``appropriate Federal banking agency''; 
                and
                    (II) in subparagraph (B)--

                        (aa) by striking ``The Director'' and inserting 
                    ``The appropriate Federal banking agency''; and
                        (bb) by striking ``the Director'' and inserting 
                    ``the appropriate Federal banking agency'';
            (D) in subsection (d)--
                (i) in paragraph (1)--

                    (I) in subparagraph (A)--

                        (aa) in the first sentence, by striking 
                    ``Director'' and inserting ``appropriate Federal 
                    banking agency'';
                        (bb) in the second sentence--
                            (AA) by striking ``Director's own name and 
                        through the Director's own attorneys'' and 
                        inserting ``name of the appropriate Federal 
                        banking agency and through the attorneys of the 
                        appropriate Federal banking agency''; and
                            (BB) by striking ``Director'' each place 
                        that term appears and inserting ``appropriate 
                        Federal banking agency''; and
                        (cc) in the third sentence, by striking 
                    ``Director'' each place that term appears and 
                    inserting ``Comptroller'';

                    (II) in subparagraph (B)--

                        (aa) in clauses (i) through (iv), by striking 
                    ``Director'' each place that term appears and 
                    inserting ``appropriate Federal banking agency'';

                    (III) in clause (v)--

                        (aa) in the matter preceding subclause (I), by 
                    striking ``Director'' and inserting ``appropriate 
                    Federal banking agency'';
                        (bb) in subclause (II), by striking 
                    ``subpenas'' and inserting ``subpoenas''; and
                        (cc) in the matter following subclause (II), by 
                    striking ``subpena'' and inserting ``subpoena'';

                    (IV) in clause (vi)--

                        (aa) in the first sentence, by striking 
                    ``Director'' and inserting ``appropriate Federal 
                    banking agency''; and
                        (bb) in the second sentence, by striking 
                    ``Director'' and inserting ``Comptroller'';

                    (V) in clause (vii)--

                        (aa) in the first sentence, by striking 
                    ``subpena'' and inserting ``subpoena'';
                        (bb) in the second sentence, by striking 
                    ``subpenaed'' and inserting ``subpoenaed''; and
                        (cc) in the third sentence, by striking 
                    ``Director'' and inserting ``appropriate Federal 
                    banking agency'';
                (ii) in paragraph (2)--

                    (I) in subparagraph (A)--

                        (aa) by striking ``Director of the Office of 
                    Thrift Supervision'' and inserting ``appropriate 
                    Federal banking agency'';
                        (bb) by striking ``any insured savings 
                    association'' and inserting ``an insured savings 
                    association''; and
                        (cc) by striking ``Director determines, in the 
                    Director's discretion'' and inserting ``appropriate 
                    Federal banking agency determines, in the 
                    discretion of the appropriate Federal banking 
                    agency'';

                    (II) in subparagraph (B), by striking ``Director'' 
                each place that term appears and inserting 
                ``appropriate Federal banking agency'';
                    (III) in subparagraphs (C) and (D), by striking 
                ``Director'' and inserting ``appropriate Federal 
                banking agency'';
                    (IV) in subparagraph (E)--

                        (aa) in clause (ii)--
                            (AA) in the clause heading, by striking 
                        ``or rtc''; and
                            (BB) by striking ``or the Resolution Trust 
                        Corporation, as appropriate,'' each place that 
                        term appears; and
                        (bb) by striking ``Director'' each place that 
                    term appears and inserting ``appropriate Federal 
                    banking agency''; and
                (iii) in paragraph (3)--

                    (I) in subparagraph (A), by striking ``Director'' 
                each place that term appears and inserting 
                ``Comptroller''; and
                    (II) in subparagraph (B)--

                        (aa) in the subparagraph heading, by striking 
                    ``or rtc'';
                        (bb) by striking ``Corporation or the 
                    Resolution Trust''; and
                        (cc) by striking ``Director'' and inserting 
                    ``Comptroller'';
                (iv) in paragraph (4), by striking ``Director'' and 
            inserting ``appropriate Federal banking agency'';
                (v) in paragraph (6)--

                    (I) in subparagraph (A), by striking ``Director'' 
                and inserting ``Comptroller''; and
                    (II) in subparagraphs (B) and (C), by striking 
                ``Director'' each place that term appears and inserting 
                ``appropriate Federal banking agency'';

                (vi) in paragraph (7)--

                    (I) in subparagraphs (A), (B), and (D), by striking 
                ``Director'' each place that term appears and inserting 
                ``appropriate Federal banking agency'';
                    (II) in subparagraph (C), by striking ``Director'' 
                and inserting ``Federal Deposit Insurance Corporation 
                or the Comptroller, as appropriate,''; and
                    (III) by striking subparagraph (E) and inserting 
                the following:

            ``(E) Administration by the comptroller and the 
        corporation.--The Comptroller may issue such regulations, and 
        the appropriate Federal banking agency may issue such orders, 
        including those issued pursuant to section 8 of the Federal 
        Deposit Insurance Act, as may be necessary to administer and 
        carry out this paragraph and to prevent evasion of this 
        paragraph.'';
            (E) in subsection (e)(2), strike ``Director'' and insert 
        ``Comptroller'';
            (F) in subsection (i)--
                (i) by striking ``Director'', each place such term 
            appears, and inserting ``Comptroller'';
                (ii) in paragraph (2), in the heading, by striking 
            ``director'' and inserting ``Comptroller'';
                (iii) in paragraph (5)(A), by striking ``of the 
            Currency''; and
                (iv) except as provided in clauses (i) through (iii), 
            by striking ``Director'' each place such term appears and 
            inserting ``Comptroller'';
            (G) in subsection (o)--
                (i) in paragraph (1), by striking ``Director'' and 
            inserting ``Comptroller''; and
                (ii) in paragraph (2)(B), by striking ``Director's 
            determination'' and inserting ``determination of the 
            Comptroller'';
            (H) in subsections (m), (n), (o), and (p), by striking 
        ``Director'', each place such term appears, and inserting 
        ``Comptroller'';
            (I) in subsection (q)--
                (i) in paragraph (6), by striking ``of Governors of the 
            Federal Reserve System'';
                (ii) by striking ``Director'' each place that term 
            appears and inserting ``Board''; and
                (iii) by inserting ``in consultation with the 
            Comptroller and the Corporation,'' before ``considers'';
            (J) in subsection (r)(3), by striking ``Director'' and 
        inserting ``Comptroller of the Currency'';
            (K) in subsection (s)--
                (i) in paragraph (1), strike ``Director'' and insert 
            ``Comptroller of the Currency'';
                (ii) in paragraph (2), strike ``Director'' and insert 
            ``Comptroller of the Currency'';
                (iii) in paragraph (3), by striking ``Director's 
            discretion, the Director'' and inserting ``discretion of 
            the appropriate Federal banking agency, the appropriate 
            Federal banking agency,'';
                (iv) in paragraph (4), by striking ``Director'' each 
            place that term appears and inserting ``appropriate Federal 
            banking agency''; and
                (v) in paragraph (5)--

                    (I) by striking ``Director'', each place such term 
                appears, and inserting ``appropriate Federal banking 
                agency''; and
                    (II) by striking ``Director's approval'' and 
                inserting ``approval of the appropriate Federal banking 
                agency'';

            (L) in subsection (t)--
                (i) in paragraph (1), by striking subparagraph (D);
                (ii) by striking paragraph (3) and inserting the 
            following:
        ``(3) [Repealed].'';
                (iii) in paragraph (5)--

                    (I) in subparagraph (B), by striking ``Corporation, 
                in its sole discretion'' and inserting ``appropriate 
                Federal banking agency, in the sole discretion of the 
                appropriate Federal banking agency''; and
                    (II) by striking subparagraph (D);

                (iv) in paragraph (6)--

                    (I) by striking subparagraph (A) and inserting the 
                following:

            ``(A) [Reserved].'';

                    (II) in subparagraph (B), by striking ``Director'' 
                each place that term appears and inserting 
                ``appropriate Federal banking agency'';
                    (III) in subparagraph (C)--

                        (aa) in clause (i), by striking ``Director's 
                    prior approval'' and inserting ``prior approval of 
                    the appropriate Federal banking agency'';
                        (bb) in clause (ii), by striking ``Director's 
                    discretion'' and inserting ``discretion of the 
                    appropriate Federal banking agency''; and
                        (cc) by striking ``Director'' each place that 
                    term appears and inserting ``appropriate Federal 
                    banking agency'';

                    (IV) in subparagraph (E), by striking ``Director 
                shall'' and inserting ``appropriate Federal banking 
                agency may''; and
                    (V) in subparagraph (F), by striking ``Director'' 
                and all that follows through the end of the 
                subparagraph and inserting ``appropriate Federal 
                banking agency under this Act or any other provision of 
                law.'';

                (v) in paragraph (7), by striking ``Director'' each 
            place that term appears and inserting ``appropriate Federal 
            banking agency'';
                (vi) by striking paragraph (8) and inserting the 
            following:
        ``(8) [Repealed].'';
                (vii) in paragraph (9)--

                    (I) in subparagraph (A), by striking ``Director'' 
                and inserting ``Comptroller'';
                    (II) in subparagraph (C), by striking ``of the 
                Currency''; and
                    (III) by striking subparagraph (B) and 
                redesignating subparagraphs (C) and (D) as 
                subparagraphs (B) and (C), respectively; and

                (viii) except as provided in clauses (i) through (vii), 
            by striking ``Director'' each place that term appears and 
            inserting ``appropriate Federal banking agency'';
            (M) in subsection (u), by striking ``Director'' each place 
        that term appears and inserting ``appropriate Federal banking 
        agency'';
            (N) in subsection (v)--
                (i) in paragraph (2), by striking ``Director's 
            determinations'' and inserting ``determinations of the 
            appropriate Federal banking agency''; and
                (ii) by striking ``Director'' each place that term 
            appears and inserting ``appropriate Federal banking 
            agency'';
            (O) in subsection (w)(1)--
                (i) in subparagraph (A)(II), by striking ``Director's 
            intention'' and inserting ``intention of the Comptroller''; 
            and
                (ii) in subparagraph (B), by striking ``Director's 
            intention'' and inserting ``intention of the Comptroller''; 
            and
            (P) except as provided in subparagraphs (A) through (J), by 
        striking ``Director'' each place that term appears and 
        inserting ``Comptroller'';
        (6) in section 8 (12 U.S.C. 1466a), by striking ``Director'' 
    each place that term appears and inserting ``Comptroller'';
        (7) in section 9 (12 U.S.C. 1467)--
            (A) in subsection (a), by striking ``assessed by the 
        Director'' and all that follows through the end of the 
        subsection and inserting the following: ``assessed by--
        ``(1) the Comptroller, against each such Federal savings 
    association, as the Comptroller deems necessary or appropriate; and
        ``(2) the Corporation, against each such State savings 
    association, as the Corporation deems necessary or appropriate.'';
            (B) in subsection (b), by striking ``Director'', each place 
        such term appears, and inserting ``Comptroller or Corporation, 
        as appropriate'';
            (C) in subsection (e)--
                (i) by striking ``Only the Director'' and inserting 
            ``The Comptroller''; and
                (ii) by striking ``Director's designee'' and inserting 
            ``designee of the Comptroller'';
            (D) by striking subsection (f) and inserting the following:
    ``(f) [Reserved].'';
            (E) in subsection (g)--
                (i) in paragraph (1), by striking ``Director'' and 
            inserting ``appropriate Federal banking agency''; and
                (ii) in paragraph (2), by striking ``Director, or the 
            Corporation, as the case may be,'' and inserting 
            ``appropriate Federal banking agency for the savings 
            association'';
            (F) in subsection (i), by striking ``Director'' each place 
        that term appears and inserting ``appropriate Federal banking 
        agency'';
            (G) in subsection (j), by striking ``Director's sole 
        discretion'' and inserting ``sole discretion of the appropriate 
        Federal banking agency'';
            (H) in subsection (k), by striking ``Director may assess 
        against institutions for which the Director is the appropriate 
        Federal banking agency, as defined in section 3 of the Federal 
        Deposit Insurance Act,'' and inserting ``appropriate Federal 
        banking agency may assess against an institution''; and
            (I) except as provided in subparagraphs (A) through (G), by 
        striking ``Director'' each place that term appears and 
        inserting ``appropriate Federal banking agency'';
        (8) in section 10 (12 U.S.C. 1467a)--
            (A) in subsection (a)(1), by striking ``Director'' each 
        place that term appears and inserting ``appropriate Federal 
        banking agency'';
            (B) in subsection (b)--
                (i) in paragraph (2), by striking ``and the regional 
            office of the Director of the district in which its 
            principal office is located,''; and
                (ii) in paragraph (6), by striking ``Director's own 
            motion or application'' and inserting ``motion or 
            application of the Board'';
            (C) in subsection (c)--
                (i) in paragraph (2)(F), by striking ``of Governors of 
            the Federal Reserve System'';
                (ii) in paragraph (4)(B), in the subparagraph heading, 
            by striking ``by director'';
                (iii) in paragraph (6)(D), in the subparagraph heading, 
            by striking ``by director''; and
                (iv) in paragraph (9)(E), by inserting ``(in 
            consultation with the appropriate Federal banking agency)'' 
            after ``including a determination'';
            (D) in subsection (g)(5)(B), by striking ``the Director's 
        discretion'' and inserting ``the discretion of the Board'';
            (E) in subsection (l), by striking ``Director'' each place 
        that term appears and inserting ``appropriate Federal banking 
        agency'';
            (F) in subsection (m), by striking ``Director'' and 
        inserting ``appropriate Federal banking agency'';
            (G) in subsection (p)--
                (i) in paragraph (1)--

                    (I) by striking ``Director determines'' the 1st 
                place such term appears and inserting ``Board or the 
                appropriate Federal banking agency for the savings 
                association determines'';
                    (II) by striking ``Director may'' and inserting 
                ``Board may''; and
                    (III) by striking ``Director determines'' the 2nd 
                place such term appears and inserting ``Board, in 
                consultation with the appropriate Federal banking 
                agency for the savings association determines''; and

                (ii) in paragraph (2), by striking ``Director'', each 
            place such term appears, and inserting ``Board'';
            (H) in subsection (q), by striking ``Director'', each place 
        such term appears, and inserting ``Board'';
            (I) in subsection (r), by striking ``Director'', each place 
        such term appears, and inserting ``Board or appropriate Federal 
        banking agency'';
            (J) in subsection (s)--
                (i) in paragraph (2)--

                    (I) in subparagraph (B)(ii), by striking 
                ``Director's judgment'' and inserting ``judgment of the 
                appropriate Federal banking agency for the savings 
                association''; and
                    (II) by striking ``Director'' each place that term 
                appears and inserting ``appropriate Federal banking 
                agency for the savings association''; and

                (ii) in paragraph (4), by striking ``Director'' and 
            inserting ``Comptroller''; and
            (K) except as provided in subparagraphs (A) through (J), by 
        striking ``Director'' each place that term appears and 
        inserting ``Board'';
        (9) in section 11 (12 U.S.C. 1468), by striking ``Director'' 
    each place that term appears and inserting ``appropriate Federal 
    banking agency'';
        (10) in section 12 (12 U.S.C. 1468a), by striking ``the 
    Director'' and inserting ``a Federal banking agency''; and
        (11) in section 13 (12 U.S.C. 1468a) is amended by striking 
    ``Director'' and inserting ``a Federal banking agency''.
    SEC. 370. HOUSING ACT OF 1948.
    Section 502(c) of the Housing Act of 1948 (12 U.S.C. 1701c(c)) is 
amended--
        (1) in the matter preceding paragraph (1), by striking ``and 
    the Director of the Office of Thrift Supervision'' and inserting 
    ``, the Comptroller of the Currency, and the Federal Deposit 
    Insurance Corporation''; and
        (2) in paragraph (3), by striking ``Board'' and inserting 
    ``Agency''.
    SEC. 371. HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1992.
    Section 543 of the Housing and Community Development Act of 1992 
(Public Law 102-550; 106 Stat. 3798) is amended--
        (1) in subsection (c)(1)--
            (A) by striking subparagraphs (D) through (F); and
            (B) by redesignating subparagraphs (G) and (H) as 
        subparagraphs (D) and (E), respectively; and
        (2) in subsection (f)--
            (A) in paragraph (2), by striking ``the Office of Thrift 
        Supervision,'' each place that term appears; and
            (B) in paragraph (3)--
                (i) in the matter preceding subparagraph (A), by 
            striking ``the Office of Thrift Supervision,''; and
                (ii) in subparagraph (D), by striking ``Office of 
            Thrift Supervision,''.
    SEC. 372. HOUSING AND URBAN-RURAL RECOVERY ACT OF 1983.
    Section 469 of the Housing and Urban-Rural Recovery Act of 1983 (12 
U.S.C. 1701p-1) is amended in the first sentence, by striking ``Federal 
Home Loan Bank Board'' and inserting ``Federal Housing Finance 
Agency''.
    SEC. 373. NATIONAL HOUSING ACT.
    Section 202(f) of the National Housing Act (12 U.S.C. 1708(f)) is 
amended--
        (1) by striking paragraph (5) and inserting the following:
        ``(5) if the mortgagee is a national bank, a subsidiary or 
    affiliate of such bank, a Federal savings association or a 
    subsidiary or affiliate of a savings association, the Comptroller 
    of the Currency;'';
        (2) in paragraph (6), by adding ``and'' at the end;
        (3) in paragraph (7)--
            (A) by inserting ``or State savings association'' after 
        ``State bank''; and
            (B) by striking ``; and'' and inserting a period; and
        (4) by striking paragraph (8).
    SEC. 374. NEIGHBORHOOD REINVESTMENT CORPORATION ACT.
    Section 606(c)(3) of the Neighborhood Reinvestment Corporation Act 
(42 U.S.C. 8105(c)(3)) is amended by striking ``Federal Home Loan Bank 
Board'' and inserting ``Federal Housing Finance Agency''.
    SEC. 375. PUBLIC LAW 93-100.
    Section 5(d) of Public Law 93-100 (12 U.S.C. 1470(a)) is amended--
        (1) in paragraph (1), by striking ``Federal Savings and Loan 
    Insurance Corporation with respect to insured institutions, the 
    Board of Governors of the Federal Reserve System with respect to 
    State member insured banks, and the Federal Deposit Insurance 
    Corporation with respect to State nonmember insured banks'' and 
    inserting ``appropriate Federal banking agency, with respect to the 
    institutions subject to the jurisdiction of each such agency,''; 
    and
        (2) in paragraph (2), by striking ``supervisory'' and inserting 
    ``banking''.
    SEC. 376. SECURITIES EXCHANGE ACT OF 1934.
    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended--
        (1) in section 3(a)(34) (15 U.S.C. 78c(a)(34))--
            (A) in subparagraph (A)--
                (i) in clause (i), by striking ``or a subsidiary or a 
            department or division of any such bank'' and inserting ``a 
            subsidiary or a department or division of any such bank, a 
            Federal savings association (as defined in section 3(b)(2) 
            of the Federal Deposit Insurance Act (12 U.S.C. 
            1813(b)(2))), the deposits of which are insured by the 
            Federal Deposit Insurance Corporation, or a subsidiary or 
            department or division of any such Federal savings 
            association'';
                (ii) in clause (ii), by striking ``or a subsidiary or a 
            department or division of such subsidiary'' and inserting 
            ``a subsidiary or a department or division of such 
            subsidiary, or a savings and loan holding company'';
                (iii) in clause (iii), by striking ``or a subsidiary or 
            department or division thereof;'' and inserting ``a 
            subsidiary or department or division of any such bank, a 
            State savings association (as defined in section 3(b)(3) of 
            the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), 
            the deposits of which are insured by the Federal Deposit 
            Insurance Corporation, or a subsidiary or a department or 
            division of any such State savings association; and'';
                (iv) by striking clause (iv); and
                (v) by redesignating clause (v) as clause (iv);
            (B) in subparagraph (B)--
                (i) in clause (i), by striking ``or a subsidiary of any 
            such bank'' and inserting ``a subsidiary of any such bank, 
            a Federal savings association (as defined in section 
            3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 
            1813(b)(2))), the deposits of which are insured by the 
            Federal Deposit Insurance Corporation, or a subsidiary of 
            any such Federal savings association'';
                (ii) in clause (ii), by striking ``or a subsidiary of a 
            bank holding company which is a bank other than a bank 
            specified in clause (i), (iii), or (iv) of this 
            subparagraph'' and inserting ``a subsidiary of a bank 
            holding company that is a bank other than a bank specified 
            in clause (i) or (iii) of this subparagraph, or a savings 
            and loan holding company'';
                (iii) in clause (iii), by striking ``or a subsidiary 
            thereof;'' and inserting ``a subsidiary of any such bank, a 
            State savings association (as defined in section 3(b)(3) of 
            the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), 
            the deposits of which are insured by the Federal Deposit 
            Insurance Corporation, or a subsidiary of any such State 
            savings association; and'';
                (iv) by striking clause (iv); and
                (v) by redesignating clause (v) as clause (iv);
            (C) in subparagraph (C)--
                (i) in clause (i), by striking ``bank'' and inserting 
            ``bank or a Federal savings association (as defined in 
            section 3(b)(2) of the Federal Deposit Insurance Act (12 
            U.S.C. 1813(b)(2))), the deposits of which are insured by 
            the Federal Deposit Insurance Corporation'';
                (ii) in clause (ii), by striking ``or a subsidiary of a 
            bank holding company which is a bank other than a bank 
            specified in clause (i), (iii), or (iv) of this 
            subparagraph'' and inserting ``a subsidiary of a bank 
            holding company that is a bank other than a bank specified 
            in clause (i) or (iii) of this subparagraph, or a savings 
            and loan holding company'';
                (iii) in clause (iii), by striking ``System)'' and 
            inserting, ``System) or a State savings association (as 
            defined in section 3(b)(3) of the Federal Deposit Insurance 
            Act (12 U.S.C. 1813(b)(3))), the deposits of which are 
            insured by the Federal Deposit Insurance Corporation; 
            and'';
                (iv) by striking clause (iv); and
                (v) by redesignating clause (v) as clause (iv);
            (D) in subparagraph (D)--
                (i) in clause (i), by inserting after ``bank'' the 
            following: ``or a Federal savings association (as defined 
            in section 3(b)(2) of the Federal Deposit Insurance Act (12 
            U.S.C. 1813(b)(2))), the deposits of which are insured by 
            the Federal Deposit Insurance Corporation'';
                (ii) in clause (ii), by adding ``and'' at the end;
                (iii) by striking clause (iii);
                (iv) by redesignating clause (iv) as clause (iii); and
                (v) in clause (iii), as so redesignated, by inserting 
            after ``bank'' the following: ``or a State savings 
            association (as defined in section 3(b)(3) of the Federal 
            Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits 
            of which are insured by the Federal Deposit Insurance 
            Corporation'';
            (E) in subparagraph (F)--
                (i) in clause (i), by inserting after ``bank'' the 
            following: ``or a Federal savings association (as defined 
            in section 3(b)(2) of the Federal Deposit Insurance Act (12 
            U.S.C. 1813(b)(2))), the deposits of which are insured by 
            the Federal Deposit Insurance Corporation'';
                (ii) by striking clause (ii);
                (iii) by redesignating clauses (iii), (iv), and (v) as 
            clauses (ii), (iii), and (iv), respectively; and
                (iv) in clause (iii), as so redesignated, by inserting 
            before the semicolon the following: ``or a State savings 
            association (as defined in section 3(b)(3) of the Federal 
            Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits 
            of which are insured by the Federal Deposit Insurance 
            Corporation'';
            (F) in subparagraph (G)--
                (i) in clause (i), by inserting after ``national bank'' 
            the following: ``, a Federal savings association (as 
            defined in section 3(b)(2) of the Federal Deposit Insurance 
            Act), the deposits of which are insured by the Federal 
            Deposit Insurance Corporation,'';
                (ii) in clause (iii)--

                    (I) by inserting after ``bank)'' the following: ``, 
                a State savings association (as defined in section 
                3(b)(3) of the Federal Deposit Insurance Act), the 
                deposits of which are insured by the Federal Deposit 
                Insurance Corporation,''; and
                    (II) by adding ``and'' at the end;

                (iii) by striking clause (iv); and
                (iv) by redesignating clause (v) as clause (iv); and
            (G) in the undesignated matter following subparagraph (H), 
        by striking ``, and the term `District of Columbia savings and 
        loan association' means any association subject to examination 
        and supervision by the Office of Thrift Supervision under 
        section 8 of the Home Owners' Loan Act of 1933'';
        (2) in section 12(i) (15 U.S.C. 78l(i))--
            (A) in paragraph (1), by inserting after ``national banks'' 
        the following: ``and Federal savings associations, the accounts 
        of which are insured by the Federal Deposit Insurance 
        Corporation'';
            (B) by striking ``(3)'' and all that follows through 
        ``vested in the Office of Thrift Supervision'' and inserting 
        ``and (3) with respect to all other insured banks and State 
        savings associations, the accounts of which are insured by the 
        Federal Deposit Insurance Corporation, are vested in the 
        Federal Deposit Insurance Corporation''; and
            (C) in the second sentence, by striking ``the Federal 
        Deposit Insurance Corporation, and the Office of Thrift 
        Supervision'' and inserting ``and the Federal Deposit Insurance 
        Corporation'';
        (3) in section 15C(g)(1) (15 U.S.C. 78o-5(g)(1)), by striking 
    ``the Director of the Office of Thrift Supervision, the Federal 
    Savings and Loan Insurance Corporation,''; and
        (4) in section 23(b)(1) (15 U.S.C. 78w(b)(1)), by striking ``, 
    other than the Office of Thrift Supervision,''.
    SEC. 377. TITLE 18, UNITED STATES CODE.
    Title 18, United States Code, is amended--
        (1) in section 212(c)(2)--
            (A) by striking subparagraph (C); and
            (B) by redesignating subparagraphs (D) through (H) as 
        subparagraphs (C) through (G), respectively;
        (2) in section 657, by striking ``Office of Thrift Supervision, 
    the Resolution Trust Corporation,'';
        (3) in section 981(a)(1)(D)--
            (A) by striking ``Resolution Trust Corporation,''; and
            (B) by striking ``or the Office of Thrift Supervision'';
        (4) in section 982(a)(3)--
            (A) by striking ``Resolution Trust Corporation,''; and
            (B) by striking ``or the Office of Thrift Supervision'';
        (5) in section 1006--
            (A) by striking ``Office of Thrift Supervision,''; and
            (B) by striking ``the Resolution Trust Corporation,'';
        (6) in section 1014--
            (A) by striking ``the Office of Thrift Supervision''; and
            (B) by striking ``the Resolution Trust Corporation,''; and
        (7) in section 1032(1)--
            (A) by striking ``the Resolution Trust Corporation,''; and
            (B) by striking ``or the Director of the Office of Thrift 
        Supervision''.
    SEC. 378. TITLE 31, UNITED STATES CODE.
    Title 31, United States Code, is amended--
        (1) in section 321--
            (A) in subsection (c)--
                (i) in paragraph (1), by adding ``and'' at the end;
                (ii) in paragraph (2), by striking ``; and'' and 
            inserting a period; and
                (iii) by striking paragraph (3); and
            (B) by striking subsection (e); and
        (2) in section 714(a), by striking ``the Office of the 
    Comptroller of the Currency, and the Office of Thrift 
    Supervision.'' and inserting ``and the Office of the Comptroller of 
    the Currency.''.

       TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS

    SEC. 401. SHORT TITLE.
    This title may be cited as the ``Private Fund Investment Advisers 
Registration Act of 2010''.
    SEC. 402. DEFINITIONS.
    (a) Investment Advisers Act of 1940 Definitions.--Section 202(a) of 
the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)) is amended by 
adding at the end the following:
        ``(29) The term `private fund' means an issuer that would be an 
    investment company, as defined in section 3 of the Investment 
    Company Act of 1940 (15 U.S.C. 80a-3), but for section 3(c)(1) or 
    3(c)(7) of that Act.
        ``(30) The term `foreign private adviser' means any investment 
    adviser who--
            ``(A) has no place of business in the United States;
            ``(B) has, in total, fewer than 15 clients and investors in 
        the United States in private funds advised by the investment 
        adviser;
            ``(C) has aggregate assets under management attributable to 
        clients in the United States and investors in the United States 
        in private funds advised by the investment adviser of less than 
        $25,000,000, or such higher amount as the Commission may, by 
        rule, deem appropriate in accordance with the purposes of this 
        title; and
            ``(D) neither--
                ``(i) holds itself out generally to the public in the 
            United States as an investment adviser; nor
                ``(ii) acts as--

                    ``(I) an investment adviser to any investment 
                company registered under the Investment Company Act of 
                1940; or
                    ``(II) a company that has elected to be a business 
                development company pursuant to section 54 of the 
                Investment Company Act of 1940 (15 U.S.C. 80a-53), and 
                has not withdrawn its election.''.

    (b) Other Definitions.--As used in this title, the terms 
``investment adviser'' and ``private fund'' have the same meanings as 
in section 202 of the Investment Advisers Act of 1940, as amended by 
this title.
    SEC. 403. ELIMINATION OF PRIVATE ADVISER EXEMPTION; LIMITED 
      EXEMPTION FOR FOREIGN PRIVATE ADVISERS; LIMITED INTRASTATE 
      EXEMPTION.
    Section 203(b) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-3(b)) is amended--
        (1) in paragraph (1), by inserting ``, other than an investment 
    adviser who acts as an investment adviser to any private fund,'' 
    before ``all of whose'';
        (2) by striking paragraph (3) and inserting the following:
        ``(3) any investment adviser that is a foreign private 
    adviser;''; and
        (3) in paragraph (5), by striking ``or'' at the end;
        (4) in paragraph (6)--
            (A) by striking ``any investment adviser'' and inserting 
        ``(A) any investment adviser'';
            (B) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), respectively; and
            (C) in clause (ii) (as so redesignated), by striking the 
        period at the end and inserting ``; or''; and
            (D) by adding at the end the following:
    ``(B) any investment adviser that is registered with the Commodity 
Futures Trading Commission as a commodity trading advisor and advises a 
private fund, provided that, if after the date of enactment of the 
Private Fund Investment Advisers Registration Act of 2010, the business 
of the advisor should become predominately the provision of securities-
related advice, then such adviser shall register with the 
Commission.''.
        (5) by adding at the end the following:
        ``(7) any investment adviser, other than any entity that has 
    elected to be regulated or is regulated as a business development 
    company pursuant to section 54 of the Investment Company Act of 
    1940 (15 U.S.C. 80a-54), who solely advises--
            ``(A) small business investment companies that are 
        licensees under the Small Business Investment Act of 1958;
            ``(B) entities that have received from the Small Business 
        Administration notice to proceed to qualify for a license as a 
        small business investment company under the Small Business 
        Investment Act of 1958, which notice or license has not been 
        revoked; or
            ``(C) applicants that are affiliated with 1 or more 
        licensed small business investment companies described in 
        subparagraph (A) and that have applied for another license 
        under the Small Business Investment Act of 1958, which 
        application remains pending.''.
    SEC. 404. COLLECTION OF SYSTEMIC RISK DATA; REPORTS; EXAMINATIONS; 
      DISCLOSURES.
    Section 204 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
4) is amended--
        (1) by redesignating subsections (b) and (c) as subsections (c) 
    and (d), respectively; and
        (2) by inserting after subsection (a) the following:
    ``(b) Records and Reports of Private Funds.--
        ``(1) In general.--The Commission may require any investment 
    adviser registered under this title--
            ``(A) to maintain such records of, and file with the 
        Commission such reports regarding, private funds advised by the 
        investment adviser, as necessary and appropriate in the public 
        interest and for the protection of investors, or for the 
        assessment of systemic risk by the Financial Stability 
        Oversight Council (in this subsection referred to as the 
        `Council'); and
            ``(B) to provide or make available to the Council those 
        reports or records or the information contained therein.
        ``(2) Treatment of records.--The records and reports of any 
    private fund to which an investment adviser registered under this 
    title provides investment advice shall be deemed to be the records 
    and reports of the investment adviser.
        ``(3) Required information.--The records and reports required 
    to be maintained by an investment adviser and subject to inspection 
    by the Commission under this subsection shall include, for each 
    private fund advised by the investment adviser, a description of--
            ``(A) the amount of assets under management and use of 
        leverage, including off-balance-sheet leverage;
            ``(B) counterparty credit risk exposure;
            ``(C) trading and investment positions;
            ``(D) valuation policies and practices of the fund;
            ``(E) types of assets held;
            ``(F) side arrangements or side letters, whereby certain 
        investors in a fund obtain more favorable rights or 
        entitlements than other investors;
            ``(G) trading practices; and
            ``(H) such other information as the Commission, in 
        consultation with the Council, determines is necessary and 
        appropriate in the public interest and for the protection of 
        investors or for the assessment of systemic risk, which may 
        include the establishment of different reporting requirements 
        for different classes of fund advisers, based on the type or 
        size of private fund being advised.
        ``(4) Maintenance of records.--An investment adviser registered 
    under this title shall maintain such records of private funds 
    advised by the investment adviser for such period or periods as the 
    Commission, by rule, may prescribe as necessary and appropriate in 
    the public interest and for the protection of investors, or for the 
    assessment of systemic risk.
        ``(5) Filing of records.--The Commission shall issue rules 
    requiring each investment adviser to a private fund to file reports 
    containing such information as the Commission deems necessary and 
    appropriate in the public interest and for the protection of 
    investors or for the assessment of systemic risk.
        ``(6) Examination of records.--
            ``(A) Periodic and special examinations.--The Commission--
                ``(i) shall conduct periodic inspections of the records 
            of private funds maintained by an investment adviser 
            registered under this title in accordance with a schedule 
            established by the Commission; and
                ``(ii) may conduct at any time and from time to time 
            such additional, special, and other examinations as the 
            Commission may prescribe as necessary and appropriate in 
            the public interest and for the protection of investors, or 
            for the assessment of systemic risk.
            ``(B) Availability of records.--An investment adviser 
        registered under this title shall make available to the 
        Commission any copies or extracts from such records as may be 
        prepared without undue effort, expense, or delay, as the 
        Commission or its representatives may reasonably request.
        ``(7) Information sharing.--
            ``(A) In general.--The Commission shall make available to 
        the Council copies of all reports, documents, records, and 
        information filed with or provided to the Commission by an 
        investment adviser under this subsection as the Council may 
        consider necessary for the purpose of assessing the systemic 
        risk posed by a private fund.
            ``(B) Confidentiality.--The Council shall maintain the 
        confidentiality of information received under this paragraph in 
        all such reports, documents, records, and information, in a 
        manner consistent with the level of confidentiality established 
        for the Commission pursuant to paragraph (8). The Council shall 
        be exempt from section 552 of title 5, United States Code, with 
        respect to any information in any report, document, record, or 
        information made available, to the Council under this 
        subsection.''.
        ``(8) Commission confidentiality of reports.--Notwithstanding 
    any other provision of law, the Commission may not be compelled to 
    disclose any report or information contained therein required to be 
    filed with the Commission under this subsection, except that 
    nothing in this subsection authorizes the Commission--
            ``(A) to withhold information from Congress, upon an 
        agreement of confidentiality; or
            ``(B) prevent the Commission from complying with--
                ``(i) a request for information from any other Federal 
            department or agency or any self-regulatory organization 
            requesting the report or information for purposes within 
            the scope of its jurisdiction; or
                ``(ii) an order of a court of the United States in an 
            action brought by the United States or the Commission.
        ``(9) Other recipients confidentiality.--Any department, 
    agency, or self-regulatory organization that receives reports or 
    information from the Commission under this subsection shall 
    maintain the confidentiality of such reports, documents, records, 
    and information in a manner consistent with the level of 
    confidentiality established for the Commission under paragraph (8).
        ``(10) Public information exception.--
            ``(A) In general.--The Commission, the Council, and any 
        other department, agency, or self-regulatory organization that 
        receives information, reports, documents, records, or 
        information from the Commission under this subsection, shall be 
        exempt from the provisions of section 552 of title 5, United 
        States Code, with respect to any such report, document, record, 
        or information. Any proprietary information of an investment 
        adviser ascertained by the Commission from any report required 
        to be filed with the Commission pursuant to this subsection 
        shall be subject to the same limitations on public disclosure 
        as any facts ascertained during an examination, as provided by 
        section 210(b) of this title.
            ``(B) Proprietary information.--For purposes of this 
        paragraph, proprietary information includes sensitive, non-
        public information regarding--
                ``(i) the investment or trading strategies of the 
            investment adviser;
                ``(ii) analytical or research methodologies;
                ``(iii) trading data;
                ``(iv) computer hardware or software containing 
            intellectual property; and
                ``(v) any additional information that the Commission 
            determines to be proprietary.
        ``(11) Annual report to congress.--The Commission shall report 
    annually to Congress on how the Commission has used the data 
    collected pursuant to this subsection to monitor the markets for 
    the protection of investors and the integrity of the markets.''.
    SEC. 405. DISCLOSURE PROVISION AMENDMENT.
    Section 210(c) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-10(c)) is amended by inserting before the period at the end the 
following: ``or for purposes of assessment of potential systemic 
risk''.
    SEC. 406. CLARIFICATION OF RULEMAKING AUTHORITY.
    Section 211 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
11) is amended--
        (1) in subsection (a), by inserting before the period at the 
    end of the first sentence the following: ``, including rules and 
    regulations defining technical, trade, and other terms used in this 
    title, except that the Commission may not define the term `client' 
    for purposes of paragraphs (1) and (2) of section 206 to include an 
    investor in a private fund managed by an investment adviser, if 
    such private fund has entered into an advisory contract with such 
    adviser''; and
        (2) by adding at the end the following:
    ``(e) Disclosure Rules on Private Funds.--The Commission and the 
Commodity Futures Trading Commission shall, after consultation with the 
Council but not later than 12 months after the date of enactment of the 
Private Fund Investment Advisers Registration Act of 2010, jointly 
promulgate rules to establish the form and content of the reports 
required to be filed with the Commission under subsection 204(b) and 
with the Commodity Futures Trading Commission by investment advisers 
that are registered both under this title and the Commodity Exchange 
Act (7 U.S.C. 1a et seq.).''.
    SEC. 407. EXEMPTION OF AND REPORTING BY VENTURE CAPITAL 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:
    ``(l) Exemption of Venture Capital Fund Advisers.--No investment 
adviser that acts as an investment adviser solely to 1 or more venture 
capital funds shall be subject to the registration requirements of this 
title with respect to the provision of investment advice relating to a 
venture capital fund. Not later than 1 year after the date of enactment 
of this subsection, the Commission shall issue final rules to define 
the term `venture capital fund' for purposes of this subsection. The 
Commission shall require such advisers to maintain such records and 
provide to the Commission such annual or other reports as the 
Commission determines necessary or appropriate in the public interest 
or for the protection of investors.''.
    SEC. 408. EXEMPTION OF AND REPORTING BY CERTAIN PRIVATE 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:
    ``(m) Exemption of and Reporting by Certain Private Fund 
Advisers.--
        ``(1) In general.--The Commission shall provide an exemption 
    from the registration requirements under this section to any 
    investment adviser of private funds, if each of such investment 
    adviser acts solely as an adviser to private funds and has assets 
    under management in the United States of less than $150,000,000.
        ``(2) Reporting.--The Commission shall require investment 
    advisers exempted by reason of this subsection to maintain such 
    records and provide to the Commission such annual or other reports 
    as the Commission determines necessary or appropriate in the public 
    interest or for the protection of investors.
    ``(n) Registration and Examination of Mid-sized Private Fund 
Advisers.--In prescribing regulations to carry out the requirements of 
this section with respect to investment advisers acting as investment 
advisers to mid-sized private funds, the Commission shall take into 
account the size, governance, and investment strategy of such funds to 
determine whether they pose systemic risk, and shall provide for 
registration and examination procedures with respect to the investment 
advisers of such funds which reflect the level of systemic risk posed 
by such funds.''.
    SEC. 409. FAMILY OFFICES.
    (a) In General.--Section 202(a)(11) of the Investment Advisers Act 
of 1940 (15 U.S.C. 80b-2(a)(11)) is amended by striking ``or (G)'' and 
inserting the following: ``; (G) any family office, as defined by rule, 
regulation, or order of the Commission, in accordance with the purposes 
of this title; or (H)''.
    (b) Rulemaking.--The rules, regulations, or orders issued by the 
Commission pursuant to section 202(a)(11)(G) of the Investment Advisers 
Act of 1940, as added by this section, regarding the definition of the 
term ``family office'' shall provide for an exemption that--
        (1) is consistent with the previous exemptive policy of the 
    Commission, as reflected in exemptive orders for family offices in 
    effect on the date of enactment of this Act, and the grandfathering 
    provisions in paragraph (3);
        (2) recognizes the range of organizational, management, and 
    employment structures and arrangements employed by family offices; 
    and
        (3) does not exclude any person who was not registered or 
    required to be registered under the Investment Advisers Act of 1940 
    on January 1, 2010 from the definition of the term ``family 
    office'', solely because such person provides investment advice to, 
    and was engaged before January 1, 2010 in providing investment 
    advice to--
            (A) natural persons who, at the time of their applicable 
        investment, are officers, directors, or employees of the family 
        office who--
                (i) have invested with the family office before January 
            1, 2010; and
                (ii) are accredited investors, as defined in Regulation 
            D of the Commission (or any successor thereto) under the 
            Securities Act of 1933, or, as the Commission may prescribe 
            by rule, the successors-in-interest thereto;
            (B) any company owned exclusively and controlled by members 
        of the family of the family office, or as the Commission may 
        prescribe by rule;
            (C) any investment adviser registered under the Investment 
        Adviser Act of 1940 that provides investment advice to the 
        family office and who identifies investment opportunities to 
        the family office, and invests in such transactions on 
        substantially the same terms as the family office invests, but 
        does not invest in other funds advised by the family office, 
        and whose assets as to which the family office directly or 
        indirectly provides investment advice represent, in the 
        aggregate, not more than 5 percent of the value of the total 
        assets as to which the family office provides investment 
        advice.
    (c) Antifraud Authority.--A family office that would not be a 
family office, but for subsection (b)(3), shall be deemed to be an 
investment adviser for the purposes of paragraphs (1), (2) and (4) of 
section 206 of the Investment Advisers Act of 1940.
    SEC. 410. STATE AND FEDERAL RESPONSIBILITIES; ASSET THRESHOLD FOR 
      FEDERAL REGISTRATION OF INVESTMENT ADVISERS.
    Section 203A(a) of the of the Investment Advisers Act of 1940 (15 
U.S.C. 80b-3a(a)) is amended--
        (1) by redesignating paragraph (2) as paragraph (3); and
        (2) by inserting after paragraph (1) the following:
        ``(2) Treatment of mid-sized investment advisers.--
            ``(A) In general.--No investment adviser described in 
        subparagraph (B) shall register under section 203, unless the 
        investment adviser is an adviser to an investment company 
        registered under the Investment Company Act of 1940, or a 
        company which has elected to be a business development company 
        pursuant to section 54 of the Investment Company Act of 1940, 
        and has not withdrawn the election, except that, if by effect 
        of this paragraph an investment adviser would be required to 
        register with 15 or more States, then the adviser may register 
        under section 203.
            ``(B) Covered persons.--An investment adviser described in 
        this subparagraph is an investment adviser that--
                ``(i) is required to be registered as an investment 
            adviser with the securities commissioner (or any agency or 
            office performing like functions) of the State in which it 
            maintains its principal office and place of business and, 
            if registered, would be subject to examination as an 
            investment adviser by any such commissioner, agency, or 
            office; and
                ``(ii) has assets under management between--

                    ``(I) the amount specified under subparagraph (A) 
                of paragraph (1), as such amount may have been adjusted 
                by the Commission pursuant to that subparagraph; and
                    ``(II) $100,000,000, or such higher amount as the 
                Commission may, by rule, deem appropriate in accordance 
                with the purposes of this title.''.

    SEC. 411. CUSTODY OF CLIENT ASSETS.
    The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) is 
amended by adding at the end the following new section:
    ``SEC. 223. CUSTODY OF CLIENT ACCOUNTS.
    ``An investment adviser registered under this title shall take such 
steps to safeguard client assets over which such adviser has custody, 
including, without limitation, verification of such assets by an 
independent public accountant, as the Commission may, by rule, 
prescribe.''.
    SEC. 412. COMPTROLLER GENERAL STUDY ON CUSTODY RULE COSTS.
    The Comptroller General of the United States shall--
        (1) conduct a study of--
            (A) the compliance costs associated with the current 
        Securities and Exchange Commission rules 204-2 (17 C.F.R. Parts 
        275.204-2) and rule 206(4)-2 (17 C.F.R. 275.206(4)-2) under the 
        Investment Advisers Act of 1940 regarding custody of funds or 
        securities of clients by investment advisers; and
            (B) the additional costs if subsection (b)(6) of rule 
        206(4)-2 (17 C.F.R. 275.206(4)-2(b)(6)) relating to operational 
        independence were eliminated; and
        (2) submit a report to the Committee on Banking, Housing, and 
    Urban Affairs of the Senate and the Committee on Financial Services 
    of the House of Representatives on the results of such study, not 
    later than 3 years after the date of enactment of this Act.
    SEC. 413. ADJUSTING THE ACCREDITED INVESTOR STANDARD.
    (a) In General.--The Commission shall adjust any net worth standard 
for an accredited investor, as set forth in the rules of the Commission 
under the Securities Act of 1933, so that the individual net worth of 
any natural person, or joint net worth with the spouse of that person, 
at the time of purchase, is more than $1,000,000 (as such amount is 
adjusted periodically by rule of the Commission), excluding the value 
of the primary residence of such natural person, except that during the 
4-year period that begins on the date of enactment of this Act, any net 
worth standard shall be $1,000,000, excluding the value of the primary 
residence of such natural person.
    (b) Review and Adjustment.--
        (1) Initial review and adjustment.--
            (A) Initial review.--The Commission may undertake a review 
        of the definition of the term ``accredited investor'', as such 
        term applies to natural persons, to determine whether the 
        requirements of the definition, excluding the requirement 
        relating to the net worth standard described in subsection (a), 
        should be adjusted or modified for the protection of investors, 
        in the public interest, and in light of the economy.
            (B) Adjustment or modification.--Upon completion of a 
        review under subparagraph (A), the Commission may, by notice 
        and comment rulemaking, make such adjustments to the definition 
        of the term ``accredited investor'', excluding adjusting or 
        modifying the requirement relating to the net worth standard 
        described in subsection (a), as such term applies to natural 
        persons, as the Commission may deem appropriate for the 
        protection of investors, in the public interest, and in light 
        of the economy.
        (2) Subsequent reviews and adjustment.--
            (A) Subsequent reviews.--Not earlier than 4 years after the 
        date of enactment of this Act, and not less frequently than 
        once every 4 years thereafter, the Commission shall undertake a 
        review of the definition, in its entirety, of the term 
        ``accredited investor'', as defined in section 230.215 of title 
        17, Code of Federal Regulations, or any successor thereto, as 
        such term applies to natural persons, to determine whether the 
        requirements of the definition should be adjusted or modified 
        for the protection of investors, in the public interest, and in 
        light of the economy.
            (B) Adjustment or modification.--Upon completion of a 
        review under subparagraph (A), the Commission may, by notice 
        and comment rulemaking, make such adjustments to the definition 
        of the term ``accredited investor'', as defined in section 
        230.215 of title 17, Code of Federal Regulations, or any 
        successor thereto, as such term applies to natural persons, as 
        the Commission may deem appropriate for the protection of 
        investors, in the public interest, and in light of the economy.
    SEC. 414. RULE OF CONSTRUCTION RELATING TO THE COMMODITIES EXCHANGE 
      ACT.
    The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) is 
further amended by adding at the end the following new section:
    ``SEC. 224. RULE OF CONSTRUCTION RELATING TO THE COMMODITIES 
      EXCHANGE ACT.
    ``Nothing in this title shall relieve any person of any obligation 
or duty, or affect the availability of any right or remedy available to 
the Commodity Futures Trading Commission or any private party, arising 
under the Commodity Exchange Act (7 U.S.C. 1 et seq.) governing 
commodity pools, commodity pool operators, or commodity trading 
advisors.''.
    SEC. 415. GAO STUDY AND REPORT ON ACCREDITED INVESTORS.
    The Comptroller General of the United States shall conduct a study 
on the appropriate criteria for determining the financial thresholds or 
other criteria needed to qualify for accredited investor status and 
eligibility to invest in private funds, and shall submit a report to 
the Committee on Banking, Housing, and Urban Affairs of the Senate and 
the Committee on Financial Services of the House of Representatives on 
the results of such study not later than 3 years after the date of 
enactment of this Act.
    SEC. 416. GAO STUDY ON SELF-REGULATORY ORGANIZATION FOR PRIVATE 
      FUNDS.
    The Comptroller General of the United States shall--
        (1) conduct a study of the feasibility of forming a self-
    regulatory organization to oversee private funds; and
        (2) submit a report to the Committee on Banking, Housing, and 
    Urban Affairs of the Senate and the Committee on Financial Services 
    of the House of Representatives on the results of such study, not 
    later than 1 year after the date of enactment of this Act.
    SEC. 417. COMMISSION STUDY AND REPORT ON SHORT SELLING.
    (a) Studies.--The Division of Risk, Strategy, and Financial 
Innovation of the Commission shall conduct--
        (1) a study, taking into account current scholarship, on the 
    state of short selling on national securities exchanges and in the 
    over-the-counter markets, with particular attention to the impact 
    of recent rule changes and the incidence of--
            (A) the failure to deliver shares sold short; or
            (B) delivery of shares on the fourth day following the 
        short sale transaction; and
        (2) a study of--
            (A) the feasibility, benefits, and costs of requiring 
        reporting publicly, in real time short sale positions of 
        publicly listed securities, or, in the alternative, reporting 
        such short positions in real time only to the Commission and 
        the Financial Industry Regulatory Authority; and
            (B) the feasibility, benefits, and costs of conducting a 
        voluntary pilot program in which public companies will agree to 
        have all trades of their shares marked ``short'', ``market 
        maker short'', ``buy'', ``buy-to-cover'', or ``long'', and 
        reported in real time through the Consolidated Tape.
    (b) Reports.--The Commission shall submit a report to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives--
        (1) on the results of the study required under subsection 
    (a)(1), including recommendations for market improvements, not 
    later than 2 years after the date of enactment of this Act; and
        (2) on the results of the study required under subsection 
    (a)(2), not later than 1 year after the date of enactment of this 
    Act.
    SEC. 418. QUALIFIED CLIENT STANDARD.
    Section 205(e) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-5(e)) is amended by adding at the end the following: ``With respect 
to any factor used in any rule or regulation by the Commission in 
making a determination under this subsection, if the Commission uses a 
dollar amount test in connection with such factor, such as a net asset 
threshold, the Commission shall, by order, not later than 1 year after 
the date of enactment of the Private Fund Investment Advisers 
Registration Act of 2010, and every 5 years thereafter, adjust for the 
effects of inflation on such test. Any such adjustment that is not a 
multiple of $100,000 shall be rounded to the nearest multiple of 
$100,000.''.
    SEC. 419. TRANSITION PERIOD.
    Except as otherwise provided in this title, this title and the 
amendments made by this title shall become effective 1 year after the 
date of enactment of this Act, except that any investment adviser may, 
at the discretion of the investment adviser, register with the 
Commission under the Investment Advisers Act of 1940 during that 1-year 
period, subject to the rules of the Commission.

                           TITLE V--INSURANCE
                  Subtitle A--Federal Insurance Office

    SEC. 501. SHORT TITLE.
    This subtitle may be cited as the ``Federal Insurance Office Act of 
2010''.
    SEC. 502. FEDERAL INSURANCE OFFICE.
    (a) Establishment of Office.--Subchapter I of chapter 3 of subtitle 
I of title 31, United States Code, is amended--
        (1) by redesignating section 312 as section 315;
        (2) by redesignating section 313 as section 312; and
        (3) by inserting after section 312 (as so redesignated) the 
    following new sections:
    ``SEC. 313. FEDERAL INSURANCE OFFICE.
    ``(a) Establishment.--There is established within the Department of 
the Treasury the Federal Insurance Office.
    ``(b) Leadership.--The Office shall be headed by a Director, who 
shall be appointed by the Secretary of the Treasury. The position of 
Director shall be a career reserved position in the Senior Executive 
Service, as that position is defined under section 3132 of title 5, 
United States Code.
    ``(c) Functions.--
        ``(1) Authority pursuant to direction of secretary.--The 
    Office, pursuant to the direction of the Secretary, shall have the 
    authority--
            ``(A) to monitor 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;
            ``(B) to monitor the extent to which traditionally 
        underserved communities and consumers, minorities (as such term 
        is defined in section 1204(c) of the Financial Institutions 
        Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 
        note)), and low- and moderate-income persons have access to 
        affordable insurance products regarding all lines of insurance, 
        except health insurance;
            ``(C) to recommend to the Financial Stability Oversight 
        Council that it designate an insurer, including the affiliates 
        of such insurer, as an entity subject to regulation as a 
        nonbank financial company supervised by the Board of Governors 
        pursuant to title I of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act;
            ``(D) 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);
            ``(E) to coordinate Federal efforts and develop Federal 
        policy 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 (r));
            ``(F) to determine, in accordance with subsection (f), 
        whether State insurance measures are preempted by covered 
        agreements;
            ``(G) to consult with the States (including State insurance 
        regulators) regarding insurance matters of national importance 
        and prudential insurance matters of international importance; 
        and
            ``(H) to perform such other related duties and authorities 
        as may be assigned to the Office by the Secretary.
        ``(2) Advisory functions.--The Office shall advise the 
    Secretary on major domestic and prudential international insurance 
    policy issues.
        ``(3) Advisory capacity on council.--The Director shall serve 
    in an advisory capacity on the Financial Stability Oversight 
    Council established under the Financial Stability Act of 2010.
    ``(d) Scope.--The authority of the Office 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.).
    ``(e) Gathering of Information.--
        ``(1) In general.--In carrying out the functions required under 
    subsection (c), the Office may--
            ``(A) receive and collect data and information on and from 
        the insurance industry and insurers;
            ``(B) enter into information-sharing agreements;
            ``(C) analyze and disseminate data and information; and
            ``(D) issue reports regarding all lines of insurance except 
        health insurance.
        ``(2) Collection of information from insurers and affiliates.--
            ``(A) In general.--Except as provided in paragraph (3), the 
        Office may require an insurer, or any affiliate of an insurer, 
        to submit such data or information as the Office may reasonably 
        require in carrying out the functions described under 
        subsection (c).
            ``(B) Rule of construction.--Notwithstanding any other 
        provision of this section, for purposes of subparagraph (A), 
        the term `insurer' means any entity that writes insurance or 
        reinsures risks and issues contracts or policies in 1 or more 
        States.
        ``(3) Exception for small insurers.--Paragraph (2) shall not 
    apply with respect to any insurer or affiliate thereof that meets a 
    minimum size threshold that the Office may establish, whether by 
    order or rule.
        ``(4) Advance coordination.--Before collecting any data or 
    information under paragraph (2) from an insurer, or affiliate of an 
    insurer, the Office shall coordinate with each relevant Federal 
    agency and 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 to determine if the 
    information to be collected is available from, and may be obtained 
    in a timely manner by, such Federal agency or State insurance 
    regulator, individually or collectively, other regulatory agency, 
    or publicly available sources. If the Director determines that such 
    data or information is available, and may be obtained in a timely 
    manner, from such an agency, regulator, regulatory agency, or 
    source, the Director shall obtain the data or information from such 
    agency, regulator, regulatory agency, or source. If the Director 
    determines that such data or information is not so available, the 
    Director may collect such data or information from an insurer (or 
    affiliate) only if the Director complies with the requirements of 
    subchapter I of chapter 35 of title 44, United States Code 
    (relating to Federal information policy; commonly known as the 
    Paperwork Reduction Act), in collecting such data or information. 
    Notwithstanding 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.
        ``(5) Confidentiality.--
            ``(A) Retention of privilege.--The submission of any 
        nonpublicly available data and information to the Office under 
        this subsection shall not constitute a waiver of, or otherwise 
        affect, any privilege arising under Federal or State law 
        (including the rules of any Federal or State court) to which 
        the data or information is otherwise subject.
            ``(B) Continued application of prior confidentiality 
        agreements.--Any requirement under Federal or State law to the 
        extent otherwise applicable, or any requirement pursuant to a 
        written agreement in effect between the original source of any 
        nonpublicly available data or information and the source of 
        such data or information to the Office, regarding the privacy 
        or confidentiality of any data or information in the possession 
        of the source to the Office, shall continue to apply to such 
        data or information after the data or information has been 
        provided pursuant to this subsection to the Office.
            ``(C) Information-sharing agreement.--Any data or 
        information obtained by the Office may be made available to 
        State insurance regulators, individually or collectively, 
        through an information-sharing agreement that--
                ``(i) shall comply with applicable Federal law; and
                ``(ii) shall not constitute a waiver of, or otherwise 
            affect, any privilege under Federal or State law (including 
            the rules of any Federal or State court) to which the data 
            or information is otherwise subject.
            ``(D) Agency disclosure requirements.--Section 552 of title 
        5, United States Code, shall apply to any data or information 
        submitted to the Office by an insurer or an affiliate of an 
        insurer.
        ``(6) Subpoenas and enforcement.--The Director shall have the 
    power to require by subpoena the production of the data or 
    information requested under paragraph (2), but only upon a written 
    finding by the Director that such data or information is required 
    to carry out the functions described under subsection (c) and that 
    the Office has coordinated with such regulator or agency as 
    required under paragraph (4). Subpoenas shall bear the signature of 
    the Director and shall be served by any person or class of persons 
    designated by the Director for that purpose. In the case of 
    contumacy or failure to obey a subpoena, the subpoena shall be 
    enforceable by order of any appropriate district court of the 
    United States. Any failure to obey the order of the court may be 
    punished by the court as a contempt of court.
    ``(f) Preemption of State Insurance Measures.--
        ``(1) Standard.--A State insurance measure shall be preempted 
    pursuant to this section or section 314 if, and only to the extent 
    that the Director 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 Director 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 Director 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 
    determination still exists, the determination shall become 
    effective and the Director 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.
    ``(g) Applicability of Administrative Procedures Act.--
Determinations of inconsistency made pursuant to subsection (f)(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.
    ``(h) Regulations, Policies, and Procedures.--The Secretary may 
issue orders, regulations, policies, and procedures to implement this 
section.
    ``(i) Consultation.--The Director shall consult with State 
insurance regulators, individually or collectively, to the extent the 
Director determines appropriate, in carrying out the functions of the 
Office.
    ``(j) 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;
        ``(2) be construed to alter, amend, or limit any provision of 
    the Consumer Financial Protection Agency Act of 2010; or
        ``(3) affect the preemption of any State insurance measure 
    otherwise inconsistent with and preempted by Federal law.
    ``(k) 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.
    ``(l) 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.
    ``(m) Retention of Authority of United States Trade 
Representative.--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 authority 
over the development and coordination of United States international 
trade policy and the administration of the United States trade 
agreements program.
    ``(n) Annual Reports to Congress.--
        ``(1) Section 313(f) reports.--Beginning September 30, 2011, 
    the Director shall submit a report on or before September 30 of 
    each calendar year to the President and 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 on any actions taken by the 
    Office pursuant to subsection (f) (regarding preemption of 
    inconsistent State insurance measures).
        ``(2) Insurance industry.--Beginning September 30, 2011, the 
    Director shall submit a report on or before September 30 of each 
    calendar year to the President and 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 insurance 
    industry and any other information as deemed relevant by the 
    Director or requested by such Committees.
    ``(o) Reports on U.S. and Global Reinsurance Market.--The Director 
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--
        ``(1) a report received not later than September 30, 2012, 
    describing the breadth and scope of the global reinsurance market 
    and the critical role such market plays in supporting insurance in 
    the United States; and
        ``(2) a report received not later than January 1, 2013, and 
    updated not later than January 1, 2015, describing the impact 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.
    ``(p) Study and Report on Regulation of Insurance.--
        ``(1) In general.--Not later than 18 months after the date of 
    enactment of this section, the Director shall conduct a study and 
    submit a report to Congress on how to modernize and improve the 
    system of insurance regulation in the United States.
        ``(2) Considerations.--The study and report required under 
    paragraph (1) shall be based on and guided by the following 
    considerations:
            ``(A) Systemic risk regulation with respect to insurance.
            ``(B) Capital standards and the relationship between 
        capital allocation and liabilities, including standards 
        relating to liquidity and duration risk.
            ``(C) Consumer protection for insurance products and 
        practices, including gaps in State regulation.
            ``(D) The degree of national uniformity of State insurance 
        regulation.
            ``(E) The regulation of insurance companies and affiliates 
        on a consolidated basis.
            ``(F) International coordination of insurance regulation.
        ``(3) Additional factors.--The study and report required under 
    paragraph (1) shall also examine the following factors:
            ``(A) The costs and benefits of potential Federal 
        regulation of insurance across various lines of insurance 
        (except health insurance).
            ``(B) The feasibility of regulating only certain lines of 
        insurance at the Federal level, while leaving other lines of 
        insurance to be regulated at the State level.
            ``(C) The ability of any potential Federal regulation or 
        Federal regulators to eliminate or minimize regulatory 
        arbitrage.
            ``(D) The impact that developments in the regulation of 
        insurance in foreign jurisdictions might have on the potential 
        Federal regulation of insurance.
            ``(E) The ability of any potential Federal regulation or 
        Federal regulator to provide robust consumer protection for 
        policyholders.
            ``(F) The potential consequences of subjecting insurance 
        companies to a Federal resolution authority, including the 
        effects of any Federal resolution authority--
                ``(i) on the operation of State insurance guaranty fund 
            systems, including the loss of guaranty fund coverage if an 
            insurance company is subject to a Federal resolution 
            authority;
                ``(ii) on policyholder protection, including the loss 
            of the priority status of policyholder claims over other 
            unsecured general creditor claims;
                ``(iii) in the case of life insurance companies, on the 
            loss of the special status of separate account assets and 
            separate account liabilities; and
                ``(iv) on the international competitiveness of 
            insurance companies.
            ``(G) Such other factors as the Director determines 
        necessary or appropriate, consistent with the principles set 
        forth in paragraph (2).
        ``(4) Required recommendations.--The study and report required 
    under paragraph (1) shall also contain any legislative, 
    administrative, or regulatory recommendations, as the Director 
    determines appropriate, to carry out or effectuate the findings set 
    forth in such report.
        ``(5) Consultation.--With respect to the study and report 
    required under paragraph (1), the Director shall consult with the 
    State insurance regulators, consumer organizations, representatives 
    of the insurance industry and policyholders, and other 
    organizations and experts, as appropriate.
    ``(q) Use of Existing Resources.--To carry out this section, the 
Office may employ personnel, facilities, and any other resource of the 
Department of the Treasury available to the Secretary and the Secretary 
shall dedicate specific personnel to the Office.
    ``(r) 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 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) 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.
        ``(6) Office.--The term `Office' means the Federal Insurance 
    Office established by this section.
        ``(7) 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.
        ``(8) State insurance regulator.--The term `State insurance 
    regulator' means any State regulatory authority responsible for the 
    supervision of insurers.
        ``(9) 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.
        ``(10) 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.
    ``(s) Authorization of Appropriations.--There are authorized to be 
appropriated for the Office for each fiscal year such sums as may be 
necessary.
    ``SEC. 314. COVERED AGREEMENTS.
    ``(a) Authority.--The Secretary and the United States Trade 
Representative are authorized, jointly, to negotiate and enter into 
covered agreements on behalf of the United States.
    ``(b) Requirements for Consultation With Congress.--
        ``(1) In general.--Before initiating negotiations to enter into 
    a covered agreement under subsection (a), during such negotiations, 
    and before entering into any such agreement, the Secretary and the 
    United States Trade Representative shall jointly consult with the 
    Committee on Financial Services and the Committee on Ways and Means 
    of the House of Representatives and the Committee on Banking, 
    Housing, and Urban Affairs and the Committee on Finance of the 
    Senate.
        ``(2) Scope.--The consultation described in paragraph (1) shall 
    include consultation with respect to--
            ``(A) the nature of the agreement;
            ``(B) how and to what extent the agreement will achieve the 
        applicable purposes, policies, priorities, and objectives of 
        section 313 and this section; and
            ``(C) the implementation of the agreement, including the 
        general effect of the agreement on existing State laws.
    ``(c) Submission and Layover Provisions.--A covered agreement under 
subsection (a) may enter into force with respect to the United States 
only if--
        ``(1) the Secretary and the United States Trade Representative 
    jointly submit to the congressional committees specified in 
    subsection (b)(1), on a day on which both Houses of Congress are in 
    session, a copy of the final legal text of the agreement; and
        ``(2) a period of 90 calendar days beginning on the date on 
    which the copy of the final legal text of the agreement is 
    submitted to the congressional committees under paragraph (1) has 
    expired.''.
    (b) Duties of Secretary.--Section 321(a) of title 31, United States 
Code, is amended--
        (1) in paragraph (7), by striking ``; and'' and inserting a 
    semicolon;
        (2) in paragraph (8)(C), by striking the period at the end and 
    inserting ``; and''; and
        (3) by adding at the end the following new paragraph:
        ``(9) advise the President on major domestic and international 
    prudential policy issues in connection with all lines of insurance 
    except health insurance.''.
    (c) Clerical Amendment.--The table of sections for subchapter I of 
chapter 3 of title 31, United States Code, is amended by striking the 
item relating to section 312 and inserting the following new items:

``Sec. 312. Terrorism and financial intelligence.
``Sec. 313. Federal Insurance Office.
``Sec. 314. Covered agreements.
``Sec. 315. Continuing in office.''.

                Subtitle B--State-Based Insurance Reform

    SEC. 511. SHORT TITLE.
    This subtitle may be cited as the ``Nonadmitted and Reinsurance 
Reform Act of 2010''.
    SEC. 512. EFFECTIVE DATE.
    Except as otherwise specifically provided in this subtitle, this 
subtitle shall take effect upon the expiration of the 12-month period 
beginning on the date of the enactment of this subtitle.

                     PART I--NONADMITTED INSURANCE

    SEC. 521. REPORTING, PAYMENT, AND ALLOCATION OF PREMIUM TAXES.
    (a) Home State's Exclusive Authority.--No State other than the home 
State of an insured may require any premium tax payment for nonadmitted 
insurance.
    (b) Allocation of Nonadmitted Premium Taxes.--
        (1) In general.--The States may enter into a compact or 
    otherwise establish procedures to allocate among the States the 
    premium taxes paid to an insured's home State described in 
    subsection (a).
        (2) Effective date.--Except as expressly otherwise provided in 
    such compact or other procedures, any such compact or other 
    procedures--
            (A) if adopted on or before the expiration of the 330-day 
        period that begins on the date of the enactment of this 
        subtitle, shall apply to any premium taxes that, on or after 
        such date of enactment, are required to be paid to any State 
        that is subject to such compact or procedures; and
            (B) if adopted after the expiration of such 330-day period, 
        shall apply to any premium taxes that, on or after January 1 of 
        the first calendar year that begins after the expiration of 
        such 330-day period, are required to be paid to any State that 
        is subject to such compact or procedures.
        (3) Report.--Upon the expiration of the 330-day period referred 
    to in paragraph (2), the NAIC may submit a report to the Committee 
    on Financial Services and the Committee on the Judiciary of the 
    House of Representatives and the Committee on Banking, Housing, and 
    Urban Affairs of the Senate identifying and describing any compact 
    or other procedures for allocation among the States of premium 
    taxes that have been adopted during such period by any States.
        (4) Nationwide system.--The Congress intends that each State 
    adopt nationwide uniform requirements, forms, and procedures, such 
    as an interstate compact, that provide for the reporting, payment, 
    collection, and allocation of premium taxes for nonadmitted 
    insurance consistent with this section.
    (c) Allocation Based on Tax Allocation Report.--To facilitate the 
payment of premium taxes among the States, an insured's home State may 
require surplus lines brokers and insureds who have independently 
procured insurance to annually file tax allocation reports with the 
insured's home State detailing the portion of the nonadmitted insurance 
policy premium or premiums attributable to properties, risks, or 
exposures located in each State. The filing of a nonadmitted insurance 
tax allocation report and the payment of tax may be made by a person 
authorized by the insured to act as its agent.
    SEC. 522. REGULATION OF NONADMITTED INSURANCE BY INSURED'S HOME 
      STATE.
    (a) Home State Authority.--Except as otherwise provided in this 
section, the placement of nonadmitted insurance shall be subject to the 
statutory and regulatory requirements solely of the insured's home 
State.
    (b) Broker Licensing.--No State other than an insured's home State 
may require a surplus lines broker to be licensed in order to sell, 
solicit, or negotiate nonadmitted insurance with respect to such 
insured.
    (c) Enforcement Provision.--With respect to section 521 and 
subsections (a) and (b) of this section, any law, regulation, 
provision, or action of any State that applies or purports to apply to 
nonadmitted insurance sold to, solicited by, or negotiated with an 
insured whose home State is another State shall be preempted with 
respect to such application.
    (d) Workers' Compensation Exception.--This section may not be 
construed to preempt any State law, rule, or regulation that restricts 
the placement of workers' compensation insurance or excess insurance 
for self-funded workers' compensation plans with a nonadmitted insurer.
    SEC. 523. PARTICIPATION IN NATIONAL PRODUCER DATABASE.
    After the expiration of the 2-year period beginning on the date of 
the enactment of this subtitle, a State may not collect any fees 
relating to licensing of an individual or entity as a surplus lines 
broker in the State unless the State has in effect at such time laws or 
regulations that provide for participation by the State in the national 
insurance producer database of the NAIC, or any other equivalent 
uniform national database, for the licensure of surplus lines brokers 
and the renewal of such licenses.
    SEC. 524. UNIFORM STANDARDS FOR SURPLUS LINES ELIGIBILITY.
    A State may not--
        (1) impose eligibility requirements on, or otherwise establish 
    eligibility criteria for, nonadmitted insurers domiciled in a 
    United States jurisdiction, except in conformance with such 
    requirements and criteria in sections 5A(2) and 5C(2)(a) of the 
    Non-Admitted Insurance Model Act, unless the State has adopted 
    nationwide uniform requirements, forms, and procedures developed in 
    accordance with section 521(b) of this subtitle that include 
    alternative nationwide uniform eligibility requirements; or
        (2) prohibit a surplus lines broker from placing nonadmitted 
    insurance with, or procuring nonadmitted insurance from, a 
    nonadmitted insurer domiciled outside the United States that is 
    listed on the Quarterly Listing of Alien Insurers maintained by the 
    International Insurers Department of the NAIC.
    SEC. 525. STREAMLINED APPLICATION FOR COMMERCIAL PURCHASERS.
    A surplus lines broker seeking to procure or place nonadmitted 
insurance in a State for an exempt commercial purchaser shall not be 
required to satisfy any State requirement to make a due diligence 
search to determine whether the full amount or type of insurance sought 
by such exempt commercial purchaser can be obtained from admitted 
insurers if--
        (1) the broker procuring or placing the surplus lines insurance 
    has disclosed to the exempt commercial purchaser that such 
    insurance may or may not be available from the admitted market that 
    may provide greater protection with more regulatory oversight; and
        (2) the exempt commercial purchaser has subsequently requested 
    in writing the broker to procure or place such insurance from a 
    nonadmitted insurer.
    SEC. 526. GAO STUDY OF NONADMITTED INSURANCE MARKET.
    (a) In General.--The Comptroller General of the United States shall 
conduct a study of the nonadmitted insurance market to determine the 
effect of the enactment of this part on the size and market share of 
the nonadmitted insurance market for providing coverage typically 
provided by the admitted insurance market.
    (b) Contents.--The study shall determine and analyze--
        (1) the change in the size and market share of the nonadmitted 
    insurance market and in the number of insurance companies and 
    insurance holding companies providing such business in the 18-month 
    period that begins upon the effective date of this subtitle;
        (2) the extent to which insurance coverage typically provided 
    by the admitted insurance market has shifted to the nonadmitted 
    insurance market;
        (3) the consequences of any change in the size and market share 
    of the nonadmitted insurance market, including differences in the 
    price and availability of coverage available in both the admitted 
    and nonadmitted insurance markets;
        (4) the extent to which insurance companies and insurance 
    holding companies that provide both admitted and nonadmitted 
    insurance have experienced shifts in the volume of business between 
    admitted and nonadmitted insurance; and
        (5) the extent to which there has been a change in the number 
    of individuals who have nonadmitted insurance policies, the type of 
    coverage provided under such policies, and whether such coverage is 
    available in the admitted insurance market.
    (c) Consultation With NAIC.--In conducting the study under this 
section, the Comptroller General shall consult with the NAIC.
    (d) Report.--The Comptroller General shall complete the study under 
this section and submit a report to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives regarding the findings of the study not 
later than 30 months after the effective date of this subtitle.
    SEC. 527. DEFINITIONS.
    For purposes of this part, the following definitions shall apply:
        (1) Admitted insurer.--The term ``admitted insurer'' means, 
    with respect to a State, an insurer licensed to engage in the 
    business of insurance in such State.
        (2) Affiliate.--The term ``affiliate'' means, with respect to 
    an insured, any entity that controls, is controlled by, or is under 
    common control with the insured.
        (3) Affiliated group.--The term ``affiliated group'' means any 
    group of entities that are all affiliated.
        (4) Control.--An entity has ``control'' over another entity 
    if--
            (A) the entity directly or indirectly or acting through 1 
        or more other persons owns, controls, or has the power to vote 
        25 percent or more of any class of voting securities of the 
        other entity; or
            (B) the entity controls in any manner the election of a 
        majority of the directors or trustees of the other entity.
        (5) Exempt commercial purchaser.--The term ``exempt commercial 
    purchaser'' means any person purchasing commercial insurance that, 
    at the time of placement, meets the following requirements:
            (A) The person employs or retains a qualified risk manager 
        to negotiate insurance coverage.
            (B) The person has paid aggregate nationwide commercial 
        property and casualty insurance premiums in excess of $100,000 
        in the immediately preceding 12 months.
            (C)(i) The person meets at least 1 of the following 
        criteria:
                (I) The person possesses a net worth in excess of 
            $20,000,000, as such amount is adjusted pursuant to clause 
            (ii).
                (II) The person generates annual revenues in excess of 
            $50,000,000, as such amount is adjusted pursuant to clause 
            (ii).
                (III) The person employs more than 500 full-time or 
            full-time equivalent employees per individual insured or is 
            a member of an affiliated group employing more than 1,000 
            employees in the aggregate.
                (IV) The person is a not-for-profit organization or 
            public entity generating annual budgeted expenditures of at 
            least $30,000,000, as such amount is adjusted pursuant to 
            clause (ii).
                (V) The person is a municipality with a population in 
            excess of 50,000 persons.
            (ii) Effective on the fifth January 1 occurring after the 
        date of the enactment of this subtitle and each fifth January 1 
        occurring thereafter, the amounts in subclauses (I), (II), and 
        (IV) of clause (i) shall be adjusted to reflect the percentage 
        change for such 5-year period in the Consumer Price Index for 
        All Urban Consumers published by the Bureau of Labor Statistics 
        of the Department of Labor.
        (6) Home state.--
            (A) In general.--Except as provided in subparagraph (B), 
        the term ``home State'' means, with respect to an insured--
                (i) the State in which an insured maintains its 
            principal place of business or, in the case of an 
            individual, the individual's principal residence; or
                (ii) if 100 percent of the insured risk is located out 
            of the State referred to in clause (i), the State to which 
            the greatest percentage of the insured's taxable premium 
            for that insurance contract is allocated.
            (B) Affiliated groups.--If more than 1 insured from an 
        affiliated group are named insureds on a single nonadmitted 
        insurance contract, the term ``home State'' means the home 
        State, as determined pursuant to subparagraph (A), of the 
        member of the affiliated group that has the largest percentage 
        of premium attributed to it under such insurance contract.
        (7) Independently procured insurance.--The term ``independently 
    procured insurance'' means insurance procured directly by an 
    insured from a nonadmitted insurer.
        (8) NAIC.--The term ``NAIC'' means the National Association of 
    Insurance Commissioners or any successor entity.
        (9) Nonadmitted insurance.--The term ``nonadmitted insurance'' 
    means any property and casualty insurance permitted to be placed 
    directly or through a surplus lines broker with a nonadmitted 
    insurer eligible to accept such insurance.
        (10) Non-admitted insurance model act.--The term ``Non-Admitted 
    Insurance Model Act'' means the provisions of the Non-Admitted 
    Insurance Model Act, as adopted by the NAIC on August 3, 1994, and 
    amended on September 30, 1996, December 6, 1997, October 2, 1999, 
    and June 8, 2002.
        (11) Nonadmitted insurer.--The term ``nonadmitted insurer''--
            (A) means, with respect to a State, an insurer not licensed 
        to engage in the business of insurance in such State; but
            (B) does not include a risk retention group, as that term 
        is defined in section 2(a)(4) of the Liability Risk Retention 
        Act of 1986 (15 U.S.C. 3901(a)(4)).
        (12) Premium tax.--The term ``premium tax'' means, with respect 
    to surplus lines or independently procured insurance coverage, any 
    tax, fee, assessment, or other charge imposed by a government 
    entity directly or indirectly based on any payment made as 
    consideration for an insurance contract for such insurance, 
    including premium deposits, assessments, registration fees, and any 
    other compensation given in consideration for a contract of 
    insurance.
        (13) Qualified risk manager.--The term ``qualified risk 
    manager'' means, with respect to a policyholder of commercial 
    insurance, a person who meets all of the following requirements:
            (A) The person is an employee of, or third-party consultant 
        retained by, the commercial policyholder.
            (B) The person provides skilled services in loss 
        prevention, loss reduction, or risk and insurance coverage 
        analysis, and purchase of insurance.
            (C) The person--
                (i)(I) has a bachelor's degree or higher from an 
            accredited college or university in risk management, 
            business administration, finance, economics, or any other 
            field determined by a State insurance commissioner or other 
            State regulatory official or entity to demonstrate minimum 
            competence in risk management; and
                (II)(aa) has 3 years of experience in risk financing, 
            claims administration, loss prevention, risk and insurance 
            analysis, or purchasing commercial lines of insurance; or
                (bb) has--

                    (AA) a designation as a Chartered Property and 
                Casualty Underwriter (in this subparagraph referred to 
                as ``CPCU'') issued by the American Institute for CPCU/
                Insurance Institute of America;
                    (BB) a designation as an Associate in Risk 
                Management (ARM) issued by the American Institute for 
                CPCU/Insurance Institute of America;
                    (CC) a designation as Certified Risk Manager (CRM) 
                issued by the National Alliance for Insurance Education 
                & Research;
                    (DD) a designation as a RIMS Fellow (RF) issued by 
                the Global Risk Management Institute; or
                    (EE) any other designation, certification, or 
                license determined by a State insurance commissioner or 
                other State insurance regulatory official or entity to 
                demonstrate minimum competency in risk management;

                (ii)(I) has at least 7 years of experience in risk 
            financing, claims administration, loss prevention, risk and 
            insurance coverage analysis, or purchasing commercial lines 
            of insurance; and
                (II) has any 1 of the designations specified in 
            subitems (AA) through (EE) of clause (i)(II)(bb);
                (iii) has at least 10 years of experience in risk 
            financing, claims administration, loss prevention, risk and 
            insurance coverage analysis, or purchasing commercial lines 
            of insurance; or
                (iv) has a graduate degree from an accredited college 
            or university in risk management, business administration, 
            finance, economics, or any other field determined by a 
            State insurance commissioner or other State regulatory 
            official or entity to demonstrate minimum competence in 
            risk management.
        (14) Reinsurance.--The term ``reinsurance'' means the 
    assumption by an insurer of all or part of a risk undertaken 
    originally by another insurer.
        (15) Surplus lines broker.--The term ``surplus lines broker'' 
    means an individual, firm, or corporation which is licensed in a 
    State to sell, solicit, or negotiate insurance on properties, 
    risks, or exposures located or to be performed in a State with 
    nonadmitted insurers.
        (16) State.--The term ``State'' includes any State of the 
    United States, the District of Columbia, the Commonwealth of Puerto 
    Rico, Guam, the Northern Mariana Islands, the Virgin Islands, and 
    American Samoa.

                          PART II--REINSURANCE

    SEC. 531. REGULATION OF CREDIT FOR REINSURANCE AND REINSURANCE 
      AGREEMENTS.
    (a) Credit for Reinsurance.--If the State of domicile of a ceding 
insurer is an NAIC-accredited State, or has financial solvency 
requirements substantially similar to the requirements necessary for 
NAIC accreditation, and recognizes credit for reinsurance for the 
insurer's ceded risk, then no other State may deny such credit for 
reinsurance.
    (b) Additional Preemption of Extraterritorial Application of State 
Law.--In addition to the application of subsection (a), all laws, 
regulations, provisions, or other actions of a State that is not the 
domiciliary State of the ceding insurer, except those with respect to 
taxes and assessments on insurance companies or insurance income, are 
preempted to the extent that they--
        (1) restrict or eliminate the rights of the ceding insurer or 
    the assuming insurer to resolve disputes pursuant to contractual 
    arbitration to the extent such contractual provision is not 
    inconsistent with the provisions of title 9, United States Code;
        (2) require that a certain State's law shall govern the 
    reinsurance contract, disputes arising from the reinsurance 
    contract, or requirements of the reinsurance contract;
        (3) attempt to enforce a reinsurance contract on terms 
    different than those set forth in the reinsurance contract, to the 
    extent that the terms are not inconsistent with this part; or
        (4) otherwise apply the laws of the State to reinsurance 
    agreements of ceding insurers not domiciled in that State.
    SEC. 532. REGULATION OF REINSURER SOLVENCY.
    (a) Domiciliary State Regulation.--If the State of domicile of a 
reinsurer is an NAIC-accredited State or has financial solvency 
requirements substantially similar to the requirements necessary for 
NAIC accreditation, such State shall be solely responsible for 
regulating the financial solvency of the reinsurer.
    (b) Nondomiciliary States.--
        (1) Limitation on financial information requirements.--If the 
    State of domicile of a reinsurer is an NAIC-accredited State or has 
    financial solvency requirements substantially similar to the 
    requirements necessary for NAIC accreditation, no other State may 
    require the reinsurer to provide any additional financial 
    information other than the information the reinsurer is required to 
    file with its domiciliary State.
        (2) Receipt of information.--No provision of this section shall 
    be construed as preventing or prohibiting a State that is not the 
    State of domicile of a reinsurer from receiving a copy of any 
    financial statement filed with its domiciliary State.
    SEC. 533. DEFINITIONS.
    For purposes of this part, the following definitions shall apply:
        (1) Ceding insurer.--The term ``ceding insurer'' means an 
    insurer that purchases reinsurance.
        (2) Domiciliary state.--The terms ``State of domicile'' and 
    ``domiciliary State'' mean, with respect to an insurer or 
    reinsurer, the State in which the insurer or reinsurer is 
    incorporated or entered through, and licensed.
        (3) NAIC.--The term ``NAIC'' means the National Association of 
    Insurance Commissioners or any successor entity.
        (4) Reinsurance.--The term ``reinsurance'' means the assumption 
    by an insurer of all or part of a risk undertaken originally by 
    another insurer.
        (5) Reinsurer.--
            (A) In general.--The term ``reinsurer'' means an insurer to 
        the extent that the insurer--
                (i) is principally engaged in the business of 
            reinsurance;
                (ii) does not conduct significant amounts of direct 
            insurance as a percentage of its net premiums; and
                (iii) is not engaged in an ongoing basis in the 
            business of soliciting direct insurance.
            (B) Determination.--A determination of whether an insurer 
        is a reinsurer shall be made under the laws of the State of 
        domicile in accordance with this paragraph.
        (6) State.--The term ``State'' includes any State of the United 
    States, the District of Columbia, the Commonwealth of Puerto Rico, 
    Guam, the Northern Mariana Islands, the Virgin Islands, and 
    American Samoa.

                     PART III--RULE OF CONSTRUCTION

    SEC. 541. RULE OF CONSTRUCTION.
    Nothing in this subtitle or the amendments made by this subtitle 
shall be construed to modify, impair, or supersede the application of 
the antitrust laws. Any implied or actual conflict between this 
subtitle and any amendments to this subtitle and the antitrust laws 
shall be resolved in favor of the operation of the antitrust laws.
    SEC. 542. SEVERABILITY.
    If any section or subsection of this subtitle, or any application 
of such provision to any person or circumstance, is held to be 
unconstitutional, the remainder of this subtitle, and the application 
of the provision to any other person or circumstance, shall not be 
affected.

 TITLE VI--IMPROVEMENTS TO REGULATION OF BANK AND SAVINGS ASSOCIATION 
             HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

    SEC. 601. SHORT TITLE.
    This title may be cited as the ``Bank and Savings Association 
Holding Company and Depository Institution Regulatory Improvements Act 
of 2010''.
    SEC. 602. DEFINITION.
    For purposes of this title, a company is a ``commercial firm'' if 
the annual gross revenues derived by the company and all of its 
affiliates from activities that are financial in nature (as defined in 
section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(k))) and, if applicable, from the ownership or control of one or 
more insured depository institutions, represent less than 15 percent of 
the consolidated annual gross revenues of the company.
    SEC. 603. MORATORIUM AND STUDY ON TREATMENT OF CREDIT CARD BANKS, 
      INDUSTRIAL LOAN COMPANIES, AND CERTAIN OTHER COMPANIES UNDER THE 
      BANK HOLDING COMPANY ACT OF 1956.
    (a) Moratorium.--
        (1) Definitions.--In this subsection--
            (A) the term ``credit card bank'' means an institution 
        described in section 2(c)(2)(F) of the Bank Holding Company Act 
        of 1956 (12 U.S.C. 1841(c)(2)(F));
            (B) the term ``industrial bank'' means an institution 
        described in section 2(c)(2)(H) of the Bank Holding Company Act 
        of 1956 (12 U.S.C. 1841(c)(2)(H)); and
            (C) the term ``trust bank'' means an institution described 
        in section 2(c)(2)(D) of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1841(c)(2)(D)).
        (2) Moratorium on provision of deposit insurance.--The 
    Corporation may not approve an application for deposit insurance 
    under section 5 of the Federal Deposit Insurance Act (12 U.S.C. 
    1815) that is received after November 23, 2009, for an industrial 
    bank, a credit card bank, or a trust bank that is directly or 
    indirectly owned or controlled by a commercial firm.
        (3) Change in control.--
            (A) In general.--Except as provided in subparagraph (B), 
        the appropriate Federal banking agency shall disapprove a 
        change in control, as provided in section 7(j) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1817(j)), of an industrial 
        bank, a credit card bank, or a trust bank if the change in 
        control would result in direct or indirect control of the 
        industrial bank, credit card bank, or trust bank by a 
        commercial firm.
            (B) Exceptions.--Subparagraph (A) shall not apply to a 
        change in control of an industrial bank, credit card bank, or 
        trust bank--
                (i) that--

                    (I) is in danger of default, as determined by the 
                appropriate Federal banking agency;
                    (II) results from the merger or whole acquisition 
                of a commercial firm that directly or indirectly 
                controls the industrial bank, credit card bank, or 
                trust bank in a bona fide merger with or acquisition by 
                another commercial firm, as determined by the 
                appropriate Federal banking agency; or
                    (III) results from an acquisition of voting shares 
                of a publicly traded company that controls an 
                industrial bank, credit card bank, or trust bank, if, 
                after the acquisition, the acquiring shareholder (or 
                group of shareholders acting in concert) holds less 
                than 25 percent of any class of the voting shares of 
                the company; and

                (ii) that has obtained all regulatory approvals 
            otherwise required for such change of control under any 
            applicable Federal or State law, including section 7(j) of 
            the Federal Deposit Insurance Act (12 U.S.C. 1817(j)).
        (4) Sunset.--This subsection shall cease to have effect 3 years 
    after the date of enactment of this Act.
    (b) Government Accountability Office Study of Exceptions Under the 
Bank Holding Company Act of 1956.--
        (1) Study required.--The Comptroller General of the United 
    States shall carry out a study to determine whether it is 
    necessary, in order to strengthen the safety and soundness of 
    institutions or the stability of the financial system, to eliminate 
    the exceptions under section 2 of the Bank Holding Company Act of 
    1956 (12 U.S.C. 1841) for institutions described in--
            (A) section 2(a)(5)(E) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(a)(5)(E));
            (B) section 2(a)(5)(F) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(a)(5)(F));
            (C) section 2(c)(2)(D) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(c)(2)(D));
            (D) section 2(c)(2)(F) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(c)(2)(F));
            (E) section 2(c)(2)(H) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(c)(2)(H)); and
            (F) section 2(c)(2)(B) of the Bank Holding Company Act of 
        1956 (12 U.S.C. 1841(c)(2)(B)).
        (2) Content of study.--
            (A) In general.--The study required under paragraph (1), 
        with respect to the institutions referenced in each of 
        subparagraphs (A) through (E) of paragraph (1), shall, to the 
        extent feasible be based on information provided to the 
        Comptroller General by the appropriate Federal or State 
        regulator, and shall--
                (i) identify the types and number of institutions 
            excepted from section 2 of the Bank Holding Company Act of 
            1956 (12 U.S.C. 1841) under each of the subparagraphs 
            described in subparagraphs (A) through (E) of paragraph 
            (1);
                (ii) generally describe the size and geographic 
            locations of the institutions described in clause (i);
                (iii) determine the extent to which the institutions 
            described in clause (i) are held by holding companies that 
            are commercial firms;
                (iv) determine whether the institutions described in 
            clause (i) have any affiliates that are commercial firms;
                (v) identify the Federal banking agency responsible for 
            the supervision of the institutions described in clause (i) 
            on and after the transfer date;
                (vi) determine the adequacy of the Federal bank 
            regulatory framework applicable to each category of 
            institution described in clause (i), including any 
            restrictions (including limitations on affiliate 
            transactions or cross-marketing) that apply to transactions 
            between an institution, the holding company of the 
            institution, and any other affiliate of the institution; 
            and
                (vii) evaluate the potential consequences of subjecting 
            the institutions described in clause (i) to the 
            requirements of the Bank Holding Company Act of 1956, 
            including with respect to the availability and allocation 
            of credit, the stability of the financial system and the 
            economy, the safe and sound operation of each category of 
            institution, and the impact on the types of activities in 
            which such institutions, and the holding companies of such 
            institutions, may engage.
            (B) Savings associations.--With respect to institutions 
        described in paragraph (1)(F), the study required under 
        paragraph (1) shall--
                (i) determine the adequacy of the Federal bank 
            regulatory framework applicable to such institutions, 
            including any restrictions (including limitations on 
            affiliate transactions or cross-marketing) that apply to 
            transactions between an institution, the holding company of 
            the institution, and any other affiliate of the 
            institution; and
                (ii) evaluate the potential consequences of subjecting 
            the institutions described in paragraph (1)(F) to the 
            requirements of the Bank Holding Company Act of 1956, 
            including with respect to the availability and allocation 
            of credit, the stability of the financial system and the 
            economy, the safe and sound operation of such institutions, 
            and the impact on the types of activities in which such 
            institutions, and the holding companies of such 
            institutions, may engage.
        (3) Report.--Not later than 18 months after the date of 
    enactment of this Act, the Comptroller General shall submit to the 
    Committee on Banking, Housing, and Urban Affairs of the Senate and 
    the Committee on Financial Services of the House of Representatives 
    a report on the study required under paragraph (1).
    SEC. 604. REPORTS AND EXAMINATIONS OF HOLDING COMPANIES; REGULATION 
      OF FUNCTIONALLY REGULATED SUBSIDIARIES.
    (a) Reports by Bank Holding Companies.--Sections 5(c)(1) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1844(c)(1)) is amended--
        (1) by striking subclause (A)(ii) and inserting the following:
                ``(ii) compliance by the bank holding company or 
            subsidiary with--

                    ``(I) this Act;
                    ``(II) Federal laws that the Board has specific 
                jurisdiction to enforce against the company or 
                subsidiary; and
                    ``(III) other than in the case of an insured 
                depository institution or functionally regulated 
                subsidiary, any other applicable provision of Federal 
                law.'';

        (2) by striking subparagraph (B) and inserting the following:
            ``(B) Use of existing reports and other supervisory 
        information.--The Board shall, to the fullest extent possible, 
        use--
                ``(i) reports and other supervisory information that 
            the bank holding company or any subsidiary thereof has been 
            required to provide to other Federal or State regulatory 
            agencies;
                ``(ii) externally audited financial statements of the 
            bank holding company or subsidiary;
                ``(iii) information otherwise available from Federal or 
            State regulatory agencies; and
                ``(iv) information that is otherwise required to be 
            reported publicly.''; and
        (3) by adding at the end the following:
            ``(C) Availability.--Upon the request of the Board, the 
        bank holding company or a subsidiary of the bank holding 
        company shall promptly provide to the Board any information 
        described in clauses (i) through (iii) of subparagraph (B).''.
    (b) Examinations of Bank Holding Companies.--Section 5(c)(2) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1844(c)(2)) is amended to 
read as follows:
        ``(2) Examinations.--
            ``(A) In general.--Subject to subtitle B of the Consumer 
        Financial Protection Act of 2010, the Board may make 
        examinations of a bank holding company and each subsidiary of a 
        bank holding company in order to--
                ``(i) inform the Board of--

                    ``(I) the nature of the operations and financial 
                condition of the bank holding company and the 
                subsidiary;
                    ``(II) the financial, operational, and other risks 
                within the bank holding company system that may pose a 
                threat to--

                        ``(aa) the safety and soundness of the bank 
                    holding company or of any depository institution 
                    subsidiary of the bank holding company; or
                        ``(bb) the stability of the financial system of 
                    the United States; and

                    ``(III) the systems of the bank holding company for 
                monitoring and controlling the risks described in 
                subclause (II); and

                ``(ii) monitor the compliance of the bank holding 
            company and the subsidiary with--

                    ``(I) this Act;
                    ``(II) Federal laws that the Board has specific 
                jurisdiction to enforce against the company or 
                subsidiary; and
                    ``(III) other than in the case of an insured 
                depository institution or functionally regulated 
                subsidiary, any other applicable provisions of Federal 
                law.

            ``(B) Use of reports to reduce examinations.--For purposes 
        of this paragraph, the Board shall, to the fullest extent 
        possible, rely on--
                ``(i) examination reports made by other Federal or 
            State regulatory agencies relating to a bank holding 
            company and any subsidiary of a bank holding company; and
                ``(ii) the reports and other information required under 
            paragraph (1).
            ``(C) Coordination with other regulators.--The Board 
        shall--
                ``(i) provide reasonable notice to, and consult with, 
            the appropriate Federal banking agency, the Securities and 
            Exchange Commission, the Commodity Futures Trading 
            Commission, or State regulatory agency, as appropriate, for 
            a subsidiary that is a depository institution or a 
            functionally regulated subsidiary of a bank holding company 
            before commencing an examination of the subsidiary under 
            this section; and
                ``(ii) to the fullest extent possible, avoid 
            duplication of examination activities, reporting 
            requirements, and requests for information.''.
    (c) Authority To Regulate Functionally Regulated Subsidiaries of 
Bank Holding Companies.--The Bank Holding Company Act of 1956 (12 
U.S.C. 1841 et seq.) is amended--
        (1) in section 5(c)(5)(B) (12 U.S.C. 1844(c)(5)(B)), by 
    striking clause (v) and inserting the following:
                ``(v) an entity that is subject to regulation by, or 
            registration with, the Commodity Futures Trading 
            Commission, with respect to activities conducted as a 
            futures commission merchant, commodity trading adviser, 
            commodity pool, commodity pool operator, swap execution 
            facility, swap data repository, swap dealer, major swap 
            participant, and activities that are incidental to such 
            commodities and swaps activities.''; and
        (2) by striking section 10A (12 U.S.C. 1848a).
    (d) Acquisitions of Banks.--Section 3(c) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1842(c)) is amended by adding at the end 
the following:
        ``(7) Financial stability.--In every case, the Board shall take 
    into consideration 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.''.
    (e) Acquisitions of Nonbanks.--
        (1) Notice procedures.--Section 4(j)(2)(A) of the Bank Holding 
    Company Act of 1956 (12 U.S.C. 1843(j)(2)(A)) is amended by 
    striking ``or unsound banking practices'' and inserting ``unsound 
    banking practices, or risk to the stability of the United States 
    banking or financial system''.
        (2) Activities that are financial in nature.--Section 
    4(k)(6)(B) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1843(k)(6)(B)) is amended to read as follows:
            ``(B) Approval not required for certain financial 
        activities.--
                ``(i) In general.--Except as provided in subsection (j) 
            with regard to the acquisition of a savings association and 
            clause (ii), a financial holding company may commence any 
            activity, or acquire any company, pursuant to paragraph (4) 
            or any regulation prescribed or order issued under 
            paragraph (5), without prior approval of the Board.
                ``(ii) Exception.--A financial holding company may not 
            acquire a company, without the prior approval of the Board, 
            in a transaction in which the total consolidated assets to 
            be acquired by the financial holding company exceed 
            $10,000,000,000.
                ``(iii) Hart-Scott-Rodino filing requirement.--Solely 
            for purposes of section 7A(c)(8) of the Clayton Act (15 
            U.S.C. 18a(c)(8)), the transactions subject to the 
            requirements of this paragraph shall be treated as if the 
            approval of the Board is not required.''.
    (f) Bank Merger Act Transactions.--Section 18(c)(5) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(c)(5)) is amended, in the matter 
immediately following subparagraph (B), by striking ``and the 
convenience and needs of the community to be served'' and inserting 
``the convenience and needs of the community to be served, and the risk 
to the stability of the United States banking or financial system''.
    (g) Reports by Savings and Loan Holding Companies.--Section 
10(b)(2) of the Home Owners' Loan Act (12 U.S.C. 1467a(b)(2) is 
amended--
        (1) by striking ``Each savings'' and inserting the following:
            ``(A) In general.--Each savings''; and
        (2) by adding at the end the following:
            ``(B) Use of existing reports and other supervisory 
        information.--The Board shall, to the fullest extent possible, 
        use--
                ``(i) reports and other supervisory information that 
            the savings and loan holding company or any subsidiary 
            thereof has been required to provide to other Federal or 
            State regulatory agencies;
                ``(ii) externally audited financial statements of the 
            savings and loan holding company or subsidiary;
                ``(iii) information that is otherwise available from 
            Federal or State regulatory agencies; and
                ``(iv) information that is otherwise required to be 
            reported publicly.
            ``(C) Availability.--Upon the request of the Board, a 
        savings and loan holding company or a subsidiary of a savings 
        and loan holding company shall promptly provide to the Board 
        any information described in clauses (i) through (iii) of 
        subparagraph (B).''.
    (h) Examination of Savings and Loan Holding Companies.--
        (1) Definitions.--Section 2 of the Home Owners' Loan Act (12 
    U.S.C. 1462) is amended by adding at the end the following:
        ``(10) Appropriate federal banking agency.--The term 
    `appropriate Federal banking agency' has the same meaning as in 
    section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
    1813(q)).
        ``(11) Functionally regulated subsidiary.--The term 
    `functionally regulated subsidiary' has the same meaning as in 
    section 5(c)(5) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1844(c)(5)).''.
        (2) Examination.--Section 10(b) of the Home Owners' Loan Act 
    (12 U.S.C. 1467a(b)) is amended by striking paragraph (4) and 
    inserting the following:
        ``(4) Examinations.--
            ``(A) In general.--Subject to subtitle B of the Consumer 
        Financial Protection Act of 2010, the Board may make 
        examinations of a savings and loan holding company and each 
        subsidiary of a savings and loan holding company system, in 
        order to--
                ``(i) inform the Board of--

                    ``(I) the nature of the operations and financial 
                condition of the savings and loan holding company and 
                the subsidiary;
                    ``(II) the financial, operational, and other risks 
                within the savings and loan holding company system that 
                may pose a threat to--

                        ``(aa) the safety and soundness of the savings 
                    and loan holding company or of any depository 
                    institution subsidiary of the savings and loan 
                    holding company; or
                        ``(bb) the stability of the financial system of 
                    the United States; and

                    ``(III) the systems of the savings and loan holding 
                company for monitoring and controlling the risks 
                described in subclause (II); and

                ``(ii) monitor the compliance of the savings and loan 
            holding company and the subsidiary with--

                    ``(I) this Act;
                    ``(II) Federal laws that the Board has specific 
                jurisdiction to enforce against the company or 
                subsidiary; and
                    ``(III) other than in the case of an insured 
                depository institution or functionally regulated 
                subsidiary, any other applicable provisions of Federal 
                law.

            ``(B) Use of reports to reduce examinations.--For purposes 
        of this subsection, the Board shall, to the fullest extent 
        possible, rely on--
                ``(i) the examination reports made by other Federal or 
            State regulatory agencies relating to a savings and loan 
            holding company and any subsidiary; and
                ``(ii) the reports and other information required under 
            paragraph (2).
            ``(C) Coordination with other regulators.--The Board 
        shall--
                ``(i) provide reasonable notice to, and consult with, 
            the appropriate Federal banking agency, the Securities and 
            Exchange Commission, the Commodity Futures Trading 
            Commission, or State regulatory agency, as appropriate, for 
            a subsidiary that is a depository institution or a 
            functionally regulated subsidiary of a savings and loan 
            holding company before commencing an examination of the 
            subsidiary under this section; and
                ``(ii) to the fullest extent possible, avoid 
            duplication of examination activities, reporting 
            requirements, and requests for information.''.
    (i) Definition of the Term ``Savings and Loan Holding Company''.--
Section 10(a)(1)(D)(ii) of the Home Owners' Loan Act (12 U.S.C. 
1467a(a)(1)(D)(ii)) is amended to read as follows:
                ``(ii) Exclusion.--The term `savings and loan holding 
            company' does not include--

                    ``(I) a bank holding company that is registered 
                under, and subject to, the Bank Holding Company Act of 
                1956 (12 U.S.C. 1841 et seq.), or to any company 
                directly or indirectly controlled by such company 
                (other than a savings association);
                    ``(II) a company that controls a savings 
                association that functions solely in a trust or 
                fiduciary capacity as described in section 2(c)(2)(D) 
                of the Bank Holding Company Act of 1956 (12 U.S.C. 
                1841(c)(2)(D)); or
                    ``(III) a company described in subsection (c)(9)(C) 
                solely by virtue of such company's control of an 
                intermediate holding company established pursuant to 
                section 10A.''.

    (j) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 605. ASSURING CONSISTENT OVERSIGHT OF PERMISSIBLE ACTIVITIES 
      OF DEPOSITORY INSTITUTION SUBSIDIARIES OF HOLDING COMPANIES.
    (a) In General.--The Federal Deposit Insurance Act (12 U.S.C. 1811 
et seq.) is amended by inserting after section 25 the following new 
section:
  ``SEC. 26. ASSURING CONSISTENT OVERSIGHT OF SUBSIDIARIES OF HOLDING 
      COMPANIES.
    ``(a) Definitions.--For purposes of this section:
        ``(1) Board.--The term `Board' means the Board of Governors of 
    the Federal Reserve System.
        ``(2) Functionally regulated subsidiary.--The term 
    `functionally regulated subsidiary' has the same meaning as in 
    section 5(c)(5) of the Bank Holding Company Act.
        ``(3) Lead insured depository institution.--The term `lead 
    insured depository institution' has the same meaning as in section 
    2(o)(8) of the Bank Holding Company Act.
    ``(b) Examination Requirements.--Subject to subtitle B of the 
Consumer Financial Protection Act of 2010, the Board shall examine the 
activities of a nondepository institution subsidiary (other than a 
functionally regulated subsidiary or a subsidiary of a depository 
institution) of a depository institution holding company that are 
permissible for the insured depository institution subsidiaries of the 
depository institution holding company in the same manner, subject to 
the same standards, and with the same frequency as would be required if 
such activities were conducted in the lead insured depository 
institution of the depository institution holding company.
    ``(c) State Coordination.--
        ``(1) Consultation and coordination.--If a nondepository 
    institution subsidiary is supervised by a State bank supervisor or 
    other State regulatory authority, the Board, in conducting the 
    examinations required in subsection (b), shall consult and 
    coordinate with such State regulator.
        ``(2) Alternating examinations permitted.--The examinations 
    required under subsection (b) may be conducted in joint or 
    alternating manner with a State regulator, if the Board determines 
    that an examination of a nondepository institution subsidiary 
    conducted by the State carries out the purposes of this section.
    ``(d) Appropriate Federal Banking Agency Backup Examination 
Authority.--
        ``(1) In general.--In the event that the Board does not conduct 
    examinations required under subsection (b) in the same manner, 
    subject to the same standards, and with the same frequency as would 
    be required if such activities were conducted by the lead insured 
    depository institution subsidiary of the depository institution 
    holding company, the appropriate Federal banking agency for the 
    lead insured depository institution may recommend in writing (which 
    shall include a written explanation of the concerns giving rise to 
    the recommendation) that the Board perform the examination required 
    under subsection (b).
        ``(2) Examination by an appropriate federal banking agency.--If 
    the Board does not, before the end of the 60-day period beginning 
    on the date on which the Board receives a recommendation under 
    paragraph (1), begin an examination as required under subsection 
    (b) or provide a written explanation or plan to the appropriate 
    Federal banking agency making such recommendation responding to the 
    concerns raised by the appropriate Federal banking agency for the 
    lead insured depository institution, the appropriate Federal 
    banking agency for the lead insured depository institution may, 
    subject to the Consumer Financial Protection Act of 2010, examine 
    the activities that are permissible for a depository institution 
    subsidiary conducted by such nondepository institution subsidiary 
    (other than a functionally regulated subsidiary or a subsidiary of 
    a depository institution) of the depository institution holding 
    company as if the nondepository institution subsidiary were an 
    insured depository institution for which the appropriate Federal 
    banking agency of the lead insured depository institution was the 
    appropriate Federal banking agency, to determine whether the 
    activities--
            ``(A) pose a material threat to the safety and soundness of 
        any insured depository institution subsidiary of the depository 
        institution holding company;
            ``(B) are conducted in accordance with applicable Federal 
        law; and
            ``(C) are subject to appropriate systems for monitoring and 
        controlling the financial, operating, and other material risks 
        of the activities that may pose a material threat to the safety 
        and soundness of the insured depository institution 
        subsidiaries of the holding company.
        ``(3) Agency coordination with the board.--An appropriate 
    Federal banking agency that conducts an examination pursuant to 
    paragraph (2) shall coordinate examination of the activities of 
    nondepository institution subsidiaries described in subsection (b) 
    with the Board in a manner that--
            ``(A) avoids duplication;
            ``(B) shares information relevant to the supervision of the 
        depository institution holding company;
            ``(C) achieves the objectives of subsection (b); and
            ``(D) ensures that the depository institution holding 
        company and the subsidiaries of the depository institution 
        holding company are not subject to conflicting supervisory 
        demands by such agency and the Board.
        ``(4) Fee permitted for examination costs.--An appropriate 
    Federal banking agency that conducts an examination or enforcement 
    action pursuant to this section may collect an assessment, fee, or 
    such other charge from the subsidiary as the appropriate Federal 
    banking agency determines necessary or appropriate to carry out the 
    responsibilities of the appropriate Federal banking agency in 
    connection with such examination.
    ``(e) Referrals for Enforcement by Appropriate Federal Banking 
Agency.--
        ``(1) Recommendation of enforcement action.--The appropriate 
    Federal banking agency for the lead insured depository institution, 
    based upon its examination of a nondepository institution 
    subsidiary conducted pursuant to subsection (d), or other relevant 
    information, may submit to the Board, in writing, a recommendation 
    that the Board take enforcement action against such nondepository 
    institution subsidiary, together with an explanation of the 
    concerns giving rise to the recommendation, if the appropriate 
    Federal banking agency determines (by a vote of its members, if 
    applicable) that the activities of the nondepository institution 
    subsidiary pose a material threat to the safety and soundness of 
    any insured depository institution subsidiary of the depository 
    institution holding company.
        ``(2) Back-up authority of the appropriate federal banking 
    agency.--If, within the 60-day period beginning on the date on 
    which the Board receives a recommendation under paragraph (1), the 
    Board does not take enforcement action against the nondepository 
    institution subsidiary or provide a plan for supervisory or 
    enforcement action that is acceptable to the appropriate Federal 
    banking agency that made the recommendation pursuant to paragraph 
    (1), such agency may take the recommended enforcement action 
    against the nondepository institution subsidiary, in the same 
    manner as if the nondepository institution subsidiary were an 
    insured depository institution for which the agency was the 
    appropriate Federal banking agency.
    ``(f) Coordination Among Appropriate Federal Banking Agencies.--
Each Federal banking agency, prior to or when exercising authority 
under subsection (d) or (e) shall--
        ``(1) provide reasonable notice to, and consult with, the 
    appropriate Federal banking agency or State bank supervisor (or 
    other State regulatory agency) of the nondepository institution 
    subsidiary of a depository institution holding company that is 
    described in subsection (d) before commencing any examination of 
    the subsidiary;
        ``(2) to the fullest extent possible--
            ``(A) rely on the examinations, inspections, and reports of 
        the appropriate Federal banking agency or the State bank 
        supervisor (or other State regulatory agency) of the 
        subsidiary;
            ``(B) avoid duplication of examination activities, 
        reporting requirements, and requests for information; and
            ``(C) ensure that the depository institution holding 
        company and the subsidiaries of the depository institution 
        holding company are not subject to conflicting supervisory 
        demands by the appropriate Federal banking agencies.
    ``(g) Rule of Construction.--No provision of this section shall be 
construed as limiting any authority of the Board, the Corporation, or 
the Comptroller of the Currency under any other provision of law.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the transfer date.
    SEC. 606. REQUIREMENTS FOR FINANCIAL HOLDING COMPANIES TO REMAIN 
      WELL CAPITALIZED AND WELL MANAGED.
    (a) Amendment.--Section 4(l)(1) of the Bank Holding Company Act of 
1956 (12 U.S.C. 1843(l)(1)) is amended--
        (1) in subparagraph (B), by striking ``and'' at the end;
        (2) by redesignating subparagraph (C) as subparagraph (D);
        (3) by inserting after subparagraph (B) the following:
            ``(C) the bank holding company is well capitalized and well 
        managed; and''; and
        (4) in subparagraph (D)(ii), as so redesignated, by striking 
    ``subparagraphs (A) and (B)'' and inserting ``subparagraphs (A), 
    (B), and (C)''.
    (b) Home Owners' Loan Act Amendment.--Section 10(c)(2) of the Home 
Owners' Loan Act (12 U.S.C. 1467a(c)(2)) is amended by adding at the 
end the following new subparagraph:
            ``(H) Any activity that is permissible for a financial 
        holding company (as such term is defined under section 2(p) of 
        the Bank Holding Company Act of 1956 (12 U.S.C. 1841(p)) to 
        conduct under section 4(k) of the Bank Holding Company Act of 
        1956 if--
                ``(i) the savings and loan holding company meets all of 
            the criteria to qualify as a financial holding company, and 
            complies with all of the requirements applicable to a 
            financial holding company, under sections 4(l) and 4(m) of 
            the Bank Holding Company Act and section 804(c) of the 
            Community Reinvestment Act of 1977 (12 U.S.C. 2903(c)) as 
            if the savings and loan holding company was a bank holding 
            company; and
                ``(ii) the savings and loan holding company conducts 
            the activity in accordance with the same terms, conditions, 
            and requirements that apply to the conduct of such activity 
            by a bank holding company under the Bank Holding Company 
            Act of 1956 and the Board's regulations and interpretations 
            under such Act.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 607. STANDARDS FOR INTERSTATE ACQUISITIONS.
    (a) Acquisition of Banks.--Section 3(d)(1)(A) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1842(d)(1)(A)) is amended by striking 
``adequately capitalized and adequately managed'' and inserting ``well 
capitalized and well managed''.
    (b) Interstate Bank Mergers.--Section 44(b)(4)(B) of the Federal 
Deposit Insurance Act (12 U.S.C. 1831u(b)(4)(B)) is amended by striking 
``will continue to be adequately capitalized and adequately managed'' 
and inserting ``will be well capitalized and well managed''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 608. ENHANCING EXISTING RESTRICTIONS ON BANK TRANSACTIONS WITH 
      AFFILIATES.
    (a) Affiliate Transactions.--Section 23A of the Federal Reserve Act 
(12 U.S.C. 371c) is amended--
        (1) in subsection (b)--
            (A) in paragraph (1), by striking subparagraph (D) and 
        inserting the following:
            ``(D) any investment fund with respect to which a member 
        bank or affiliate thereof is an investment adviser; and''; and
            (B) in paragraph (7)--
                (i) in subparagraph (A), by inserting before the 
            semicolon at the end the following: ``, including a 
            purchase of assets subject to an agreement to repurchase'';
                (ii) in subparagraph (C), by striking ``, including 
            assets subject to an agreement to repurchase,'';
                (iii) in subparagraph (D)--

                    (I) by inserting ``or other debt obligations'' 
                after ``acceptance of securities''; and
                    (II) by striking ``or'' at the end; and

                (iv) by adding at the end the following:
            ``(F) a transaction with an affiliate that involves the 
        borrowing or lending of securities, to the extent that the 
        transaction causes a member bank or a subsidiary to have credit 
        exposure to the affiliate; or
            ``(G) a derivative transaction, as defined in paragraph (3) 
        of section 5200(b) of the Revised Statutes of the United States 
        (12 U.S.C. 84(b)), with an affiliate, to the extent that the 
        transaction causes a member bank or a subsidiary to have credit 
        exposure to the affiliate;'';
        (2) in subsection (c)--
            (A) in paragraph (1)--
                (i) in the matter preceding subparagraph (A), by 
            striking ``subsidiary'' and all that follows through ``time 
            of the transaction'' and inserting ``subsidiary, and any 
            credit exposure of a member bank or a subsidiary to an 
            affiliate resulting from a securities borrowing or lending 
            transaction, or a derivative transaction, shall be secured 
            at all times''; and
                (ii) in each of subparagraphs (A) through (D), by 
            striking ``or letter of credit'' and inserting ``letter of 
            credit, or credit exposure'';
            (B) by striking paragraph (2);
            (C) by redesignating paragraphs (3) through (5) as 
        paragraphs (2) through (4), respectively;
            (D) in paragraph (2), as so redesignated, by inserting 
        before the period at the end ``, or credit exposure to an 
        affiliate resulting from a securities borrowing or lending 
        transaction, or derivative transaction''; and
            (E) in paragraph (3), as so redesignated--
                (i) by inserting ``or other debt obligations'' after 
            ``securities''; and
                (ii) by striking ``or guarantee'' and all that follows 
            through ``behalf of,'' and inserting ``guarantee, 
            acceptance, or letter of credit issued on behalf of, or 
            credit exposure from a securities borrowing or lending 
            transaction, or derivative transaction to,'';
        (3) in subsection (d)(4), in the matter preceding subparagraph 
    (A), by striking ``or issuing'' and all that follows through 
    ``behalf of,'' and inserting ``issuing a guarantee, acceptance, or 
    letter of credit on behalf of, or having credit exposure resulting 
    from a securities borrowing or lending transaction, or derivative 
    transaction to,''; and
        (4) in subsection (f)--
            (A) in paragraph (2)--
                (i) by striking ``or order'';
                (ii) by striking ``if it finds'' and all that follows 
            through the end of the paragraph and inserting the 
            following: ``if--
                ``(i) the Board finds the exemption to be in the public 
            interest and consistent with the purposes of this section, 
            and notifies the Federal Deposit Insurance Corporation of 
            such finding; and
                ``(ii) before the end of the 60-day period beginning on 
            the date on which the Federal Deposit Insurance Corporation 
            receives notice of the finding under clause (i), the 
            Federal Deposit Insurance Corporation does not object, in 
            writing, to the finding, based on a determination that the 
            exemption presents an unacceptable risk to the Deposit 
            Insurance Fund.'';
                (iii) by striking the Board and inserting the 
            following:
            ``(A) In general.--The Board''; and
                (iv) by adding at the end the following:
            ``(B) Additional exemptions.--
                ``(i) National banks.--The Comptroller of the Currency 
            may, by order, exempt a transaction of a national bank from 
            the requirements of this section if--

                    ``(I) the Board and the Office of the Comptroller 
                of the Currency jointly find the exemption to be in the 
                public interest and consistent with the purposes of 
                this section and notify the Federal Deposit Insurance 
                Corporation of such finding; and
                    ``(II) before the end of the 60-day period 
                beginning on the date on which the Federal Deposit 
                Insurance Corporation receives notice of the finding 
                under subclause (I), the Federal Deposit Insurance 
                Corporation does not object, in writing, to the 
                finding, based on a determination that the exemption 
                presents an unacceptable risk to the Deposit Insurance 
                Fund.

                ``(ii) State banks.--The Federal Deposit Insurance 
            Corporation may, by order, exempt a transaction of a State 
            nonmember bank, and the Board may, by order, exempt a 
            transaction of a State member bank, from the requirements 
            of this section if--

                    ``(I) the Board and the Federal Deposit Insurance 
                Corporation jointly find that the exemption is in the 
                public interest and consistent with the purposes of 
                this section; and
                    ``(II) the Federal Deposit Insurance Corporation 
                finds that the exemption does not present an 
                unacceptable risk to the Deposit Insurance Fund.''; and

            (B) by adding at the end the following:
        ``(4) Amounts of covered transactions.--The Board may issue 
    such regulations or interpretations as the Board determines are 
    necessary or appropriate with respect to the manner in which a 
    netting agreement may be taken into account in determining the 
    amount of a covered transaction between a member bank or a 
    subsidiary and an affiliate, including the extent to which netting 
    agreements between a member bank or a subsidiary and an affiliate 
    may be taken into account in determining whether a covered 
    transaction is fully secured for purposes of subsection (d)(4). An 
    interpretation under this paragraph with respect to a specific 
    member bank, subsidiary, or affiliate shall be issued jointly with 
    the appropriate Federal banking agency for such member bank, 
    subsidiary, or affiliate.''.
    (b) Transactions With Affiliates.--Section 23B(e) of the Federal 
Reserve Act (12 U.S.C. 371c-1(e)) is amended--
        (1) by striking the undesignated matter following subparagraph 
    (B);
        (2) by redesignating subparagraphs (A) and (B) as clauses (i) 
    and (ii), respectively, and adjusting the clause margins 
    accordingly;
        (3) by redesignating paragraphs (1) and (2) as subparagraphs 
    (A) and (B), respectively, and adjusting the subparagraph margins 
    accordingly;
        (4) by striking ``The Board'' and inserting the following:
        ``(1) In general.--The Board'';
        (5) in paragraph (1)(B), as so redesignated--
            (A) in the matter preceding clause (i), by inserting before 
        ``regulations'' the following: ``subject to paragraph (2), if 
        the Board finds that an exemption or exclusion is in the public 
        interest and is consistent with the purposes of this section, 
        and notifies the Federal Deposit Insurance Corporation of such 
        finding,''; and
            (B) in clause (ii), by striking the comma at the end and 
        inserting a period; and
        (6) by adding at the end the following:
        ``(2) Exception.--The Board may grant an exemption or exclusion 
    under this subsection only if, during the 60-day period beginning 
    on the date of receipt of notice of the finding from the Board 
    under paragraph (1)(B), the Federal Deposit Insurance Corporation 
    does not object, in writing, to such exemption or exclusion, based 
    on a determination that the exemption presents an unacceptable risk 
    to the Deposit Insurance Fund.''.
    (c) Home Owners' Loan Act.--Section 11 of the Home Owners' Loan Act 
(12 U.S.C. 1468) is amended by adding at the end the following:
    ``(d) Exemptions.--
        ``(1) Federal savings associations.--The Comptroller of the 
    Currency may, by order, exempt a transaction of a Federal savings 
    association from the requirements of this section if--
            ``(A) the Board and the Office of the Comptroller of the 
        Currency jointly find the exemption to be in the public 
        interest and consistent with the purposes of this section and 
        notify the Federal Deposit Insurance Corporation of such 
        finding; and
            ``(B) before the end of the 60-day period beginning on the 
        date on which the Federal Deposit Insurance Corporation 
        receives notice of the finding under subparagraph (A), the 
        Federal Deposit Insurance Corporation does not object, in 
        writing, to the finding, based on a determination that the 
        exemption presents an unacceptable risk to the Deposit 
        Insurance Fund.
        ``(2) State savings association.--The Federal Deposit Insurance 
    Corporation may, by order, exempt a transaction of a State savings 
    association from the requirements of this section if the Board and 
    the Federal Deposit Insurance Corporation jointly find that--
            ``(A) the exemption is in the public interest and 
        consistent with the purposes of this section; and
            ``(B) the exemption does not present an unacceptable risk 
        to the Deposit Insurance Fund.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect 1 year after the transfer date.
    SEC. 609. ELIMINATING EXCEPTIONS FOR TRANSACTIONS WITH FINANCIAL 
      SUBSIDIARIES.
    (a) Amendment.--Section 23A(e) of the Federal Reserve Act (12 
U.S.C. 371c(e)) is amended--
        (1) by striking paragraph (3); and
        (2) by redesignating paragraph (4) as paragraph (3).
    (b) Prospective Application of Amendment.--The amendments made by 
this section shall apply with respect to any covered transaction 
between a bank and a subsidiary of the bank, as those terms are defined 
in section 23A of the Federal Reserve Act (12 U.S.C. 371c), that is 
entered into on or after the date of enactment of this Act.
    (c) Effective Date.--The amendments made by this section shall take 
effect 1 year after the transfer date.
    SEC. 610. LENDING LIMITS APPLICABLE TO CREDIT EXPOSURE ON 
      DERIVATIVE TRANSACTIONS, REPURCHASE AGREEMENTS, REVERSE 
      REPURCHASE AGREEMENTS, AND SECURITIES LENDING AND BORROWING 
      TRANSACTIONS.
    (a) National Banks.--Section 5200(b) of the Revised Statutes of the 
United States (12 U.S.C. 84(b)) is amended--
        (1) in paragraph (1), by striking ``shall include'' and all 
    that follows through the end of the paragraph and inserting the 
    following: ``shall include--
            ``(A) all direct or indirect advances of funds to a person 
        made on the basis of any obligation of that person to repay the 
        funds or repayable from specific property pledged by or on 
        behalf of the person;
            ``(B) to the extent specified by the Comptroller of the 
        Currency, any liability of a national banking association to 
        advance funds to or on behalf of a person pursuant to a 
        contractual commitment; and
            ``(C) any credit exposure to a person arising from a 
        derivative transaction, repurchase agreement, reverse 
        repurchase agreement, securities lending transaction, or 
        securities borrowing transaction between the national banking 
        association and the person;'';
        (2) in paragraph (2), by striking the period at the end and 
    inserting ``; and''; and
        (3) by adding at the end the following:
        ``(3) the term `derivative transaction' includes any 
    transaction that is a contract, agreement, swap, warrant, note, or 
    option that is based, in whole or in part, on the value of, any 
    interest in, or any quantitative measure or the occurrence of any 
    event relating to, one or more commodities, securities, currencies, 
    interest or other rates, indices, or other assets.''.
    (b) Savings Associations.--Section 5(u)(3) of the Home Owners' Loan 
Act (12 U.S.C. 1464(u)(3)) is amended by striking ``Director'' each 
place that term appears and inserting ``Comptroller of the Currency''.
    (c) Effective Date.--The amendments made by this section shall take 
effect 1 year after the transfer date.
    SEC. 611. CONSISTENT TREATMENT OF DERIVATIVE TRANSACTIONS IN 
      LENDING LIMITS.
    (a) Amendment.--Section 18 of the Federal Deposit Insurance Act (12 
U.S.C. 1828) is amended by adding at the end the following:
    ``(y) State Lending Limit Treatment of Derivatives Transactions.--
An insured State bank may engage in a derivative transaction, as 
defined in section 5200(b)(3) of the Revised Statutes of the United 
States (12 U.S.C. 84(b)(3)), only if the law with respect to lending 
limits of the State in which the insured State bank is chartered takes 
into consideration credit exposure to derivative transactions.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect 18 months after the transfer date.
    SEC. 612. RESTRICTION ON CONVERSIONS OF TROUBLED BANKS.
    (a) Conversion of a National Banking Association.--The Act entitled 
``An Act to provide for the conversion of national banking associations 
into and their merger or consolidation with State banks, and for other 
purposes.'' (12 U.S.C. 214 et seq.) is amended by adding at the end the 
following:
  ``SEC. 10. PROHIBITION ON CONVERSION.
    ``A national banking association may not convert to a State bank or 
State savings association during any period in which the national 
banking association is subject to a cease and desist order (or other 
formal enforcement order) issued by, or a memorandum of understanding 
entered into with, the Comptroller of the Currency with respect to a 
significant supervisory matter.''.
    (b) Conversion of a State Bank or Savings Association.--Section 
5154 of the Revised Statutes of the United States (12 U.S.C. 35) is 
amended by adding at the end the following: ``The Comptroller of the 
Currency may not approve the conversion of a State bank or State 
savings association to a national banking association or Federal 
savings association during any period in which the State bank or State 
savings association is subject to a cease and desist order (or other 
formal enforcement order) issued by, or a memorandum of understanding 
entered into with, a State bank supervisor or the appropriate Federal 
banking agency with respect to a significant supervisory matter or a 
final enforcement action by a State Attorney General.''.
    (c) Conversion of a Federal Savings Association.--Section 5(i) of 
the Home Owners' Loan Act (12 U.S.C. 1464(i)) is amended by adding at 
the end the following:
        ``(6) Limitation on certain conversions by federal savings 
    associations.--A Federal savings association may not convert to a 
    State bank or State savings association during any period in which 
    the Federal savings association is subject to a cease and desist 
    order (or other formal enforcement order) issued by, or a 
    memorandum of understanding entered into with, the Office of Thrift 
    Supervision or the Comptroller of the Currency with respect to a 
    significant supervisory matter.''.
    (d) Exception.--The prohibition on the approval of conversions 
under the amendments made by subsections (a), (b), and (c) shall not 
apply, if--
        (1) the Federal banking agency that would be the appropriate 
    Federal banking agency after the proposed conversion gives the 
    appropriate Federal banking agency or State bank supervisor that 
    issued the cease and desist order (or other formal enforcement 
    order) or memorandum of understanding, as appropriate, written 
    notice of the proposed conversion including a plan to address the 
    significant supervisory matter in a manner that is consistent with 
    the safe and sound operation of the institution;
        (2) within 30 days of receipt of the written notice required 
    under paragraph (1), the appropriate Federal banking agency or 
    State bank supervisor that issued the cease and desist order (or 
    other formal enforcement order) or memorandum of understanding, as 
    appropriate, does not object to the conversion or the plan to 
    address the significant supervisory matter;
        (3) after conversion of the insured depository institution, the 
    appropriate Federal banking agency after the conversion implements 
    such plan; and
        (4) in the case of a final enforcement action by a State 
    Attorney General, approval of the conversion is conditioned on 
    compliance by the insured depository institution with the terms of 
    such final enforcement action.
    (e) Notification of Pending Enforcement Actions.--
        (1) Copy of conversion application.--At the time an insured 
    depository institution files a conversion application, the insured 
    depository institution shall transmit a copy of the conversion 
    application to--
            (A) the appropriate Federal banking agency for the insured 
        depository institution; and
            (B) the Federal banking agency that would be the 
        appropriate Federal banking agency of the insured depository 
        institution after the proposed conversion.
        (2) Notification and access to information.--Upon receipt of a 
    copy of the application described in paragraph (1), the appropriate 
    Federal banking agency for the insured depository institution 
    proposing the conversion shall--
            (A) notify the Federal banking agency that would be the 
        appropriate Federal banking agency for the institution after 
        the proposed conversion in writing of any ongoing supervisory 
        or investigative proceedings that the appropriate Federal 
        banking agency for the institution proposing to convert 
        believes is likely to result, in the near term and absent the 
        proposed conversion, in a cease and desist order (or other 
        formal enforcement order) or memorandum of understanding with 
        respect to a significant supervisory matter; and
            (B) provide the Federal banking agency that would be the 
        appropriate Federal banking agency for the institution after 
        the proposed conversion access to all investigative and 
        supervisory information relating to the proceedings described 
        in subparagraph (A).
    SEC. 613. DE NOVO BRANCHING INTO STATES.
    (a) National Banks.--Section 5155(g)(1)(A) of the Revised Statutes 
of the United States (12 U.S.C. 36(g)(1)(A)) is amended to read as 
follows:
            ``(A) the law of the State in which the branch is located, 
        or is to be located, would permit establishment of the branch, 
        if the national bank were a State bank chartered by such State; 
        and''.
    (b) State Insured Banks.--Section 18(d)(4)(A)(i) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(d)(4)(A)(i)) is amended to read 
as follows:
                ``(i) the law of the State in which the branch is 
            located, or is to be located, would permit establishment of 
            the branch, if the bank were a State bank chartered by such 
            State; and''.
    SEC. 614. LENDING LIMITS TO INSIDERS.
    (a) Extensions of Credit.--Section 22(h)(9)(D)(i) of the Federal 
Reserve Act (12 U.S.C. 375b(9)(D)(i)) is amended--
        (1) by striking the period at the end and inserting ``; or'';
        (2) by striking ``a person'' and inserting ``the person'';
        (3) by striking ``extends credit by making'' and inserting the 
    following: ``extends credit to a person by--

                    ``(I) making''; and

        (4) by adding at the end the following:

                    ``(II) having credit exposure to the person arising 
                from a derivative transaction (as defined in section 
                5200(b) of the Revised Statutes of the United States 
                (12 U.S.C. 84(b))), repurchase agreement, reverse 
                repurchase agreement, securities lending transaction, 
                or securities borrowing transaction between the member 
                bank and the person.''.

    (b) Effective Date.--The amendments made by this section shall take 
effect 1 year after the transfer date.
    SEC. 615. LIMITATIONS ON PURCHASES OF ASSETS FROM INSIDERS.
    (a) Amendment to the Federal Deposit Insurance Act.--Section 18 of 
the Federal Deposit Insurance Act (12 U.S.C. 1828) is amended by adding 
at the end the following:
    ``(z) General Prohibition on Sale of Assets.--
        ``(1) In general.--An insured depository institution may not 
    purchase an asset from, or sell an asset to, an executive officer, 
    director, or principal shareholder of the insured depository 
    institution, or any related interest of such person (as such terms 
    are defined in section 22(h) of Federal Reserve Act), unless--
            ``(A) the transaction is on market terms; and
            ``(B) if the transaction represents more than 10 percent of 
        the capital stock and surplus of the insured depository 
        institution, the transaction has been approved in advance by a 
        majority of the members of the board of directors of the 
        insured depository institution who do not have an interest in 
        the transaction.
        ``(2) Rulemaking.--The Board of Governors of the Federal 
    Reserve System may issue such rules as may be necessary to define 
    terms and to carry out the purposes this subsection. Before 
    proposing or adopting a rule under this paragraph, the Board of 
    Governors of the Federal Reserve System shall consult with the 
    Comptroller of the Currency and the Corporation as to the terms of 
    the rule.''.
    (b) Amendments to the Federal Reserve Act.--Section 22(d) of the 
Federal Reserve Act (12 U.S.C. 375) is amended to read as follows:
    ``(d) [Reserved]''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 616. REGULATIONS REGARDING CAPITAL LEVELS.
    (a) Capital Levels of Bank Holding Companies.--Section 5(b) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1844(b)) is amended--
        (1) by inserting after ``orders'' the following: ``, including 
    regulations and orders relating to the capital requirements for 
    bank holding companies,''; and
        (2) by adding at the end the following: ``In establishing 
    capital regulations pursuant to this subsection, the Board shall 
    seek to make such requirements countercyclical, so that the amount 
    of capital required to be maintained by a company increases in 
    times of economic expansion and decreases in times of economic 
    contraction, consistent with the safety and soundness of the 
    company.''.
    (b) Capital Levels of Savings and Loan Holding Companies.--Section 
10(g)(1) of the Home Owners' Loan Act (12 U.S.C. 1467a(g)(1)) is 
amended--
        (1) by inserting after ``orders'' the following: ``, including 
    regulations and orders relating to capital requirements for savings 
    and loan holding companies,''; and
        (2) by inserting at the end the following: ``In establishing 
    capital regulations pursuant to this subsection, the appropriate 
    Federal banking agency shall seek to make such requirements 
    countercyclical so that the amount of capital required to be 
    maintained by a company increases in times of economic expansion 
    and decreases in times of economic contraction, consistent with the 
    safety and soundness of the company.''.
    (c) Capital Levels of Insured Depository Institutions.--Section 
908(a)(1) of the International Lending Supervision Act of 1983 (12 
U.S.C. 3907(a)(1)) is amended by adding at the end the following: 
``Each appropriate Federal banking agency shall seek to make the 
capital standards required under this section or other provisions of 
Federal law for insured depository institutions countercyclical so that 
the amount of capital required to be maintained by an insured 
depository institution increases in times of economic expansion and 
decreases in times of economic contraction, consistent with the safety 
and soundness of the insured depository institution.''
    (d) Source of Strength.--The Federal Deposit Insurance Act (12 
U.S.C. 1811 et seq.) is amended by inserting after section 38 (12 
U.S.C. 1831o) the following:
    ``SEC. 38A. SOURCE OF STRENGTH.
    ``(a) Holding Companies.--The appropriate Federal banking agency 
for a bank holding company or savings and loan holding company shall 
require the bank holding company or savings and loan holding company to 
serve as a source of financial strength for any subsidiary of the bank 
holding company or savings and loan holding company that is a 
depository institution.
    ``(b) Other Companies.--If an insured depository institution is not 
the subsidiary of a bank holding company or savings and loan holding 
company, the appropriate Federal banking agency for the insured 
depository institution shall require any company that directly or 
indirectly controls the insured depository institution to serve as a 
source of financial strength for such institution.
    ``(c) Reports.--The appropriate Federal banking agency for an 
insured depository institution described in subsection (b) may, from 
time to time, require the company, or a company that directly or 
indirectly controls the insured depository institution, to submit a 
report, under oath, for the purposes of--
        ``(1) assessing the ability of such company to comply with the 
    requirement under subsection (b); and
        ``(2) enforcing the compliance of such company with the 
    requirement under subsection (b).
    ``(d) Rules.--Not later than 1 year after the transfer date, as 
defined in section 311 of the Enhancing Financial Institution Safety 
and Soundness Act of 2010, the appropriate Federal banking agencies 
shall jointly issue final rules to carry out this section.
    ``(e) Definition.--In this section, the term `source of financial 
strength' means the ability of a company that directly or indirectly 
owns or controls an insured depository institution to provide financial 
assistance to such insured depository institution in the event of the 
financial distress of the insured depository institution.''.
    (e) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 617. ELIMINATION OF ELECTIVE INVESTMENT BANK HOLDING COMPANY 
      FRAMEWORK.
    (a) Amendment.--Section 17 of the Securities Exchange Act of 1934 
(15 U.S.C. 78q) is amended--
        (1) by striking subsection (i); and
        (2) by redesignating subsections (j) and (k) as subsections (i) 
    and (j), respectively.
    (b) Effective Date.--The amendments made by this section shall take 
effect on the transfer date.
    SEC. 618. SECURITIES HOLDING COMPANIES.
    (a) Definitions.--In this section--
        (1) the term ``associated person of a securities holding 
    company'' means a person directly or indirectly controlling, 
    controlled by, or under common control with, a securities holding 
    company;
        (2) the term ``foreign bank'' has the same meaning as in 
    section 1(b)(7) of the International Banking Act of 1978 (12 U.S.C. 
    3101(7));
        (3) the term ``insured bank'' has the same meaning as in 
    section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813);
        (4) the term ``securities holding company''--
            (A) means--
                (i) a person (other than a natural person) that owns or 
            controls 1 or more brokers or dealers registered with the 
            Commission; and
                (ii) the associated persons of a person described in 
            clause (i); and
            (B) does not include a person that is--
                (i) a nonbank financial company supervised by the Board 
            under title I;
                (ii) an insured bank (other than an institution 
            described in subparagraphs (D), (F), or (H) of section 
            2(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 
            1841(c)(2)) or a savings association;
                (iii) an affiliate of an insured bank (other than an 
            institution described in subparagraphs (D), (F), or (H) of 
            section 2(c)(2) of the Bank Holding Company Act of 1956 (12 
            U.S.C. 1841(c)(2)) or an affiliate of a savings 
            association;
                (iv) a foreign bank, foreign company, or company that 
            is described in section 8(a) of the International Banking 
            Act of 1978 (12 U.S.C. 3106(a));
                (v) a foreign bank that controls, directly or 
            indirectly, a corporation chartered under section 25A of 
            the Federal Reserve Act (12 U.S.C. 611 et seq.); or
                (vi) subject to comprehensive consolidated supervision 
            by a foreign regulator;
        (5) the term ``supervised securities holding company'' means a 
    securities holding company that is supervised by the Board of 
    Governors under this section; and
        (6) the terms ``affiliate'', ``bank'', ``bank holding 
    company'', ``company'', ``control'', ``savings association'', and 
    ``subsidiary'' have the same meanings as in section 2 of the Bank 
    Holding Company Act of 1956.
    (b) Supervision of a Securities Holding Company Not Having a Bank 
or Savings Association Affiliate.--
        (1) In general.--A securities holding company that is required 
    by a foreign regulator or provision of foreign law to be subject to 
    comprehensive consolidated supervision may register with the Board 
    of Governors under paragraph (2) to become a supervised securities 
    holding company. Any securities holding company filing such a 
    registration shall be supervised in accordance with this section, 
    and shall comply with the rules and orders prescribed by the Board 
    of Governors applicable to supervised securities holding companies.
        (2) Registration as a supervised securities holding company.--
            (A) Registration.--A securities holding company that elects 
        to be subject to comprehensive consolidated supervision shall 
        register by filing with the Board of Governors such information 
        and documents as the Board of Governors, by regulation, may 
        prescribe as necessary or appropriate in furtherance of the 
        purposes of this section.
            (B) Effective date.--A securities holding company that 
        registers under subparagraph (A) shall be deemed to be a 
        supervised securities holding company, effective on the date 
        that is 45 days after the date of receipt of the registration 
        information and documents under subparagraph (A) by the Board 
        of Governors, or within such shorter period as the Board of 
        Governors, by rule or order, may determine.
    (c) Supervision of Securities Holding Companies.--
        (1) Recordkeeping and reporting.--
            (A) Recordkeeping and reporting required.--Each supervised 
        securities holding company and each affiliate of a supervised 
        securities holding company shall make and keep for periods 
        determined by the Board of Governors such records, furnish 
        copies of such records, and make such reports, as the Board of 
        Governors determines to be necessary or appropriate to carry 
        out this section, to prevent evasions thereof, and to monitor 
        compliance by the supervised securities holding company or 
        affiliate with applicable provisions of law.
            (B) Form and contents.--
                (i) In general.--Any record or report required to be 
            made, furnished, or kept under this paragraph shall--

                    (I) be prepared in such form and according to such 
                specifications (including certification by a registered 
                public accounting firm), as the Board of Governors may 
                require; and
                    (II) be provided promptly to the Board of Governors 
                at any time, upon request by the Board of Governors.

                (ii) Contents.--Records and reports required to be 
            made, furnished, or kept under this paragraph may include--

                    (I) a balance sheet or income statement of the 
                supervised securities holding company or an affiliate 
                of a supervised securities holding company;
                    (II) an assessment of the consolidated capital and 
                liquidity of the supervised securities holding company;
                    (III) a report by an independent auditor attesting 
                to the compliance of the supervised securities holding 
                company with the internal risk management and internal 
                control objectives of the supervised securities holding 
                company; and
                    (IV) a report concerning the extent to which the 
                supervised securities holding company or affiliate has 
                complied with the provisions of this section and any 
                regulations prescribed and orders issued under this 
                section.

        (2) Use of existing reports.--
            (A) In general.--The Board of Governors shall, to the 
        fullest extent possible, accept reports in fulfillment of the 
        requirements of this paragraph that a supervised securities 
        holding company or an affiliate of a supervised securities 
        holding company has been required to provide to another 
        regulatory agency or a self-regulatory organization.
            (B) Availability.--A supervised securities holding company 
        or an affiliate of a supervised securities holding company 
        shall promptly provide to the Board of Governors, at the 
        request of the Board of Governors, any report described in 
        subparagraph (A), as permitted by law.
        (3) Examination authority.--
            (A) Focus of examination authority.--The Board of Governors 
        may make examinations of any supervised securities holding 
        company and any affiliate of a supervised securities holding 
        company to carry out this subsection, to prevent evasions 
        thereof, and to monitor compliance by the supervised securities 
        holding company or affiliate with applicable provisions of law.
            (B) Deference to other examinations.--For purposes of this 
        subparagraph, the Board of Governors shall, to the fullest 
        extent possible, use the reports of examination made by other 
        appropriate Federal or State regulatory authorities with 
        respect to any functionally regulated subsidiary or any 
        institution described in subparagraph (D), (F), or (H) of 
        section 2(c)(2) of the Bank Holding Company Act of 1956 (12 
        U.S.C. 1841(c)(2)).
    (d) Capital and Risk Management.--
        (1) In general.--The Board of Governors shall, by regulation or 
    order, prescribe capital adequacy and other risk management 
    standards for supervised securities holding companies that are 
    appropriate to protect the safety and soundness of the supervised 
    securities holding companies and address the risks posed to 
    financial stability by supervised securities holding companies.
        (2) Differentiation.--In imposing standards under this 
    subsection, the Board of Governors may differentiate among 
    supervised securities holding companies on an individual basis, or 
    by category, taking into consideration the requirements under 
    paragraph (3).
        (3) Content.--Any standards imposed on a supervised securities 
    holding company under this subsection shall take into account--
            (A) the differences among types of business activities 
        carried out by the supervised securities holding company;
            (B) the amount and nature of the financial assets of the 
        supervised securities holding company;
            (C) the amount and nature of the liabilities of the 
        supervised securities holding company, including the degree of 
        reliance on short-term funding;
            (D) the extent and nature of the off-balance sheet 
        exposures of the supervised securities holding company;
            (E) the extent and nature of the transactions and 
        relationships of the supervised securities holding company with 
        other financial companies;
            (F) the importance of the supervised securities holding 
        company as a source of credit for households, businesses, and 
        State and local governments, and as a source of liquidity for 
        the financial system; and
            (G) the nature, scope, and mix of the activities of the 
        supervised securities holding company.
        (4) Notice.--A capital requirement imposed under this 
    subsection may not take effect earlier than 180 days after the date 
    on which a supervised securities holding company is provided notice 
    of the capital requirement.
    (e) Other Provisions of Law Applicable to Supervised Securities 
Holding Companies.--
        (1) Federal deposit insurance act.--Subsections (b), (c) 
    through (s), and (u) of section 8 of the Federal Deposit Insurance 
    Act (12 U.S.C. 1818) shall apply to any supervised securities 
    holding company, and to any subsidiary (other than a bank or an 
    institution described in subparagraph (D), (F), or (H) of section 
    2(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1841(c)(2))) of a supervised securities holding company, in the 
    same manner as such subsections apply to a bank holding company for 
    which the Board of Governors is the appropriate Federal banking 
    agency. For purposes of applying such subsections to a supervised 
    securities holding company or a subsidiary (other than a bank or an 
    institution described in subparagraph (D), (F), or (H) of section 
    2(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 
    1841(c)(2))) of a supervised securities holding company, the Board 
    of Governors shall be deemed the appropriate Federal banking agency 
    for the supervised securities holding company or subsidiary.
        (2) Bank holding company act of 1956.--Except as the Board of 
    Governors may otherwise provide by regulation or order, a 
    supervised securities holding company shall be subject to the 
    provisions of the Bank Holding Company Act of 1956 (12 U.S.C. 1841 
    et seq.) in the same manner and to the same extent a bank holding 
    company is subject to such provisions, except that a supervised 
    securities holding company may not, by reason of this paragraph, be 
    deemed to be a bank holding company for purposes of section 4 of 
    the Bank Holding Company Act of 1956 (12 U.S.C. 1843).
    SEC. 619. PROHIBITIONS ON PROPRIETARY TRADING AND CERTAIN 
      RELATIONSHIPS WITH HEDGE FUNDS AND PRIVATE EQUITY FUNDS.
    The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is 
amended by adding at the end the following:
  ``SEC. 13. PROHIBITIONS ON PROPRIETARY TRADING AND CERTAIN 
      RELATIONSHIPS WITH HEDGE FUNDS AND PRIVATE EQUITY FUNDS.
    ``(a) In General.--
        ``(1) Prohibition.--Unless otherwise provided in this section, 
    a banking entity shall not--
            ``(A) engage in proprietary trading; or
            ``(B) acquire or retain any equity, partnership, or other 
        ownership interest in or sponsor a hedge fund or a private 
        equity fund.
        ``(2) Nonbank financial companies supervised by the board.--Any 
    nonbank financial company supervised by the Board that engages in 
    proprietary trading or takes or retains any equity, partnership, or 
    other ownership interest in or sponsors a hedge fund or a private 
    equity fund shall be subject, by rule, as provided in subsection 
    (b)(2), to additional capital requirements for and additional 
    quantitative limits with regards to such proprietary trading and 
    taking or retaining any equity, partnership, or other ownership 
    interest in or sponsorship of a hedge fund or a private equity 
    fund, except that permitted activities as described in subsection 
    (d) shall not be subject to the additional capital and additional 
    quantitative limits except as provided in subsection (d)(3), as if 
    the nonbank financial company supervised by the Board were a 
    banking entity.
    ``(b) Study and Rulemaking.--
        ``(1) Study.--Not later than 6 months after the date of 
    enactment of this section, the Financial Stability Oversight 
    Council shall study and make recommendations on implementing the 
    provisions of this section so as to--
            ``(A) promote and enhance the safety and soundness of 
        banking entities;
            ``(B) protect taxpayers and consumers and enhance financial 
        stability by minimizing the risk that insured depository 
        institutions and the affiliates of insured depository 
        institutions will engage in unsafe and unsound activities;
            ``(C) limit the inappropriate transfer of Federal subsidies 
        from institutions that benefit from deposit insurance and 
        liquidity facilities of the Federal Government to unregulated 
        entities;
            ``(D) reduce conflicts of interest between the self-
        interest of banking entities and nonbank financial companies 
        supervised by the Board, and the interests of the customers of 
        such entities and companies;
            ``(E) limit activities that have caused undue risk or loss 
        in banking entities and nonbank financial companies supervised 
        by the Board, or that might reasonably be expected to create 
        undue risk or loss in such banking entities and nonbank 
        financial companies supervised by the Board;
            ``(F) appropriately accommodate the business of insurance 
        within an insurance company, subject to regulation in 
        accordance with the relevant insurance company investment laws, 
        while protecting the safety and soundness of any banking entity 
        with which such insurance company is affiliated and of the 
        United States financial system; and
            ``(G) appropriately time the divestiture of illiquid assets 
        that are affected by the implementation of the prohibitions 
        under subsection (a).
        ``(2) Rulemaking.--
            ``(A) In general.--Unless otherwise provided in this 
        section, not later than 9 months after the completion of the 
        study under paragraph (1), the appropriate Federal banking 
        agencies, the Securities and Exchange Commission, and the 
        Commodity Futures Trading Commission, shall consider the 
        findings of the study under paragraph (1) and adopt rules to 
        carry out this section, as provided in subparagraph (B).
            ``(B) Coordinated rulemaking.--
                ``(i) Regulatory authority.--The regulations issued 
            under this paragraph shall be issued by--

                    ``(I) the appropriate Federal banking agencies, 
                jointly, with respect to insured depository 
                institutions;
                    ``(II) the Board, with respect to any company that 
                controls an insured depository institution, or that is 
                treated as a bank holding company for purposes of 
                section 8 of the International Banking Act, any nonbank 
                financial company supervised by the Board, and any 
                subsidiary of any of the foregoing (other than a 
                subsidiary for which an agency described in subclause 
                (I), (III), or (IV) is the primary financial regulatory 
                agency);
                    ``(III) the Commodity Futures Trading Commission, 
                with respect to any entity for which the Commodity 
                Futures Trading Commission is the primary financial 
                regulatory agency, as defined in section 2 of the Dodd-
                Frank Wall Street Reform and Consumer Protection Act; 
                and
                    ``(IV) the Securities and Exchange Commission, with 
                respect to any entity for which the Securities and 
                Exchange Commission is the primary financial regulatory 
                agency, as defined in section 2 of the Dodd-Frank Wall 
                Street Reform and Consumer Protection Act.

                ``(ii) Coordination, consistency, and comparability.--
            In developing and issuing regulations pursuant to this 
            section, the appropriate Federal banking agencies, the 
            Securities and Exchange Commission, and the Commodity 
            Futures Trading Commission shall consult and coordinate 
            with each other, as appropriate, for the purposes of 
            assuring, to the extent possible, that such regulations are 
            comparable and provide for consistent application and 
            implementation of the applicable provisions of this section 
            to avoid providing advantages or imposing disadvantages to 
            the companies affected by this subsection and to protect 
            the safety and soundness of banking entities and nonbank 
            financial companies supervised by the Board.
                ``(iii) Council role.--The Chairperson of the Financial 
            Stability Oversight Council shall be responsible for 
            coordination of the regulations issued under this section.
    ``(c) Effective Date.--
        ``(1) In general.--Except as provided in paragraphs (2) and 
    (3), this section shall take effect on the earlier of--
            ``(A) 12 months after the date of the issuance of final 
        rules under subsection (b); or
            ``(B) 2 years after the date of enactment of this section.
        ``(2) Conformance period for divestiture.--A banking entity or 
    nonbank financial company supervised by the Board shall bring its 
    activities and investments into compliance with the requirements of 
    this section not later than 2 years after the date on which the 
    requirements become effective pursuant to this section or 2 years 
    after the date on which the entity or company becomes a nonbank 
    financial company supervised by the Board. The Board may, by rule 
    or order, extend this two-year period for not more than one year at 
    a time, if, in the judgment of the Board, such an extension is 
    consistent with the purposes of this section and would not be 
    detrimental to the public interest. The extensions made by the 
    Board under the preceding sentence may not exceed an aggregate of 3 
    years.
        ``(3) Extended transition for illiquid funds.--
            ``(A) Application.--The Board may, upon the application of 
        a banking entity, extend the period during which the banking 
        entity, to the extent necessary to fulfill a contractual 
        obligation that was in effect on May 1, 2010, may take or 
        retain its equity, partnership, or other ownership interest in, 
        or otherwise provide additional capital to, an illiquid fund.
            ``(B) Time limit on approval.--The Board may grant 1 
        extension under subparagraph (A), which may not exceed 5 years.
        ``(4) Divestiture required.--Except as otherwise provided in 
    subsection (d)(1)(G), a banking entity may not engage in any 
    activity prohibited under subsection (a)(1)(B) after the earlier 
    of--
            ``(A) the date on which the contractual obligation to 
        invest in the illiquid fund terminates; and
            ``(B) the date on which any extensions granted by the Board 
        under paragraph (3) expire.
        ``(5) Additional capital during transition period.--
    Notwithstanding paragraph (2), on the date on which the rules are 
    issued under subsection (b)(2), the appropriate Federal banking 
    agencies, the Securities and Exchange Commission, and the Commodity 
    Futures Trading Commission shall issue rules, as provided in 
    subsection (b)(2), to impose additional capital requirements, and 
    any other restrictions, as appropriate, on any equity, partnership, 
    or ownership interest in or sponsorship of a hedge fund or private 
    equity fund by a banking entity.
        ``(6) Special rulemaking.--Not later than 6 months after the 
    date of enactment of this section, the Board shall issues rules to 
    implement paragraphs (2) and (3).
    ``(d) Permitted Activities.--
        ``(1) In general.--Notwithstanding the restrictions under 
    subsection (a), to the extent permitted by any other provision of 
    Federal or State law, and subject to the limitations under 
    paragraph (2) and any restrictions or limitations that the 
    appropriate Federal banking agencies, the Securities and Exchange 
    Commission, and the Commodity Futures Trading Commission, may 
    determine, the following activities (in this section referred to as 
    `permitted activities') are permitted:
            ``(A) The purchase, sale, acquisition, or disposition of 
        obligations of the United States or any agency thereof, 
        obligations, participations, or other instruments of or issued 
        by the Government National Mortgage Association, the Federal 
        National Mortgage Association, the Federal Home Loan Mortgage 
        Corporation, a Federal Home Loan Bank, the Federal Agricultural 
        Mortgage Corporation, or a Farm Credit System institution 
        chartered under and subject to the provisions of the Farm 
        Credit Act of 1971 (12 U.S.C. 2001 et seq.), and obligations of 
        any State or of any political subdivision thereof.
            ``(B) The purchase, sale, acquisition, or disposition of 
        securities and other instruments described in subsection (h)(4) 
        in connection with underwriting or market-making-related 
        activities, to the extent that any such activities permitted by 
        this subparagraph are designed not to exceed the reasonably 
        expected near term demands of clients, customers, or 
        counterparties.
            ``(C) Risk-mitigating hedging activities in connection with 
        and related to individual or aggregated positions, contracts, 
        or other holdings of a banking entity that are designed to 
        reduce the specific risks to the banking entity in connection 
        with and related to such positions, contracts, or other 
        holdings.
            ``(D) The purchase, sale, acquisition, or disposition of 
        securities and other instruments described in subsection (h)(4) 
        on behalf of customers.
            ``(E) Investments in one or more small business investment 
        companies, as defined in section 102 of the Small Business 
        Investment Act of 1958 (15 U.S.C. 662), investments designed 
        primarily to promote the public welfare, of the type permitted 
        under paragraph (11) of section 5136 of the Revised Statutes of 
        the United States (12 U.S.C. 24), or investments that are 
        qualified rehabilitation expenditures with respect to a 
        qualified rehabilitated building or certified historic 
        structure, as such terms are defined in section 47 of the 
        Internal Revenue Code of 1986 or a similar State historic tax 
        credit program.
            ``(F) The purchase, sale, acquisition, or disposition of 
        securities and other instruments described in subsection (h)(4) 
        by a regulated insurance company directly engaged in the 
        business of insurance for the general account of the company 
        and by any affiliate of such regulated insurance company, 
        provided that such activities by any affiliate are solely for 
        the general account of the regulated insurance company, if--
                ``(i) the purchase, sale, acquisition, or disposition 
            is conducted in compliance with, and subject to, the 
            insurance company investment laws, regulations, and written 
            guidance of the State or jurisdiction in which each such 
            insurance company is domiciled; and
                ``(ii) the appropriate Federal banking agencies, after 
            consultation with the Financial Stability Oversight Council 
            and the relevant insurance commissioners of the States and 
            territories of the United States, have not jointly 
            determined, after notice and comment, that a particular 
            law, regulation, or written guidance described in clause 
            (i) is insufficient to protect the safety and soundness of 
            the banking entity, or of the financial stability of the 
            United States.
            ``(G) Organizing and offering a private equity or hedge 
        fund, including serving as a general partner, managing member, 
        or trustee of the fund and in any manner selecting or 
        controlling (or having employees, officers, directors, or 
        agents who constitute) a majority of the directors, trustees, 
        or management of the fund, including any necessary expenses for 
        the foregoing, only if--
                ``(i) the banking entity provides bona fide trust, 
            fiduciary, or investment advisory services;
                ``(ii) the fund is organized and offered only in 
            connection with the provision of bona fide trust, 
            fiduciary, or investment advisory services and only to 
            persons that are customers of such services of the banking 
            entity;
                ``(iii) the banking entity does not acquire or retain 
            an equity interest, partnership interest, or other 
            ownership interest in the funds except for a de minimis 
            investment subject to and in compliance with paragraph (4);
                ``(iv) the banking entity complies with the 
            restrictions under paragraphs (1) and (2) of subparagraph 
            (f);
                ``(v) the banking entity does not, directly or 
            indirectly, guarantee, assume, or otherwise insure the 
            obligations or performance of the hedge fund or private 
            equity fund or of any hedge fund or private equity fund in 
            which such hedge fund or private equity fund invests;
                ``(vi) the banking entity does not share with the hedge 
            fund or private equity fund, for corporate, marketing, 
            promotional, or other purposes, the same name or a 
            variation of the same name;
                ``(vii) no director or employee of the banking entity 
            takes or retains an equity interest, partnership interest, 
            or other ownership interest in the hedge fund or private 
            equity fund, except for any director or employee of the 
            banking entity who is directly engaged in providing 
            investment advisory or other services to the hedge fund or 
            private equity fund; and
                ``(viii) the banking entity discloses to prospective 
            and actual investors in the fund, in writing, that any 
            losses in such hedge fund or private equity fund are borne 
            solely by investors in the fund and not by the banking 
            entity, and otherwise complies with any additional rules of 
            the appropriate Federal banking agencies, the Securities 
            and Exchange Commission, or the Commodity Futures Trading 
            Commission, as provided in subsection (b)(2), designed to 
            ensure that losses in such hedge fund or private equity 
            fund are borne solely by investors in the fund and not by 
            the banking entity.
            ``(H) Proprietary trading conducted by a banking entity 
        pursuant to paragraph (9) or (13) of section 4(c), provided 
        that the trading occurs solely outside of the United States and 
        that the banking entity is not directly or indirectly 
        controlled by a banking entity that is organized under the laws 
        of the United States or of one or more States.
            ``(I) The acquisition or retention of any equity, 
        partnership, or other ownership interest in, or the sponsorship 
        of, a hedge fund or a private equity fund by a banking entity 
        pursuant to paragraph (9) or (13) of section 4(c) solely 
        outside of the United States, provided that no ownership 
        interest in such hedge fund or private equity fund is offered 
        for sale or sold to a resident of the United States and that 
        the banking entity is not directly or indirectly controlled by 
        a banking entity that is organized under the laws of the United 
        States or of one or more States.
            ``(J) Such other activity as the appropriate Federal 
        banking agencies, the Securities and Exchange Commission, and 
        the Commodity Futures Trading Commission determine, by rule, as 
        provided in subsection (b)(2), would promote and protect the 
        safety and soundness of the banking entity and the financial 
        stability of the United States.
        ``(2) Limitation on permitted activities.--
            ``(A) In general.--No transaction, class of transactions, 
        or activity may be deemed a permitted activity under paragraph 
        (1) if the transaction, class of transactions, or activity--
                ``(i) would involve or result in a material conflict of 
            interest (as such term shall be defined by rule as provided 
            in subsection (b)(2)) between the banking entity and its 
            clients, customers, or counterparties;
                ``(ii) would result, directly or indirectly, in a 
            material exposure by the banking entity to high-risk assets 
            or high-risk trading strategies (as such terms shall be 
            defined by rule as provided in subsection (b)(2));
                ``(iii) would pose a threat to the safety and soundness 
            of such banking entity; or
                ``(iv) would pose a threat to the financial stability 
            of the United States.
            ``(B) Rulemaking.--The appropriate Federal banking 
        agencies, the Securities and Exchange Commission, and the 
        Commodity Futures Trading Commission shall issue regulations to 
        implement subparagraph (A), as part of the regulations issued 
        under subsection (b)(2).
        ``(3) Capital and quantitative limitations.--The appropriate 
    Federal banking agencies, the Securities and Exchange Commission, 
    and the Commodity Futures Trading Commission shall, as provided in 
    subsection (b)(2), adopt rules imposing additional capital 
    requirements and quantitative limitations, including 
    diversification requirements, regarding the activities permitted 
    under this section if the appropriate Federal banking agencies, the 
    Securities and Exchange Commission, and the Commodity Futures 
    Trading Commission determine that additional capital and 
    quantitative limitations are appropriate to protect the safety and 
    soundness of banking entities engaged in such activities.
        ``(4) De minimis investment.--
            ``(A) In general.--A banking entity may make and retain an 
        investment in a hedge fund or private equity fund that the 
        banking entity organizes and offers, subject to the limitations 
        and restrictions in subparagraph (B) for the purposes of--
                ``(i) establishing the fund and providing the fund with 
            sufficient initial equity for investment to permit the fund 
            to attract unaffiliated investors; or
                ``(ii) making a de minimis investment.
            ``(B) Limitations and restrictions on investments.--
                ``(i) Requirement to seek other investors.--A banking 
            entity shall actively seek unaffiliated investors to reduce 
            or dilute the investment of the banking entity to the 
            amount permitted under clause (ii).
                ``(ii) Limitations on size of investments.--
            Notwithstanding any other provision of law, investments by 
            a banking entity in a hedge fund or private equity fund 
            shall--

                    ``(I) not later than 1 year after the date of 
                establishment of the fund, be reduced through 
                redemption, sale, or dilution to an amount that is not 
                more than 3 percent of the total ownership interests of 
                the fund;
                    ``(II) be immaterial to the banking entity, as 
                defined, by rule, pursuant to subsection (b)(2), but in 
                no case may the aggregate of all of the interests of 
                the banking entity in all such funds exceed 3 percent 
                of the Tier 1 capital of the banking entity.

                ``(iii) Capital.--For purposes of determining 
            compliance with applicable capital standards under 
            paragraph (3), the aggregate amount of the outstanding 
            investments by a banking entity under this paragraph, 
            including retained earnings, shall be deducted from the 
            assets and tangible equity of the banking entity, and the 
            amount of the deduction shall increase commensurate with 
            the leverage of the hedge fund or private equity fund.
            ``(C) Extension.--Upon an application by a banking entity, 
        the Board may extend the period of time to meet the 
        requirements under subparagraph (B)(ii)(I) for 2 additional 
        years, if the Board finds that an extension would be consistent 
        with safety and soundness and in the public interest.
    ``(e) Anti-evasion.--
        ``(1) Rulemaking.--The appropriate Federal banking agencies, 
    the Securities and Exchange Commission, and the Commodity Futures 
    Trading Commission shall issue regulations, as part of the 
    rulemaking provided for in subsection (b)(2), regarding internal 
    controls and recordkeeping, in order to insure compliance with this 
    section.
        ``(2) Termination of activities or investment.--Notwithstanding 
    any other provision of law, whenever an appropriate Federal banking 
    agency, the Securities and Exchange Commission, or the Commodity 
    Futures Trading Commission, as appropriate, has reasonable cause to 
    believe that a banking entity or nonbank financial company 
    supervised by the Board under the respective agency's jurisdiction 
    has made an investment or engaged in an activity in a manner that 
    functions as an evasion of the requirements of this section 
    (including through an abuse of any permitted activity) or otherwise 
    violates the restrictions under this section, the appropriate 
    Federal banking agency, the Securities and Exchange Commission, or 
    the Commodity Futures Trading Commission, as appropriate, shall 
    order, after due notice and opportunity for hearing, the banking 
    entity or nonbank financial company supervised by the Board to 
    terminate the activity and, as relevant, dispose of the investment. 
    Nothing in this paragraph shall be construed to limit the inherent 
    authority of any Federal agency or State regulatory authority to 
    further restrict any investments or activities under otherwise 
    applicable provisions of law.
    ``(f) Limitations on Relationships With Hedge Funds and Private 
Equity Funds.--
        ``(1) In general.--No banking entity that serves, directly or 
    indirectly, as the investment manager, investment adviser, or 
    sponsor to a hedge fund or private equity fund, or that organizes 
    and offers a hedge fund or private equity fund pursuant to 
    paragraph (d)(1)(G), and no affiliate of such entity, may enter 
    into a transaction with the fund, or with any other hedge fund or 
    private equity fund that is controlled by such fund, that would be 
    a covered transaction, as defined in section 23A of the Federal 
    Reserve Act (12 U.S.C. 371c), with the hedge fund or private equity 
    fund, as if such banking entity and the affiliate thereof were a 
    member bank and the hedge fund or private equity fund were an 
    affiliate thereof.
        ``(2) Treatment as member bank.--A banking entity that serves, 
    directly or indirectly, as the investment manager, investment 
    adviser, or sponsor to a hedge fund or private equity fund, or that 
    organizes and offers a hedge fund or private equity fund pursuant 
    to paragraph (d)(1)(G), shall be subject to section 23B of the 
    Federal Reserve Act (12 U.S.C. 371c-1), as if such banking entity 
    were a member bank and such hedge fund or private equity fund were 
    an affiliate thereof.
        ``(3) Permitted services.--
            ``(A) In general.--Notwithstanding paragraph (1), the Board 
        may permit a banking entity to enter into any prime brokerage 
        transaction with any hedge fund or private equity fund in which 
        a hedge fund or private equity fund managed, sponsored, or 
        advised by such banking entity has taken an equity, 
        partnership, or other ownership interest, if--
                ``(i) the banking entity is in compliance with each of 
            the limitations set forth in subsection (d)(1)(G) with 
            regard to a hedge fund or private equity fund organized and 
            offered by such banking entity;
                ``(ii) the chief executive officer (or equivalent 
            officer) of the banking entity certifies in writing 
            annually (with a duty to update the certification if the 
            information in the certification materially changes) that 
            the conditions specified in subsection (d)(1)(g)(v) are 
            satisfied; and
                ``(iii) the Board has determined that such transaction 
            is consistent with the safe and sound operation and 
            condition of the banking entity.
            ``(B) Treatment of prime brokerage transactions.--For 
        purposes of subparagraph (A), a prime brokerage transaction 
        described in subparagraph (A) shall be subject to section 23B 
        of the Federal Reserve Act (12 U.S.C. 371c-1) as if the 
        counterparty were an affiliate of the banking entity.
        ``(4) Application to nonbank financial companies supervised by 
    the board.--The appropriate Federal banking agencies, the 
    Securities and Exchange Commission, and the Commodity Futures 
    Trading Commission shall adopt rules, as provided in subsection 
    (b)(2), imposing additional capital charges or other restrictions 
    for nonbank financial companies supervised by the Board to address 
    the risks to and conflicts of interest of banking entities 
    described in paragraphs (1), (2), and (3) of this subsection.
    ``(g) Rules of Construction.--
        ``(1) Limitation on contrary authority.--Except as provided in 
    this section, notwithstanding any other provision of law, the 
    prohibitions and restrictions under this section shall apply to 
    activities of a banking entity or nonbank financial company 
    supervised by the Board, even if such activities are authorized for 
    a banking entity or nonbank financial company supervised by the 
    Board.
        ``(2) Sale or securitization of loans.--Nothing in this section 
    shall be construed to limit or restrict the ability of a banking 
    entity or nonbank financial company supervised by the Board to sell 
    or securitize loans in a manner otherwise permitted by law.
        ``(3) Authority of federal agencies and state regulatory 
    authorities.--Nothing in this section shall be construed to limit 
    the inherent authority of any Federal agency or State regulatory 
    authority under otherwise applicable provisions of law.
    ``(h) Definitions.--In this section, the following definitions 
shall apply:
        ``(1) Banking entity.--The term `banking entity' means any 
    insured depository institution (as defined in section 3 of the 
    Federal Deposit Insurance Act (12 U.S.C. 1813)), any company that 
    controls an insured depository institution, or that is treated as a 
    bank holding company for purposes of section 8 of the International 
    Banking Act of 1978, and any affiliate or subsidiary of any such 
    entity. For purposes of this paragraph, the term `insured 
    depository institution' does not include an institution that 
    functions solely in a trust or fiduciary capacity, if--
            ``(A) all or substantially all of the deposits of such 
        institution are in trust funds and are received in a bona fide 
        fiduciary capacity;
            ``(B) no deposits of such institution which are insured by 
        the Federal Deposit Insurance Corporation are offered or 
        marketed by or through an affiliate of such institution;
            ``(C) such institution does not accept demand deposits or 
        deposits that the depositor may withdraw by check or similar 
        means for payment to third parties or others or make commercial 
        loans; and
            ``(D) such institution does not--
                ``(i) obtain payment or payment related services from 
            any Federal Reserve bank, including any service referred to 
            in section 11A of the Federal Reserve Act (12 U.S.C. 248a); 
            or
                ``(ii) exercise discount or borrowing privileges 
            pursuant to section 19(b)(7) of the Federal Reserve Act (12 
            U.S.C. 461(b)(7)).
        ``(2) Hedge fund; private equity fund.--The terms `hedge fund' 
    and `private equity fund' mean an issuer that would be an 
    investment company, as defined in the Investment Company Act of 
    1940 (15 U.S.C. 80a-1 et seq.), but for section 3(c)(1) or 3(c)(7) 
    of that Act, or such similar funds as the appropriate Federal 
    banking agencies, the Securities and Exchange Commission, and the 
    Commodity Futures Trading Commission may, by rule, as provided in 
    subsection (b)(2), determine.
        ``(3) Nonbank financial company supervised by the board.--The 
    term `nonbank financial company supervised by the Board' means a 
    nonbank financial company supervised by the Board of Governors, as 
    defined in section 102 of the Financial Stability Act of 2010.
        ``(4) Proprietary trading.--The term `proprietary trading', 
    when used with respect to a banking entity or nonbank financial 
    company supervised by the Board, means engaging as a principal for 
    the trading account of the banking entity or nonbank financial 
    company supervised by the Board in any transaction to purchase or 
    sell, or otherwise acquire or dispose of, any security, any 
    derivative, any contract of sale of a commodity for future 
    delivery, any option on any such security, derivative, or contract, 
    or any other security or financial instrument that the appropriate 
    Federal banking agencies, the Securities and Exchange Commission, 
    and the Commodity Futures Trading Commission may, by rule as 
    provided in subsection (b)(2), determine.
        ``(5) Sponsor.--The term to `sponsor' a fund means--
            ``(A) to serve as a general partner, managing member, or 
        trustee of a fund;
            ``(B) in any manner to select or to control (or to have 
        employees, officers, or directors, or agents who constitute) a 
        majority of the directors, trustees, or management of a fund; 
        or
            ``(C) to share with a fund, for corporate, marketing, 
        promotional, or other purposes, the same name or a variation of 
        the same name.
        ``(6) Trading account.--The term `trading account' means any 
    account used for acquiring or taking positions in the securities 
    and instruments described in paragraph (4) principally for the 
    purpose of selling in the near term (or otherwise with the intent 
    to resell in order to profit from short-term price movements), and 
    any such other accounts as the appropriate Federal banking 
    agencies, the Securities and Exchange Commission, and the Commodity 
    Futures Trading Commission may, by rule as provided in subsection 
    (b)(2), determine.
        ``(7) Illiquid fund.--
            ``(A) In general.--The term `illiquid fund' means a hedge 
        fund or private equity fund that--
                ``(i) as of May 1, 2010, was principally invested in, 
            or was invested and contractually committed to principally 
            invest in, illiquid assets, such as portfolio companies, 
            real estate investments, and venture capital investments; 
            and
                ``(ii) makes all investments pursuant to, and 
            consistent with, an investment strategy to principally 
            invest in illiquid assets. In issuing rules regarding this 
            subparagraph, the Board shall take into consideration the 
            terms of investment for the hedge fund or private equity 
            fund, including contractual obligations, the ability of the 
            fund to divest of assets held by the fund, and any other 
            factors that the Board determines are appropriate.
            ``(B) Hedge fund.--For the purposes of this paragraph, the 
        term `hedge fund' means any fund identified under subsection 
        (h)(2), and does not include a private equity fund, as such 
        term is used in section 203(m) of the Investment Advisers Act 
        of 1940 (15 U.S.C. 80b-3(m)).''.
    SEC. 620. STUDY OF BANK INVESTMENT ACTIVITIES.
    (a) Study.--
        (1) In general.--Not later than 18 months after the date of 
    enactment of this Act, the appropriate Federal banking agencies 
    shall jointly review and prepare a report on the activities that a 
    banking entity, as such term is defined in the Bank Holding Company 
    Act of 1956 (12 U.S.C. 1841 et. seq.), may engage in under Federal 
    and State law, including activities authorized by statute and by 
    order, interpretation and guidance.
        (2) Content.--In carrying out the study under paragraph (1), 
    the appropriate Federal banking agencies shall review and 
    consider--
            (A) the type of activities or investments;
            (B) any financial, operational, managerial, or reputation 
        risks associated with or presented as a result of the banking 
        entity engaged in the activity or making the investment; and
            (C) risk mitigation activities undertaken by the banking 
        entity with regard to the risks.
    (b) Report and Recommendations to the Council and to Congress.--The 
appropriate Federal banking agencies shall submit to the Council, the 
Committee on Financial Services of the House of Representatives, and 
the Committee on Banking, Housing, and Urban Affairs of the Senate the 
study conducted pursuant to subsection (a) no later than 2 months after 
its completion. In addition to the information described in subsection 
(a), the report shall include recommendations regarding--
        (1) whether each activity or investment has or could have a 
    negative effect on the safety and soundness of the banking entity 
    or the United States financial system;
        (2) the appropriateness of the conduct of each activity or type 
    of investment by banking entities; and
        (3) additional restrictions as may be necessary to address 
    risks to safety and soundness arising from the activities or types 
    of investments described in subsection (a).
    SEC. 621. CONFLICTS OF INTEREST.
    (a) In General.--The Securities Act of 1933 (15 U.S.C. 77a et seq.) 
is amended by inserting after section 27A the following:
    ``SEC. 27B. CONFLICTS OF INTEREST RELATING TO CERTAIN 
      SECURITIZATIONS.
    ``(a) In General.--An underwriter, placement agent, initial 
purchaser, or sponsor, or any affiliate or subsidiary of any such 
entity, of an asset-backed security (as such term is defined in section 
3 of the Securities and Exchange Act of 1934 (15 U.S.C. 78c), which for 
the purposes of this section shall include a synthetic asset-backed 
security), shall not, at any time for a period ending on the date that 
is one year after the date of the first closing of the sale of the 
asset-backed security, engage in any transaction that would involve or 
result in any material conflict of interest with respect to any 
investor in a transaction arising out of such activity.
    ``(b) Rulemaking.--Not later than 270 days after the date of 
enactment of this section, the Commission shall issue rules for the 
purpose of implementing subsection (a).
    ``(c) Exception.--The prohibitions of subsection (a) shall not 
apply to--
        ``(1) risk-mitigating hedging activities in connection with 
    positions or holdings arising out of the underwriting, placement, 
    initial purchase, or sponsorship of an asset-backed security, 
    provided that such activities are designed to reduce the specific 
    risks to the underwriter, placement agent, initial purchaser, or 
    sponsor associated with positions or holdings arising out of such 
    underwriting, placement, initial purchase, or sponsorship; or
        ``(2) purchases or sales of asset-backed securities made 
    pursuant to and consistent with--
            ``(A) commitments of the underwriter, placement agent, 
        initial purchaser, or sponsor, or any affiliate or subsidiary 
        of any such entity, to provide liquidity for the asset-backed 
        security, or
            ``(B) bona fide market-making in the asset backed security.
    ``(d) Rule of Construction.--This subsection shall not otherwise 
limit the application of section 15G of the Securities Exchange Act of 
1934.''.
    (b) Effective Date.--Section 27B of the Securities Act of 1933, as 
added by this section, shall take effect on the effective date of final 
rules issued by the Commission under subsection (b) of such section 
27B, except that subsections (b) and (d) of such section 27B shall take 
effect on the date of enactment of this Act.
    SEC. 622. CONCENTRATION LIMITS ON LARGE FINANCIAL FIRMS.
    The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is 
amended by adding at the end the following:
  ``SEC. 14. CONCENTRATION LIMITS ON LARGE FINANCIAL FIRMS.
    ``(a) Definitions.--In this section--
        ``(1) the term `Council' means the Financial Stability 
    Oversight Council;
        ``(2) the term `financial company' means--
            ``(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;
            ``(E) a nonbank financial company supervised by the Board 
        under title I of the Dodd-Frank Wall Street Reform and Consumer 
        Protection Act; and
            ``(F) a foreign bank or company that is treated as a bank 
        holding company for purposes of this Act; and
        ``(3) the term `liabilities' means--
            ``(A) with respect to a United States financial company--
                ``(i) the total risk-weighted assets of the financial 
            company, as determined under the risk-based capital rules 
            applicable to bank holding companies, as adjusted to 
            reflect exposures that are deducted from regulatory 
            capital; less
                ``(ii) the total regulatory capital of the financial 
            company under the risk-based capital rules applicable to 
            bank holding companies;
            ``(B) with respect to a foreign-based financial company--
                ``(i) the total risk-weighted assets of the United 
            States operations of the financial company, as determined 
            under the applicable risk-based capital rules, as adjusted 
            to reflect exposures that are deducted from regulatory 
            capital; less
                ``(ii) the total regulatory capital of the United 
            States operations of the financial company, as determined 
            under the applicable risk-based capital rules; and
            ``(C) with respect to an insurance company or other nonbank 
        financial company supervised by the Board, such assets of the 
        company as the Board shall specify by rule, in order to provide 
        for consistent and equitable treatment of such companies.
    ``(b) Concentration Limit.--Subject to the recommendations by the 
Council under subsection (e), a financial company may not merge or 
consolidate with, acquire all or substantially all of the assets of, or 
otherwise acquire control of, another company, if the total 
consolidated liabilities of the acquiring financial company upon 
consummation of the transaction would exceed 10 percent of the 
aggregate consolidated liabilities of all financial companies at the 
end of the calendar year preceding the transaction.
    ``(c) Exception to Concentration Limit.--With the prior written 
consent of the Board, the concentration limit under subsection (b) 
shall not apply to an acquisition--
        ``(1) of a bank in default or in danger of default;
        ``(2) with respect to which assistance is provided by the 
    Federal Deposit Insurance Corporation under section 13(c) of the 
    Federal Deposit Insurance Act (12 U.S.C. 1823(c)); or
        ``(3) that would result only in a de minimis increase in the 
    liabilities of the financial company.
    ``(d) Rulemaking and Guidance.--The Board shall issue regulations 
implementing this section in accordance with the recommendations of the 
Council under subsection (e), including the definition of terms, as 
necessary. The Board may issue interpretations or guidance regarding 
the application of this section to an individual financial company or 
to financial companies in general.
    ``(e) Council Study and Rulemaking.--
        ``(1) Study and recommendations.--Not later than 6 months after 
    the date of enactment of this section, the Council shall--
            ``(A) complete a study of the extent to which the 
        concentration limit under this section would affect financial 
        stability, moral hazard in the financial system, the efficiency 
        and competitiveness of United States financial firms and 
        financial markets, and the cost and availability of credit and 
        other financial services to households and businesses in the 
        United States; and
            ``(B) make recommendations regarding any modifications to 
        the concentration limit that the Council determines would more 
        effectively implement this section.
        ``(2) Rulemaking.--Not later than 9 months after the date of 
    completion of the study under paragraph (1), and notwithstanding 
    subsections (b) and (d), the Board shall issue final regulations 
    implementing this section, which shall reflect any recommendations 
    by the Council under paragraph (1)(B).''.
    SEC. 623. INTERSTATE MERGER TRANSACTIONS.
    (a) Interstate Merger Transactions.--Section 18(c) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(c)) is amended by adding at the 
end the following:
    ``(13)(A) Except as provided in subparagraph (B), the responsible 
agency may not approve an application for an interstate merger 
transaction if the resulting insured depository institution (including 
all insured depository institutions which are affiliates of the 
resulting insured depository institution), upon consummation of the 
transaction, would control more than 10 percent of the total amount of 
deposits of insured depository institutions in the United States.
    ``(B) Subparagraph (A) shall not apply to an interstate merger 
transaction that involves 1 or more insured depository institutions in 
default or in danger of default, or with respect to which the 
Corporation provides assistance under section 13.
    ``(C) In this paragraph--
        ``(i) the term `interstate merger transaction' means a merger 
    transaction involving 2 or more insured depository institutions 
    that have different home States and that are not affiliates; and
        ``(ii) the term `home State' means--
            ``(I) with respect to a national bank, the State in which 
        the main office of the bank is located;
            ``(II) with respect to a State bank or State savings 
        association, the State by which the State bank or State savings 
        association is chartered; and
            ``(III) with respect to a Federal savings association, the 
        State in which the home office (as defined by the regulations 
        of the Director of the Office of Thrift Supervision, or, on and 
        after the transfer date, the Comptroller of the Currency) of 
        the Federal savings association is located.''.
    (b) Acquisitions by Bank Holding Companies.--
        (1) In general.--Section 4 of the Bank Holding Company Act of 
    1956 (12 U.S.C. 1843) is amended--
            (A) in subsection (i), by adding at the end the following:
        ``(8) Interstate acquisitions.--
            ``(A) In general.--The Board may not approve an application 
        by a bank holding company to acquire an insured depository 
        institution under subsection (c)(8) or any other provision of 
        this Act if--
                ``(i) the home State of such insured depository 
            institution is a State other than the home State of the 
            bank holding company; and
                ``(ii) the applicant (including all insured depository 
            institutions which are affiliates of the applicant) 
            controls, or upon consummation of the transaction would 
            control, more than 10 percent of the total amount of 
            deposits of insured depository institutions in the United 
            States.
            ``(B) Exception.--Subparagraph (A) shall not apply to an 
        acquisition that involves an insured depository institution in 
        default or in danger of default, or with respect to which the 
        Federal Deposit Insurance Corporation provides assistance under 
        section 13 of the Federal Deposit Insurance Act (12 U.S.C. 
        1823).''; and
            (B) in subsection (k)(6)(B), by striking ``savings 
        association'' and inserting ``insured depository institution''.
        (2) Definitions.--Section 2(o)(4) of the Bank Holding Company 
    Act of 1956 (12 U.S.C. 1841(o)(4)) is amended--
            (A) in subparagraph (B), by striking ``and'' at the end;
            (B) in subparagraph (C)(ii), by striking the period at the 
        end and inserting a semicolon; and
            (C) by adding at the end the following:
            ``(D) with respect to a State savings association, the 
        State by which the savings association is chartered; and
            ``(E) with respect to a Federal savings association, the 
        State in which the home office (as defined by the regulations 
        of the Director of the Office of Thrift Supervision, or, on and 
        after the transfer date, the Comptroller of the Currency) of 
        the Federal savings association is located.''.
    (c) Acquisitions by Savings and Loan Holding Companies.--Section 
10(e)(2) of the Home Owners' Loan Act (12 U.S.C. 1467a(e)(2)) is 
amended--
        (1) in paragraph (2)--
            (A) in subparagraph (C), by striking ``or'' at the end;
            (B) in subparagraph (D), by striking the period at the end 
        and inserting ``, or''; and
            (C) by adding at the end the following:
            ``(E) in the case of an application by a savings and loan 
        holding company to acquire an insured depository institution, 
        if--
                ``(i) the home State of the insured depository 
            institution is a State other than the home State of the 
            savings and loan holding company;
                ``(ii) the applicant (including all insured depository 
            institutions which are affiliates of the applicant) 
            controls, or upon consummation of the transaction would 
            control, more than 10 percent of the total amount of 
            deposits of insured depository institutions in the United 
            States; and
                ``(iii) the acquisition does not involve an insured 
            depository institution in default or in danger of default, 
            or with respect to which the Federal Deposit Insurance 
            Corporation provides assistance under section 13 of the 
            Federal Deposit Insurance Act (12 U.S.C. 1823).''; and
        (2) by adding at the end the following:
        ``(7) Definitions.--For purposes of paragraph (2)(E)--
            ``(A) the terms `default', `in danger of default', and 
        `insured depository institution' have the same meanings as in 
        section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
        1813); and
            ``(B) the term `home State' means--
                ``(i) with respect to a national bank, the State in 
            which the main office of the bank is located;
                ``(ii) with respect to a State bank or State savings 
            association, the State by which the savings association is 
            chartered;
                ``(iii) with respect to a Federal savings association, 
            the State in which the home office (as defined by the 
            regulations of the Director of the Office of Thrift 
            Supervision, or, on and after the transfer date, the 
            Comptroller of the Currency) of the Federal savings 
            association is located; and
                ``(iv) with respect to a savings and loan holding 
            company, the State in which the amount of total deposits of 
            all insured depository institution subsidiaries of such 
            company was the greatest on the date on which the company 
            became a savings and loan holding company.''.
    SEC. 624. QUALIFIED THRIFT LENDERS.
    Section 10(m)(3) of the Home Owners' Loan Act (12 U.S.C. 
1467a(m)(3)) is amended--
        (1) by striking subparagraph (A) and inserting the following:
            ``(A) In general.--A savings association that fails to 
        become or remain a qualified thrift lender shall immediately be 
        subject to the restrictions under subparagraph (B).''; and
        (2) in subparagraph (B)(i), by striking subclause (III) and 
    inserting the following:

                    ``(III) Dividends.--The savings association may not 
                pay dividends, except for dividends that--

                        ``(aa) would be permissible for a national 
                    bank;
                        ``(bb) are necessary to meet obligations of a 
                    company that controls such savings association; and
                        ``(cc) are specifically approved by the 
                    Comptroller of the Currency and the Board after a 
                    written request submitted to the Comptroller of the 
                    Currency and the Board by the savings association 
                    not later than 30 days before the date of the 
                    proposed payment.

                    ``(IV) Regulatory authority.--A savings association 
                that fails to become or remain a qualified thrift 
                lender shall be deemed to have violated section 5 of 
                the Home Owners' Loan Act (12 U.S.C. 1464) and subject 
                to actions authorized by section 5(d) of the Home 
                Owners' Loan Act (12 U.S.C. 1464(d)).''.

    SEC. 625. TREATMENT OF DIVIDENDS BY CERTAIN MUTUAL HOLDING 
      COMPANIES.
    (a) In General.--Section 10(o) of the Home Owners' Loan Act (12 
U.S.C. 1467a(o) is amended by adding at the end the following:
        ``(11) Dividends.--
            ``(A) Declaration of dividends.--
                ``(i) Advance notice required.--Each subsidiary of a 
            mutual holding company that is a savings association shall 
            give the appropriate Federal banking agency and the Board 
            notice not later than 30 days before the date of a proposed 
            declaration by the board of directors of the savings 
            association of any dividend on the guaranty, permanent, or 
            other nonwithdrawable stock of the savings association.
                ``(ii) Invalid dividends.--Any dividend described in 
            clause (i) that is declared without giving notice to the 
            appropriate Federal banking agency and the Board under 
            clause (i), or that is declared during the 30-day period 
            preceding the date of a proposed declaration for which 
            notice is given to the appropriate Federal banking agency 
            and the Board under clause (i), shall be invalid and shall 
            confer no rights or benefits upon the holder of any such 
            stock.
            ``(B) Waiver of dividends.--A mutual holding company may 
        waive the right to receive any dividend declared by a 
        subsidiary of the mutual holding company, if--
                ``(i) no insider of the mutual holding company, 
            associate of an insider, or tax-qualified or non-tax-
            qualified employee stock benefit plan of the mutual holding 
            company holds any share of the stock in the class of stock 
            to which the waiver would apply; or
                ``(ii) the mutual holding company gives written notice 
            to the Board of the intent of the mutual holding company to 
            waive the right to receive dividends, not later than 30 
            days before the date of the proposed date of payment of the 
            dividend, and the Board does not object to the waiver.
            ``(C) Resolution included in waiver notice.--A notice of a 
        waiver under subparagraph (B) shall include a copy of the 
        resolution of the board of directors of the mutual holding 
        company, in such form and substance as the Board may determine, 
        together with any supporting materials relied upon by the board 
        of directors of the mutual holding company, concluding that the 
        proposed dividend waiver is consistent with the fiduciary 
        duties of the board of directors to the mutual members of the 
        mutual holding company.
            ``(D) Standards for waiver of dividend.--The Board may not 
        object to a waiver of dividends under subparagraph (B) if--
                ``(i) the waiver would not be detrimental to the safe 
            and sound operation of the savings association;
                ``(ii) the board of directors of the mutual holding 
            company expressly determines that a waiver of the dividend 
            by the mutual holding company is consistent with the 
            fiduciary duties of the board of directors to the mutual 
            members of the mutual holding company; and
                ``(iii) the mutual holding company has, prior to 
            December 1, 2009--

                    ``(I) reorganized into a mutual holding company 
                under subsection (o);
                    ``(II) issued minority stock either from its mid-
                tier stock holding company or its subsidiary stock 
                savings association; and
                    ``(III) waived dividends it had a right to receive 
                from the subsidiary stock savings association.

            ``(E) Valuation.--
                ``(i) In general.--The appropriate Federal banking 
            agency shall consider waived dividends in determining an 
            appropriate exchange ratio in the event of a full 
            conversion to stock form.
                ``(ii) Exception.--In the case of a savings association 
            that has reorganized into a mutual holding company, has 
            issued minority stock from a mid-tier stock holding company 
            or a subsidiary stock savings association of the mutual 
            holding company, and has waived dividends it had a right to 
            receive from a subsidiary savings association before 
            December 1, 2009, the appropriate Federal banking agency 
            shall not consider waived dividends in determining an 
            appropriate exchange ratio in the event of a full 
            conversion to stock form.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the transfer date.
    SEC. 626. INTERMEDIATE HOLDING COMPANIES.
    The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended by 
inserting after section 10 (12 U.S.C. 1467a) the following new section:
    ``SEC. 10A. INTERMEDIATE HOLDING COMPANIES.
    ``(a) Definition.--For purposes of this section:
        ``(1) Financial activities.--The term `financial activities' 
    means activities described in clauses (i) and (ii) of section 
    10(c)(9)(A).
        ``(2) Grandfathered unitary savings and loan holding company.--
    The term `grandfathered unitary savings and loan holding company' 
    means a company described in section 10(c)(9)(C).
        ``(3) Internal financial activities.--The term `internal 
    financial activities' includes--
            ``(A) internal financial activities conducted by a 
        grandfathered savings and loan holding company or any 
        affiliate; and
            ``(B) internal treasury, investment, and employee benefit 
        functions.
    ``(b) Requirement.--
        ``(1) In general.--
            ``(A) Activities other than financial activities.--If a 
        grandfathered unitary savings and loan holding company conducts 
        activities other than financial activities, the Board may 
        require such company to establish and conduct all or a portion 
        of such financial activities in or through an intermediate 
        holding company, which shall be a savings and loan holding 
        company, established pursuant to regulations of the Board, not 
        later than 90 days (or such longer period as the Board may deem 
        appropriate) after the transfer date.
            ``(B) Other activities.--Notwithstanding subparagraph (A), 
        the Board shall require a grandfathered unitary savings and 
        loan holding company to establish an intermediate holding 
        company if the Board makes a determination that the 
        establishment of such intermediate holding company is 
        necessary--
                ``(i) to appropriately supervise activities that are 
            determined to be financial activities; or
                ``(ii) to ensure that supervision by the Board does not 
            extend to the activities of such company that are not 
            financial activities.
        ``(2) Internal financial activities.--
            ``(A) Treatment of internal financial activities.--For 
        purposes of this subsection, the internal financial activities 
        of a grandfathered unitary savings and loan holding company 
        shall not be required to be placed in an intermediate holding 
        company.
            ``(B) Grandfathered activities.--A grandfathered unitary 
        savings and loan holding company may continue to engage in an 
        internal financial activity, subject to review by the Board to 
        determine whether engaging in such activity presents undue risk 
        to the grandfathered unitary savings and loan holding company 
        or to the financial stability of the United States, if--
                ``(i) the grandfathered unitary savings and loan 
            holding company engaged in the activity during the year 
            before the date of enactment of this section; and
                ``(ii) at least \2/3\ of the assets or \2/3\ of the 
            revenues generated from the activity are from or 
            attributable to the grandfathered unitary savings and loan 
            holding company.
        ``(3) Source of strength.--A grandfathered unitary savings and 
    loan holding company that directly or indirectly controls an 
    intermediate holding company established under this section shall 
    serve as a source of strength to its subsidiary intermediate 
    holding company.
        ``(4) Parent company reports.--The Board, may from time to 
    time, examine and require reports under oath from a grandfathered 
    unitary savings and loan holding company that controls an 
    intermediate holding company, and from the appropriate officers or 
    directors of such company, solely for purposes of ensuring 
    compliance with the provisions of this section, including assessing 
    the ability of the company to serve as a source of strength to its 
    subsidiary intermediate holding company as required under paragraph 
    (3) and enforcing compliance with such requirement.
        ``(5) Limited parent company enforcement.--
            ``(A) In general.--In addition to any other authority of 
        the Board, the Board may enforce compliance with the provisions 
        of this subsection that are applicable to any company described 
        in paragraph (1)(A) that controls an intermediate holding 
        company under section 8 of the Federal Deposit Insurance Act, 
        and a company described in paragraph (1)(A) shall be subject to 
        such section (solely for purposes of this subparagraph) in the 
        same manner and to the same extent as if the company described 
        in paragraph (1)(A) were a savings and loan holding company.
            ``(B) Application of other act.--Any violation of this 
        subsection by a grandfathered unitary savings and loan holding 
        company that controls an intermediate holding company may also 
        be treated as a violation of the Federal Deposit Insurance Act 
        for purposes of subparagraph (A).
            ``(C) No effect on other authority.--No provision of this 
        paragraph shall be construed as limiting any authority of the 
        Board or any other Federal agency under any other provision of 
        law.
    ``(c) Regulations.--The Board--
        ``(1) shall promulgate regulations to establish the criteria 
    for determining whether to require a grandfathered unitary savings 
    and loan holding company to establish an intermediate holding 
    company under subsection (b); and
        ``(2) may promulgate regulations to establish any restrictions 
    or limitations on transactions between an intermediate holding 
    company or a parent of such company and its affiliates, as 
    necessary to prevent unsafe and unsound practices in connection 
    with transactions between the intermediate holding company, or any 
    subsidiary thereof, and its parent company or affiliates that are 
    not subsidiaries of the intermediate holding company, except that 
    such regulations shall not restrict or limit any transaction in 
    connection with the bona fide acquisition or lease by an 
    unaffiliated person of assets, goods, or services.
    ``(d) Rules of Construction.--
        ``(1) Activities.--Nothing in this section shall be construed 
    to require a grandfathered unitary savings and loan holding company 
    to conform its activities to permissible activities.
        ``(2) Permissible corporate reorganization.--The formation of 
    an intermediate holding company as required in subsection (b) shall 
    be presumed to be a permissible corporate reorganization as 
    described in section 10(c)(9)(D).''.
    SEC. 627. INTEREST-BEARING TRANSACTION ACCOUNTS AUTHORIZED.
    (a) Repeal of Prohibition on Payment of Interest on Demand 
Deposits.--
        (1) Federal reserve act.--Section 19(i) of the Federal Reserve 
    Act (12 U.S.C. 371a) is amended to read as follows:
    ``(i) [Repealed]''.
        (2) Home owners' loan act.--The first sentence of section 
    5(b)(1)(B) of the Home Owners' Loan Act (12 U.S.C. 1464(b)(1)(B)) 
    is amended by striking ``savings association may not--'' and all 
    that follows through ``(ii) permit any'' and inserting ``savings 
    association may not permit any''.
        (3) Federal deposit insurance act.--Section 18(g) of the 
    Federal Deposit Insurance Act (12 U.S.C. 1828(g)) is amended to 
    read as follows:
    ``(g) [Repealed]''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect 1 year after the date of the enactment of this Act.
    SEC. 628. CREDIT CARD BANK SMALL BUSINESS LENDING.
    Section 2(c)(2)(F)(v) of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841(c)(2)(F)(v)) is amended by inserting before the period the 
following: ``, other than credit card loans that are made to businesses 
that meet the criteria for a small business concern to be eligible for 
business loans under regulations established by the Small Business 
Administration under part 121 of title 13, Code of Federal 
Regulations''.

         TITLE VII--WALL STREET TRANSPARENCY AND ACCOUNTABILITY

    SEC. 701. SHORT TITLE.
    This title may be cited as the ``Wall Street Transparency and 
Accountability Act of 2010''.

        Subtitle A--Regulation of Over-the-Counter Swaps Markets

                      PART I--REGULATORY AUTHORITY

    SEC. 711. DEFINITIONS.
    In this subtitle, the terms ``prudential regulator'', ``swap'', 
``swap dealer'', ``major swap participant'', ``swap data repository'', 
``associated person of a swap dealer or major swap participant'', 
``eligible contract participant'', ``swap execution facility'', 
``security-based swap'', ``security-based swap dealer'', ``major 
security-based swap participant'', and ``associated person of a 
security-based swap dealer or major security-based swap participant'' 
have the meanings given the terms in section 1a of the Commodity 
Exchange Act (7 U.S.C. 1a), including any modification of the meanings 
under section 721(b) of this Act.
    SEC. 712. REVIEW OF REGULATORY AUTHORITY.
    (a) Consultation.--
        (1) Commodity futures trading commission.--Before commencing 
    any rulemaking or issuing an order regarding swaps, swap dealers, 
    major swap participants, swap data repositories, derivative 
    clearing organizations with regard to swaps, persons associated 
    with a swap dealer or major swap participant, eligible contract 
    participants, or swap execution facilities pursuant to this 
    subtitle, the Commodity Futures Trading Commission shall consult 
    and coordinate to the extent possible with the Securities and 
    Exchange Commission and the prudential regulators for the purposes 
    of assuring regulatory consistency and comparability, to the extent 
    possible.
        (2) Securities and exchange commission.--Before commencing any 
    rulemaking or issuing an order regarding security-based swaps, 
    security-based swap dealers, major security-based swap 
    participants, security-based swap data repositories, clearing 
    agencies with regard to security-based swaps, persons associated 
    with a security-based swap dealer or major security-based swap 
    participant, eligible contract participants with regard to 
    security-based swaps, or security-based swap execution facilities 
    pursuant to subtitle B, the Securities and Exchange Commission 
    shall consult and coordinate to the extent possible with the 
    Commodity Futures Trading Commission and the prudential regulators 
    for the purposes of assuring regulatory consistency and 
    comparability, to the extent possible.
        (3) Procedures and deadline.--Such regulations shall be 
    prescribed in accordance with applicable requirements of title 5, 
    United States Code, and shall be issued in final form not later 
    than 360 days after the date of enactment of this Act.
        (4) Applicability.--The requirements of paragraphs (1) and (2) 
    shall not apply to an order issued--
            (A) in connection with or arising from a violation or 
        potential violation of any provision of the Commodity Exchange 
        Act (7 U.S.C. 1 et seq.);
            (B) in connection with or arising from a violation or 
        potential violation of any provision of the securities laws; or
            (C) in any proceeding that is conducted on the record in 
        accordance with sections 556 and 557 of title 5, United States 
        Code.
        (5) Effect.--Nothing in this subsection authorizes any 
    consultation or procedure for consultation that is not consistent 
    with the requirements of subchapter II of chapter 5, and chapter 7, 
    of title 5, United States Code (commonly known as the 
    ``Administrative Procedure Act'').
        (6) Rules; orders.--In developing and promulgating rules or 
    orders pursuant to this subsection, each Commission shall consider 
    the views of the prudential regulators.
        (7) Treatment of similar products and entities.--
            (A) In general.--In adopting rules and orders under this 
        subsection, the Commodity Futures Trading Commission and the 
        Securities and Exchange Commission shall treat functionally or 
        economically similar products or entities described in 
        paragraphs (1) and (2) in a similar manner.
            (B) Effect.--Nothing in this subtitle requires the 
        Commodity Futures Trading Commission or the Securities and 
        Exchange Commission to adopt joint rules or orders that treat 
        functionally or economically similar products or entities 
        described in paragraphs (1) and (2) in an identical manner.
        (8) Mixed swaps.--The Commodity Futures Trading Commission and 
    the Securities and Exchange Commission, after consultation with the 
    Board of Governors, shall jointly prescribe such regulations 
    regarding mixed swaps, as described in section 1a(47)(D) of the 
    Commodity Exchange Act (7 U.S.C. 1a(47)(D)) and in section 
    3(a)(68)(D) of the Securities Exchange Act of 1934 (15 U.S.C. 
    78c(a)(68)(D)), as may be necessary to carry out the purposes of 
    this title.
    (b) Limitation.--
        (1) Commodity futures trading commission.--Nothing in this 
    title, unless specifically provided, confers jurisdiction on the 
    Commodity Futures Trading Commission to issue a rule, regulation, 
    or order providing for oversight or regulation of--
            (A) security-based swaps; or
            (B) with regard to its activities or functions concerning 
        security-based swaps--
                (i) security-based swap dealers;
                (ii) major security-based swap participants;
                (iii) security-based swap data repositories;
                (iv) associated persons of a security-based swap dealer 
            or major security-based swap participant;
                (v) eligible contract participants with respect to 
            security-based swaps; or
                (vi) swap execution facilities with respect to 
            security-based swaps.
        (2) Securities and exchange commission.--Nothing in this title, 
    unless specifically provided, confers jurisdiction on the 
    Securities and Exchange Commission or State securities regulators 
    to issue a rule, regulation, or order providing for oversight or 
    regulation of--
            (A) swaps; or
            (B) with regard to its activities or functions concerning 
        swaps--
                (i) swap dealers;
                (ii) major swap participants;
                (iii) swap data repositories;
                (iv) persons associated with a swap dealer or major 
            swap participant;
                (v) eligible contract participants with respect to 
            swaps; or
                (vi) swap execution facilities with respect to swaps.
        (3) Prohibition on certain futures associations and national 
    securities associations.--
            (A) Futures associations.--Notwithstanding any other 
        provision of law (including regulations), unless otherwise 
        authorized by this title, no futures association registered 
        under section 17 of the Commodity Exchange Act (7 U.S.C. 21) 
        may issue a rule, regulation, or order for the oversight or 
        regulation of, or otherwise assert jurisdiction over, for any 
        purpose, any security-based swap, except that this subparagraph 
        shall not limit the authority of a registered futures 
        association to examine for compliance with, and enforce, its 
        rules on capital adequacy.
            (B) National securities associations.--Notwithstanding any 
        other provision of law (including regulations), unless 
        otherwise authorized by this title, no national securities 
        association registered under section 15A of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78o-3) may issue a rule, 
        regulation, or order for the oversight or regulation of, or 
        otherwise assert jurisdiction over, for any purpose, any swap, 
        except that this subparagraph shall not limit the authority of 
        a national securities association to examine for compliance 
        with, and enforce, its rules on capital adequacy.
    (c) Objection to Commission Regulation.--
        (1) Filing of petition for review.--
            (A) In general.--If either Commission referred to in this 
        section determines that a final rule, regulation, or order of 
        the other Commission conflicts with subsection (a)(7) or (b), 
        then the complaining Commission may obtain review of the final 
        rule, regulation, or order in the United States Court of 
        Appeals for the District of Columbia Circuit by filing in the 
        court, not later than 60 days after the date of publication of 
        the final rule, regulation, or order, a written petition 
        requesting that the rule, regulation, or order be set aside.
            (B) Expedited proceeding.--A proceeding described in 
        subparagraph (A) shall be expedited by the United States Court 
        of Appeals for the District of Columbia Circuit.
        (2) Transmittal of petition and record.--
            (A) In general.--A copy of a petition described in 
        paragraph (1) shall be transmitted not later than 1 business 
        day after the date of filing by the complaining Commission to 
        the Secretary of the responding Commission.
            (B) Duty of responding commission.--On receipt of the copy 
        of a petition described in paragraph (1), the responding 
        Commission shall file with the United States Court of Appeals 
        for the District of Columbia Circuit--
                (i) a copy of the rule, regulation, or order under 
            review (including any documents referred to therein); and
                (ii) any other materials prescribed by the United 
            States Court of Appeals for the District of Columbia 
            Circuit.
        (3) Standard of review.--The United States Court of Appeals for 
    the District of Columbia Circuit shall--
            (A) give deference to the views of neither Commission; and
            (B) determine to affirm or set aside a rule, regulation, or 
        order of the responding Commission under this subsection, based 
        on the determination of the court as to whether the rule, 
        regulation, or order is in conflict with subsection (a)(7) or 
        (b), as applicable.
        (4) Judicial stay.--The filing of a petition by the complaining 
    Commission pursuant to paragraph (1) shall operate as a stay of the 
    rule, regulation, or order until the date on which the 
    determination of the United States Court of Appeals for the 
    District of Columbia Circuit is final (including any appeal of the 
    determination).
    (d) Joint Rulemaking.--
        (1) In general.--Notwithstanding any other provision of this 
    title and subsections (b) and (c), the Commodity Futures Trading 
    Commission and the Securities and Exchange Commission, in 
    consultation with the Board of Governors, shall further define the 
    terms ``swap'', ``security-based swap'', ``swap dealer'', 
    ``security-based swap dealer'', ``major swap participant'', ``major 
    security-based swap participant'', ``eligible contract 
    participant'', and ``security-based swap agreement'' in section 
    1a(47)(A)(v) of the Commodity Exchange Act (7 U.S.C. 1a(47)(A)(v)) 
    and section 3(a)(78) of the Securities Exchange Act of 1934 (15 
    U.S.C. 78c(a)(78)).
        (2) Authority of the commissions.--
            (A) In general.--Notwithstanding any other provision of 
        this title, the Commodity Futures Trading Commission and the 
        Securities and Exchange Commission, in consultation with the 
        Board of Governors, shall jointly adopt such other rules 
        regarding such definitions as the Commodity Futures Trading 
        Commission and the Securities and Exchange Commission determine 
        are necessary and appropriate, in the public interest, and for 
        the protection of investors.
            (B) Trade repository recordkeeping.--Notwithstanding any 
        other provision of this title, the Commodity Futures Trading 
        Commission and the Securities and Exchange Commission, in 
        consultation with the Board of Governors, shall engage in joint 
        rulemaking to jointly adopt a rule or rules governing the books 
        and records that are required to be kept and maintained 
        regarding security-based swap agreements by persons that are 
        registered as swap data repositories under the Commodity 
        Exchange Act, including uniform rules that specify the data 
        elements that shall be collected and maintained by each 
        repository.
            (C) Books and records.--Notwithstanding any other provision 
        of this title, the Commodity Futures Trading Commission and the 
        Securities and Exchange Commission, in consultation with the 
        Board of Governors, shall engage in joint rulemaking to jointly 
        adopt a rule or rules governing books and records regarding 
        security-based swap agreements, including daily trading 
        records, for swap dealers, major swap participants, security-
        based swap dealers, and security-based swap participants.
            (D) Comparable rules.--Rules and regulations prescribed 
        jointly under this title by the Commodity Futures Trading 
        Commission and the Securities and Exchange Commission shall be 
        comparable to the maximum extent possible, taking into 
        consideration differences in instruments and in the applicable 
        statutory requirements.
            (E) Tracking uncleared transactions.--Any rules prescribed 
        under subparagraph (A) shall require the maintenance of records 
        of all activities relating to security-based swap agreement 
        transactions defined under subparagraph (A) that are not 
        cleared.
            (F) Sharing of information.--The Commodity Futures Trading 
        Commission shall make available to the Securities and Exchange 
        Commission information relating to security-based swap 
        agreement transactions defined in subparagraph (A) that are not 
        cleared.
        (3) Financial stability oversight council.--In the event that 
    the Commodity Futures Trading Commission and the Securities and 
    Exchange Commission fail to jointly prescribe rules pursuant to 
    paragraph (1) or (2) in a timely manner, at the request of either 
    Commission, the Financial Stability Oversight Council shall resolve 
    the dispute--
            (A) within a reasonable time after receiving the request;
            (B) after consideration of relevant information provided by 
        each Commission; and
            (C) by agreeing with 1 of the Commissions regarding the 
        entirety of the matter or by determining a compromise position.
        (4) Joint interpretation.--Any interpretation of, or guidance 
    by either Commission regarding, a provision of this title, shall be 
    effective only if issued jointly by the Commodity Futures Trading 
    Commission and the Securities and Exchange Commission, after 
    consultation with the Board of Governors, if this title requires 
    the Commodity Futures Trading Commission and the Securities and 
    Exchange Commission to issue joint regulations to implement the 
    provision.
    (e) Global Rulemaking Timeframe.--Unless otherwise provided in this 
title, or an amendment made by this title, the Commodity Futures 
Trading Commission or the Securities and Exchange Commission, or both, 
shall individually, and not jointly, promulgate rules and regulations 
required of each Commission under this title or an amendment made by 
this title not later than 360 days after the date of enactment of this 
Act.
    (f) Rules and Registration Before Final Effective Dates.--Beginning 
on the date of enactment of this Act and notwithstanding the effective 
date of any provision of this Act, the Commodity Futures Trading 
Commission and the Securities and Exchange Commission may, in order to 
prepare for the effective dates of the provisions of this Act--
        (1) promulgate rules, regulations, or orders permitted or 
    required by this Act;
        (2) conduct studies and prepare reports and recommendations 
    required by this Act;
        (3) register persons under the provisions of this Act; and
        (4) exempt persons, agreements, contracts, or transactions from 
    provisions of this Act, under the terms contained in this Act,
provided, however, that no action by the Commodity Futures Trading 
Commission or the Securities and Exchange Commission described in 
paragraphs (1) through (4) shall become effective prior to the 
effective date applicable to such action under the provisions of this 
Act.
    SEC. 713. PORTFOLIO MARGINING CONFORMING CHANGES.
    (a) Securities Exchange Act of 1934.--Section 15(c)(3) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o(c)(3)) is amended by 
adding at the end the following:
            ``(C) Notwithstanding any provision of sections 
        2(a)(1)(C)(i) or 4d(a)(2) of the Commodity Exchange Act and the 
        rules and regulations thereunder, and pursuant to an exemption 
        granted by the Commission under section 36 of this title or 
        pursuant to a rule or regulation, cash and securities may be 
        held by a broker or dealer registered pursuant to subsection 
        (b)(1) and also registered as a futures commission merchant 
        pursuant to section 4f(a)(1) of the Commodity Exchange Act, in 
        a portfolio margining account carried as a futures account 
        subject to section 4d of the Commodity Exchange Act and the 
        rules and regulations thereunder, pursuant to a portfolio 
        margining program approved by the Commodity Futures Trading 
        Commission, and subject to subchapter IV of chapter 7 of title 
        11 of the United States Code and the rules and regulations 
        thereunder. The Commission shall consult with the Commodity 
        Futures Trading Commission to adopt rules to ensure that such 
        transactions and accounts are subject to comparable 
        requirements to the extent practicable for similar products.''.
    (b) Commodity Exchange Act.--Section 4d of the Commodity Exchange 
Act (7 U.S.C. 6d) is amended by adding at the end the following:
    ``(h) Notwithstanding subsection (a)(2) or the rules and 
regulations thereunder, and pursuant to an exemption granted by the 
Commission under section 4(c) of this Act or pursuant to a rule or 
regulation, a futures commission merchant that is registered pursuant 
to section 4f(a)(1) of this Act and also registered as a broker or 
dealer pursuant to section 15(b)(1) of the Securities Exchange Act of 
1934 may, pursuant to a portfolio margining program approved by the 
Securities and Exchange Commission pursuant to section 19(b) of the 
Securities Exchange Act of 1934, hold in a portfolio margining account 
carried as a securities account subject to section 15(c)(3) of the 
Securities Exchange Act of 1934 and the rules and regulations 
thereunder, a contract for the purchase or sale of a commodity for 
future delivery or an option on such a contract, and any money, 
securities or other property received from a customer to margin, 
guarantee or secure such a contract, or accruing to a customer as the 
result of such a contract. The Commission shall consult with the 
Securities and Exchange Commission to adopt rules to ensure that such 
transactions and accounts are subject to comparable requirements to the 
extent practical for similar products.''.
    (c) Duty of Commodity Futures Trading Commission.--Section 20 of 
the Commodity Exchange Act (7 U.S.C. 24) is amended by adding at the 
end the following:
    ``(c) The Commission shall exercise its authority to ensure that 
securities held in a portfolio margining account carried as a futures 
account are customer property and the owners of those accounts are 
customers for the purposes of subchapter IV of chapter 7 of title 11 of 
the United States Code.''.
    SEC. 714. ABUSIVE SWAPS.
    The Commodity Futures Trading Commission or the Securities and 
Exchange Commission, or both, individually may, by rule or order--
        (1) collect information as may be necessary concerning the 
    markets for any types of--
            (A) swap (as defined in section 1a of the Commodity 
        Exchange Act (7 U.S.C. 1a)); or
            (B) security-based swap (as defined in section 1a of the 
        Commodity Exchange Act (7 U.S.C. 1a)); and
        (2) issue a report with respect to any types of swaps or 
    security-based swaps that the Commodity Futures Trading Commission 
    or the Securities and Exchange Commission determines to be 
    detrimental to--
            (A) the stability of a financial market; or
            (B) participants in a financial market.
    SEC. 715. AUTHORITY TO PROHIBIT PARTICIPATION IN SWAP ACTIVITIES.
    Except as provided in section 4 of the Commodity Exchange Act (7 
U.S.C. 6), if the Commodity Futures Trading Commission or the 
Securities and Exchange Commission determines that the regulation of 
swaps or security-based swaps markets in a foreign country undermines 
the stability of the United States financial system, either Commission, 
in consultation with the Secretary of the Treasury, may prohibit an 
entity domiciled in the foreign country from participating in the 
United States in any swap or security-based swap activities.
    SEC. 716. PROHIBITION AGAINST FEDERAL GOVERNMENT BAILOUTS OF SWAPS 
      ENTITIES.
    (a) Prohibition on Federal Assistance.--Notwithstanding any other 
provision of law (including regulations), no Federal assistance may be 
provided to any swaps entity with respect to any swap, security-based 
swap, or other activity of the swaps entity.
    (b) Definitions.--In this section:
        (1) Federal assistance.--The term ``Federal assistance'' means 
    the use of any advances from any Federal Reserve credit facility or 
    discount window that is not part of a program or facility with 
    broad-based eligibility under section 13(3)(A) of the Federal 
    Reserve Act, Federal Deposit Insurance Corporation insurance or 
    guarantees for the purpose of--
            (A) making any loan to, or purchasing any stock, equity 
        interest, or debt obligation of, any swaps entity;
            (B) purchasing the assets of any swaps entity;
            (C) guaranteeing any loan or debt issuance of any swaps 
        entity; or
            (D) entering into any assistance arrangement (including tax 
        breaks), loss sharing, or profit sharing with any swaps entity.
        (2) Swaps entity.--
            (A) In general.--The term ``swaps entity'' means any swap 
        dealer, security-based swap dealer, major swap participant, 
        major security-based swap participant, that is registered 
        under--
                (i) the Commodity Exchange Act (7 U.S.C. 1 et seq.); or
                (ii) the Securities Exchange Act of 1934 (15 U.S.C. 78a 
            et seq.).
            (B) Exclusion.--The term ``swaps entity'' does not include 
        any major swap participant or major security-based swap 
        participant that is an insured depository institution.
    (c) Affiliates of Insured Depository Institutions.--The prohibition 
on Federal assistance contained in subsection (a) does not apply to and 
shall not prevent an insured depository institution from having or 
establishing an affiliate which is a swaps entity, as long as such 
insured depository institution is part of a bank holding company, or 
savings and loan holding company, that is supervised by the Federal 
Reserve and such swaps entity affiliate complies with sections 23A and 
23B of the Federal Reserve Act and such other requirements as the 
Commodity Futures Trading Commission or the Securities Exchange 
Commission, as appropriate, and the Board of Governors of the Federal 
Reserve System, may determine to be necessary and appropriate.
    (d) Only Bona Fide Hedging and Traditional Bank Activities 
Permitted.--The prohibition in subsection (a) shall apply to any 
insured depository institution unless the insured depository 
institution limits its swap or security-based swap activities to:
        (1) Hedging and other similar risk mitigating activities 
    directly related to the insured depository institution's 
    activities.
        (2) Acting as a swaps entity for swaps or security-based swaps 
    involving rates or reference assets that are permissible for 
    investment by a national bank under the paragraph designated as 
    ``Seventh.'' of section 5136 of the Revised Statutes of the United 
    States ( 12 U.S.C. 24), other than as described in paragraph (3).
        (3) Limitation on credit default swaps.--Acting as a swaps 
    entity for credit default swaps, including swaps or security-based 
    swaps referencing the credit risk of asset-backed securities as 
    defined in section 3(a)(77) of the Securities Exchange Act of 1934 
    (15 U.S.C. 78c(a)(77)) (as amended by this Act) shall not be 
    considered a bank permissible activity for purposes of subsection 
    (d)(2) unless such swaps or security-based swaps are cleared by a 
    derivatives clearing organization (as such term is defined in 
    section la of the Commodity Exchange Act (7 U.S.C. la)) or a 
    clearing agency (as such term is defined in section 3 of the 
    Securities Exchange Act (15 U.S.C. 78c)) that is registered, or 
    exempt from registration, as a derivatives clearing organization 
    under the Commodity Exchange Act or as a clearing agency under the 
    Securities Exchange Act, respectively.
    (e) Existing Swaps and Security-based Swaps.--The prohibition in 
subsection (a) shall only apply to swaps or security-based swaps 
entered into by an insured depository institution after the end of the 
transition period described in subsection (f).
    (f) Transition Period.--To the extent an insured depository 
institution qualifies as a ``swaps entity'' and would be subject to the 
Federal assistance prohibition in subsection (a), the appropriate 
Federal banking agency, after consulting with and considering the views 
of the Commodity Futures Trading Commission or the Securities Exchange 
Commission, as appropriate, shall permit the insured depository 
institution up to 24 months to divest the swaps entity or cease the 
activities that require registration as a swaps entity. In establishing 
the appropriate transition period to effect such divestiture or 
cessation of activities, which may include making the swaps entity an 
affiliate of the insured depository institution, the appropriate 
Federal banking agency shall take into account and make written 
findings regarding the potential impact of such divestiture or 
cessation of activities on the insured depository institution's (1) 
mortgage lending, (2) small business lending, (3) job creation, and (4) 
capital formation versus the potential negative impact on insured 
depositors and the Deposit Insurance Fund of the Federal Deposit 
Insurance Corporation. The appropriate Federal banking agency may 
consider such other factors as may be appropriate. The appropriate 
Federal banking agency may place such conditions on the insured 
depository institution's divestiture or ceasing of activities of the 
swaps entity as it deems necessary and appropriate. The transition 
period under this subsection may be extended by the appropriate Federal 
banking agency, after consultation with the Commodity Futures Trading 
Commission and the Securities and Exchange Commission, for a period of 
up to 1 additional year.
    (g) Excluded Entities.--For purposes of this section, the term 
``swaps entity'' shall not include any insured depository institution 
under the Federal Deposit Insurance Act or a covered financial company 
under title II which is in a conservatorship, receivership, or a bridge 
bank operated by the Federal Deposit Insurance Corporation.
    (h) Effective Date.--The prohibition in subsection (a) shall be 
effective 2 years following the date on which this Act is effective.
    (i) Liquidation Required.--
        (1) In general.--
            (A) FDIC insured institutions.--All swaps entities that are 
        FDIC insured institutions that are put into receivership or 
        declared insolvent as a result of swap or security-based swap 
        activity of the swaps entities shall be subject to the 
        termination or transfer of that swap or security-based swap 
        activity in accordance with applicable law prescribing the 
        treatment of those contracts. No taxpayer funds shall be used 
        to prevent the receivership of any swap entity resulting from 
        swap or security-based swap activity of the swaps entity.
            (B) Institutions that pose a systemic risk and are subject 
        to heightened prudential supervision as regulated under section 
        113.--All swaps entities that are institutions that pose a 
        systemic risk and are subject to heightened prudential 
        supervision as regulated under section 113, that are put into 
        receivership or declared insolvent as a result of swap or 
        security-based swap activity of the swaps entities shall be 
        subject to the termination or transfer of that swap or 
        security-based swap activity in accordance with applicable law 
        prescribing the treatment of those contracts. No taxpayer funds 
        shall be used to prevent the receivership of any swap entity 
        resulting from swap or security-based swap activity of the 
        swaps entity.
            (C) Non-FDIC insured, non-systemically significant 
        institutions not subject to heightened prudential supervision 
        as regulated under section 113.--No taxpayer resources shall be 
        used for the orderly liquidation of any swaps entities that are 
        non-FDIC insured, non-systemically significant institutions not 
        subject to heightened prudential supervision as regulated under 
        section 113.
        (2) Recovery of funds.--All funds expended on the termination 
    or transfer of the swap or security-based swap activity of the 
    swaps entity shall be recovered in accordance with applicable law 
    from the disposition of assets of such swap entity or through 
    assessments, including on the financial sector as provided under 
    applicable law.
        (3) No losses to taxpayers.--Taxpayers shall bear no losses 
    from the exercise of any authority under this title.
    (j) Prohibition on Unregulated Combination of Swaps Entities and 
Banking.--At no time following adoption of the rules in subsection (k) 
may a bank or bank holding company be permitted to be or become a swap 
entity unless it conducts its swap or security-based swap activity in 
compliance with such minimum standards set by its prudential regulator 
as are reasonably calculated to permit the swaps entity to conduct its 
swap or security-based swap activities in a safe and sound manner and 
mitigate systemic risk.
    (k) Rules.--In prescribing rules, the prudential regulator for a 
swaps entity shall consider the following factors:
        (1) The expertise and managerial strength of the swaps entity, 
    including systems for effective oversight.
        (2) The financial strength of the swaps entity.
        (3) Systems for identifying, measuring and controlling risks 
    arising from the swaps entity's operations.
        (4) Systems for identifying, measuring and controlling the 
    swaps entity's participation in existing markets.
        (5) Systems for controlling the swaps entity's participation or 
    entry into in new markets and products.
    (l) Authority of the Financial Stability Oversight Council.--The 
Financial Stability Oversight Council may determine that, when other 
provisions established by this Act are insufficient to effectively 
mitigate systemic risk and protect taxpayers, that swaps entities may 
no longer access Federal assistance with respect to any swap, security-
based swap, or other activity of the swaps entity. Any such 
determination by the Financial Stability Oversight Council of a 
prohibition of federal assistance shall be made on an institution-by-
institution basis, and shall require the vote of not fewer than two-
thirds of the members of the Financial Stability Oversight Council, 
which must include the vote by the Chairman of the Council, the 
Chairman of the Board of Governors of the Federal Reserve System, and 
the Chairperson of the Federal Deposit Insurance Corporation. Notice 
and hearing requirements for such determinations shall be consistent 
with the standards provided in title I.
    (m) Ban on Proprietary Trading in Derivatives.--An insured 
depository institution shall comply with the prohibition on proprietary 
trading in derivatives as required by section 619 of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act.
    SEC. 717. NEW PRODUCT APPROVAL CFTC--SEC PROCESS.
    (a) Amendments to the Commodity Exchange Act.--Section 2(a)(1)(C) 
of the Commodity Exchange Act (7 U.S.C. 2(a)(1)(C)) is amended--
        (1) in clause (i) by striking ``This'' and inserting ``(I) 
    Except as provided in subclause (II), this''; and
        (2) by adding at the end of clause (i) the following:

                    ``(II) This Act shall apply to and the Commission 
                shall have jurisdiction with respect to accounts, 
                agreements, and transactions involving, and may permit 
                the listing for trading pursuant to section 5c(c) of, a 
                put, call, or other option on 1 or more securities (as 
                defined in section 2(a)(1) of the Securities Act of 
                1933 or section 3(a)(10) of the Securities Exchange Act 
                of 1934 on the date of enactment of the Futures Trading 
                Act of 1982), including any group or index of such 
                securities, or any interest therein or based on the 
                value thereof, that is exempted by the Securities and 
                Exchange Commission pursuant to section 36(a)(1) of the 
                Securities Exchange Act of 1934 with the condition that 
                the Commission exercise concurrent jurisdiction over 
                such put, call, or other option; provided, however, 
                that nothing in this paragraph shall be construed to 
                affect the jurisdiction and authority of the Securities 
                and Exchange Commission over such put, call, or other 
                option.''.

    (b) Amendments to the Securities Exchange Act of 1934.--The 
Securities Exchange Act of 1934 is amended by adding the following 
section after section 3A (15 U.S.C. 78c-1):
  ``SEC. 3B. SECURITIES-RELATED DERIVATIVES.
    ``(a) Any agreement, contract, or transaction (or class thereof) 
that is exempted by the Commodity Futures Trading Commission pursuant 
to section 4(c)(1) of the Commodity Exchange Act (7 U.S.C. 6(c)(1)) 
with the condition that the Commission exercise concurrent jurisdiction 
over such agreement, contract, or transaction (or class thereof) shall 
be deemed a security for purposes of the securities laws.
    ``(b) With respect to any agreement, contract, or transaction (or 
class thereof) that is exempted by the Commodity Futures Trading 
Commission pursuant to section 4(c)(1) of the Commodity Exchange Act (7 
U.S.C. 6(c)(1)) with the condition that the Commission exercise 
concurrent jurisdiction over such agreement, contract, or transaction 
(or class thereof), references in the securities laws to the `purchase' 
or `sale' of a security shall be deemed to include the execution, 
termination (prior to its scheduled maturity date), assignment, 
exchange, or similar transfer or conveyance of, or extinguishing of 
rights or obligations under such agreement, contract, or transaction, 
as the context may require.''.
    (c) Amendment to Securities Exchange Act of 1934.--Section 19(b) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78s(b)) is amended by 
adding at the end the following:
        ``(10) Notwithstanding paragraph (2), the time period within 
    which the Commission is required by order to approve a proposed 
    rule change or institute proceedings to determine whether the 
    proposed rule change should be disapproved is stayed pending a 
    determination by the Commission upon the request of the Commodity 
    Futures Trading Commission or its Chairman that the Commission 
    issue a determination as to whether a product that is the subject 
    of such proposed rule change is a security pursuant to section 718 
    of the Wall Street Transparency and Accountability Act of 2010.''.
    (d) Amendment to Commodity Exchange Act.--Section 5c(c)(1) of the 
Commodity Exchange Act (7 U.S.C. 7a-2(c)(1)) is amended--
        (1) by striking ``Subject to paragraph (2)'' and inserting the 
    following:
            ``(A) Election.--Subject to paragraph (2)''; and
        (2) by adding at the end the following:
            ``(B) Certification.--The certification of a product 
        pursuant to this paragraph shall be stayed pending a 
        determination by the Commission upon the request of the 
        Securities and Exchange Commission or its Chairman that the 
        Commission issue a determination as to whether the product that 
        is the subject of such certification is a contract of sale of a 
        commodity for future delivery, an option on such a contract, or 
        an option on a commodity pursuant to section 718 of the Wall 
        Street Transparency and Accountability Act of 2010.''.
    SEC. 718. DETERMINING STATUS OF NOVEL DERIVATIVE PRODUCTS.
    (a) Process for Determining the Status of a Novel Derivative 
Product.--
        (1) Notice.--
            (A) In general.--Any person filing a proposal to list or 
        trade a novel derivative product that may have elements of both 
        securities and contracts of sale of a commodity for future 
        delivery (or options on such contracts or options on 
        commodities) may concurrently provide notice and furnish a copy 
        of such filing with the Securities and Exchange Commission and 
        the Commodity Futures Trading Commission. Any such notice shall 
        state that notice has been made with both Commissions.
            (B) Notification.--If no concurrent notice is made pursuant 
        to subparagraph (A), within 5 business days after determining 
        that a proposal that seeks to list or trade a novel derivative 
        product may have elements of both securities and contracts of 
        sale of a commodity for future delivery (or options on such 
        contracts or options on commodities), the Securities and 
        Exchange Commission or the Commodity Futures Trading 
        Commission, as applicable, shall notify the other Commission 
        and provide a copy of such filing to the other Commission.
        (2) Request for determination.--
            (A) In general.--No later than 21 days after receipt of a 
        notice under paragraph (1), or upon its own initiative if no 
        such notice is received, the Commodity Futures Trading 
        Commission may request that the Securities and Exchange 
        Commission issue a determination as to whether a product is a 
        security, as defined in section 3(a)(10) of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78c(a)(10)).
            (B) Request.--No later than 21 days after receipt of a 
        notice under paragraph (1), or upon its own initiative if no 
        such notice is received, the Securities and Exchange Commission 
        may request that the Commodity Futures Trading Commission issue 
        a determination as to whether a product is a contract of sale 
        of a commodity for future delivery, an option on such a 
        contract, or an option on a commodity subject to the Commodity 
        Futures Trading Commission's exclusive jurisdiction under 
        section 2(a)(1)(A) of the Commodity Exchange Act (7 U.S.C. 
        2(a)(1)(A)).
            (C) Requirement relating to request.--A request under 
        subparagraph (A) or (B) shall be made by submitting such 
        request, in writing, to the Securities and Exchange Commission 
        or the Commodity Futures Trading Commission, as applicable.
            (D) Effect.--Nothing in this paragraph shall be construed 
        to prevent--
                (i) the Commodity Futures Trading Commission from 
            requesting that the Securities and Exchange Commission 
            grant an exemption pursuant to section 36(a)(1) of the 
            Securities Exchange Act of 1934 (15 U.S.C. 78mm(a)(1)) with 
            respect to a product that is the subject of a filing under 
            paragraph (1); or
                (ii) the Securities and Exchange Commission from 
            requesting that the Commodity Futures Trading Commission 
            grant an exemption pursuant to section 4(c)(1) of the 
            Commodity Exchange Act (7 U.S.C. 6(c)(1)) with respect to a 
            product that is the subject of a filing under paragraph 
            (1),
        Provided, however, that nothing in this subparagraph shall be 
        construed to require the Commodity Futures Trading Commission 
        or the Securities and Exchange Commission to issue an exemption 
        requested pursuant to this subparagraph; provided further, That 
        an order granting or denying an exemption described in this 
        subparagraph and issued under paragraph (3)(B) shall not be 
        subject to judicial review pursuant to subsection (b).
            (E) Withdrawal of request.--A request under subparagraph 
        (A) or (B) may be withdrawn by the Commission making the 
        request at any time prior to a determination being made 
        pursuant to paragraph (3) for any reason by providing written 
        notice to the head of the other Commission.
        (3) Determination.--Notwithstanding any other provision of law, 
    no later than 120 days after the date of receipt of a request--
            (A) under subparagraph (A) or (B) of paragraph (2), unless 
        such request has been withdrawn pursuant to paragraph (2)(E), 
        the Securities and Exchange Commission or the Commodity Futures 
        Trading Commission, as applicable, shall, by order, issue the 
        determination requested in subparagraph (A) or (B) of paragraph 
        (2), as applicable, and the reasons therefor; or
            (B) under paragraph (2)(D), unless such request has been 
        withdrawn, the Securities and Exchange Commission or the 
        Commodity Futures Trading Commission, as applicable, shall 
        grant an exemption or provide reasons for not granting such 
        exemption, provided that any decision by the Securities and 
        Exchange Commission not to grant such exemption shall not be 
        reviewable under section 25 of the Securities Exchange Act of 
        1934 (15 U.S.C. 78y).
    (b) Judicial Resolution.--
        (1) In general.--The Commodity Futures Trading Commission or 
    the Securities and Exchange Commission may petition the United 
    States Court of Appeals for the District of Columbia Circuit for 
    review of a final order of the other Commission issued pursuant to 
    subsection (a)(3)(A), with respect to a novel derivative product 
    that may have elements of both securities and contracts of sale of 
    a commodity for future delivery (or options on such contracts or 
    options on commodities) that it believes affects its statutory 
    jurisdiction within 60 days after the date of entry of such order, 
    a written petition requesting a review of the order. Any such 
    proceeding shall be expedited by the Court of Appeals.
        (2) Transmittal of petition and record.--A copy of a petition 
    described in paragraph (1) shall be transmitted not later than 1 
    business day after filing by the complaining Commission to the 
    responding Commission. On receipt of the petition, the responding 
    Commission shall file with the court a copy of the order under 
    review and any documents referred to therein, and any other 
    materials prescribed by the court.
        (3) Standard of review.--The court, in considering a petition 
    filed pursuant to paragraph (1), shall give no deference to, or 
    presumption in favor of, the views of either Commission.
        (4) Judicial stay.--The filing of a petition by the complaining 
    Commission pursuant to paragraph (1) shall operate as a stay of the 
    order, until the date on which the determination of the court is 
    final (including any appeal of the determination).
    SEC. 719. STUDIES.
    (a) Study on Effects of Position Limits on Trading on Exchanges in 
the United States.--
        (1) Study.--The Commodity Futures Trading Commission, in 
    consultation with each entity that is a designated contract market 
    under the Commodity Exchange Act, shall conduct a study of the 
    effects (if any) of the position limits imposed pursuant to the 
    other provisions of this title on excessive speculation and on the 
    movement of transactions from exchanges in the United States to 
    trading venues outside the United States.
        (2) Report to the congress.--Within 12 months after the 
    imposition of position limits pursuant to the other provisions of 
    this title, the Commodity Futures Trading Commission, in 
    consultation with each entity that is a designated contract market 
    under the Commodity Exchange Act, shall submit to the Congress a 
    report on the matters described in paragraph (1).
        (3) Required hearing.--Within 30 legislative days after the 
    submission to the Congress of the report described in paragraph 
    (2), the Committee on Agriculture of the House of Representatives 
    shall hold a hearing examining the findings of the report.
        (4) Biennial reporting.--In addition to the study required in 
    paragraph (1), the Chairman of the Commodity Futures Trading 
    Commission shall prepare and submit to the Congress biennial 
    reports on the growth or decline of the derivatives markets in the 
    United States and abroad, which shall include assessments of the 
    causes of any such growth or decline, the effectiveness of 
    regulatory regimes in managing systemic risk, a comparison of the 
    costs of compliance at the time of the report for market 
    participants subject to regulation by the United States with the 
    costs of compliance in December 2008 for the market participants, 
    and the quality of the available data. In preparing the report, the 
    Chairman shall solicit the views of, consult with, and address the 
    concerns raised by, market participants, regulators, legislators, 
    and other interested parties.
    (b) Study on Feasibility of Requiring Use of Standardized 
Algorithmic Descriptions for Financial Derivatives.--
        (1) In general.--The Securities and Exchange Commission and the 
    Commodity Futures Trading Commission shall conduct a joint study of 
    the feasibility of requiring the derivatives industry to adopt 
    standardized computer-readable algorithmic descriptions which may 
    be used to describe complex and standardized financial derivatives.
        (2) Goals.--The algorithmic descriptions defined in the study 
    shall be designed to facilitate computerized analysis of individual 
    derivative contracts and to calculate net exposures to complex 
    derivatives. The algorithmic descriptions shall be optimized for 
    simultaneous use by--
            (A) commercial users and traders of derivatives;
            (B) derivative clearing houses, exchanges and electronic 
        trading platforms;
            (C) trade repositories and regulator investigations of 
        market activities; and
            (D) systemic risk regulators.
    The study will also examine the extent to which the algorithmic 
    description, together with standardized and extensible legal 
    definitions, may serve as the binding legal definition of 
    derivative contracts. The study will examine the logistics of 
    possible implementations of standardized algorithmic descriptions 
    for derivatives contracts. The study shall be limited to electronic 
    formats for exchange of derivative contract descriptions and will 
    not contemplate disclosure of proprietary valuation models.
        (3) International coordination.--In conducting the study, the 
    Securities and Exchange Commission and the Commodity Futures 
    Trading Commission shall coordinate the study with international 
    financial institutions and regulators as appropriate and practical.
        (4) Report.--Within 8 months after the date of the enactment of 
    this Act, the Securities and Exchange Commission and the Commodity 
    Futures Trading Commission shall jointly submit to the Committees 
    on Agriculture and on Financial Services of the House of 
    Representatives and the Committees on Agriculture, Nutrition, and 
    Forestry and on Banking, Housing, and Urban Affairs of the Senate a 
    written report which contains the results of the study required by 
    paragraphs (1) through (3).
    (c) International Swap Regulation.--
        (1) In general.--The Commodity Futures Trading Commission and 
    the Securities and Exchange Commission shall jointly conduct a 
    study--
            (A) relating to--
                (i) swap regulation in the United States, Asia, and 
            Europe; and
                (ii) clearing house and clearing agency regulation in 
            the United States, Asia, and Europe; and
            (B) that identifies areas of regulation that are similar in 
        the United States, Asia and Europe and other areas of 
        regulation that could be harmonized
        (2) Report.--Not later than 18 months after the date of 
    enactment of this Act, the Commodity Futures Trading Commission and 
    the Securities and Exchange Commission shall submit to the 
    Committee on Agriculture, Nutrition, and Forestry and the Committee 
    on Banking, Housing, and Urban Affairs of the Senate and the 
    Committee on Agriculture and the Committee on Financial Services of 
    the House of Representatives a report that includes a description 
    of the results of the study under subsection (a), including--
            (A) identification of the major exchanges and their 
        regulator in each geographic area for the trading of swaps and 
        security-based swaps including a listing of the major contracts 
        and their trading volumes and notional values as well as 
        identification of the major swap dealers participating in such 
        markets;
            (B) identification of the major clearing houses and 
        clearing agencies and their regulator in each geographic area 
        for the clearing of swaps and security-based swaps, including a 
        listing of the major contracts and the clearing volumes and 
        notional values as well as identification of the major clearing 
        members of such clearing houses and clearing agencies in such 
        markets;
            (C) a description of the comparative methods of clearing 
        swaps in the United States, Asia, and Europe; and
            (D) a description of the various systems used for 
        establishing margin on individual swaps, security-based swaps, 
        and swap portfolios.
    (d) Stable Value Contracts.--
        (1) Determination.--
            (A) Status.--Not later than 15 months after the date of the 
        enactment of this Act, the Securities and Exchange Commission 
        and the Commodity Futures Trading Commission shall, jointly, 
        conduct a study to determine whether stable value contracts 
        fall within the definition of a swap. In making the 
        determination required under this subparagraph, the Commissions 
        jointly shall consult with the Department of Labor, the 
        Department of the Treasury, and the State entities that 
        regulate the issuers of stable value contracts.
            (B) Regulations.--If the Commissions determine that stable 
        value contracts fall within the definition of a swap, the 
        Commissions jointly shall determine if an exemption for stable 
        value contracts from the definition of swap is appropriate and 
        in the public interest. The Commissions shall issue regulations 
        implementing the determinations required under this paragraph. 
        Until the effective date of such regulations, and 
        notwithstanding any other provision of this title, the 
        requirements of this title shall not apply to stable value 
        contracts.
            (C) Legal certainty.--Stable value contracts in effect 
        prior to the effective date of the regulations described in 
        subparagraph (B) shall not be considered swaps.
        (2) Definition.--For purposes of this subsection, the term 
    ``stable value contract'' means any contract, agreement, or 
    transaction that provides a crediting interest rate and guaranty or 
    financial assurance of liquidity at contract or book value prior to 
    maturity offered by a bank, insurance company, or other State or 
    federally regulated financial institution for the benefit of any 
    individual or commingled fund available as an investment in an 
    employee benefit plan (as defined in section 3(3) of the Employee 
    Retirement Income Security Act of 1974, including plans described 
    in section 3(32) of such Act) subject to participant direction, an 
    eligible deferred compensation plan (as defined in section 457(b) 
    of the Internal Revenue Code of 1986) that is maintained by an 
    eligible employer described in section 457(e)(1)(A) of such Code, 
    an arrangement described in section 403(b) of such Code, or a 
    qualified tuition program (as defined in section 529 of such Code).
    SEC. 720. MEMORANDUM.
    (a)(1) The Commodity Futures Trading Commission and the Federal 
Energy Regulatory Commission shall, not later than 180 days after the 
date of the enactment of this Act, negotiate a memorandum of 
understanding to establish procedures for--
        (A) applying their respective authorities in a manner so as to 
    ensure effective and efficient regulation in the public interest;
        (B) resolving conflicts concerning overlapping jurisdiction 
    between the 2 agencies; and
        (C) avoiding, to the extent possible, conflicting or 
    duplicative regulation.
    (2) Such memorandum and any subsequent amendments to the memorandum 
shall be promptly submitted to the appropriate committees of Congress.
    (b) The Commodity Futures Trading Commission and the Federal Energy 
Regulatory Commission shall, not later than 180 days after the date of 
the enactment of this section, negotiate a memorandum of understanding 
to share information that may be requested where either Commission is 
conducting an investigation into potential manipulation, fraud, or 
market power abuse in markets subject to such Commission's regulation 
or oversight. Shared information shall remain subject to the same 
restrictions on disclosure applicable to the Commission initially 
holding the information.

                  PART II--REGULATION OF SWAP MARKETS

    SEC. 721. DEFINITIONS.
    (a) In General.--Section 1a of the Commodity Exchange Act (7 U.S.C. 
1a) is amended--
        (1) by redesignating paragraphs (2), (3) and (4), (5) through 
    (17), (18) through (23), (24) through (28), (29), (30), (31) 
    through (33), and (34) as paragraphs (6), (8) and (9), (11) through 
    (23), (26) through (31), (34) through (38), (40), (41), (44) 
    through (46), and (51), respectively;
        (2) by inserting after paragraph (1) the following:
        ``(2) Appropriate federal banking agency.--The term 
    `appropriate Federal banking agency'--
            ``(A) has the meaning given the term in section 3 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1813);
            ``(B) means the Board in the case of a noninsured State 
        bank; and
            ``(C) is the Farm Credit Administration for farm credit 
        system institutions.
        ``(3) Associated person of a security-based swap dealer or 
    major security-based swap participant.--The term `associated person 
    of a security-based swap dealer or major security-based swap 
    participant' has the meaning given the term in section 3(a) of the 
    Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).
        ``(4) Associated person of a swap dealer or major swap 
    participant.--
            ``(A) In general.--The term `associated person of a swap 
        dealer or major swap participant' means a person who is 
        associated with a swap dealer or major swap participant as a 
        partner, officer, employee, or agent (or any person occupying a 
        similar status or performing similar functions), in any 
        capacity that involves--
                ``(i) the solicitation or acceptance of swaps; or
                ``(ii) the supervision of any person or persons so 
            engaged.
            ``(B) Exclusion.--Other than for purposes of section 
        4s(b)(6), the term `associated person of a swap dealer or major 
        swap participant' does not include any person associated with a 
        swap dealer or major swap participant the functions of which 
        are solely clerical or ministerial.
        ``(5) Board.--The term `Board' means the Board of Governors of 
    the Federal Reserve System.'';
        (3) by inserting after paragraph (6) (as redesignated by 
    paragraph (1)) the following:
        ``(7) Cleared swap.--The term `cleared swap' means any swap 
    that is, directly or indirectly, submitted to and cleared by a 
    derivatives clearing organization registered with the 
    Commission.'';
        (4) in paragraph (9) (as redesignated by paragraph (1)), by 
    striking ``except onions'' and all that follows through the period 
    at the end and inserting the following: ``except onions (as 
    provided by the first section of Public Law 85-839 (7 U.S.C. 13-1)) 
    and motion picture box office receipts (or any index, measure, 
    value, or data related to such receipts), and all services, rights, 
    and interests (except motion picture box office receipts, or any 
    index, measure, value or data related to such receipts) in which 
    contracts for future delivery are presently or in the future dealt 
    in.'';
        (5) by inserting after paragraph (9) (as redesignated by 
    paragraph (1)) the following:
        ``(10) Commodity pool.--
            ``(A) In general.--The term `commodity pool' means any 
        investment trust, syndicate, or similar form of enterprise 
        operated for the purpose of trading in commodity interests, 
        including any--
                ``(i) commodity for future delivery, security futures 
            product, or swap;
                ``(ii) agreement, contract, or transaction described in 
            section 2(c)(2)(C)(i) or section 2(c)(2)(D)(i);
                ``(iii) commodity option authorized under section 4c; 
            or
                ``(iv) leverage transaction authorized under section 
            19.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `commodity pool' any investment trust, syndicate, or similar 
        form of enterprise if the Commission determines that the rule 
        or regulation will effectuate the purposes of this Act.'';
        (6) by striking paragraph (11) (as redesignated by paragraph 
    (1)) and inserting the following:
        ``(11) Commodity pool operator.--
            ``(A) In general.--The term `commodity pool operator' means 
        any person--
                ``(i) engaged in a business that is of the nature of a 
            commodity pool, investment trust, syndicate, or similar 
            form of enterprise, and who, in connection therewith, 
            solicits, accepts, or receives from others, funds, 
            securities, or property, either directly or through capital 
            contributions, the sale of stock or other forms of 
            securities, or otherwise, for the purpose of trading in 
            commodity interests, including any--

                    ``(I) commodity for future delivery, security 
                futures product, or swap;
                    ``(II) agreement, contract, or transaction 
                described in section 2(c)(2)(C)(i) or section 
                2(c)(2)(D)(i);
                    ``(III) commodity option authorized under section 
                4c; or
                    ``(IV) leverage transaction authorized under 
                section 19; or

                ``(ii) who is registered with the Commission as a 
            commodity pool operator.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `commodity pool operator' any person engaged in a business that 
        is of the nature of a commodity pool, investment trust, 
        syndicate, or similar form of enterprise if the Commission 
        determines that the rule or regulation will effectuate the 
        purposes of this Act.'';
        (7) in paragraph (12) (as redesignated by paragraph (1)), in 
    subparagraph (A)--
            (A) in clause (i)--
                (i) in subclause (I), by striking ``made or to be made 
            on or subject to the rules of a contract market or 
            derivatives transaction execution facility'' and inserting 
            ``, security futures product, or swap'';
                (ii) by redesignating subclauses (II) and (III) as 
            subclauses (III) and (IV);
                (iii) by inserting after subclause (I) the following:

                    ``(II) any agreement, contract, or transaction 
                described in section 2(c)(2)(C)(i) or section 
                2(c)(2)(D)(i)''; and

                (iv) in subclause (IV) (as so redesignated), by 
            striking ``or'';
            (B) in clause (ii), by striking the period at the end and 
        inserting a semicolon; and
            (C) by adding at the end the following:
                ``(iii) is registered with the Commission as a 
            commodity trading advisor; or
                ``(iv) the Commission, by rule or regulation, may 
            include if the Commission determines that the rule or 
            regulation will effectuate the purposes of this Act.'';
        (8) in paragraph (17) (as redesignated by paragraph (1)), in 
    subparagraph (A), in the matter preceding clause (i), by striking 
    ``paragraph (12)(A)'' and inserting ``paragraph (18)(A)'';
        (9) in paragraph (18) (as redesignated by paragraph (1))--
            (A) in subparagraph (A)--
                (i) in the matter following clause (vii)(III)--

                    (I) by striking ``section 1a (11)(A)'' and 
                inserting ``paragraph (17)(A)''; and
                    (II) by striking ``$25,000,000'' and inserting 
                ``$50,000,000''; and

                (ii) in clause (xi), in the matter preceding subclause 
            (I), by striking ``total assets in an amount'' and 
            inserting ``amounts invested on a discretionary basis, the 
            aggregate of which is'';
        (10) by striking paragraph (22) (as redesignated by paragraph 
    (1)) and inserting the following:
        ``(22) Floor broker.--
            ``(A) In general.--The term `floor broker' means any 
        person--
                ``(i) who, in or surrounding any pit, ring, post, or 
            other place provided by a contract market for the meeting 
            of persons similarly engaged, shall purchase or sell for 
            any other person--

                    ``(I) any commodity for future delivery, security 
                futures product, or swap; or
                    ``(II) any commodity option authorized under 
                section 4c; or

                ``(ii) who is registered with the Commission as a floor 
            broker.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `floor broker' any person in or surrounding any pit, ring, 
        post, or other place provided by a contract market for the 
        meeting of persons similarly engaged who trades for any other 
        person if the Commission determines that the rule or regulation 
        will effectuate the purposes of this Act.'';
        (11) by striking paragraph (23) (as redesignated by paragraph 
    (1)) and inserting the following:
        ``(23) Floor trader.--
            ``(A) In general.--The term `floor trader' means any 
        person--
                ``(i) who, in or surrounding any pit, ring, post, or 
            other place provided by a contract market for the meeting 
            of persons similarly engaged, purchases, or sells solely 
            for such person's own account--

                    ``(I) any commodity for future delivery, security 
                futures product, or swap; or
                    ``(II) any commodity option authorized under 
                section 4c; or

                ``(ii) who is registered with the Commission as a floor 
            trader.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `floor trader' any person in or surrounding any pit, ring, 
        post, or other place provided by a contract market for the 
        meeting of persons similarly engaged who trades solely for such 
        person's own account if the Commission determines that the rule 
        or regulation will effectuate the purposes of this Act.'';
        (12) by inserting after paragraph (23) (as redesignated by 
    paragraph (1)) the following:
        ``(24) Foreign exchange forward.--The term `foreign exchange 
    forward' means a transaction that solely involves the exchange of 2 
    different currencies on a specific future date at a fixed rate 
    agreed upon on the inception of the contract covering the exchange.
        ``(25) Foreign exchange swap.--The term `foreign exchange swap' 
    means a transaction that solely involves--
            ``(A) an exchange of 2 different currencies on a specific 
        date at a fixed rate that is agreed upon on the inception of 
        the contract covering the exchange; and
            ``(B) a reverse exchange of the 2 currencies described in 
        subparagraph (A) at a later date and at a fixed rate that is 
        agreed upon on the inception of the contract covering the 
        exchange.'';
        (13) by striking paragraph (28) (as redesignated by paragraph 
    (1)) and inserting the following:
        ``(28) Futures commission merchant.--
            ``(A) In general.--The term `futures commission merchant' 
        means an individual, association, partnership, corporation, or 
        trust--
                ``(i) that--

                    ``(I) is--

                        ``(aa) engaged in soliciting or in accepting 
                    orders for--
                            ``(AA) the purchase or sale of a commodity 
                        for future delivery;
                            ``(BB) a security futures product;
                            ``(CC) a swap;
                            ``(DD) any agreement, contract, or 
                        transaction described in section 2(c)(2)(C)(i) 
                        or section 2(c)(2)(D)(i);
                            ``(EE) any commodity option authorized 
                        under section 4c; or
                            ``(FF) any leverage transaction authorized 
                        under section 19; or
                        ``(bb) acting as a counterparty in any 
                    agreement, contract, or transaction described in 
                    section 2(c)(2)(C)(i) or section 2(c)(2)(D)(i); and

                    ``(II) in or in connection with the activities 
                described in items (aa) or (bb) of subclause (I), 
                accepts any money, securities, or property (or extends 
                credit in lieu thereof) to margin, guarantee, or secure 
                any trades or contracts that result or may result 
                therefrom; or

                ``(ii) that is registered with the Commission as a 
            futures commission merchant.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `futures commission merchant' any person who engages in 
        soliciting or accepting orders for, or acting as a counterparty 
        in, any agreement, contract, or transaction subject to this 
        Act, and who accepts any money, securities, or property (or 
        extends credit in lieu thereof) to margin, guarantee, or secure 
        any trades or contracts that result or may result therefrom, if 
        the Commission determines that the rule or regulation will 
        effectuate the purposes of this Act.'';
        (14) in paragraph (30) (as redesignated by paragraph (1)), in 
    subparagraph (B), by striking ``state'' and inserting ``State'';
        (15) by striking paragraph (31) (as redesignated by paragraph 
    (1)) and inserting the following:
        ``(31) Introducing broker.--
            ``(A) In general.--The term `introducing broker' means any 
        person (except an individual who elects to be and is registered 
        as an associated person of a futures commission merchant)--
                ``(i) who--

                    ``(I) is engaged in soliciting or in accepting 
                orders for--

                        ``(aa) the purchase or sale of any commodity 
                    for future delivery, security futures product, or 
                    swap;
                        ``(bb) any agreement, contract, or transaction 
                    described in section 2(c)(2)(C)(i) or section 
                    2(c)(2)(D)(i);
                        ``(cc) any commodity option authorized under 
                    section 4c; or
                        ``(dd) any leverage transaction authorized 
                    under section 19; and

                    ``(II) does not accept any money, securities, or 
                property (or extend credit in lieu thereof) to margin, 
                guarantee, or secure any trades or contracts that 
                result or may result therefrom; or

                ``(ii) who is registered with the Commission as an 
            introducing broker.
            ``(B) Further definition.--The Commission, by rule or 
        regulation, may include within, or exclude from, the term 
        `introducing broker' any person who engages in soliciting or 
        accepting orders for any agreement, contract, or transaction 
        subject to this Act, and who does not accept any money, 
        securities, or property (or extend credit in lieu thereof) to 
        margin, guarantee, or secure any trades or contracts that 
        result or may result therefrom, if the Commission determines 
        that the rule or regulation will effectuate the purposes of 
        this Act.'';
        (16) by inserting after paragraph (31) (as redesignated by 
    paragraph (1)) the following:
        ``(32) Major security-based swap participant.--The term `major 
    security-based swap participant' has the meaning given the term in 
    section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
    78c(a)).
        ``(33) Major swap participant.--
            ``(A) In general.--The term `major swap participant' means 
        any person who is not a swap dealer, and--
                ``(i) maintains a substantial position in swaps for any 
            of the major swap categories as determined by the 
            Commission, excluding--

                    ``(I) positions held for hedging or mitigating 
                commercial risk; and
                    ``(II) positions maintained by any employee benefit 
                plan (or any contract held by such a plan) as defined 
                in paragraphs (3) and (32) of section 3 of the Employee 
                Retirement Income Security Act of 1974 (29 U.S.C. 1002) 
                for the primary purpose of hedging or mitigating any 
                risk directly associated with the operation of the 
                plan;

                ``(ii) whose outstanding swaps create substantial 
            counterparty exposure that could have serious adverse 
            effects on the financial stability of the United States 
            banking system or financial markets; or
                ``(iii)(I) is a financial entity that is highly 
            leveraged relative to the amount of capital it holds and 
            that is not subject to capital requirements established by 
            an appropriate Federal banking agency; and
                ``(II) maintains a substantial position in outstanding 
            swaps in any major swap category as determined by the 
            Commission.
            ``(B) Definition of substantial position.--For purposes of 
        subparagraph (A), the Commission shall define by rule or 
        regulation the term `substantial position' at the threshold 
        that the Commission determines to be prudent for the effective 
        monitoring, management, and oversight of entities that are 
        systemically important or can significantly impact the 
        financial system of the United States. In setting the 
        definition under this subparagraph, the Commission shall 
        consider the person's relative position in uncleared as opposed 
        to cleared swaps and may take into consideration the value and 
        quality of collateral held against counterparty exposures.
            ``(C) Scope of designation.--For purposes of subparagraph 
        (A), a person may be designated as a major swap participant for 
        1 or more categories of swaps without being classified as a 
        major swap participant for all classes of swaps.
            ``(D) Exclusions.--The definition under this paragraph 
        shall not include an entity whose primary business is providing 
        financing, and uses derivatives for the purpose of hedging 
        underlying commercial risks related to interest rate and 
        foreign currency exposures, 90 percent or more of which arise 
        from financing that facilitates the purchase or lease of 
        products, 90 percent or more of which are manufactured by the 
        parent company or another subsidiary of the parent company.'';
        (17) by inserting after paragraph (38) (as redesignated by 
    paragraph (1)) the following:
        ``(39) Prudential regulator.--The term `prudential regulator' 
    means--
            ``(A) the Board in the case of a swap dealer, major swap 
        participant, security-based swap dealer, or major security-
        based swap participant that is--
                ``(i) a State-chartered bank that is a member of the 
            Federal Reserve System;
                ``(ii) a State-chartered branch or agency of a foreign 
            bank;
                ``(iii) any foreign bank which does not operate an 
            insured branch;
                ``(iv) any organization operating under section 25A of 
            the Federal Reserve Act or having an agreement with the 
            Board under section 225 of the Federal Reserve Act;
                ``(v) any bank holding company (as defined in section 2 
            of the Bank Holding Company Act of 1965 (12 U.S.C. 1841)), 
            any foreign bank (as defined in section 1(b)(7) of the 
            International Banking Act of 1978 (12 U.S.C. 3101(b)(7)) 
            that is treated as a bank holding company under section 
            8(a) of the International Banking Act of 1978 (12 U.S.C. 
            3106(a)), and any subsidiary of such a company or foreign 
            bank (other than a subsidiary that is described in 
            subparagraph (A) or (B) or that is required to be 
            registered with the Commission as a swap dealer or major 
            swap participant under this Act or with the Securities and 
            Exchange Commission as a security-based swap dealer or 
            major security-based swap participant);
                ``(vi) after the transfer date (as defined in section 
            311 of the Dodd-Frank Wall Street Reform and Consumer 
            Protection Act), any savings and loan holding company (as 
            defined in section 10 of the Home Owners' Loan Act (12 
            U.S.C. 1467a)) and any subsidiary of such company (other 
            than a subsidiary that is described in subparagraph (A) or 
            (B) or that is required to be registered as a swap dealer 
            or major swap participant with the Commission under this 
            Act or with the Securities and Exchange Commission as a 
            security-based swap dealer or major security-based swap 
            participant); or
                ``(vii) any organization operating under section 25A of 
            the Federal Reserve Act (12U.S.C. 611 et seq.) or having an 
            agreement with the Board under section 25 of the Federal 
            Reserve Act (12 U.S.C. 601 et seq.);
            ``(B) the Office of the Comptroller of the Currency in the 
        case of a swap dealer, major swap participant, security-based 
        swap dealer, or major security-based swap participant that is--
                ``(i) a national bank;
                ``(ii) a federally chartered branch or agency of a 
            foreign bank; or
                ``(iii) any Federal savings association;
            ``(C) the Federal Deposit Insurance Corporation in the case 
        of a swap dealer, major swap participant, security-based swap 
        dealer, or major security-based swap participant that is--
                ``(i) a State-chartered bank that is not a member of 
            the Federal Reserve System; or
                ``(ii) any State savings association;
            ``(D) the Farm Credit Administration, in the case of a swap 
        dealer, major swap participant, security-based swap dealer, or 
        major security-based swap participant that is an institution 
        chartered under the Farm Credit Act of 1971 (12 U.S.C. 2001 et 
        seq.); and
            ``(E) the Federal Housing Finance Agency in the case of a 
        swap dealer, major swap participant, security-based swap 
        dealer, or major security-based swap participant that is a 
        regulated entity (as such term is defined in section 1303 of 
        the Federal Housing Enterprises Financial Safety and Soundness 
        Act of 1992).'';
        (18) in paragraph (40) (as redesignated by paragraph (1))--
            (A) by striking subparagraph (B);
            (B) by redesignating subparagraphs (C), (D), and (E) as 
        subparagraphs (B), (C), and (F), respectively;
            (C) in subparagraph (C) (as so redesignated), by striking 
        ``and''; and
            (D) by inserting after subparagraph (C) (as so 
        redesignated) the following:
            ``(D) a swap execution facility registered under section 
        5h;
            ``(E) a swap data repository registered under section 21; 
        and'';
        (19) by inserting after paragraph (41) (as redesignated by 
    paragraph (1)) the following:
        ``(42) Security-based swap.--The term `security-based swap' has 
    the meaning given the term in section 3(a) of the Securities 
    Exchange Act of 1934 (15 U.S.C. 78c(a)).
        ``(43) Security-based swap dealer.--The term `security-based 
    swap dealer' has the meaning given the term in section 3(a) of the 
    Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).'';
        (20) in paragraph (46) (as redesignated by paragraph (1)), by 
    striking ``subject to section 2(h)(7)'' and inserting ``subject to 
    section 2(h)(5)'';
        (21) by inserting after paragraph (46) (as redesignated by 
    paragraph (1)) the following:
        ``(47) Swap.--
            ``(A) In general.--Except as provided in subparagraph (B), 
        the term `swap' means any agreement, contract, or transaction--
                ``(i) that is a put, call, cap, floor, collar, or 
            similar option of any kind that is for the purchase or 
            sale, or based on the value, of 1 or more interest or other 
            rates, currencies, commodities, securities, instruments of 
            indebtedness, indices, quantitative measures, or other 
            financial or economic interests or property of any kind;
                ``(ii) that provides for any purchase, sale, payment, 
            or delivery (other than a dividend on an equity security) 
            that is dependent on the occurrence, nonoccurrence, or the 
            extent of the occurrence of an event or contingency 
            associated with a potential financial, economic, or 
            commercial consequence;
                ``(iii) that provides on an executory basis for the 
            exchange, on a fixed or contingent basis, of 1 or more 
            payments based on the value or level of 1 or more interest 
            or other rates, currencies, commodities, securities, 
            instruments of indebtedness, indices, quantitative 
            measures, or other financial or economic interests or 
            property of any kind, or any interest therein or based on 
            the value thereof, and that transfers, as between the 
            parties to the transaction, in whole or in part, the 
            financial risk associated with a future change in any such 
            value or level without also conveying a current or future 
            direct or indirect ownership interest in an asset 
            (including any enterprise or investment pool) or liability 
            that incorporates the financial risk so transferred, 
            including any agreement, contract, or transaction commonly 
            known as--

                    ``(I) an interest rate swap;
                    ``(II) a rate floor;
                    ``(III) a rate cap;
                    ``(IV) a rate collar;
                    ``(V) a cross-currency rate swap;
                    ``(VI) a basis swap;
                    ``(VII) a currency swap;
                    ``(VIII) a foreign exchange swap;
                    ``(IX) a total return swap;
                    ``(X) an equity index swap;
                    ``(XI) an equity swap;
                    ``(XII) a debt index swap;
                    ``(XIII) a debt swap;
                    ``(XIV) a credit spread;
                    ``(XV) a credit default swap;
                    ``(XVI) a credit swap;
                    ``(XVII) a weather swap;
                    ``(XVIII) an energy swap;
                    ``(XIX) a metal swap;
                    ``(XX) an agricultural swap;
                    ``(XXI) an emissions swap; and
                    ``(XXII) a commodity swap;

                ``(iv) that is an agreement, contract, or transaction 
            that is, or in the future becomes, commonly known to the 
            trade as a swap;
                ``(v) including any security-based swap agreement which 
            meets the definition of `swap agreement' as defined in 
            section 206A of the Gramm-Leach-Bliley Act (15 U.S.C. 78c 
            note) of which a material term is based on the price, 
            yield, value, or volatility of any security or any group or 
            index of securities, or any interest therein; or
                ``(vi) that is any combination or permutation of, or 
            option on, any agreement, contract, or transaction 
            described in any of clauses (i) through (v).
            ``(B) Exclusions.--The term `swap' does not include--
                ``(i) any contract of sale of a commodity for future 
            delivery (or option on such a contract), leverage contract 
            authorized under section 19, security futures product, or 
            agreement, contract, or transaction described in section 
            2(c)(2)(C)(i) or section 2(c)(2)(D)(i);
                ``(ii) any sale of a nonfinancial commodity or security 
            for deferred shipment or delivery, so long as the 
            transaction is intended to be physically settled;
                ``(iii) any put, call, straddle, option, or privilege 
            on any security, certificate of deposit, or group or index 
            of securities, including any interest therein or based on 
            the value thereof, that is subject to--

                    ``(I) the Securities Act of 1933 (15 U.S.C. 77a et 
                seq.); and
                    ``(II) the Securities Exchange Act of 1934 (15 
                U.S.C. 78a et seq.);

                ``(iv) any put, call, straddle, option, or privilege 
            relating to a foreign currency entered into on a national 
            securities exchange registered pursuant to section 6(a) of 
            the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
                ``(v) any agreement, contract, or transaction providing 
            for the purchase or sale of 1 or more securities on a fixed 
            basis that is subject to--

                    ``(I) the Securities Act of 1933 (15 U.S.C. 77a et 
                seq.); and
                    ``(II) the Securities Exchange Act of 1934 (15 
                U.S.C. 78a et seq.);

                ``(vi) any agreement, contract, or transaction 
            providing for the purchase or sale of 1 or more securities 
            on a contingent basis that is subject to the Securities Act 
            of 1933 (15 U.S.C. 77a et seq.) and the Securities Exchange 
            Act of 1934 (15 U.S.C. 78a et seq.), unless the agreement, 
            contract, or transaction predicates the purchase or sale on 
            the occurrence of a bona fide contingency that might 
            reasonably be expected to affect or be affected by the 
            creditworthiness of a party other than a party to the 
            agreement, contract, or transaction;
                ``(vii) any note, bond, or evidence of indebtedness 
            that is a security, as defined in section 2(a)(1) of the 
            Securities Act of 1933 (15 U.S.C. 77b(a)(1));
                ``(viii) any agreement, contract, or transaction that 
            is--

                    ``(I) based on a security; and
                    ``(II) entered into directly or through an 
                underwriter (as defined in section 2(a)(11) of the 
                Securities Act of 1933 (15 U.S.C. 77b(a)(11)) by the 
                issuer of such security for the purposes of raising 
                capital, unless the agreement, contract, or transaction 
                is entered into to manage a risk associated with 
                capital raising;

                ``(ix) any agreement, contract, or transaction a 
            counterparty of which is a Federal Reserve bank, the 
            Federal Government, or a Federal agency that is expressly 
            backed by the full faith and credit of the United States; 
            and
                ``(x) any security-based swap, other than a security-
            based swap as described in subparagraph (D).
            ``(C) Rule of construction regarding master agreements.--
                ``(i) In general.--Except as provided in clause (ii), 
            the term `swap' includes a master agreement that provides 
            for an agreement, contract, or transaction that is a swap 
            under subparagraph (A), together with each supplement to 
            any master agreement, without regard to whether the master 
            agreement contains an agreement, contract, or transaction 
            that is not a swap pursuant to subparagraph (A).
                ``(ii) Exception.--For purposes of clause (i), the 
            master agreement shall be considered to be a swap only with 
            respect to each agreement, contract, or transaction covered 
            by the master agreement that is a swap pursuant to 
            subparagraph (A).
            ``(D) Mixed swap.--The term `security-based swap' includes 
        any agreement, contract, or transaction that is as described in 
        section 3(a)(68)(A) of the Securities Exchange Act of 1934 (15 
        U.S.C. 78c(a)(68)(A)) and also is based on the value of 1 or 
        more interest or other rates, currencies, commodities, 
        instruments of indebtedness, indices, quantitative measures, 
        other financial or economic interest or property of any kind 
        (other than a single security or a narrow-based security 
        index), or the occurrence, non-occurrence, or the extent of the 
        occurrence of an event or contingency associated with a 
        potential financial, economic, or commercial consequence (other 
        than an event described in subparagraph (A)(iii)).
            ``(E) Treatment of foreign exchange swaps and forwards.--
                ``(i) In general.--Foreign exchange swaps and foreign 
            exchange forwards shall be considered swaps under this 
            paragraph unless the Secretary makes a written 
            determination under section 1b that either foreign exchange 
            swaps or foreign exchange forwards or both--

                    ``(I) should be not be regulated as swaps under 
                this Act; and
                    ``(II) are not 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 that Act.

                ``(ii) Congressional notice; effectiveness.--The 
            Secretary shall submit any written determination under 
            clause (i) to the appropriate committees of Congress, 
            including the Committee on Agriculture, Nutrition, and 
            Forestry of the Senate and the Committee on Agriculture of 
            the House of Representatives. Any such written 
            determination by the Secretary shall not be effective until 
            it is submitted to the appropriate committees of Congress.
                ``(iii) Reporting.--Notwithstanding a written 
            determination by the Secretary under clause (i), all 
            foreign exchange swaps and foreign exchange forwards shall 
            be reported to either a swap data repository, or, if there 
            is no swap data repository that would accept such swaps or 
            forwards, to the Commission pursuant to section 4r within 
            such time period as the Commission may by rule or 
            regulation prescribe.
                ``(iv) Business standards.--Notwithstanding a written 
            determination by the Secretary pursuant to clause (i), any 
            party to a foreign exchange swap or forward that is a swap 
            dealer or major swap participant shall conform to the 
            business conduct standards contained in section 4s(h).
                ``(v) Secretary.--For purposes of this subparagraph, 
            the term `Secretary' means the Secretary of the Treasury.
            ``(F) Exception for certain foreign exchange swaps and 
        forwards.--
                ``(i) Registered entities.--Any foreign exchange swap 
            and any foreign exchange forward that is listed and traded 
            on or subject to the rules of a designated contract market 
            or a swap execution facility, or that is cleared by a 
            derivatives clearing organization, shall not be exempt from 
            any provision of this Act or amendments made by the Wall 
            Street Transparency and Accountability Act of 2010 
            prohibiting fraud or manipulation.
                ``(ii) Retail transactions.--Nothing in subparagraph 
            (E) shall affect, or be construed to affect, the 
            applicability of this Act or the jurisdiction of the 
            Commission with respect to agreements, contracts, or 
            transactions in foreign currency pursuant to section 
            2(c)(2).
        ``(48) Swap data repository.--The term `swap data repository' 
    means any person that collects and maintains information or records 
    with respect to transactions or positions in, or the terms and 
    conditions of, swaps entered into by third parties for the purpose 
    of providing a centralized recordkeeping facility for swaps.
        ``(49) Swap dealer.--
            ``(A) In general.--The term `swap dealer' means any person 
        who--
                ``(i) holds itself out as a dealer in swaps;
                ``(ii) makes a market in swaps;
                ``(iii) regularly enters into swaps with counterparties 
            as an ordinary course of business for its own account; or
                ``(iv) engages in any activity causing the person to be 
            commonly known in the trade as a dealer or market maker in 
            swaps,
        provided however, in no event shall an insured depository 
        institution be considered to be a swap dealer to the extent it 
        offers to enter into a swap with a customer in connection with 
        originating a loan with that customer.
            ``(B) Inclusion.--A person may be designated as a swap 
        dealer for a single type or single class or category of swap or 
        activities and considered not to be a swap dealer for other 
        types, classes, or categories of swaps or activities.
            ``(C) Exception.--The term `swap dealer' does not include a 
        person that enters into swaps for such person's own account, 
        either individually or in a fiduciary capacity, but not as a 
        part of a regular business.
            ``(D) De minimis exception.--The Commission shall exempt 
        from designation as a swap dealer an entity that engages in a 
        de minimis quantity of swap dealing in connection with 
        transactions with or on behalf of its customers. The Commission 
        shall promulgate regulations to establish factors with respect 
        to the making of this determination to exempt.
        ``(50) Swap execution facility.--The term `swap execution 
    facility' means a trading system or platform in which multiple 
    participants have the ability to execute or trade swaps by 
    accepting bids and offers made by multiple participants in the 
    facility or system, through any means of interstate commerce, 
    including any trading facility, that--
            ``(A) facilitates the execution of swaps between persons; 
        and
            ``(B) is not a designated contract market.''.
        (22) in paragraph (51) (as redesignated by paragraph (1)), in 
    subparagraph (A)(i), by striking ``partipants'' and inserting 
    ``participants''.
    (b) Authority To Define Terms.--The Commodity Futures Trading 
Commission may adopt a rule to define--
        (1) the term ``commercial risk''; and
        (2) any other term included in an amendment to the Commodity 
    Exchange Act (7 U.S.C. 1 et seq.) made by this subtitle.
    (c) Modification of Definitions.--To include transactions and 
entities that have been structured to evade this subtitle (or an 
amendment made by this subtitle), the Commodity Futures Trading 
Commission shall adopt a rule to further define the terms ``swap'', 
``swap dealer'', ``major swap participant'', and ``eligible contract 
participant''.
    (d) Exemptions.--Section 4(c)(1) of the Commodity Exchange Act (7 
U.S.C. 6(c)(1)) is amended by striking ``except that'' and all that 
follows through the period at the end and inserting the following: 
``except that--
        ``(A) unless the Commission is expressly authorized by any 
    provision described in this subparagraph to grant exemptions, with 
    respect to amendments made by subtitle A of the Wall Street 
    Transparency and Accountability Act of 2010--
            ``(i) with respect to--
                ``(I) paragraphs (2), (3), (4), (5), and (7), paragraph 
            (18)(A)(vii)(III), paragraphs (23), (24), (31), (32), (38), 
            (39), (41), (42), (46), (47), (48), and (49) of section 1a, 
            and sections 2(a)(13), 2(c)(1)(D), 4a(a), 4a(b), 4d(c), 
            4d(d), 4r, 4s, 5b(a), 5b(b), 5(d), 5(g), 5(h), 5b(c), 
            5b(i), 8e, and 21; and
                ``(II) section 206(e) of the Gramm-Leach-Bliley Act 
            (Public Law 106-102; 15 U.S.C. 78c note); and
            ``(ii) in sections 721(c) and 742 of the Dodd-Frank Wall 
        Street Reform and Consumer Protection Act; and
        ``(B) the Commission and the Securities and Exchange Commission 
    may by rule, regulation, or order jointly exclude any agreement, 
    contract, or transaction from section 2(a)(1)(D)) if the 
    Commissions determine that the exemption would be consistent with 
    the public interest.''.
    (e) Conforming Amendments.--
        (1) Section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act (7 
    U.S.C. 2(c)(2)(B)(i)(II)) is amended--
            (A) in item (cc)--
                (i) in subitem (AA), by striking ``section 1a(20)'' and 
            inserting ``section 1a''; and
                (ii) in subitem (BB), by striking ``section 1a(20)'' 
            and inserting ``section 1a''; and
            (B) in item (dd), by striking ``section 1a(12)(A)(ii)'' and 
        inserting ``section 1a(18)(A)(ii)''.
        (2) Section 4m(3) of the Commodity Exchange Act (7 U.S.C. 
    6m(3)) is amended by striking ``section 1a(6)'' and inserting 
    ``section 1a''.
        (3) Section 4q(a)(1) of the Commodity Exchange Act (7 U.S.C. 
    6o-1(a)(1)) is amended by striking ``section 1a(4)'' and inserting 
    ``section 1a(9)''.
        (4) Section 5(e)(1) of the Commodity Exchange Act (7 U.S.C. 
    7(e)(1)) is amended by striking ``section 1a(4)'' and inserting 
    ``section 1a(9)''.
        (5) Section 5a(b)(2)(F) of the Commodity Exchange Act (7 U.S.C. 
    7a(b)(2)(F)) is amended by striking ``section 1a(4)'' and inserting 
    ``section 1a(9)''.
        (6) Section 5b(a) of the Commodity Exchange Act (7 U.S.C. 7a-
    1(a)) is amended, in the matter preceding paragraph (1), by 
    striking ``section 1a(9)'' and inserting ``section 1a''.
        (7) Section 5c(c)(2)(B) of the Commodity Exchange Act (7 U.S.C. 
    7a-2(c)(2)(B)) is amended by striking ``section 1a(4)'' and 
    inserting ``section 1a(9)''.
        (8) Section 6(g)(5)(B)(i) of the Securities Exchange Act of 
    1934 (15 U.S.C. 78f(g)(5)(B)(i)) is amended--
            (A) in subclause (I), by striking ``section 1a(12)(B)(ii)'' 
        and inserting ``section 1a(18)(B)(ii)''; and
            (B) in subclause (II), by striking ``section 1a(12)'' and 
        inserting ``section 1a(18)''.
        (9) Section 402 of the Legal Certainty for Bank Products Act of 
    2000 (7 U.S.C. 27 et seq.) is amended--
            (A) in subsection (a)(7), by striking ``section 1a(20)'' 
        and inserting ``section 1a'';
            (B) in subsection (b)(2), by striking ``section 1a(12)'' 
        and inserting ``section 1a''; and
            (C) in subsection (c), by striking ``section 1a(4)'' and 
        inserting ``section 1a''.
        (10) The first section of Public Law 85-839 (7 U.S.C. 13-1) is 
    amended in subsection (a), in the first sentence, by inserting 
    ``motion picture box office receipts (or any index, measure, value, 
    or data related to such receipts) or'' after ``sale of''.
    (f) Effective Date.--Notwithstanding any other provision of this 
Act, the amendments made by subsection (a)(4) shall take effect on June 
1, 2010.
    SEC. 722. JURISDICTION.
    (a) Exclusive Jurisdiction.--Section 2(a)(1) of the Commodity 
Exchange Act (7 U.S.C. 2(a)(1)) is amended--
        (1) in subparagraph (A), in the first sentence--
            (A) by inserting ``the Wall Street Transparency and 
        Accountability Act of 2010 (including an amendment made by that 
        Act) and'' after ``otherwise provided in'';
            (B) by striking ``(C) and (D)'' and inserting ``(C), (D), 
        and (I)'';
            (C) by striking ``(c) through (i) of this section'' and 
        inserting ``(c) and (f)'';
            (D) by striking ``contracts of sale'' and inserting ``swaps 
        or contracts of sale''; and
            (E) by striking ``or derivatives transaction execution 
        facility registered pursuant to section 5 or 5a'' and inserting 
        ``pursuant to section 5 or a swap execution facility pursuant 
        to section 5h''; and
        (2) by adding at the end the following:
            ``(G)(i) Nothing in this paragraph shall limit the 
        jurisdiction conferred on the Securities and Exchange 
        Commission by the Wall Street Transparency and Accountability 
        Act of 2010 with regard to security-based swap agreements as 
        defined pursuant to section 3(a)(78) of the Securities Exchange 
        Act of 1934, and security-based swaps.
            ``(ii) In addition to the authority of the Securities and 
        Exchange Commission described in clause (i), nothing in this 
        subparagraph shall limit or affect any statutory authority of 
        the Commission with respect to an agreement, contract, or 
        transaction described in clause (i).
            ``(H) Notwithstanding any other provision of law, the Wall 
        Street Transparency and Accountability Act of 2010 shall not 
        apply to, and the Commodity Futures Trading Commission shall 
        have no jurisdiction under such Act (or any amendments to the 
        Commodity Exchange Act made by such Act) with respect to, any 
        security other than a security-based swap.''.
    (b) Regulation of Swaps Under Federal and State Law.--Section 12 of 
the Commodity Exchange Act (7 U.S.C. 16) is amended by adding at the 
end the following:
    ``(h) Regulation of Swaps as Insurance Under State Law.--A swap--
        ``(1) shall not be considered to be insurance; and
        ``(2) may not be regulated as an insurance contract under the 
    law of any State.''.
    (c) Agreements, Contracts, and Transactions Traded on an Organized 
Exchange.--Section 2(c)(2)(A) of the Commodity Exchange Act (7 U.S.C. 
2(c)(2)(A)) is amended--
        (1) in clause (i), by striking ``or'' at the end;
        (2) by redesignating clause (ii) as clause (iii); and
        (3) by inserting after clause (i) the following:
                ``(ii) a swap; or''.
    (d) Applicability.--Section 2 of the Commodity Exchange Act (7 
U.S.C. 2) (as amended by section 723(a)(3)) is amended by adding at the 
end the following:
    ``(i) Applicability.--The provisions of this Act relating to swaps 
that were enacted by the Wall Street Transparency and Accountability 
Act of 2010 (including any rule prescribed or regulation promulgated 
under that Act), shall not apply to activities outside the United 
States unless those activities--
        ``(1) have a direct and significant connection with activities 
    in, or effect on, commerce of the United States; or
        ``(2) contravene such rules or regulations as the Commission 
    may prescribe or promulgate as are necessary or appropriate to 
    prevent the evasion of any provision of this Act that was enacted 
    by the Wall Street Transparency and Accountability Act of 2010.''.
    (e) Federal Energy Regulatory Commission.--Section 2(a)(1) of the 
Commodity Exchange Act (7 U.S.C. 2(a)(1)) is amended by adding at the 
end the following:
            ``(I)(i) Nothing in this Act shall limit or affect any 
        statutory authority of the Federal Energy Regulatory Commission 
        or a State regulatory authority (as defined in section 3(21) of 
        the Federal Power Act (16 U.S.C. 796(21)) with respect to an 
        agreement, contract, or transaction that is entered into 
        pursuant to a tariff or rate schedule approved by the Federal 
        Energy Regulatory Commission or a State regulatory authority 
        and is--
                ``(I) not executed, traded, or cleared on a registered 
            entity or trading facility; or
                ``(II) executed, traded, or cleared on a registered 
            entity or trading facility owned or operated by a regional 
            transmission organization or independent system operator.
            ``(ii) In addition to the authority of the Federal Energy 
        Regulatory Commission or a State regulatory authority described 
        in clause (i), nothing in this subparagraph shall limit or 
        affect--
                ``(I) any statutory authority of the Commission with 
            respect to an agreement, contract, or transaction described 
            in clause (i); or
                ``(II) the jurisdiction of the Commission under 
            subparagraph (A) with respect to an agreement, contract, or 
            transaction that is executed, traded, or cleared on a 
            registered entity or trading facility that is not owned or 
            operated by a regional transmission organization or 
            independent system operator (as defined by sections 3(27) 
            and (28) of the Federal Power Act (16 U.S.C. 796(27), 
            796(28)).''.
    (f) Public Interest Waiver.--Section 4(c) of the Commodity Exchange 
Act (7 U.S.C. 6(c)) (as amended by section 721(d)) is amended by adding 
at the end the following:
        ``(6) If the Commission determines that the exemption would be 
    consistent with the public interest and the purposes of this Act, 
    the Commission shall, in accordance with paragraphs (1) and (2), 
    exempt from the requirements of this Act an agreement, contract, or 
    transaction that is entered into--
            ``(A) pursuant to a tariff or rate schedule approved or 
        permitted to take effect by the Federal Energy Regulatory 
        Commission;
            ``(B) pursuant to a tariff or rate schedule establishing 
        rates or charges for, or protocols governing, the sale of 
        electric energy approved or permitted to take effect by the 
        regulatory authority of the State or municipality having 
        jurisdiction to regulate rates and charges for the sale of 
        electric energy within the State or municipality; or
            ``(C) between entities described in section 201(f) of the 
        Federal Power Act (16 U.S.C. 824(f)).''.
    (g) Authority of FERC.--Nothing in the Wall Street Transparency and 
Accountability Act of 2010 or the amendments to the Commodity Exchange 
Act made by such Act shall limit or affect any statutory enforcement 
authority of the Federal Energy Regulatory Commission pursuant to 
section 222 of the Federal Power Act and section 4A of the Natural Gas 
Act that existed prior to the date of enactment of the Wall Street 
Transparency and Accountability Act of 2010.
    (h) Determination.--The Commodity Exchange Act is amended by 
inserting after section 1a (7 U.S.C. 1a) the following:
  ``SEC. 1b. REQUIREMENTS OF SECRETARY OF THE TREASURY REGARDING 
      EXEMPTION OF FOREIGN EXCHANGE SWAPS AND FOREIGN EXCHANGE FORWARDS 
      FROM DEFINITION OF THE TERM `SWAP'.
    ``(a) Required Considerations.--In determining whether to exempt 
foreign exchange swaps and foreign exchange forwards from the 
definition of the term `swap', the Secretary of the Treasury (referred 
to in this section as the `Secretary') shall consider--
        ``(1) whether the required trading and clearing of foreign 
    exchange swaps and foreign exchange forwards would create systemic 
    risk, lower transparency, or threaten the financial stability of 
    the United States;
        ``(2) whether foreign exchange swaps and foreign exchange 
    forwards are already subject to a regulatory scheme that is 
    materially comparable to that established by this Act for other 
    classes of swaps;
        ``(3) the extent to which bank regulators of participants in 
    the foreign exchange market provide adequate supervision, including 
    capital and margin requirements;
        ``(4) the extent of adequate payment and settlement systems; 
    and
        ``(5) the use of a potential exemption of foreign exchange 
    swaps and foreign exchange forwards to evade otherwise applicable 
    regulatory requirements.
    ``(b) Determination.--If the Secretary makes a determination to 
exempt foreign exchange swaps and foreign exchange forwards from the 
definition of the term `swap', the Secretary shall submit to the 
appropriate committees of Congress a determination that contains--
        ``(1) an explanation regarding why foreign exchange swaps and 
    foreign exchange forwards are qualitatively different from other 
    classes of swaps in a way that would make the foreign exchange 
    swaps and foreign exchange forwards ill-suited for regulation as 
    swaps; and
        ``(2) an identification of the objective differences of foreign 
    exchange swaps and foreign exchange forwards with respect to 
    standard swaps that warrant an exempted status.
    ``(c) Effect of Determination.--A determination by the Secretary 
under subsection (b) shall not exempt any foreign exchange swaps and 
foreign exchange forwards traded on a designated contract market or 
swap execution facility from any applicable antifraud and 
antimanipulation provision under this title.''.
    SEC. 723. CLEARING.
    (a) Clearing Requirement.--
        (1) In general.--Section 2 of the Commodity Exchange Act (7 
    U.S.C. 2) is amended--
            (A) by striking subsections (d), (e), (g), and (h); and
            (B) by redesignating subsection (i) as subsection (g).
        (2) Swaps; limitation on participation.--Section 2 of the 
    Commodity Exchange Act (7 U.S.C. 2) (as amended by paragraph (1)) 
    is amended by inserting after subsection (c) the following:
    ``(d) Swaps.--Nothing in this Act (other than subparagraphs (A), 
(B), (C), (D), (G), and (H) of subsection (a)(1), subsections (f) and 
(g), sections 1a, 2(a)(13), 2(c)(2)(A)(ii), 2(e), 2(h), 4(c), 4a, 4b, 
and 4b-1, subsections (a), (b), and (g) of section 4c, sections 4d, 4e, 
4f, 4g, 4h, 4i, 4j, 4k, 4l, 4m, 4n, 4o, 4p, 4r, 4s, 4t, 5, 5b, 5c, 5e, 
and 5h, subsections (c) and (d) of section 6, sections 6c, 6d, 8, 8a, 
and 9, subsections (e)(2), (f), and (h) of section 12, subsections (a) 
and (b) of section 13, sections 17, 20, 21, and 22(a)(4), and any other 
provision of this Act that is applicable to registered entities or 
Commission registrants) governs or applies to a swap.
    ``(e) Limitation on Participation.--It shall be unlawful for any 
person, other than an eligible contract participant, to enter into a 
swap unless the swap is entered into on, or subject to the rules of, a 
board of trade designated as a contract market under section 5.''.
        (3) Mandatory clearing of swaps.--Section 2 of the Commodity 
    Exchange Act (7 U.S.C. 2) is amended by inserting after subsection 
    (g) (as redesignated by paragraph (1)(B)) the following:
    ``(h) Clearing Requirement.--
        ``(1) In general.--
            ``(A) Standard for clearing.--It shall be unlawful for any 
        person to engage in a swap unless that person submits such swap 
        for clearing to a derivatives clearing organization that is 
        registered under this Act or a derivatives clearing 
        organization that is exempt from registration under this Act if 
        the swap is required to be cleared.
            ``(B) Open access.--The rules of a derivatives clearing 
        organization described in subparagraph (A) shall--
                ``(i) prescribe that all swaps (but not contracts of 
            sale of a commodity for future delivery or options on such 
            contracts) submitted to the derivatives clearing 
            organization with the same terms and conditions are 
            economically equivalent within the derivatives clearing 
            organization and may be offset with each other within the 
            derivatives clearing organization; and
                ``(ii) provide for non-discriminatory clearing of a 
            swap (but not a contract of sale of a commodity for future 
            delivery or option on such contract) executed bilaterally 
            or on or through the rules of an unaffiliated designated 
            contract market or swap execution facility.
        ``(2) Commission review.--
            ``(A) Commission-initiated review.--
                ``(i) The Commission on an ongoing basis shall review 
            each swap, or any group, category, type, or class of swaps 
            to make a determination as to whether the swap or group, 
            category, type, or class of swaps should be required to be 
            cleared.
                ``(ii) The Commission shall provide at least a 30-day 
            public comment period regarding any determination made 
            under clause (i).
            ``(B) Swap submissions.--
                ``(i) A derivatives clearing organization shall submit 
            to the Commission each swap, or any group, category, type, 
            or class of swaps that it plans to accept for clearing, and 
            provide notice to its members (in a manner to be determined 
            by the Commission) of the submission.
                ``(ii) Any swap or group, category, type, or class of 
            swaps listed for clearing by a derivative clearing 
            organization as of the date of enactment of this subsection 
            shall be considered submitted to the Commission.
                ``(iii) The Commission shall--

                    ``(I) make available to the public submissions 
                received under clauses (i) and (ii);
                    ``(II) review each submission made under clauses 
                (i) and (ii), and determine whether the swap, or group, 
                category, type, or class of swaps described in the 
                submission is required to be cleared; and
                    ``(III) provide at least a 30-day public comment 
                period regarding its determination as to whether the 
                clearing requirement under paragraph (1)(A) shall apply 
                to the submission.

            ``(C) Deadline.--The Commission shall make its 
        determination under subparagraph (B)(iii) not later than 90 
        days after receiving a submission made under subparagraphs 
        (B)(i) and (B)(ii), unless the submitting derivatives clearing 
        organization agrees to an extension for the time limitation 
        established under this subparagraph.
            ``(D) Determination.--
                ``(i) In reviewing a submission made under subparagraph 
            (B), the Commission shall review whether the submission is 
            consistent with section 5b(c)(2).
                ``(ii) In reviewing a swap, group of swaps, or class of 
            swaps pursuant to subparagraph (A) or a submission made 
            under subparagraph (B), the Commission shall take into 
            account the following factors:

                    ``(I) The existence of significant outstanding 
                notional exposures, trading liquidity, and adequate 
                pricing data.
                    ``(II) The availability of rule framework, 
                capacity, operational expertise and resources, and 
                credit support infrastructure to clear the contract on 
                terms that are consistent with the material terms and 
                trading conventions on which the contract is then 
                traded.
                    ``(III) The effect on the mitigation of systemic 
                risk, taking into account the size of the market for 
                such contract and the resources of the derivatives 
                clearing organization available to clear the contract.
                    ``(IV) The effect on competition, including 
                appropriate fees and charges applied to clearing.
                    ``(V) The existence of reasonable legal certainty 
                in the event of the insolvency of the relevant 
                derivatives clearing organization or 1 or more of its 
                clearing members with regard to the treatment of 
                customer and swap counterparty positions, funds, and 
                property.

                ``(iii) In making a determination under subparagraph 
            (A) or (B)(iii) that the clearing requirement shall apply, 
            the Commission may require such terms and conditions to the 
            requirement as the Commission determines to be appropriate.
            ``(E) Rules.--Not later than 1 year after the date of the 
        enactment of this subsection, the Commission shall adopt rules 
        for a derivatives clearing organization's submission for 
        review, pursuant to this paragraph, of a swap, or a group, 
        category, type, or class of swaps, that it seeks to accept for 
        clearing. Nothing in this subparagraph limits the Commission 
        from making a determination under subparagraph (B)(iii) for 
        swaps described in subparagraph (B)(ii).
        ``(3) Stay of clearing requirement.--
            ``(A) In general.--After making a determination pursuant to 
        paragraph (2)(B), the Commission, on application of a 
        counterparty to a swap or on its own initiative, may stay the 
        clearing requirement of paragraph (1) until the Commission 
        completes a review of the terms of the swap (or the group, 
        category, type, or class of swaps) and the clearing 
        arrangement.
            ``(B) Deadline.--The Commission shall complete a review 
        undertaken pursuant to subparagraph (A) not later than 90 days 
        after issuance of the stay, unless the derivatives clearing 
        organization that clears the swap, or group, category, type, or 
        class of swaps agrees to an extension of the time limitation 
        established under this subparagraph.
            ``(C) Determination.--Upon completion of the review 
        undertaken pursuant to subparagraph (A), the Commission may--
                ``(i) determine, unconditionally or subject to such 
            terms and conditions as the Commission determines to be 
            appropriate, that the swap, or group, category, type, or 
            class of swaps must be cleared pursuant to this subsection 
            if it finds that such clearing is consistent with paragraph 
            (2)(D); or
                ``(ii) determine that the clearing requirement of 
            paragraph (1) shall not apply to the swap, or group, 
            category, type, or class of swaps.
            ``(D) Rules.--Not later than 1 year after the date of the 
        enactment of the Wall Street Transparency and Accountability 
        Act of 2010, the Commission shall adopt rules for reviewing, 
        pursuant to this paragraph, a derivatives clearing 
        organization's clearing of a swap, or a group, category, type, 
        or class of swaps, that it has accepted for clearing.
        ``(4) Prevention of evasion.--
            ``(A) In general.--The Commission shall prescribe rules 
        under this subsection (and issue interpretations of rules 
        prescribed under this subsection) as determined by the 
        Commission to be necessary to prevent evasions of the mandatory 
        clearing requirements under this Act.
            ``(B) Duty of commission to investigate and take certain 
        actions.--To the extent the Commission finds that a particular 
        swap, group, category, type, or class of swaps would otherwise 
        be subject to mandatory clearing but no derivatives clearing 
        organization has listed the swap, group, category, type, or 
        class of swaps for clearing, the Commission shall--
                ``(i) investigate the relevant facts and circumstances;
                ``(ii) within 30 days issue a public report containing 
            the results of the investigation; and
                ``(iii) take such actions as the Commission determines 
            to be necessary and in the public interest, which may 
            include requiring the retaining of adequate margin or 
            capital by parties to the swap, group, category, type, or 
            class of swaps.
            ``(C) Effect on authority.--Nothing in this paragraph--
                ``(i) authorizes the Commission to adopt rules 
            requiring a derivatives clearing organization to list for 
            clearing a swap, group, category, type, or class of swaps 
            if the clearing of the swap, group, category, type, or 
            class of swaps would threaten the financial integrity of 
            the derivatives clearing organization; and
                ``(ii) affects the authority of the Commission to 
            enforce the open access provisions of paragraph (1)(B) with 
            respect to a swap, group, category, type, or class of swaps 
            that is listed for clearing by a derivatives clearing 
            organization.
        ``(5) Reporting transition rules.--Rules adopted by the 
    Commission under this section shall provide for the reporting of 
    data, as follows:
            ``(A) Swaps entered into before the date of the enactment 
        of this subsection shall be reported to a registered swap data 
        repository or the Commission no later than 180 days after the 
        effective date of this subsection.
            ``(B) Swaps entered into on or after such date of enactment 
        shall be reported to a registered swap data repository or the 
        Commission no later than the later of--
                ``(i) 90 days after such effective date; or
                ``(ii) such other time after entering into the swap as 
            the Commission may prescribe by rule or regulation.
        ``(6) Clearing transition rules.--
            ``(A) Swaps entered into before the date of the enactment 
        of this subsection are exempt from the clearing requirements of 
        this subsection if reported pursuant to paragraph (5)(A).
            ``(B) Swaps entered into before application of the clearing 
        requirement pursuant to this subsection are exempt from the 
        clearing requirements of this subsection if reported pursuant 
        to paragraph (5)(B).
        ``(7) Exceptions.--
            ``(A) In general.--The requirements of paragraph (1)(A) 
        shall not apply to a swap if 1 of the counterparties to the 
        swap--
                ``(i) is not a financial entity;
                ``(ii) is using swaps to hedge or mitigate commercial 
            risk; and
                ``(iii) notifies the Commission, in a manner set forth 
            by the Commission, how it generally meets its financial 
            obligations associated with entering into non-cleared 
            swaps.
            ``(B) Option to clear.--The application of the clearing 
        exception in subparagraph (A) is solely at the discretion of 
        the counterparty to the swap that meets the conditions of 
        clauses (i) through (iii) of subparagraph (A).
            ``(C) Financial entity definition.--
                ``(i) In general.--For the purposes of this paragraph, 
            the term `financial entity' means--

                    ``(I) a swap dealer;
                    ``(II) a security-based swap dealer;
                    ``(III) a major swap participant;
                    ``(IV) a major security-based swap participant;
                    ``(V) a commodity pool;
                    ``(VI) a private fund as defined in section 202(a) 
                of the Investment Advisers Act of 1940 (15 U.S.C. 80-b-
                2(a));
                    ``(VII) an employee benefit plan as defined in 
                paragraphs (3) and (32) of section 3 of the Employee 
                Retirement Income Security Act of 1974 (29 U.S.C. 
                1002);
                    ``(VIII) a person predominantly engaged in 
                activities that are in the business of banking, or in 
                activities that are financial in nature, as defined in 
                section 4(k) of the Bank Holding Company Act of 1956.

                ``(ii) Exclusion.--The Commission shall consider 
            whether to exempt small banks, savings associations, farm 
            credit system institutions, and credit unions, including--

                    ``(I) depository institutions with total assets of 
                $10,000,000,000 or less;
                    ``(II) farm credit system institutions with total 
                assets of $10,000,000,000 or less; or
                    ``(III) credit unions with total assets of 
                $10,000,000,000 or less.

                ``(iii) Limitation.--Such definition shall not include 
            an entity whose primary business is providing financing, 
            and uses derivatives for the purpose of hedging underlying 
            commercial risks related to interest rate and foreign 
            currency exposures, 90 percent or more of which arise from 
            financing that facilitates the purchase or lease of 
            products, 90 percent or more of which are manufactured by 
            the parent company or another subsidiary of the parent 
            company.
            ``(D) Treatment of affiliates.--
                ``(i) In general.--An affiliate of a person that 
            qualifies for an exception under subparagraph (A) 
            (including affiliate entities predominantly engaged in 
            providing financing for the purchase of the merchandise or 
            manufactured goods of the person) may qualify for the 
            exception only if the affiliate, acting on behalf of the 
            person and as an agent, uses the swap to hedge or mitigate 
            the commercial risk of the person or other affiliate of the 
            person that is not a financial entity.
                ``(ii) Prohibition relating to certain affiliates.--The 
            exception in clause (i) shall not apply if the affiliate 
            is--

                    ``(I) a swap dealer;
                    ``(II) a security-based swap dealer;
                    ``(III) a major swap participant;
                    ``(IV) a major security-based swap participant;
                    ``(V) an issuer that would be an investment 
                company, as defined in section 3 of the Investment 
                Company Act of 1940 (15 U.S.C. 80a-3), but for 
                paragraph (1) or (7) of subsection (c) of that Act (15 
                U.S.C. 80a-3(c));
                    ``(VI) a commodity pool; or
                    ``(VII) a bank holding company with over 
                $50,000,000,000 in consolidated assets.

                ``(iii) Transition rule for affiliates.--An affiliate, 
            subsidiary, or a wholly owned entity of a person that 
            qualifies for an exception under subparagraph (A) and is 
            predominantly engaged in providing financing for the 
            purchase or lease of merchandise or manufactured goods of 
            the person shall be exempt from the margin requirement 
            described in section 4s(e) and the clearing requirement 
            described in paragraph (1) with regard to swaps entered 
            into to mitigate the risk of the financing activities for 
            not less than a 2-year period beginning on the date of 
            enactment of this clause.
            ``(E) Election of counterparty.--
                ``(i) Swaps required to be cleared.--With respect to 
            any swap that is subject to the mandatory clearing 
            requirement under this subsection and entered into by a 
            swap dealer or a major swap participant with a counterparty 
            that is not a swap dealer, major swap participant, 
            security-based swap dealer, or major security-based swap 
            participant, the counterparty shall have the sole right to 
            select the derivatives clearing organization at which the 
            swap will be cleared.
                ``(ii) Swaps not required to be cleared.--With respect 
            to any swap that is not subject to the mandatory clearing 
            requirement under this subsection and entered into by a 
            swap dealer or a major swap participant with a counterparty 
            that is not a swap dealer, major swap participant, 
            security-based swap dealer, or major security-based swap 
            participant, the counterparty--

                    ``(I) may elect to require clearing of the swap; 
                and
                    ``(II) shall have the sole right to select the 
                derivatives clearing organization at which the swap 
                will be cleared.

            ``(F) Abuse of exception.--The Commission may prescribe 
        such rules or issue interpretations of the rules as the 
        Commission determines to be necessary to prevent abuse of the 
        exceptions described in this paragraph. The Commission may also 
        request information from those persons claiming the clearing 
        exception as necessary to prevent abuse of the exceptions 
        described in this paragraph.
        ``(8) Trade execution.--
            ``(A) In general.--With respect to transactions involving 
        swaps subject to the clearing requirement of paragraph (1), 
        counterparties shall--
                ``(i) execute the transaction on a board of trade 
            designated as a contract market under section 5; or
                ``(ii) execute the transaction on a swap execution 
            facility registered under 5h or a swap execution facility 
            that is exempt from registration under section 5h(f) of 
            this Act.
            ``(B) Exception.--The requirements of clauses (i) and (ii) 
        of subparagraph (A) shall not apply if no board of trade or 
        swap execution facility makes the swap available to trade or 
        for swap transactions subject to the clearing exception under 
        paragraph (7).''.
    (b) Commodity Exchange Act.--Section 2 of the Commodity Exchange 
Act (7 U.S.C. 2) is amended by adding at the end the following:
    ``(j)  Committee Approval by Board.--Exemptions from the 
requirements of subsection (h)(1) to clear a swap and subsection (h)(8) 
to execute a swap through a board of trade or swap execution facility 
shall be available to a counterparty that is an issuer of securities 
that are registered under section 12 of the Securities Exchange Act of 
1934 (15 U.S.C. 78l) or that is required to file reports pursuant to 
section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78o) 
only if an appropriate committee of the issuer's board or governing 
body has reviewed and approved its decision to enter into swaps that 
are subject to such exemptions.''.
    (c) Grandfather Provisions.--
        (1) Legal certainty for certain transactions in exempt 
    commodities.--Not later than 60 days after the date of enactment of 
    this Act, a person may submit to the Commodity Futures Trading 
    Commission a petition to remain subject to section 2(h) of the 
    Commodity Exchange Act (7 U.S.C. 2(h)) (as in effect on the day 
    before the date of enactment of this Act).
        (2) Consideration; authority of commodity futures trading 
    commission.--The Commodity Futures Trading Commission--
            (A) shall consider any petition submitted under 
        subparagraph (A) in a prompt manner; and
            (B) may allow a person to continue operating subject to 
        section 2(h) of the Commodity Exchange Act (7 U.S.C. 2(h)) (as 
        in effect on the day before the date of enactment of this Act) 
        for not longer than a 1-year period.
        (3) Agricultural swaps.--
            (A) In general.--Except as provided in subparagraph (B), no 
        person shall offer to enter into, enter into, or confirm the 
        execution of, any swap in an agricultural commodity (as defined 
        by the Commodity Futures Trading Commission).
            (B) Exception.--Notwithstanding subparagraph (A), a person 
        may offer to enter into, enter into, or confirm the execution 
        of, any swap in an agricultural commodity pursuant to section 
        4(c) of the Commodity Exchange Act (7 U.S.C. 6(c)) or any rule, 
        regulation, or order issued thereunder (including any rule, 
        regulation, or order in effect as of the date of enactment of 
        this Act) by the Commodity Futures Trading Commission to allow 
        swaps under such terms and conditions as the Commission shall 
        prescribe.
        (4) Required reporting.--If the exception described in section 
    2(h)(8)(B) of the Commodity Exchange Act applies, the 
    counterparties shall comply with any recordkeeping and transaction 
    reporting requirements that may be prescribed by the Commission 
    with respect to swaps subject to section 2(h)(8)(B) of the 
    Commodity Exchange Act.
    SEC. 724. SWAPS; SEGREGATION AND BANKRUPTCY TREATMENT.
    (a) Segregation Requirements for Cleared Swaps.--Section 4d of the 
Commodity Exchange Act (7 U.S.C. 6d) (as amended by section 732) is 
amended by adding at the end the following:
    ``(f) Swaps.--
        ``(1) Registration requirement.--It shall be unlawful for any 
    person to accept any money, securities, or property (or to extend 
    any credit in lieu of money, securities, or property) from, for, or 
    on behalf of a swaps customer to margin, guarantee, or secure a 
    swap cleared by or through a derivatives clearing organization 
    (including money, securities, or property accruing to the customer 
    as the result of such a swap), unless the person shall have 
    registered under this Act with the Commission as a futures 
    commission merchant, and the registration shall not have expired 
    nor been suspended nor revoked.
        ``(2) Cleared swaps.--
            ``(A) Segregation required.--A futures commission merchant 
        shall treat and deal with all money, securities, and property 
        of any swaps customer received to margin, guarantee, or secure 
        a swap cleared by or though a derivatives clearing organization 
        (including money, securities, or property accruing to the swaps 
        customer as the result of such a swap) as belonging to the 
        swaps customer.
            ``(B) Commingling prohibited.--Money, securities, and 
        property of a swaps customer described in subparagraph (A) 
        shall be separately accounted for and shall not be commingled 
        with the funds of the futures commission merchant or be used to 
        margin, secure, or guarantee any trades or contracts of any 
        swaps customer or person other than the person for whom the 
        same are held.
        ``(3) Exceptions.--
            ``(A) Use of funds.--
                ``(i) In general.--Notwithstanding paragraph (2), 
            money, securities, and property of swap customers of a 
            futures commission merchant described in paragraph (2) may, 
            for convenience, be commingled and deposited in the same 
            account or accounts with any bank or trust company or with 
            a derivatives clearing organization.
                ``(ii) Withdrawal.--Notwithstanding paragraph (2), such 
            share of the money, securities, and property described in 
            clause (i) as in the normal course of business shall be 
            necessary to margin, guarantee, secure, transfer, adjust, 
            or settle a cleared swap with a derivatives clearing 
            organization, or with any member of the derivatives 
            clearing organization, may be withdrawn and applied to such 
            purposes, including the payment of commissions, brokerage, 
            interest, taxes, storage, and other charges, lawfully 
            accruing in connection with the cleared swap.
            ``(B) Commission action.--Notwithstanding paragraph (2), in 
        accordance with such terms and conditions as the Commission may 
        prescribe by rule, regulation, or order, any money, securities, 
        or property of the swaps customers of a futures commission 
        merchant described in paragraph (2) may be commingled and 
        deposited in customer accounts with any other money, 
        securities, or property received by the futures commission 
        merchant and required by the Commission to be separately 
        accounted for and treated and dealt with as belonging to the 
        swaps customer of the futures commission merchant.
        ``(4) Permitted investments.--Money described in paragraph (2) 
    may be invested in obligations of the United States, in general 
    obligations of any State or of any political subdivision of a 
    State, and in obligations fully guaranteed as to principal and 
    interest by the United States, or in any other investment that the 
    Commission may by rule or regulation prescribe, and such 
    investments shall be made in accordance with such rules and 
    regulations and subject to such conditions as the Commission may 
    prescribe.
        ``(5) Commodity contract.--A swap cleared by or through a 
    derivatives clearing organization shall be considered to be a 
    commodity contract as such term is defined in section 761 of title 
    11, United States Code, with regard to all money, securities, and 
    property of any swaps customer received by a futures commission 
    merchant or a derivatives clearing organization to margin, 
    guarantee, or secure the swap (including money, securities, or 
    property accruing to the customer as the result of the swap).
        ``(6) Prohibition.--It shall be unlawful for any person, 
    including any derivatives clearing organization and any depository 
    institution, that has received any money, securities, or property 
    for deposit in a separate account or accounts as provided in 
    paragraph (2) to hold, dispose of, or use any such money, 
    securities, or property as belonging to the depositing futures 
    commission merchant or any person other than the swaps customer of 
    the futures commission merchant.''.
    (b) Bankruptcy Treatment of Cleared Swaps.--Section 761 of title 
11, United States Code, is amended--
        (1) in paragraph (4), by striking subparagraph (F) and 
    inserting the following:
            ``(F)(i) any other contract, option, agreement, or 
        transaction that is similar to a contract, option, agreement, 
        or transaction referred to in this paragraph; and
            ``(ii) with respect to a futures commission merchant or a 
        clearing organization, any other contract, option, agreement, 
        or transaction, in each case, that is cleared by a clearing 
        organization;''; and
        (2) in paragraph (9)(A)(i), by striking ``the commodity futures 
    account'' and inserting ``a commodity contract account''.
    (c) Segregation Requirements for Uncleared Swaps.--Section 4s of 
the Commodity Exchange Act (as added by section 731) is amended by 
adding at the end the following:
    ``(l) Segregation Requirements.--
        ``(1) Segregation of assets held as collateral in uncleared 
    swap transactions.--
            ``(A) Notification.--A swap dealer or major swap 
        participant shall be required to notify the counterparty of the 
        swap dealer or major swap participant at the beginning of a 
        swap transaction that the counterparty has the right to require 
        segregation of the funds or other property supplied to margin, 
        guarantee, or secure the obligations of the counterparty.
            ``(B) Segregation and maintenance of funds.--At the request 
        of a counterparty to a swap that provides funds or other 
        property to a swap dealer or major swap participant to margin, 
        guarantee, or secure the obligations of the counterparty, the 
        swap dealer or major swap participant shall--
                ``(i) segregate the funds or other property for the 
            benefit of the counterparty; and
                ``(ii) in accordance with such rules and regulations as 
            the Commission may promulgate, maintain the funds or other 
            property in a segregated account separate from the assets 
            and other interests of the swap dealer or major swap 
            participant.
        ``(2) Applicability.--The requirements described in paragraph 
    (1) shall--
            ``(A) apply only to a swap between a counterparty and a 
        swap dealer or major swap participant that is not submitted for 
        clearing to a derivatives clearing organization; and
            ``(B)(i) not apply to variation margin payments; or
            ``(ii) not preclude any commercial arrangement regarding--
                ``(I) the investment of segregated funds or other 
            property that may only be invested in such investments as 
            the Commission may permit by rule or regulation; and
                ``(II) the related allocation of gains and losses 
            resulting from any investment of the segregated funds or 
            other property.
        ``(3) Use of independent third-party custodians.--The 
    segregated account described in paragraph (1) shall be--
            ``(A) carried by an independent third-party custodian; and
            ``(B) designated as a segregated account for and on behalf 
        of the counterparty.
        ``(4) Reporting requirement.--If the counterparty does not 
    choose to require segregation of the funds or other property 
    supplied to margin, guarantee, or secure the obligations of the 
    counterparty, the swap dealer or major swap participant shall 
    report to the counterparty of the swap dealer or major swap 
    participant on a quarterly basis that the back office procedures of 
    the swap dealer or major swap participant relating to margin and 
    collateral requirements are in compliance with the agreement of the 
    counterparties.''.
    SEC. 725. DERIVATIVES CLEARING ORGANIZATIONS.
    (a) Registration Requirement.--Section 5b of the Commodity Exchange 
Act (7 U.S.C. 7a-1) is amended by striking subsections (a) and (b) and 
inserting the following:
    ``(a) Registration Requirement.--
        ``(1) In general.--Except as provided in paragraph (2), it 
    shall be unlawful for a derivatives clearing organization, directly 
    or indirectly, to make use of the mails or any means or 
    instrumentality of interstate commerce to perform the functions of 
    a derivatives clearing organization with respect to--
            ``(A) a contract of sale of a commodity for future delivery 
        (or an option on the contract of sale) or option on a 
        commodity, in each case, unless the contract or option is--
                ``(i) excluded from this Act by subsection 
            (a)(1)(C)(i), (c), or (f) of section 2; or
                ``(ii) a security futures product cleared by a clearing 
            agency registered with the Securities and Exchange 
            Commission under the Securities Exchange Act of 1934 (15 
            U.S.C. 78a et seq.); or
            ``(B) a swap.
        ``(2) Exception.--Paragraph (1) shall not apply to a 
    derivatives clearing organization that is registered with the 
    Commission.
    ``(b) Voluntary Registration.--A person that clears 1 or more 
agreements, contracts, or transactions that are not required to be 
cleared under this Act may register with the Commission as a 
derivatives clearing organization.''.
    (b) Registration for Depository Institutions and Clearing Agencies; 
Exemptions; Compliance Officer; Annual Reports.--Section 5b of the 
Commodity Exchange Act (7 U.S.C. 7a-1) is amended by adding at the end 
the following:
    ``(g) Existing Depository Institutions and Clearing Agencies.--
        ``(1) In general.--A depository institution or clearing agency 
    registered with the Securities and Exchange Commission under the 
    Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) that is 
    required to be registered as a derivatives clearing organization 
    under this section is deemed to be registered under this section to 
    the extent that, before the date of enactment of this subsection--
            ``(A) the depository institution cleared swaps as a 
        multilateral clearing organization; or
            ``(B) the clearing agency cleared swaps.
        ``(2) Conversion of depository institutions.--A depository 
    institution to which this subsection applies may, by the vote of 
    the shareholders owning not less than 51 percent of the voting 
    interests of the depository institution, be converted into a State 
    corporation, partnership, limited liability company, or similar 
    legal form pursuant to a plan of conversion, if the conversion is 
    not in contravention of applicable State law.
        ``(3) Sharing of information.--The Securities and Exchange 
    Commission shall make available to the Commission, upon request, 
    all information determined to be relevant by the Securities and 
    Exchange Commission regarding a clearing agency deemed to be 
    registered with the Commission under paragraph (1).
    ``(h) Exemptions.--The Commission may exempt, conditionally or 
unconditionally, a derivatives clearing organization from registration 
under this section for the clearing of swaps if the Commission 
determines that the derivatives clearing organization is subject to 
comparable, comprehensive supervision and regulation by the Securities 
and Exchange Commission or the appropriate government authorities in 
the home country of the organization. Such conditions may include, but 
are not limited to, requiring that the derivatives clearing 
organization be available for inspection by the Commission and make 
available all information requested by the Commission.
    ``(i) Designation of Chief Compliance Officer.--
        ``(1) In general.--Each derivatives clearing organization shall 
    designate an individual to serve as a chief compliance officer.
        ``(2) Duties.--The chief compliance officer shall--
            ``(A) report directly to the board or to the senior officer 
        of the derivatives clearing organization;
            ``(B) review the compliance of the derivatives clearing 
        organization with respect to the core principles described in 
        subsection (c)(2);
            ``(C) in consultation with the board of the derivatives 
        clearing organization, a body performing a function similar to 
        the board of the derivatives clearing organization, or the 
        senior officer of the derivatives clearing organization, 
        resolve any conflicts of interest that may arise;
            ``(D) be responsible for administering each policy and 
        procedure that is required to be established pursuant to this 
        section;
            ``(E) ensure compliance with this Act (including 
        regulations) relating to agreements, contracts, or 
        transactions, including each rule prescribed by the Commission 
        under this section;
            ``(F) establish procedures for the remediation of 
        noncompliance issues identified by the compliance officer 
        through any--
                ``(i) compliance office review;
                ``(ii) look-back;
                ``(iii) internal or external audit finding;
                ``(iv) self-reported error; or
                ``(v) validated complaint; and
            ``(G) establish and follow appropriate procedures for the 
        handling, management response, remediation, retesting, and 
        closing of noncompliance issues.
        ``(3) Annual reports.--
            ``(A) In general.--In accordance with rules prescribed by 
        the Commission, the chief compliance officer shall annually 
        prepare and sign a report that contains a description of--
                ``(i) the compliance of the derivatives clearing 
            organization of the compliance officer with respect to this 
            Act (including regulations); and
                ``(ii) each policy and procedure of the derivatives 
            clearing organization of the compliance officer (including 
            the code of ethics and conflict of interest policies of the 
            derivatives clearing organization).
            ``(B) Requirements.--A compliance report under subparagraph 
        (A) shall--
                ``(i) accompany each appropriate financial report of 
            the derivatives clearing organization that is required to 
            be furnished to the Commission pursuant to this section; 
            and
                ``(ii) include a certification that, under penalty of 
            law, the compliance report is accurate and complete.''.
    (c) Core Principles for Derivatives Clearing Organizations.--
Section 5b(c) of the Commodity Exchange Act (7 U.S.C. 7a-1(c)) is 
amended by striking paragraph (2) and inserting the following:
        ``(2) Core principles for derivatives clearing organizations.--
            ``(A) Compliance.--
                ``(i) In general.--To be registered and to maintain 
            registration as a derivatives clearing organization, a 
            derivatives clearing organization shall comply with each 
            core principle described in this paragraph and any 
            requirement that the Commission may impose by rule or 
            regulation pursuant to section 8a(5).
                ``(ii) Discretion of derivatives clearing 
            organization.--Subject to any rule or regulation prescribed 
            by the Commission, a derivatives clearing organization 
            shall have reasonable discretion in establishing the manner 
            by which the derivatives clearing organization complies 
            with each core principle described in this paragraph.
            ``(B) Financial resources.--
                ``(i) In general.--Each derivatives clearing 
            organization shall have adequate financial, operational, 
            and managerial resources, as determined by the Commission, 
            to discharge each responsibility of the derivatives 
            clearing organization.
                ``(ii) Minimum amount of financial resources.--Each 
            derivatives clearing organization shall possess financial 
            resources that, at a minimum, exceed the total amount that 
            would--

                    ``(I) enable the organization to meet its financial 
                obligations to its members and participants 
                notwithstanding a default by the member or participant 
                creating the largest financial exposure for that 
                organization in extreme but plausible market 
                conditions; and
                    ``(II) enable the derivatives clearing organization 
                to cover the operating costs of the derivatives 
                clearing organization for a period of 1 year (as 
                calculated on a rolling basis).

            ``(C) Participant and product eligibility.--
                ``(i) In general.--Each derivatives clearing 
            organization shall establish--

                    ``(I) appropriate admission and continuing 
                eligibility standards (including sufficient financial 
                resources and operational capacity to meet obligations 
                arising from participation in the derivatives clearing 
                organization) for members of, and participants in, the 
                derivatives clearing organization; and
                    ``(II) appropriate standards for determining the 
                eligibility of agreements, contracts, or transactions 
                submitted to the derivatives clearing organization for 
                clearing.

                ``(ii) Required procedures.--Each derivatives clearing 
            organization shall establish and implement procedures to 
            verify, on an ongoing basis, the compliance of each 
            participation and membership requirement of the derivatives 
            clearing organization.
                ``(iii) Requirements.--The participation and membership 
            requirements of each derivatives clearing organization 
            shall--

                    ``(I) be objective;
                    ``(II) be publicly disclosed; and
                    ``(III) permit fair and open access.

            ``(D) Risk management.--
                ``(i) In general.--Each derivatives clearing 
            organization shall ensure that the derivatives clearing 
            organization possesses the ability to manage the risks 
            associated with discharging the responsibilities of the 
            derivatives clearing organization through the use of 
            appropriate tools and procedures.
                ``(ii) Measurement of credit exposure.--Each 
            derivatives clearing organization shall--

                    ``(I) not less than once during each business day 
                of the derivatives clearing organization, measure the 
                credit exposures of the derivatives clearing 
                organization to each member and participant of the 
                derivatives clearing organization; and
                    ``(II) monitor each exposure described in subclause 
                (I) periodically during the business day of the 
                derivatives clearing organization.

                ``(iii) Limitation of exposure to potential losses from 
            defaults.--Each derivatives clearing organization, through 
            margin requirements and other risk control mechanisms, 
            shall limit the exposure of the derivatives clearing 
            organization to potential losses from defaults by members 
            and participants of the derivatives clearing organization 
            to ensure that--

                    ``(I) the operations of the derivatives clearing 
                organization would not be disrupted; and
                    ``(II) nondefaulting members or participants would 
                not be exposed to losses that nondefaulting members or 
                participants cannot anticipate or control.

                ``(iv) Margin requirements.--The margin required from 
            each member and participant of a derivatives clearing 
            organization shall be sufficient to cover potential 
            exposures in normal market conditions.
                ``(v) Requirements regarding models and parameters.--
            Each model and parameter used in setting margin 
            requirements under clause (iv) shall be--

                    ``(I) risk-based; and
                    ``(II) reviewed on a regular basis.

            ``(E) Settlement procedures.--Each derivatives clearing 
        organization shall--
                ``(i) complete money settlements on a timely basis (but 
            not less frequently than once each business day);
                ``(ii) employ money settlement arrangements to 
            eliminate or strictly limit the exposure of the derivatives 
            clearing organization to settlement bank risks (including 
            credit and liquidity risks from the use of banks to effect 
            money settlements);
                ``(iii) ensure that money settlements are final when 
            effected;
                ``(iv) maintain an accurate record of the flow of funds 
            associated with each money settlement;
                ``(v) possess the ability to comply with each term and 
            condition of any permitted netting or offset arrangement 
            with any other clearing organization;
                ``(vi) regarding physical settlements, establish rules 
            that clearly state each obligation of the derivatives 
            clearing organization with respect to physical deliveries; 
            and
                ``(vii) ensure that each risk arising from an 
            obligation described in clause (vi) is identified and 
            managed.
            ``(F) Treatment of funds.--
                ``(i) Required standards and procedures.--Each 
            derivatives clearing organization shall establish standards 
            and procedures that are designed to protect and ensure the 
            safety of member and participant funds and assets.
                ``(ii) Holding of funds and assets.--Each derivatives 
            clearing organization shall hold member and participant 
            funds and assets in a manner by which to minimize the risk 
            of loss or of delay in the access by the derivatives 
            clearing organization to the assets and funds.
                ``(iii) Permissible investments.--Funds and assets 
            invested by a derivatives clearing organization shall be 
            held in instruments with minimal credit, market, and 
            liquidity risks.
            ``(G) Default rules and procedures.--
                ``(i) In general.--Each derivatives clearing 
            organization shall have rules and procedures designed to 
            allow for the efficient, fair, and safe management of 
            events during which members or participants--

                    ``(I) become insolvent; or
                    ``(II) otherwise default on the obligations of the 
                members or participants to the derivatives clearing 
                organization.

                ``(ii) Default procedures.--Each derivatives clearing 
            organization shall--

                    ``(I) clearly state the default procedures of the 
                derivatives clearing organization;
                    ``(II) make publicly available the default rules of 
                the derivatives clearing organization; and
                    ``(III) ensure that the derivatives clearing 
                organization may take timely action--

                        ``(aa) to contain losses and liquidity 
                    pressures; and
                        ``(bb) to continue meeting each obligation of 
                    the derivatives clearing organization.
            ``(H) Rule enforcement.--Each derivatives clearing 
        organization shall--
                ``(i) maintain adequate arrangements and resources 
            for--

                    ``(I) the effective monitoring and enforcement of 
                compliance with the rules of the derivatives clearing 
                organization; and
                    ``(II) the resolution of disputes;

                ``(ii) have the authority and ability to discipline, 
            limit, suspend, or terminate the activities of a member or 
            participant due to a violation by the member or participant 
            of any rule of the derivatives clearing organization; and
                ``(iii) report to the Commission regarding rule 
            enforcement activities and sanctions imposed against 
            members and participants as provided in clause (ii).
            ``(I) System safeguards.--Each derivatives clearing 
        organization shall--
                ``(i) establish and maintain a program of risk analysis 
            and oversight to identify and minimize sources of 
            operational risk through the development of appropriate 
            controls and procedures, and automated systems, that are 
            reliable, secure, and have adequate scalable capacity;
                ``(ii) establish and maintain emergency procedures, 
            backup facilities, and a plan for disaster recovery that 
            allows for--

                    ``(I) the timely recovery and resumption of 
                operations of the derivatives clearing organization; 
                and
                    ``(II) the fulfillment of each obligation and 
                responsibility of the derivatives clearing 
                organization; and

                ``(iii) periodically conduct tests to verify that the 
            backup resources of the derivatives clearing organization 
            are sufficient to ensure daily processing, clearing, and 
            settlement.
            ``(J) Reporting.--Each derivatives clearing organization 
        shall provide to the Commission all information that the 
        Commission determines to be necessary to conduct oversight of 
        the derivatives clearing organization.
            ``(K) Recordkeeping.--Each derivatives clearing 
        organization shall maintain records of all activities related 
        to the business of the derivatives clearing organization as a 
        derivatives clearing organization--
                ``(i) in a form and manner that is acceptable to the 
            Commission; and
                ``(ii) for a period of not less than 5 years.
            ``(L) Public information.--
                ``(i) In general.--Each derivatives clearing 
            organization shall provide to market participants 
            sufficient information to enable the market participants to 
            identify and evaluate accurately the risks and costs 
            associated with using the services of the derivatives 
            clearing organization.
                ``(ii) Availability of information.--Each derivatives 
            clearing organization shall make information concerning the 
            rules and operating and default procedures governing the 
            clearing and settlement systems of the derivatives clearing 
            organization available to market participants.
                ``(iii) Public disclosure.--Each derivatives clearing 
            organization shall disclose publicly and to the Commission 
            information concerning--

                    ``(I) the terms and conditions of each contract, 
                agreement, and transaction cleared and settled by the 
                derivatives clearing organization;
                    ``(II) each clearing and other fee that the 
                derivatives clearing organization charges the members 
                and participants of the derivatives clearing 
                organization;
                    ``(III) the margin-setting methodology, and the 
                size and composition, of the financial resource package 
                of the derivatives clearing organization;
                    ``(IV) daily settlement prices, volume, and open 
                interest for each contract settled or cleared by the 
                derivatives clearing organization; and
                    ``(V) any other matter relevant to participation in 
                the settlement and clearing activities of the 
                derivatives clearing organization.

            ``(M) Information-sharing.--Each derivatives clearing 
        organization shall--
                ``(i) enter into, and abide by the terms of, each 
            appropriate and applicable domestic and international 
            information-sharing agreement; and
                ``(ii) use relevant information obtained from each 
            agreement described in clause (i) in carrying out the risk 
            management program of the derivatives clearing 
            organization.
            ``(N) Antitrust considerations.--Unless necessary or 
        appropriate to achieve the purposes of this Act, a derivatives 
        clearing organization shall not--
                ``(i) adopt any rule or take any action that results in 
            any unreasonable restraint of trade; or
                ``(ii) impose any material anticompetitive burden.
            ``(O) Governance fitness standards.--
                ``(i) Governance arrangements.--Each derivatives 
            clearing organization shall establish governance 
            arrangements that are transparent--

                    ``(I) to fulfill public interest requirements; and
                    ``(II) to permit the consideration of the views of 
                owners and participants.

                ``(ii) Fitness standards.--Each derivatives clearing 
            organization shall establish and enforce appropriate 
            fitness standards for--

                    ``(I) directors;
                    ``(II) members of any disciplinary committee;
                    ``(III) members of the derivatives clearing 
                organization;
                    ``(IV) any other individual or entity with direct 
                access to the settlement or clearing activities of the 
                derivatives clearing organization; and
                    ``(V) any party affiliated with any individual or 
                entity described in this clause.

            ``(P) Conflicts of interest.--Each derivatives clearing 
        organization shall--
                ``(i) establish and enforce rules to minimize conflicts 
            of interest in the decision-making process of the 
            derivatives clearing organization; and
                ``(ii) establish a process for resolving conflicts of 
            interest described in clause (i).
            ``(Q) Composition of governing boards.--Each derivatives 
        clearing organization shall ensure that the composition of the 
        governing board or committee of the derivatives clearing 
        organization includes market participants.
            ``(R) Legal risk.--Each derivatives clearing organization 
        shall have a well-founded, transparent, and enforceable legal 
        framework for each aspect of the activities of the derivatives 
        clearing organization.''.
    (d) Conflicts of Interest.--The Commodity Futures Trading 
Commission shall adopt rules mitigating conflicts of interest in 
connection with the conduct of business by a swap dealer or a major 
swap participant with a derivatives clearing organization, board of 
trade, or a swap execution facility that clears or trades swaps in 
which the swap dealer or major swap participant has a material debt or 
material equity investment.
    (e) Reporting Requirements.--Section 5b of the Commodity Exchange 
Act (7 U.S.C. 7a-1) (as amended by subsection (b)) is amended by adding 
at the end the following:
    ``(k) Reporting Requirements.--
        ``(1) Duty of derivatives clearing organizations.--Each 
    derivatives clearing organization that clears swaps shall provide 
    to the Commission all information that is determined by the 
    Commission to be necessary to perform each responsibility of the 
    Commission under this Act.
        ``(2) Data collection and maintenance requirements.--The 
    Commission shall adopt data collection and maintenance requirements 
    for swaps cleared by derivatives clearing organizations that are 
    comparable to the corresponding requirements for--
            ``(A) swaps data reported to swap data repositories; and
            ``(B) swaps traded on swap execution facilities.
        ``(3) Reports on security-based swap agreements to be shared 
    with the securities and exchange commission.--
            ``(A) In general.--A derivatives clearing organization that 
        clears security-based swap agreements (as defined in section 
        1a(47)(A)(v)) shall, upon request, open to inspection and 
        examination to the Securities and Exchange Commission all books 
        and records relating to such security-based swap agreements, 
        consistent with the confidentiality and disclosure requirements 
        of section 8.
            ``(B) Jurisdiction.--Nothing in this paragraph shall affect 
        the exclusive jurisdiction of the Commission to prescribe 
        recordkeeping and reporting requirements for a derivatives 
        clearing organization that is registered with the Commission.
        ``(4) Information sharing.--Subject to section 8, and upon 
    request, the Commission shall share information collected under 
    paragraph (2) with--
            ``(A) the Board;
            ``(B) the Securities and Exchange Commission;
            ``(C) each appropriate prudential regulator;
            ``(D) the Financial Stability Oversight Council;
            ``(E) the Department of Justice; and
            ``(F) any other person that the Commission determines to be 
        appropriate, including--
                ``(i) foreign financial supervisors (including foreign 
            futures authorities);
                ``(ii) foreign central banks; and
                ``(iii) foreign ministries.
        ``(5) Confidentiality and indemnification agreement.--Before 
    the Commission may share information with any entity described in 
    paragraph (4)--
            ``(A) the Commission shall receive a written agreement from 
        each entity stating that the entity shall abide by the 
        confidentiality requirements described in section 8 relating to 
        the information on swap transactions that is provided; and
            ``(B) each entity shall agree to indemnify the Commission 
        for any expenses arising from litigation relating to the 
        information provided under section 8.
        ``(6) Public information.--Each derivatives clearing 
    organization that clears swaps shall provide to the Commission 
    (including any designee of the Commission) information under 
    paragraph (2) in such form and at such frequency as is required by 
    the Commission to comply with the public reporting requirements 
    contained in section 2(a)(13).''.
    (f) Public Disclosure.--Section 8(e) of the Commodity Exchange Act 
(7 U.S.C. 12(e)) is amended in the last sentence--
        (1) by inserting ``, central bank and ministries,'' after 
    ``department'' each place it appears; and
        (2) by striking ``. is a party.'' and inserting ``, is a 
    party.''.
    (g) Legal Certainty for Identified Banking Products.--
        (1) Repeals.--The Legal Certainty for Bank Products Act of 2000 
    (7 U.S.C. 27 et seq.) is amended--
            (A) by striking sections 404 and 407 (7 U.S.C. 27b, 27e);
            (B) in section 402 (7 U.S.C. 27), by striking subsection 
        (d); and
            (C) in section 408 (7 U.S.C. 27f)--
                (i) in subsection (c)--

                    (I) by striking ``in the case'' and all that 
                follows through ``a hybrid'' and inserting ``in the 
                case of a hybrid'';
                    (II) by striking ``; or'' and inserting a period; 
                and
                    (III) by striking paragraph (2);

                (ii) by striking subsection (b); and
                (iii) by redesignating subsection (c) as subsection 
            (b).
        (2) Legal certainty for bank products act of 2000.--Section 403 
    of the Legal Certainty for Bank Products Act of 2000 (7 U.S.C. 27a) 
    is amended to read as follows:
    ``SEC. 403. EXCLUSION OF IDENTIFIED BANKING PRODUCT.
    ``(a) Exclusion.--Except as provided in subsection (b) or (c)--
        ``(1) the Commodity Exchange Act (7 U.S.C. 1 et seq.) shall not 
    apply to, and the Commodity Futures Trading Commission shall not 
    exercise regulatory authority under the Commodity Exchange Act (7 
    U.S.C. 1 et seq.) with respect to, an identified banking product; 
    and
        ``(2) the definitions of `security-based swap' in section 
    3(a)(68) of the Securities Exchange Act of 1934 and `security-based 
    swap agreement' in section 1a(47)(A)(v) of the Commodity Exchange 
    Act and section 3(a)(78) of the Securities Exchange Act of 1934 do 
    not include any identified bank product.
    ``(b) Exception.--An appropriate Federal banking agency may except 
an identified banking product of a bank under its regulatory 
jurisdiction from the exclusion in subsection (a) if the agency 
determines, in consultation with the Commodity Futures Trading 
Commission and the Securities and Exchange Commission, that the 
product--
        ``(1) would meet the definition of a `swap' under section 
    1a(47) of the Commodity Exchange Act (7 U.S.C. 1a) or a `security-
    based swap' under that section 3(a)(68) of the Securities Exchange 
    Act of 1934; and
        ``(2) has become known to the trade as a swap or security-based 
    swap, or otherwise has been structured as an identified banking 
    product for the purpose of evading the provisions of the Commodity 
    Exchange Act (7 U.S.C. 1 et seq.), the Securities Act of 1933 (15 
    U.S.C. 77a et seq.), or the Securities Exchange Act of 1934 (15 
    U.S.C. 78a et seq.).
    ``(c) Exception.--The exclusions in subsection (a) shall not apply 
to an identified bank product that--
        ``(1) is a product of a bank that is not under the regulatory 
    jurisdiction of an appropriate Federal banking agency;
        ``(2) meets the definition of swap in section 1a(47) of the 
    Commodity Exchange Act or security-based swap in section 3(a)(68) 
    of the Securities Exchange Act of 1934; and
        ``(3) has become known to the trade as a swap or security-based 
    swap, or otherwise has been structured as an identified banking 
    product for the purpose of evading the provisions of the Commodity 
    Exchange Act (7 U.S.C. 1 et seq.), the Securities Act of 1933 (15 
    U.S.C. 77a et seq.), or the Securities Exchange Act of 1934 (15 
    U.S.C. 78a et seq.).''.
    (h) Reducing Clearing Systemic Risk.--Section 5b(f)(1) of the 
Commodity Exchange Act (7 U.S.C. 7a-1(F)(i)) is amended by adding at 
the end the following: ``In order to minimize systemic risk, under no 
circumstances shall a derivatives clearing organization be compelled to 
accept the counterparty credit risk of another clearing 
organization.''.
    SEC. 726. RULEMAKING ON CONFLICT OF INTEREST.
    (a) In General.--In order to mitigate conflicts of interest, not 
later than 180 days after the date of enactment of the Wall Street 
Transparency and Accountability Act of 2010, the Commodity Futures 
Trading Commission shall adopt rules which may include numerical limits 
on the control of, or the voting rights with respect to, any 
derivatives clearing organization that clears swaps, or swap execution 
facility or board of trade designated as a contract market that posts 
swaps or makes swaps available for trading, by a bank holding company 
(as defined in section 2 of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841)) with total consolidated assets of $50,000,000,000 or 
more, a nonbank financial company (as defined in section 102) 
supervised by the Board, an affiliate of such a bank holding company or 
nonbank financial company, a swap dealer, major swap participant, or 
associated person of a swap dealer or major swap participant.
    (b) Purposes.--The Commission shall adopt rules if it determines, 
after the review described in subsection (a), that such rules are 
necessary or appropriate to improve the governance of, or to mitigate 
systemic risk, promote competition, or mitigate conflicts of interest 
in connection with a swap dealer or major swap participant's conduct of 
business with, a derivatives clearing organization, contract market, or 
swap execution facility that clears or posts swaps or makes swaps 
available for trading and in which such swap dealer or major swap 
participant has a material debt or equity investment.
    (c) Considerations.--In adopting rules pursuant to this section, 
the Commodity Futures Trading Commission shall consider any conflicts 
of interest arising from the amount of equity owned by a single 
investor, the ability to vote, cause the vote of, or withhold votes 
entitled to be cast on any matters by the holders of the ownership 
interest, and the governance arrangements of any derivatives clearing 
organization that clears swaps, or swap execution facility or board of 
trade designated as a contract market that posts swaps or makes swaps 
available for trading.
    SEC. 727. PUBLIC REPORTING OF SWAP TRANSACTION DATA.
    Section 2(a) of the Commodity Exchange Act (7 U.S.C. 2(a)) is 
amended by adding at the end the following:
        ``(13) Public availability of swap transaction data.--
            ``(A) Definition of real-time public reporting.--In this 
        paragraph, the term `real-time public reporting' means to 
        report data relating to a swap transaction, including price and 
        volume, as soon as technologically practicable after the time 
        at which the swap transaction has been executed.
            ``(B) Purpose.--The purpose of this section is to authorize 
        the Commission to make swap transaction and pricing data 
        available to the public in such form and at such times as the 
        Commission determines appropriate to enhance price discovery.
            ``(C) General rule.--The Commission is authorized and 
        required to provide by rule for the public availability of swap 
        transaction and pricing data as follows:
                ``(i) With respect to those swaps that are subject to 
            the mandatory clearing requirement described in subsection 
            (h)(1) (including those swaps that are excepted from the 
            requirement pursuant to subsection (h)(7)), the Commission 
            shall require real-time public reporting for such 
            transactions.
                ``(ii) With respect to those swaps that are not subject 
            to the mandatory clearing requirement described in 
            subsection (h)(1), but are cleared at a registered 
            derivatives clearing organization, the Commission shall 
            require real-time public reporting for such transactions.
                ``(iii) With respect to swaps that are not cleared at a 
            registered derivatives clearing organization and which are 
            reported to a swap data repository or the Commission under 
            subsection (h)(6), the Commission shall require real-time 
            public reporting for such transactions, in a manner that 
            does not disclose the business transactions and market 
            positions of any person.
                ``(iv) With respect to swaps that are determined to be 
            required to be cleared under subsection (h)(2) but are not 
            cleared, the Commission shall require real-time public 
            reporting for such transactions.
            ``(D) Registered entities and public reporting.--The 
        Commission may require registered entities to publicly 
        disseminate the swap transaction and pricing data required to 
        be reported under this paragraph.
            ``(E) Rulemaking required.--With respect to the rule 
        providing for the public availability of transaction and 
        pricing data for swaps described in clauses (i) and (ii) of 
        subparagraph (C), the rule promulgated by the Commission shall 
        contain provisions--
                ``(i) to ensure such information does not identify the 
            participants;
                ``(ii) to specify the criteria for determining what 
            constitutes a large notional swap transaction (block trade) 
            for particular markets and contracts;
                ``(iii) to specify the appropriate time delay for 
            reporting large notional swap transactions (block trades) 
            to the public; and
                ``(iv) that take into account whether the public 
            disclosure will materially reduce market liquidity.
            ``(F) Timeliness of reporting.--Parties to a swap 
        (including agents of the parties to a swap) shall be 
        responsible for reporting swap transaction information to the 
        appropriate registered entity in a timely manner as may be 
        prescribed by the Commission.
            ``(G) Reporting of swaps to registered swap data 
        repositories.--Each swap (whether cleared or uncleared) shall 
        be reported to a registered swap data repository.
        ``(14) Semiannual and annual public reporting of aggregate swap 
    data.--
            ``(A) In general.--In accordance with subparagraph (B), the 
        Commission shall issue a written report on a semiannual and 
        annual basis to make available to the public information 
        relating to--
                ``(i) the trading and clearing in the major swap 
            categories; and
                ``(ii) the market participants and developments in new 
            products.
            ``(B) Use; consultation.--In preparing a report under 
        subparagraph (A), the Commission shall--
                ``(i) use information from swap data repositories and 
            derivatives clearing organizations; and
                ``(ii) consult with the Office of the Comptroller of 
            the Currency, the Bank for International Settlements, and 
            such other regulatory bodies as may be necessary.
            ``(C) Authority of the commission.--The Commission may, by 
        rule, regulation, or order, delegate the public reporting 
        responsibilities of the Commission under this paragraph in 
        accordance with such terms and conditions as the Commission 
        determines to be appropriate and in the public interest.''.
    SEC. 728. SWAP DATA REPOSITORIES.
    The Commodity Exchange Act is amended by inserting after section 20 
(7 U.S.C. 24) the following:
  ``SEC. 21. SWAP DATA REPOSITORIES.
    ``(a) Registration Requirement.--
        ``(1) Requirement; authority of derivatives clearing 
    organization.--
            ``(A) In general.--It shall be unlawful for any person, 
        unless registered with the Commission, directly or indirectly 
        to make use of the mails or any means or instrumentality of 
        interstate commerce to perform the functions of a swap data 
        repository.
            ``(B) Registration of derivatives clearing organizations.--
        A derivatives clearing organization may register as a swap data 
        repository.
        ``(2) Inspection and examination.--Each registered swap data 
    repository shall be subject to inspection and examination by any 
    representative of the Commission.
        ``(3) Compliance with core principles.--
            ``(A) In general.--To be registered, and maintain 
        registration, as a swap data repository, the swap data 
        repository shall comply with--
                ``(i) the requirements and core principles described in 
            this section; and
                ``(ii) any requirement that the Commission may impose 
            by rule or regulation pursuant to section 8a(5).
            ``(B) Reasonable discretion of swap data repository.--
        Unless otherwise determined by the Commission by rule or 
        regulation, a swap data repository described in subparagraph 
        (A) shall have reasonable discretion in establishing the manner 
        in which the swap data repository complies with the core 
        principles described in this section.
    ``(b) Standard Setting.--
        ``(1) Data identification.--
            ``(A) In general.--In accordance with subparagraph (B), the 
        Commission shall prescribe standards that specify the data 
        elements for each swap that shall be collected and maintained 
        by each registered swap data repository.
            ``(B) Requirement.--In carrying out subparagraph (A), the 
        Commission shall prescribe consistent data element standards 
        applicable to registered entities and reporting counterparties.
        ``(2) Data collection and maintenance.--The Commission shall 
    prescribe data collection and data maintenance standards for swap 
    data repositories.
        ``(3) Comparability.--The standards prescribed by the 
    Commission under this subsection shall be comparable to the data 
    standards imposed by the Commission on derivatives clearing 
    organizations in connection with their clearing of swaps.
    ``(c) Duties.--A swap data repository shall--
        ``(1) accept data prescribed by the Commission for each swap 
    under subsection (b);
        ``(2) confirm with both counterparties to the swap the accuracy 
    of the data that was submitted;
        ``(3) maintain the data described in paragraph (1) in such 
    form, in such manner, and for such period as may be required by the 
    Commission;
        ``(4)(A) provide direct electronic access to the Commission (or 
    any designee of the Commission, including another registered 
    entity); and
        ``(B) provide the information described in paragraph (1) in 
    such form and at such frequency as the Commission may require to 
    comply with the public reporting requirements contained in section 
    2(a)(13);
        ``(5) at the direction of the Commission, establish automated 
    systems for monitoring, screening, and analyzing swap data, 
    including compliance and frequency of end user clearing exemption 
    claims by individual and affiliated entities;
        ``(6) maintain the privacy of any and all swap transaction 
    information that the swap data repository receives from a swap 
    dealer, counterparty, or any other registered entity; and
        ``(7) on a confidential basis pursuant to section 8, upon 
    request, and after notifying the Commission of the request, make 
    available all data obtained by the swap data repository, including 
    individual counterparty trade and position data, to--
            ``(A) each appropriate prudential regulator;
            ``(B) the Financial Stability Oversight Council;
            ``(C) the Securities and Exchange Commission;
            ``(D) the Department of Justice; and
            ``(E) any other person that the Commission determines to be 
        appropriate, including--
                ``(i) foreign financial supervisors (including foreign 
            futures authorities);
                ``(ii) foreign central banks; and
                ``(iii) foreign ministries; and
        ``(8) establish and maintain emergency procedures, backup 
    facilities, and a plan for disaster recovery that allows for the 
    timely recovery and resumption of operations and the fulfillment of 
    the responsibilities and obligations of the organization.
    ``(d) Confidentiality and Indemnification Agreement.--Before the 
swap data repository may share information with any entity described in 
subsection (c)(7)--
        ``(1) the swap data repository shall receive a written 
    agreement from each entity stating that the entity shall abide by 
    the confidentiality requirements described in section 8 relating to 
    the information on swap transactions that is provided; and
        ``(2) each entity shall agree to indemnify the swap data 
    repository and the Commission for any expenses arising from 
    litigation relating to the information provided under section 8.
    ``(e) Designation of Chief Compliance Officer.--
        ``(1) In general.--Each swap data repository shall designate an 
    individual to serve as a chief compliance officer.
        ``(2) Duties.--The chief compliance officer shall--
            ``(A) report directly to the board or to the senior officer 
        of the swap data repository;
            ``(B) review the compliance of the swap data repository 
        with respect to the requirements and core principles described 
        in this section;
            ``(C) in consultation with the board of the swap data 
        repository, a body performing a function similar to the board 
        of the swap data repository, or the senior officer of the swap 
        data repository, resolve any conflicts of interest that may 
        arise;
            ``(D) be responsible for administering each policy and 
        procedure that is required to be established pursuant to this 
        section;
            ``(E) ensure compliance with this Act (including 
        regulations) relating to agreements, contracts, or 
        transactions, including each rule prescribed by the Commission 
        under this section;
            ``(F) establish procedures for the remediation of 
        noncompliance issues identified by the chief compliance officer 
        through any--
                ``(i) compliance office review;
                ``(ii) look-back;
                ``(iii) internal or external audit finding;
                ``(iv) self-reported error; or
                ``(v) validated complaint; and
            ``(G) establish and follow appropriate procedures for the 
        handling, management response, remediation, retesting, and 
        closing of noncompliance issues.
        ``(3) Annual reports.--
            ``(A) In general.--In accordance with rules prescribed by 
        the Commission, the chief compliance officer shall annually 
        prepare and sign a report that contains a description of--
                ``(i) the compliance of the swap data repository of the 
            chief compliance officer with respect to this Act 
            (including regulations); and
                ``(ii) each policy and procedure of the swap data 
            repository of the chief compliance officer (including the 
            code of ethics and conflict of interest policies of the 
            swap data repository).
            ``(B) Requirements.--A compliance report under subparagraph 
        (A) shall--
                ``(i) accompany each appropriate financial report of 
            the swap data repository that is required to be furnished 
            to the Commission pursuant to this section; and
                ``(ii) include a certification that, under penalty of 
            law, the compliance report is accurate and complete.
    ``(f) Core Principles Applicable To Swap Data Repositories.--
        ``(1) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this Act, a swap data 
    repository shall not--
            ``(A) adopt any rule or take any action that results in any 
        unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on the 
        trading, clearing, or reporting of transactions.
        ``(2) Governance arrangements.--Each swap data repository shall 
    establish governance arrangements that are transparent--
            ``(A) to fulfill public interest requirements; and
            ``(B) to support the objectives of the Federal Government, 
        owners, and participants.
        ``(3) Conflicts of interest.--Each swap data repository shall--
            ``(A) establish and enforce rules to minimize conflicts of 
        interest in the decision-making process of the swap data 
        repository; and
            ``(B) establish a process for resolving conflicts of 
        interest described in subparagraph (A).
        ``(4) Additional duties developed by commission.--
            ``(A) In general.--The Commission may develop 1 or more 
        additional duties applicable to swap data repositories.
            ``(B) Consideration of evolving standards.--In developing 
        additional duties under subparagraph (A), the Commission may 
        take into consideration any evolving standard of the United 
        States or the international community.
            ``(C) Additional duties for commission designees.--The 
        Commission shall establish additional duties for any registrant 
        described in section 1a(48) in order to minimize conflicts of 
        interest, protect data, ensure compliance, and guarantee the 
        safety and security of the swap data repository.
    ``(g) Required Registration for Swap Data Repositories.--Any person 
that is required to be registered as a swap data repository under this 
section shall register with the Commission regardless of whether that 
person is also licensed as a bank or registered with the Securities and 
Exchange Commission as a swap data repository.
    ``(h) Rules.--The Commission shall adopt rules governing persons 
that are registered under this section.''.
    SEC. 729. REPORTING AND RECORDKEEPING.
    The Commodity Exchange Act is amended by inserting after section 4q 
(7 U.S.C. 6o-1) the following:
  ``SEC. 4r. REPORTING AND RECORDKEEPING FOR UNCLEARED SWAPS.
    ``(a) Required Reporting of Swaps Not Accepted by Any Derivatives 
Clearing Organization.--
        ``(1) In general.--Each swap that is not accepted for clearing 
    by any derivatives clearing organization shall be reported to--
            ``(A) a swap data repository described in section 21; or
            ``(B) in the case in which there is no swap data repository 
        that would accept the swap, to the Commission pursuant to this 
        section within such time period as the Commission may by rule 
        or regulation prescribe.
        ``(2) Transition rule for preenactment swaps.--
            ``(A) Swaps entered into before the date of enactment of 
        the wall street transparency and accountability act of 2010.--
        Each swap entered into before the date of enactment of the Wall 
        Street Transparency and Accountability Act of 2010, the terms 
        of which have not expired as of the date of enactment of that 
        Act, shall be reported to a registered swap data repository or 
        the Commission by a date that is not later than--
                ``(i) 30 days after issuance of the interim final rule; 
            or
                ``(ii) such other period as the Commission determines 
            to be appropriate.
            ``(B) Commission rulemaking.--The Commission shall 
        promulgate an interim final rule within 90 days of the date of 
        enactment of this section providing for the reporting of each 
        swap entered into before the date of enactment as referenced in 
        subparagraph (A).
            ``(C) Effective date.--The reporting provisions described 
        in this section shall be effective upon the enactment of this 
        section.
        ``(3) Reporting obligations.--
            ``(A) Swaps in which only 1 counterparty is a swap dealer 
        or major swap participant.--With respect to a swap in which 
        only 1 counterparty is a swap dealer or major swap participant, 
        the swap dealer or major swap participant shall report the swap 
        as required under paragraphs (1) and (2).
            ``(B) Swaps in which 1 counterparty is a swap dealer and 
        the other a major swap participant.--With respect to a swap in 
        which 1 counterparty is a swap dealer and the other a major 
        swap participant, the swap dealer shall report the swap as 
        required under paragraphs (1) and (2).
            ``(C) Other swaps.--With respect to any other swap not 
        described in subparagraph (A) or (B), the counterparties to the 
        swap shall select a counterparty to report the swap as required 
        under paragraphs (1) and (2).
    ``(b) Duties of Certain Individuals.--Any individual or entity that 
enters into a swap shall meet each requirement described in subsection 
(c) if the individual or entity did not--
        ``(1) clear the swap in accordance with section 2(h)(1); or
        ``(2) have the data regarding the swap accepted by a swap data 
    repository in accordance with rules (including timeframes) adopted 
    by the Commission under section 21.
    ``(c) Requirements.--An individual or entity described in 
subsection (b) shall--
        ``(1) upon written request from the Commission, provide reports 
    regarding the swaps held by the individual or entity to the 
    Commission in such form and in such manner as the Commission may 
    request; and
        ``(2) maintain books and records pertaining to the swaps held 
    by the individual or entity in such form, in such manner, and for 
    such period as the Commission may require, which shall be open to 
    inspection by--
            ``(A) any representative of the Commission;
            ``(B) an appropriate prudential regulator;
            ``(C) the Securities and Exchange Commission;
            ``(D) the Financial Stability Oversight Council; and
            ``(E) the Department of Justice.
    ``(d) Identical Data.--In prescribing rules under this section, the 
Commission shall require individuals and entities described in 
subsection (b) to submit to the Commission a report that contains data 
that is not less comprehensive than the data required to be collected 
by swap data repositories under section 21.''.
    SEC. 730. LARGE SWAP TRADER REPORTING.
    The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended by 
adding after section 4s (as added by section 731) the following:
  ``SEC. 4t. LARGE SWAP TRADER REPORTING.
    ``(a) Prohibition.--
        ``(1) In general.--Except as provided in paragraph (2), it 
    shall be unlawful for any person to enter into any swap that the 
    Commission determines to perform a significant price discovery 
    function with respect to registered entities if--
            ``(A) the person directly or indirectly enters into the 
        swap during any 1 day in an amount equal to or in excess of 
        such amount as shall be established periodically by the 
        Commission; and
            ``(B) the person directly or indirectly has or obtains a 
        position in the swap equal to or in excess of such amount as 
        shall be established periodically by the Commission.
        ``(2) Exception.--Paragraph (1) shall not apply if--
            ``(A) the person files or causes to be filed with the 
        properly designated officer of the Commission such reports 
        regarding any transactions or positions described in 
        subparagraphs (A) and (B) of paragraph (1) as the Commission 
        may require by rule or regulation; and
            ``(B) in accordance with the rules and regulations of the 
        Commission, the person keeps books and records of all such 
        swaps and any transactions and positions in any related 
        commodity traded on or subject to the rules of any designated 
        contract market or swap execution facility, and of cash or spot 
        transactions in, inventories of, and purchase and sale 
        commitments of, such a commodity.
    ``(b) Requirements.--
        ``(1) In general.--Books and records described in subsection 
    (a)(2)(B) shall--
            ``(A) show such complete details concerning all 
        transactions and positions as the Commission may prescribe by 
        rule or regulation;
            ``(B) be open at all times to inspection and examination by 
        any representative of the Commission; and
            ``(C) be open at all times to inspection and examination by 
        the Securities and Exchange Commission, to the extent such 
        books and records relate to transactions in swaps (as that term 
        is defined in section 1a(47)(A)(v)), and consistent with the 
        confidentiality and disclosure requirements of section 8.
        ``(2) Jurisdiction.--Nothing in paragraph (1) shall affect the 
    exclusive jurisdiction of the Commission to prescribe recordkeeping 
    and reporting requirements for large swap traders under this 
    section.
    ``(c) Applicability.--For purposes of this section, the swaps, 
futures, and cash or spot transactions and positions of any person 
shall include the swaps, futures, and cash or spot transactions and 
positions of any persons directly or indirectly controlled by the 
person.
    ``(d) Significant Price Discovery Function.--In making a 
determination as to whether a swap performs or affects a significant 
price discovery function with respect to registered entities, the 
Commission shall consider the factors described in section 4a(a)(3).''.
    SEC. 731. REGISTRATION AND REGULATION OF SWAP DEALERS AND MAJOR 
      SWAP PARTICIPANTS.
    The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended by 
inserting after section 4r (as added by section 729) the following:
  ``SEC. 4s. REGISTRATION AND REGULATION OF SWAP DEALERS AND MAJOR SWAP 
      PARTICIPANTS.
    ``(a) Registration.--
        ``(1) Swap dealers.--It shall be unlawful for any person to act 
    as a swap dealer unless the person is registered as a swap dealer 
    with the Commission.
        ``(2) Major swap participants.--It shall be unlawful for any 
    person to act as a major swap participant unless the person is 
    registered as a major swap participant with the Commission.
    ``(b) Requirements.--
        ``(1) In general.--A person shall register as a swap dealer or 
    major swap participant by filing a registration application with 
    the Commission.
        ``(2) Contents.--
            ``(A) In general.--The application shall be made in such 
        form and manner as prescribed by the Commission, and shall 
        contain such information, as the Commission considers necessary 
        concerning the business in which the applicant is or will be 
        engaged.
            ``(B) Continual reporting.--A person that is registered as 
        a swap dealer or major swap participant shall continue to 
        submit to the Commission reports that contain such information 
        pertaining to the business of the person as the Commission may 
        require.
        ``(3) Expiration.--Each registration under this section shall 
    expire at such time as the Commission may prescribe by rule or 
    regulation.
        ``(4) Rules.--Except as provided in subsections (d) and (e), 
    the Commission may prescribe rules applicable to swap dealers and 
    major swap participants, including rules that limit the activities 
    of swap dealers and major swap participants.
        ``(5) Transition.--Rules under this section shall provide for 
    the registration of swap dealers and major swap participants not 
    later than 1 year after the date of enactment of the Wall Street 
    Transparency and Accountability Act of 2010.
        ``(6) Statutory disqualification.--Except to the extent 
    otherwise specifically provided by rule, regulation, or order, it 
    shall be unlawful for a swap dealer or a major swap participant to 
    permit any person associated with a swap dealer or a major swap 
    participant who is subject to a statutory disqualification to 
    effect or be involved in effecting swaps on behalf of the swap 
    dealer or major swap participant, if the swap dealer or major swap 
    participant knew, or in the exercise of reasonable care should have 
    known, of the statutory disqualification.
    ``(c) Dual Registration.--
        ``(1) Swap dealer.--Any person that is required to be 
    registered as a swap dealer under this section shall register with 
    the Commission regardless of whether the person also is a 
    depository institution or is registered with the Securities and 
    Exchange Commission as a security-based swap dealer.
        ``(2) Major swap participant.--Any person that is required to 
    be registered as a major swap participant under this section shall 
    register with the Commission regardless of whether the person also 
    is a depository institution or is registered with the Securities 
    and Exchange Commission as a major security-based swap participant.
    ``(d) Rulemakings.--
        ``(1) In general.--The Commission shall adopt rules for persons 
    that are registered as swap dealers or major swap participants 
    under this section.
        ``(2) Exception for prudential requirements.--
            ``(A) In general.--The Commission may not prescribe rules 
        imposing prudential requirements on swap dealers or major swap 
        participants for which there is a prudential regulator.
            ``(B) Applicability.--Subparagraph (A) does not limit the 
        authority of the Commission to prescribe rules as directed 
        under this section.
    ``(e) Capital and Margin Requirements.--
        ``(1) In general.--
            ``(A) Swap dealers and major swap participants that are 
        banks.--Each registered swap dealer and major swap participant 
        for which there is a prudential regulator shall meet such 
        minimum capital requirements and minimum initial and variation 
        margin requirements as the prudential regulator shall by rule 
        or regulation prescribe under paragraph (2)(A).
            ``(B) Swap dealers and major swap participants that are not 
        banks.--Each registered swap dealer and major swap participant 
        for which there is not a prudential regulator shall meet such 
        minimum capital requirements and minimum initial and variation 
        margin requirements as the Commission shall by rule or 
        regulation prescribe under paragraph (2)(B).
        ``(2) Rules.--
            ``(A) Swap dealers and major swap participants that are 
        banks.--The prudential regulators, in consultation with the 
        Commission and the Securities and Exchange Commission, shall 
        jointly adopt rules for swap dealers and major swap 
        participants, with respect to their activities as a swap dealer 
        or major swap participant, for which there is a prudential 
        regulator imposing--
                ``(i) capital requirements; and
                ``(ii) both initial and variation margin requirements 
            on all swaps that are not cleared by a registered 
            derivatives clearing organization.
            ``(B) Swap dealers and major swap participants that are not 
        banks.--The Commission shall adopt rules for swap dealers and 
        major swap participants, with respect to their activities as a 
        swap dealer or major swap participant, for which there is not a 
        prudential regulator imposing--
                ``(i) capital requirements; and
                ``(ii) both initial and variation margin requirements 
            on all swaps that are not cleared by a registered 
            derivatives clearing organization.
            ``(C) Capital.--In setting capital requirements for a 
        person that is designated as a swap dealer or a major swap 
        participant for a single type or single class or category of 
        swap or activities, the prudential regulator and the Commission 
        shall take into account the risks associated with other types 
        of swaps or classes of swaps or categories of swaps engaged in 
        and the other activities conducted by that person that are not 
        otherwise subject to regulation applicable to that person by 
        virtue of the status of the person as a swap dealer or a major 
        swap participant.
        ``(3) Standards for capital and margin.--
            ``(A) In general.--To offset the greater risk to the swap 
        dealer or major swap participant and the financial system 
        arising from the use of swaps that are not cleared, the 
        requirements imposed under paragraph (2) shall--
                ``(i) help ensure the safety and soundness of the swap 
            dealer or major swap participant; and
                ``(ii) be appropriate for the risk associated with the 
            non-cleared swaps held as a swap dealer or major swap 
            participant.
            ``(B) Rule of construction.--
                ``(i) In general.--Nothing in this section shall limit, 
            or be construed to limit, the authority--

                    ``(I) of the Commission to set financial 
                responsibility rules for a futures commission merchant 
                or introducing broker registered pursuant to section 
                4f(a) (except for section 4f(a)(3)) in accordance with 
                section 4f(b); or
                    ``(II) of the Securities and Exchange Commission to 
                set financial responsibility rules for a broker or 
                dealer registered pursuant to section 15(b) of the 
                Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) 
                (except for section 15(b)(11) of that Act (15 U.S.C. 
                78o(b)(11)) in accordance with section 15(c)(3) of the 
                Securities Exchange Act of 1934 (15 U.S.C. 78o(c)(3)).

                ``(ii) Futures commission merchants and other 
            dealers.--A futures commission merchant, introducing 
            broker, broker, or dealer shall maintain sufficient capital 
            to comply with the stricter of any applicable capital 
            requirements to which such futures commission merchant, 
            introducing broker, broker, or dealer is subject to under 
            this Act or the Securities Exchange Act of 1934 (15 U.S.C. 
            78a et seq.).
            ``(C) Margin requirements.--In prescribing margin 
        requirements under this subsection, the prudential regulator 
        with respect to swap dealers and major swap participants for 
        which it is the prudential regulator and the Commission with 
        respect to swap dealers and major swap participants for which 
        there is no prudential regulator shall permit the use of 
        noncash collateral, as the regulator or the Commission 
        determines to be consistent with--
                ``(i) preserving the financial integrity of markets 
            trading swaps; and
                ``(ii) preserving the stability of the United States 
            financial system.
            ``(D) Comparability of capital and margin requirements.--
                ``(i) In general.--The prudential regulators, the 
            Commission, and the Securities and Exchange Commission 
            shall periodically (but not less frequently than annually) 
            consult on minimum capital requirements and minimum initial 
            and variation margin requirements.
                ``(ii) Comparability.--The entities described in clause 
            (i) shall, to the maximum extent practicable, establish and 
            maintain comparable minimum capital requirements and 
            minimum initial and variation margin requirements, 
            including the use of non cash collateral, for--

                    ``(I) swap dealers; and
                    ``(II) major swap participants.

    ``(f) Reporting and Recordkeeping.--
        ``(1) In general.--Each registered swap dealer and major swap 
    participant--
            ``(A) shall make such reports as are required by the 
        Commission by rule or regulation regarding the transactions and 
        positions and financial condition of the registered swap dealer 
        or major swap participant;
            ``(B)(i) for which there is a prudential regulator, shall 
        keep books and records of all activities related to the 
        business as a swap dealer or major swap participant in such 
        form and manner and for such period as may be prescribed by the 
        Commission by rule or regulation; and
            ``(ii) for which there is no prudential regulator, shall 
        keep books and records in such form and manner and for such 
        period as may be prescribed by the Commission by rule or 
        regulation;
            ``(C) shall keep books and records described in 
        subparagraph (B) open to inspection and examination by any 
        representative of the Commission; and
            ``(D) shall keep any such books and records relating to 
        swaps defined in section 1a(47)(A)(v) open to inspection and 
        examination by the Securities and Exchange Commission.
        ``(2) Rules.--The Commission shall adopt rules governing 
    reporting and recordkeeping for swap dealers and major swap 
    participants.
    ``(g) Daily Trading Records.--
        ``(1) In general.--Each registered swap dealer and major swap 
    participant shall maintain daily trading records of the swaps of 
    the registered swap dealer and major swap participant and all 
    related records (including related cash or forward transactions) 
    and recorded communications, including electronic mail, instant 
    messages, and recordings of telephone calls, for such period as may 
    be required by the Commission by rule or regulation.
        ``(2) Information requirements.--The daily trading records 
    shall include such information as the Commission shall require by 
    rule or regulation.
        ``(3) Counterparty records.--Each registered swap dealer and 
    major swap participant shall maintain daily trading records for 
    each counterparty in a manner and form that is identifiable with 
    each swap transaction.
        ``(4) Audit trail.--Each registered swap dealer and major swap 
    participant shall maintain a complete audit trail for conducting 
    comprehensive and accurate trade reconstructions.
        ``(5) Rules.--The Commission shall adopt rules governing daily 
    trading records for swap dealers and major swap participants.
    ``(h) Business Conduct Standards.--
        ``(1) In general.--Each registered swap dealer and major swap 
    participant shall conform with such business conduct standards as 
    prescribed in paragraph (3) and as may be prescribed by the 
    Commission by rule or regulation that relate to--
            ``(A) fraud, manipulation, and other abusive practices 
        involving swaps (including swaps that are offered but not 
        entered into);
            ``(B) diligent supervision of the business of the 
        registered swap dealer and major swap participant;
            ``(C) adherence to all applicable position limits; and
            ``(D) such other matters as the Commission determines to be 
        appropriate.
        ``(2) Responsibilities with respect to special entities.--
            ``(A) Advising special entities.--A swap dealer or major 
        swap participant that acts as an advisor to a special entity 
        regarding a swap shall comply with the requirements of 
        subparagraph (4) with respect to such Special Entity.
            ``(B) Entering of swaps with respect to special entities.--
        A swap dealer that enters into or offers to enter into swap 
        with a Special Entity shall comply with the requirements of 
        subparagraph (5) with respect to such Special Entity.
            ``(C) Special entity defined.--For purposes of this 
        subsection, the term `special entity' means--
                ``(i) a Federal agency;
                ``(ii) a State, State agency, city, county, 
            municipality, or other political subdivision of a State;
                ``(iii) any employee benefit plan, as defined in 
            section 3 of the Employee Retirement Income Security Act of 
            1974 (29 U.S.C. 1002);
                ``(iv) any governmental plan, as defined in section 3 
            of the Employee Retirement Income Security Act of 1974 (29 
            U.S.C. 1002); or
                ``(v) any endowment, including an endowment that is an 
            organization described in section 501(c)(3) of the Internal 
            Revenue Code of 1986.
        ``(3) Business conduct requirements.--Business conduct 
    requirements adopted by the Commission shall--
            ``(A) establish a duty for a swap dealer or major swap 
        participant to verify that any counterparty meets the 
        eligibility standards for an eligible contract participant;
            ``(B) require disclosure by the swap dealer or major swap 
        participant to any counterparty to the transaction (other than 
        a swap dealer, major swap participant, security-based swap 
        dealer, or major security-based swap participant) of--
                ``(i) information about the material risks and 
            characteristics of the swap;
                ``(ii) any material incentives or conflicts of interest 
            that the swap dealer or major swap participant may have in 
            connection with the swap; and
                ``(iii)(I) for cleared swaps, upon the request of the 
            counterparty, receipt of the daily mark of the transaction 
            from the appropriate derivatives clearing organization; and
                ``(II) for uncleared swaps, receipt of the daily mark 
            of the transaction from the swap dealer or the major swap 
            participant;
            ``(C) establish a duty for a swap dealer or major swap 
        participant to communicate in a fair and balanced manner based 
        on principles of fair dealing and good faith; and
            ``(D) establish such other standards and requirements as 
        the Commission may determine are appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this Act.
        ``(4) Special requirements for swap dealers acting as 
    advisors.--
            ``(A) In general.--It shall be unlawful for a swap dealer 
        or major swap participant--
                ``(i) to employ any device, scheme, or artifice to 
            defraud any Special Entity or prospective customer who is a 
            Special Entity;
                ``(ii) to engage in any transaction, practice, or 
            course of business that operates as a fraud or deceit on 
            any Special Entity or prospective customer who is a Special 
            Entity; or
                ``(iii) to engage in any act, practice, or course of 
            business that is fraudulent, deceptive or manipulative.
            ``(B) Duty.--Any swap dealer that acts as an advisor to a 
        Special Entity shall have a duty to act in the best interests 
        of the Special Entity.
            ``(C) Reasonable efforts.--Any swap dealer that acts as an 
        advisor to a Special Entity shall make reasonable efforts to 
        obtain such information as is necessary to make a reasonable 
        determination that any swap recommended by the swap dealer is 
        in the best interests of the Special Entity, including 
        information relating to--
                ``(i) the financial status of the Special Entity;
                ``(ii) the tax status of the Special Entity;
                ``(iii) the investment or financing objectives of the 
            Special Entity; and
                ``(iv) any other information that the Commission may 
            prescribe by rule or regulation.
        ``(5) Special requirements for swap dealers as counterparties 
    to special entities.--
            ``(A) Any swap dealer or major swap participant that offers 
        to enter or enters into a swap with a Special Entity shall--
                ``(i) comply with any duty established by the 
            Commission for a swap dealer or major swap participant, 
            with respect to a counterparty that is an eligible contract 
            participant within the meaning of subclause (I) or (II) of 
            clause (vii) of section 1a(18) of this Act, that requires 
            the swap dealer or major swap participant to have a 
            reasonable basis to believe that the counterparty that is a 
            Special Entity has an independent representative that--

                    ``(I) has sufficient knowledge to evaluate the 
                transaction and risks;
                    ``(II) is not subject to a statutory 
                disqualification;
                    ``(III) is independent of the swap dealer or major 
                swap participant;
                    ``(IV) undertakes a duty to act in the best 
                interests of the counterparty it represents;
                    ``(V) makes appropriate disclosures;
                    ``(VI) will provide written representations to the 
                Special Entity regarding fair pricing and the 
                appropriateness of the transaction; and
                    ``(VII) in the case of employee benefit plans 
                subject to the Employee Retirement Income Security act 
                of 1974, is a fiduciary as defined in section 3 of that 
                Act (29 U.S.C. 1002); and

                ``(ii) before the initiation of the transaction, 
            disclose to the Special Entity in writing the capacity in 
            which the swap dealer is acting; and
            ``(B) the Commission may establish such other standards and 
        requirements as the Commission may determine are appropriate in 
        the public interest, for the protection of investors, or 
        otherwise in furtherance of the purposes of this Act.
        ``(6) Rules.--The Commission shall prescribe rules under this 
    subsection governing business conduct standards for swap dealers 
    and major swap participants.
        ``(7) Applicability.--This section shall not apply with respect 
    to a transaction that is--
            ``(A) initiated by a Special Entity on an exchange or swap 
        execution facility; and
            ``(B) one in which the swap dealer or major swap 
        participant does not know the identity of the counterparty to 
        the transaction.
    ``(i) Documentation Standards.--
        ``(1) In general.--Each registered swap dealer and major swap 
    participant shall conform with such standards as may be prescribed 
    by the Commission by rule or regulation that relate to timely and 
    accurate confirmation, processing, netting, documentation, and 
    valuation of all swaps.
        ``(2) Rules.--The Commission shall adopt rules governing 
    documentation standards for swap dealers and major swap 
    participants.
    ``(j) Duties.--Each registered swap dealer and major swap 
participant at all times shall comply with the following requirements:
        ``(1) Monitoring of trading.--The swap dealer or major swap 
    participant shall monitor its trading in swaps to prevent 
    violations of applicable position limits.
        ``(2) Risk management procedures.--The swap dealer or major 
    swap participant shall establish robust and professional risk 
    management systems adequate for managing the day-to-day business of 
    the swap dealer or major swap participant.
        ``(3) Disclosure of general information.--The swap dealer or 
    major swap participant shall disclose to the Commission and to the 
    prudential regulator for the swap dealer or major swap participant, 
    as applicable, information concerning--
            ``(A) terms and conditions of its swaps;
            ``(B) swap trading operations, mechanisms, and practices;
            ``(C) financial integrity protections relating to swaps; 
        and
            ``(D) other information relevant to its trading in swaps.
        ``(4) Ability to obtain information.--The swap dealer or major 
    swap participant shall--
            ``(A) establish and enforce internal systems and procedures 
        to obtain any necessary information to perform any of the 
        functions described in this section; and
            ``(B) provide the information to the Commission and to the 
        prudential regulator for the swap dealer or major swap 
        participant, as applicable, on request.
        ``(5) Conflicts of interest.--The swap dealer and major swap 
    participant shall implement conflict-of-interest systems and 
    procedures that--
            ``(A) establish structural and institutional safeguards to 
        ensure that the activities of any person within the firm 
        relating to research or analysis of the price or market for any 
        commodity or swap or acting in a role of providing clearing 
        activities or making determinations as to accepting clearing 
        customers are separated by appropriate informational partitions 
        within the firm from the review, pressure, or oversight of 
        persons whose involvement in pricing, trading, or clearing 
        activities might potentially bias their judgment or supervision 
        and contravene the core principles of open access and the 
        business conduct standards described in this Act; and
            ``(B) address such other issues as the Commission 
        determines to be appropriate.
        ``(6) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this Act, a swap dealer or 
    major swap participant shall not--
            ``(A) adopt any process or take any action that results in 
        any unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on trading 
        or clearing.
        ``(7) Rules.--The Commission shall prescribe rules under this 
    subsection governing duties of swap dealers and major swap 
    participants.
    ``(k) Designation of Chief Compliance Officer.--
        ``(1) In general.--Each swap dealer and major swap participant 
    shall designate an individual to serve as a chief compliance 
    officer.
        ``(2) Duties.--The chief compliance officer shall--
            ``(A) report directly to the board or to the senior officer 
        of the swap dealer or major swap participant;
            ``(B) review the compliance of the swap dealer or major 
        swap participant with respect to the swap dealer and major swap 
        participant requirements described in this section;
            ``(C) in consultation with the board of directors, a body 
        performing a function similar to the board, or the senior 
        officer of the organization, resolve any conflicts of interest 
        that may arise;
            ``(D) be responsible for administering each policy and 
        procedure that is required to be established pursuant to this 
        section;
            ``(E) ensure compliance with this Act (including 
        regulations) relating to swaps, including each rule prescribed 
        by the Commission under this section;
            ``(F) establish procedures for the remediation of 
        noncompliance issues identified by the chief compliance officer 
        through any--
                ``(i) compliance office review;
                ``(ii) look-back;
                ``(iii) internal or external audit finding;
                ``(iv) self-reported error; or
                ``(v) validated complaint; and
            ``(G) establish and follow appropriate procedures for the 
        handling, management response, remediation, retesting, and 
        closing of noncompliance issues.
        ``(3) Annual reports.--
            ``(A) In general.--In accordance with rules prescribed by 
        the Commission, the chief compliance officer shall annually 
        prepare and sign a report that contains a description of--
                ``(i) the compliance of the swap dealer or major swap 
            participant with respect to this Act (including 
            regulations); and
                ``(ii) each policy and procedure of the swap dealer or 
            major swap participant of the chief compliance officer 
            (including the code of ethics and conflict of interest 
            policies).
            ``(B) Requirements.--A compliance report under subparagraph 
        (A) shall--
                ``(i) accompany each appropriate financial report of 
            the swap dealer or major swap participant that is required 
            to be furnished to the Commission pursuant to this section; 
            and
                ``(ii) include a certification that, under penalty of 
            law, the compliance report is accurate and complete.''.
    SEC. 732. CONFLICTS OF INTEREST.
    Section 4d of the Commodity Exchange Act (7 U.S.C. 6d) is amended--
        (1) by redesignating subsection (c) as subsection (e); and
        (2) by inserting after subsection (b) the following:
    ``(c) Conflicts of Interest.--The Commission shall require that 
futures commission merchants and introducing brokers implement 
conflict-of-interest systems and procedures that--
        ``(1) establish structural and institutional safeguards to 
    ensure that the activities of any person within the firm relating 
    to research or analysis of the price or market for any commodity 
    are separated by appropriate informational partitions within the 
    firm from the review, pressure, or oversight of persons whose 
    involvement in trading or clearing activities might potentially 
    bias the judgment or supervision of the persons; and
        ``(2) address such other issues as the Commission determines to 
    be appropriate.
    ``(d) Designation of Chief Compliance Officer.--Each futures 
commission merchant shall designate an individual to serve as its Chief 
Compliance Officer and perform such duties and responsibilities as 
shall be set forth in regulations to be adopted by the Commission or 
rules to be adopted by a futures association registered under section 
17.''.
    SEC. 733. SWAP EXECUTION FACILITIES.
    The Commodity Exchange Act is amended by inserting after section 5g 
(7 U.S.C. 7b-2) the following:
  ``SEC. 5h. SWAP EXECUTION FACILITIES.
    ``(a) Registration.--
        ``(1) In general.--No person may operate a facility for the 
    trading or processing of swaps unless the facility is registered as 
    a swap execution facility or as a designated contract market under 
    this section.
        ``(2) Dual registration.--Any person that is registered as a 
    swap execution facility under this section shall register with the 
    Commission regardless of whether the person also is registered with 
    the Securities and Exchange Commission as a swap execution 
    facility.
    ``(b) Trading and Trade Processing.--
        ``(1) In general.--Except as specified in paragraph (2), a swap 
    execution facility that is registered under subsection (a) may--
            ``(A) make available for trading any swap; and
            ``(B) facilitate trade processing of any swap.
        ``(2) Agricultural swaps.--A swap execution facility may not 
    list for trading or confirm the execution of any swap in an 
    agricultural commodity (as defined by the Commission) except 
    pursuant to a rule or regulation of the Commission allowing the 
    swap under such terms and conditions as the Commission shall 
    prescribe.
    ``(c) Identification of Facility Used To Trade Swaps by Contract 
Markets.--A board of trade that operates a contract market shall, to 
the extent that the board of trade also operates a swap execution 
facility and uses the same electronic trade execution system for 
listing and executing trades of swaps on or through the contract market 
and the swap execution facility, identify whether the electronic 
trading of such swaps is taking place on or through the contract market 
or the swap execution facility.
    ``(d) Rule-writing.--
        ``(1) The Securities and Exchange Commission and Commodity 
    Futures Trading Commission may promulgate rules defining the 
    universe of swaps that can be executed on a swap execution 
    facility. These rules shall take into account the price and 
    nonprice requirements of the counterparties to a swap and the goal 
    of this section as set forth in subsection (e).
        ``(2) For all swaps that are not required to be executed 
    through a swap execution facility as defined in paragraph (1), such 
    trades may be executed through any other available means of 
    interstate commerce.
        ``(3) The Securities and Exchange Commission and Commodity 
    Futures Trading Commission shall update these rules as necessary to 
    account for technological and other innovation.
    ``(e) Rule of Construction.--The goal of this section is to promote 
the trading of swaps on swap execution facilities and to promote pre-
trade price transparency in the swaps market.
    ``(f) Core Principles for Swap Execution Facilities.--
        ``(1) Compliance with core principles.--
            ``(A) In general.--To be registered, and maintain 
        registration, as a swap execution facility, the swap execution 
        facility shall comply with--
                ``(i) the core principles described in this subsection; 
            and
                ``(ii) any requirement that the Commission may impose 
            by rule or regulation pursuant to section 8a(5).
            ``(B) Reasonable discretion of swap execution facility.--
        Unless otherwise determined by the Commission by rule or 
        regulation, a swap execution facility described in subparagraph 
        (A) shall have reasonable discretion in establishing the manner 
        in which the swap execution facility complies with the core 
        principles described in this subsection.
        ``(2) Compliance with rules.--A swap execution facility shall--
            ``(A) establish and enforce compliance with any rule of the 
        swap execution facility, including--
                ``(i) the terms and conditions of the swaps traded or 
            processed on or through the swap execution facility; and
                ``(ii) any limitation on access to the swap execution 
            facility;
            ``(B) establish and enforce trading, trade processing, and 
        participation rules that will deter abuses and have the 
        capacity to detect, investigate, and enforce those rules, 
        including means--
                ``(i) to provide market participants with impartial 
            access to the market; and
                ``(ii) to capture information that may be used in 
            establishing whether rule violations have occurred;
            ``(C) establish rules governing the operation of the 
        facility, including rules specifying trading procedures to be 
        used in entering and executing orders traded or posted on the 
        facility, including block trades; and
            ``(D) provide by its rules that when a swap dealer or major 
        swap participant enters into or facilitates a swap that is 
        subject to the mandatory clearing requirement of section 2(h), 
        the swap dealer or major swap participant shall be responsible 
        for compliance with the mandatory trading requirement under 
        section 2(h)(8).
        ``(3) Swaps not readily susceptible to manipulation.--The swap 
    execution facility shall permit trading only in swaps that are not 
    readily susceptible to manipulation.
        ``(4) Monitoring of trading and trade processing.--The swap 
    execution facility shall--
            ``(A) establish and enforce rules or terms and conditions 
        defining, or specifications detailing--
                ``(i) trading procedures to be used in entering and 
            executing orders traded on or through the facilities of the 
            swap execution facility; and
                ``(ii) procedures for trade processing of swaps on or 
            through the facilities of the swap execution facility; and
            ``(B) monitor trading in swaps to prevent manipulation, 
        price distortion, and disruptions of the delivery or cash 
        settlement process through surveillance, compliance, and 
        disciplinary practices and procedures, including methods for 
        conducting real-time monitoring of trading and comprehensive 
        and accurate trade reconstructions.
        ``(5) Ability to obtain information.--The swap execution 
    facility shall--
            ``(A) establish and enforce rules that will allow the 
        facility to obtain any necessary information to perform any of 
        the functions described in this section;
            ``(B) provide the information to the Commission on request; 
        and
            ``(C) have the capacity to carry out such international 
        information-sharing agreements as the Commission may require.
        ``(6) Position limits or accountability.--
            ``(A) In general.--To reduce the potential threat of market 
        manipulation or congestion, especially during trading in the 
        delivery month, a swap execution facility that is a trading 
        facility shall adopt for each of the contracts of the facility, 
        as is necessary and appropriate, position limitations or 
        position accountability for speculators.
            ``(B) Position limits.--For any contract that is subject to 
        a position limitation established by the Commission pursuant to 
        section 4a(a), the swap execution facility shall--
                ``(i) set its position limitation at a level no higher 
            than the Commission limitation; and
                ``(ii) monitor positions established on or through the 
            swap execution facility for compliance with the limit set 
            by the Commission and the limit, if any, set by the swap 
            execution facility.
        ``(7) Financial integrity of transactions.--The swap execution 
    facility shall establish and enforce rules and procedures for 
    ensuring the financial integrity of swaps entered on or through the 
    facilities of the swap execution facility, including the clearance 
    and settlement of the swaps pursuant to section 2(h)(1).
        ``(8) Emergency authority.--The swap execution facility shall 
    adopt rules to provide for the exercise of emergency authority, in 
    consultation or cooperation with the Commission, as is necessary 
    and appropriate, including the authority to liquidate or transfer 
    open positions in any swap or to suspend or curtail trading in a 
    swap.
        ``(9) Timely publication of trading information.--
            ``(A) In general.--The swap execution facility shall make 
        public timely information on price, trading volume, and other 
        trading data on swaps to the extent prescribed by the 
        Commission.
            ``(B) Capacity of swap execution facility.--The swap 
        execution facility shall be required to have the capacity to 
        electronically capture and transmit trade information with 
        respect to transactions executed on the facility.
        ``(10) Recordkeeping and reporting.--
            ``(A) In general.--A swap execution facility shall--
                ``(i) maintain records of all activities relating to 
            the business of the facility, including a complete audit 
            trail, in a form and manner acceptable to the Commission 
            for a period of 5 years;
                ``(ii) report to the Commission, in a form and manner 
            acceptable to the Commission, such information as the 
            Commission determines to be necessary or appropriate for 
            the Commission to perform the duties of the Commission 
            under this Act; and
                ``(iii) shall keep any such records relating to swaps 
            defined in section 1a(47)(A)(v) open to inspection and 
            examination by the Securities and Exchange Commission.''
            ``(B) Requirements.--The Commission shall adopt data 
        collection and reporting requirements for swap execution 
        facilities that are comparable to corresponding requirements 
        for derivatives clearing organizations and swap data 
        repositories.
        ``(11) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this Act, the swap execution 
    facility shall not--
            ``(A) adopt any rules or taking any actions that result in 
        any unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on trading 
        or clearing.
        ``(12) Conflicts of interest.--The swap execution facility 
    shall--
            ``(A) establish and enforce rules to minimize conflicts of 
        interest in its decision-making process; and
            ``(B) establish a process for resolving the conflicts of 
        interest.
        ``(13) Financial resources.--
            ``(A) In general.--The swap execution facility shall have 
        adequate financial, operational, and managerial resources to 
        discharge each responsibility of the swap execution facility.
            ``(B) Determination of resource adequacy.--The financial 
        resources of a swap execution facility shall be considered to 
        be adequate if the value of the financial resources exceeds the 
        total amount that would enable the swap execution facility to 
        cover the operating costs of the swap execution facility for a 
        1-year period, as calculated on a rolling basis.
        ``(14) System safeguards.--The swap execution facility shall--
            ``(A) establish and maintain a program of risk analysis and 
        oversight to identify and minimize sources of operational risk, 
        through the development of appropriate controls and procedures, 
        and automated systems, that--
                ``(i) are reliable and secure; and
                ``(ii) have adequate scalable capacity;
            ``(B) establish and maintain emergency procedures, backup 
        facilities, and a plan for disaster recovery that allow for--
                ``(i) the timely recovery and resumption of operations; 
            and
                ``(ii) the fulfillment of the responsibilities and 
            obligations of the swap execution facility; and
            ``(C) periodically conduct tests to verify that the backup 
        resources of the swap execution facility are sufficient to 
        ensure continued--
                ``(i) order processing and trade matching;
                ``(ii) price reporting;
                ``(iii) market surveillance and
                ``(iv) maintenance of a comprehensive and accurate 
            audit trail.
        ``(15) Designation of chief compliance officer.--
            ``(A) In general.--Each swap execution facility shall 
        designate an individual to serve as a chief compliance officer.
            ``(B) Duties.--The chief compliance officer shall--
                ``(i) report directly to the board or to the senior 
            officer of the facility;
                ``(ii) review compliance with the core principles in 
            this subsection;
                ``(iii) in consultation with the board of the facility, 
            a body performing a function similar to that of a board, or 
            the senior officer of the facility, resolve any conflicts 
            of interest that may arise;
                ``(iv) be responsible for establishing and 
            administering the policies and procedures required to be 
            established pursuant to this section;
                ``(v) ensure compliance with this Act and the rules and 
            regulations issued under this Act, including rules 
            prescribed by the Commission pursuant to this section; and
                ``(vi) establish procedures for the remediation of 
            noncompliance issues found during compliance office 
            reviews, look backs, internal or external audit findings, 
            self-reported errors, or through validated complaints.
            ``(C) Requirements for procedures.--In establishing 
        procedures under subparagraph (B)(vi), the chief compliance 
        officer shall design the procedures to establish the handling, 
        management response, remediation, retesting, and closing of 
        noncompliance issues.
            ``(D) Annual reports.--
                ``(i) In general.--In accordance with rules prescribed 
            by the Commission, the chief compliance officer shall 
            annually prepare and sign a report that contains a 
            description of--

                    ``(I) the compliance of the swap execution facility 
                with this Act; and
                    ``(II) the policies and procedures, including the 
                code of ethics and conflict of interest policies, of 
                the swap execution facility.

                ``(ii) Requirements.--The chief compliance officer 
            shall--

                    ``(I) submit each report described in clause (i) 
                with the appropriate financial report of the swap 
                execution facility that is required to be submitted to 
                the Commission pursuant to this section; and
                    ``(II) include in the report a certification that, 
                under penalty of law, the report is accurate and 
                complete.

    ``(g) Exemptions.--The Commission may exempt, conditionally or 
unconditionally, a swap execution facility from registration under this 
section if the Commission finds that the facility is subject to 
comparable, comprehensive supervision and regulation on a consolidated 
basis by the Securities and Exchange Commission, a prudential 
regulator, or the appropriate governmental authorities in the home 
country of the facility.
    ``(h) Rules.--The Commission shall prescribe rules governing the 
regulation of alternative swap execution facilities under this 
section.''.
    SEC. 734. DERIVATIVES TRANSACTION EXECUTION FACILITIES AND EXEMPT 
      BOARDS OF TRADE.
    (a) In General.--Sections 5a and 5d of the Commodity Exchange Act 
(7 U.S.C. 7a, 7a-3) are repealed.
    (b) Conforming Amendments.--
        (1) Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is 
    amended--
            (A) in subsection (a)(1)(A), in the first sentence, by 
        striking ``or 5a''; and
            (B) in paragraph (2) of subsection (g) (as redesignated by 
        section 723(a)(1)(B)), by striking ``section 5a of this Act'' 
        and all that follows through ``5d of this Act'' and inserting 
        ``section 5b of this Act''.
        (2) Section 6(g)(1)(A) of the Securities Exchange Act of 1934 
    (15 U.S.C. 78f(g)(1)(A)) is amended--
            (A) by striking ``that--'' and all that follows through 
        ``(i) has been designated'' and inserting ``that has been 
        designated'';
            (B) by striking ``; or'' and inserting ``; and'' and
            (C) by striking clause (ii).
    (c) Ability to Petition Commission.--
        (1) In general.--Prior to the final effective dates in this 
    title, a person may petition the Commodity Futures Trading 
    Commission to remain subject to the provisions of section 5d of the 
    Commodity Exchange Act, as such provisions existed prior to the 
    effective date of this subtitle.
        (2) Consideration of petition.--The Commodity Futures Trading 
    Commission shall consider any petition submitted under paragraph 
    (1) in a prompt manner and may allow a person to continue operating 
    subject to the provisions of section 5d of the Commodity Exchange 
    Act for up to 1 year after the effective date of this subtitle.
    SEC. 735. DESIGNATED CONTRACT MARKETS.
    (a) Criteria for Designation.--Section 5 of the Commodity Exchange 
Act (7 U.S.C. 7) is amended by striking subsection (b).
    (b) Core Principles for Contract Markets.--Section 5 of the 
Commodity Exchange Act (7 U.S.C. 7) is amended by striking subsection 
(d) and inserting the following:
    ``(d) Core Principles for Contract Markets.--
        ``(1) Designation as contract market.--
            ``(A) In general.--To be designated, and maintain a 
        designation, as a contract market, a board of trade shall 
        comply with--
                ``(i) any core principle described in this subsection; 
            and
                ``(ii) any requirement that the Commission may impose 
            by rule or regulation pursuant to section 8a(5).
            ``(B) Reasonable discretion of contract market.--Unless 
        otherwise determined by the Commission by rule or regulation, a 
        board of trade described in subparagraph (A) shall have 
        reasonable discretion in establishing the manner in which the 
        board of trade complies with the core principles described in 
        this subsection.
        ``(2) Compliance with rules.--
            ``(A) In general.--The board of trade shall establish, 
        monitor, and enforce compliance with the rules of the contract 
        market, including--
                ``(i) access requirements;
                ``(ii) the terms and conditions of any contracts to be 
            traded on the contract market; and
                ``(iii) rules prohibiting abusive trade practices on 
            the contract market.
            ``(B) Capacity of contract market.--The board of trade 
        shall have the capacity to detect, investigate, and apply 
        appropriate sanctions to any person that violates any rule of 
        the contract market.
            ``(C) Requirement of rules.--The rules of the contract 
        market shall provide the board of trade with the ability and 
        authority to obtain any necessary information to perform any 
        function described in this subsection, including the capacity 
        to carry out such international information-sharing agreements 
        as the Commission may require.
        ``(3) Contracts not readily subject to manipulation.--The board 
    of trade shall list on the contract market only contracts that are 
    not readily susceptible to manipulation.
        ``(4) Prevention of market disruption.--The board of trade 
    shall have the capacity and responsibility to prevent manipulation, 
    price distortion, and disruptions of the delivery or cash-
    settlement process through market surveillance, compliance, and 
    enforcement practices and procedures, including--
            ``(A) methods for conducting real-time monitoring of 
        trading; and
            ``(B) comprehensive and accurate trade reconstructions.
        ``(5) Position limitations or accountability.--
            ``(A) In general.--To reduce the potential threat of market 
        manipulation or congestion (especially during trading in the 
        delivery month), the board of trade shall adopt for each 
        contract of the board of trade, as is necessary and 
        appropriate, position limitations or position accountability 
        for speculators.
            ``(B) Maximum allowable position limitation.--For any 
        contract that is subject to a position limitation established 
        by the Commission pursuant to section 4a(a), the board of trade 
        shall set the position limitation of the board of trade at a 
        level not higher than the position limitation established by 
        the Commission.
        ``(6) Emergency authority.--The board of trade, in consultation 
    or cooperation with the Commission, shall adopt rules to provide 
    for the exercise of emergency authority, as is necessary and 
    appropriate, including the authority--
            ``(A) to liquidate or transfer open positions in any 
        contract;
            ``(B) to suspend or curtail trading in any contract; and
            ``(C) to require market participants in any contract to 
        meet special margin requirements.
        ``(7) Availability of general information.--The board of trade 
    shall make available to market authorities, market participants, 
    and the public accurate information concerning--
            ``(A) the terms and conditions of the contracts of the 
        contract market; and
            ``(B)(i) the rules, regulations, and mechanisms for 
        executing transactions on or through the facilities of the 
        contract market; and
            ``(ii) the rules and specifications describing the 
        operation of the contract market's--
                ``(I) electronic matching platform; or
                ``(II) trade execution facility.
        ``(8) Daily publication of trading information.--The board of 
    trade shall make public daily information on settlement prices, 
    volume, open interest, and opening and closing ranges for actively 
    traded contracts on the contract market.
        ``(9) Execution of transactions.--
            ``(A) In general.--The board of trade shall provide a 
        competitive, open, and efficient market and mechanism for 
        executing transactions that protects the price discovery 
        process of trading in the centralized market of the board of 
        trade.
            ``(B) Rules.--The rules of the board of trade may 
        authorize, for bona fide business purposes--
                ``(i) transfer trades or office trades;
                ``(ii) an exchange of--

                    ``(I) futures in connection with a cash commodity 
                transaction;
                    ``(II) futures for cash commodities; or
                    ``(III) futures for swaps; or

                ``(iii) a futures commission merchant, acting as 
            principal or agent, to enter into or confirm the execution 
            of a contract for the purchase or sale of a commodity for 
            future delivery if the contract is reported, recorded, or 
            cleared in accordance with the rules of the contract market 
            or a derivatives clearing organization.
        ``(10) Trade information.--The board of trade shall maintain 
    rules and procedures to provide for the recording and safe storage 
    of all identifying trade information in a manner that enables the 
    contract market to use the information--
            ``(A) to assist in the prevention of customer and market 
        abuses; and
            ``(B) to provide evidence of any violations of the rules of 
        the contract market.
        ``(11) Financial integrity of transactions.--The board of trade 
    shall establish and enforce--
            ``(A) rules and procedures for ensuring the financial 
        integrity of transactions entered into on or through the 
        facilities of the contract market (including the clearance and 
        settlement of the transactions with a derivatives clearing 
        organization); and
            ``(B) rules to ensure--
                ``(i) the financial integrity of any--

                    ``(I) futures commission merchant; and
                    ``(II) introducing broker; and

                ``(ii) the protection of customer funds.
        ``(12) Protection of markets and market participants.--The 
    board of trade shall establish and enforce rules--
            ``(A) to protect markets and market participants from 
        abusive practices committed by any party, including abusive 
        practices committed by a party acting as an agent for a 
        participant; and
            ``(B) to promote fair and equitable trading on the contract 
        market.
        ``(13) Disciplinary procedures.--The board of trade shall 
    establish and enforce disciplinary procedures that authorize the 
    board of trade to discipline, suspend, or expel members or market 
    participants that violate the rules of the board of trade, or 
    similar methods for performing the same functions, including 
    delegation of the functions to third parties.
        ``(14) Dispute resolution.--The board of trade shall establish 
    and enforce rules regarding, and provide facilities for alternative 
    dispute resolution as appropriate for, market participants and any 
    market intermediaries.
        ``(15) Governance fitness standards.--The board of trade shall 
    establish and enforce appropriate fitness standards for directors, 
    members of any disciplinary committee, members of the contract 
    market, and any other person with direct access to the facility 
    (including any party affiliated with any person described in this 
    paragraph).
        ``(16) Conflicts of interest.--The board of trade shall 
    establish and enforce rules--
            ``(A) to minimize conflicts of interest in the decision-
        making process of the contract market; and
            ``(B) to establish a process for resolving conflicts of 
        interest described in subparagraph (A).
        ``(17) Composition of governing boards of contract markets.--
    The governance arrangements of the board of trade shall be designed 
    to permit consideration of the views of market participants.
        ``(18) Recordkeeping.--The board of trade shall maintain 
    records of all activities relating to the business of the contract 
    market--
            ``(A) in a form and manner that is acceptable to the 
        Commission; and
            ``(B) for a period of at least 5 years.
        ``(19) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this Act, the board of trade 
    shall not--
            ``(A) adopt any rule or taking any action that results in 
        any unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on trading 
        on the contract market.
        ``(20) System safeguards.--The board of trade shall--
            ``(A) establish and maintain a program of risk analysis and 
        oversight to identify and minimize sources of operational risk, 
        through the development of appropriate controls and procedures, 
        and the development of automated systems, that are reliable, 
        secure, and have adequate scalable capacity;
            ``(B) establish and maintain emergency procedures, backup 
        facilities, and a plan for disaster recovery that allow for the 
        timely recovery and resumption of operations and the 
        fulfillment of the responsibilities and obligations of the 
        board of trade; and
            ``(C) periodically conduct tests to verify that backup 
        resources are sufficient to ensure continued order processing 
        and trade matching, price reporting, market surveillance, and 
        maintenance of a comprehensive and accurate audit trail.
        ``(21) Financial resources.--
            ``(A) In general.--The board of trade shall have adequate 
        financial, operational, and managerial resources to discharge 
        each responsibility of the board of trade.
            ``(B) Determination of adequacy.--The financial resources 
        of the board of trade shall be considered to be adequate if the 
        value of the financial resources exceeds the total amount that 
        would enable the contract market to cover the operating costs 
        of the contract market for a 1-year period, as calculated on a 
        rolling basis.
        ``(22) Diversity of board of directors.--The board of trade, if 
    a publicly traded company, shall endeavor to recruit individuals to 
    serve on the board of directors and the other decision-making 
    bodies (as determined by the Commission) of the board of trade from 
    among, and to have the composition of the bodies reflect, a broad 
    and culturally diverse pool of qualified candidates.
        ``(23) Securities and exchange commission.--The board of trade 
    shall keep any such records relating to swaps defined in section 
    1a(47)(A)(v) open to inspection and examination by the Securities 
    and Exchange Commission.''.
    SEC. 736. MARGIN.
    Section 8a(7) of the Commodity Exchange Act (7 U.S.C. 12a(7)) is 
amended--
        (1) in subparagraph (C), by striking ``, excepting the setting 
    of levels of margin'';
        (2) by redesignating subparagraphs (D) through (F) as 
    subparagraphs (E) through (G), respectively; and
        (3) by inserting after subparagraph (C) the following:
            ``(D) margin requirements, provided that the rules, 
        regulations, or orders shall--
                ``(i) be limited to protecting the financial integrity 
            of the derivatives clearing organization;
                ``(ii) be designed for risk management purposes to 
            protect the financial integrity of transactions; and
                ``(iii) not set specific margin amounts;''.
    SEC. 737. POSITION LIMITS.
    (a) Aggregate Position Limits.--Section 4a(a) of the Commodity 
Exchange Act (7 U.S.C. 6a(a)) is amended--
        (1) by inserting after ``(a)'' the following:
        ``(1) In general.--'';
        (2) in the first sentence, by striking ``on electronic trading 
    facilities with respect to a significant price discovery contract'' 
    and inserting ``swaps that perform or affect a significant price 
    discovery function with respect to registered entities'';
        (3) in the second sentence--
            (A) by inserting ``, including any group or class of 
        traders,'' after ``held by any person''; and
            (B) by striking ``on an electronic trading facility with 
        respect to a significant price discovery contract,'' and 
        inserting ``swaps traded on or subject to the rules of a 
        designated contract market or a swap execution facility, or 
        swaps not traded on or subject to the rules of a designated 
        contract market or a swap execution facility that performs a 
        significant price discovery function with respect to a 
        registered entity,''; and
        (4) by adding at the end the following:
        ``(2) Establishment of limitations.--
            ``(A) In general.--In accordance with the standards set 
        forth in paragraph (1) of this subsection and consistent with 
        the good faith exception cited in subsection (b)(2), with 
        respect to physical commodities other than excluded commodities 
        as defined by the Commission, the Commission shall by rule, 
        regulation, or order establish limits on the amount of 
        positions, as appropriate, other than bona fide hedge 
        positions, that may be held by any person with respect to 
        contracts of sale for future delivery or with respect to 
        options on the contracts or commodities traded on or subject to 
        the rules of a designated contract market.
            ``(B) Timing.--
                ``(i) Exempt commodities.--For exempt commodities, the 
            limits required under subparagraph (A) shall be established 
            within 180 days after the date of the enactment of this 
            paragraph.
                ``(ii) Agricultural commodities.--For agricultural 
            commodities, the limits required under subparagraph (A) 
            shall be established within 270 days after the date of the 
            enactment of this paragraph.
            ``(C) Goal.--In establishing the limits required under 
        subparagraph (A), the Commission shall strive to ensure that 
        trading on foreign boards of trade in the same commodity will 
        be subject to comparable limits and that any limits to be 
        imposed by the Commission will not cause price discovery in the 
        commodity to shift to trading on the foreign boards of trade.
        ``(3) Specific limitations.--In establishing the limits 
    required in paragraph (2), the Commission, as appropriate, shall 
    set limits--
            ``(A) on the number of positions that may be held by any 
        person for the spot month, each other month, and the aggregate 
        number of positions that may be held by any person for all 
        months; and
            ``(B) to the maximum extent practicable, in its 
        discretion--
                ``(i) to diminish, eliminate, or prevent excessive 
            speculation as described under this section;
                ``(ii) to deter and prevent market manipulation, 
            squeezes, and corners;
                ``(iii) to ensure sufficient market liquidity for bona 
            fide hedgers; and
                ``(iv) to ensure that the price discovery function of 
            the underlying market is not disrupted.
        ``(4) Significant price discovery function.--In making a 
    determination whether a swap performs or affects a significant 
    price discovery function with respect to regulated markets, the 
    Commission shall consider, as appropriate:
            ``(A) Price linkage.--The extent to which the swap uses or 
        otherwise relies on a daily or final settlement price, or other 
        major price parameter, of another contract traded on a 
        regulated market based upon the same underlying commodity, to 
        value a position, transfer or convert a position, financially 
        settle a position, or close out a position.
            ``(B) Arbitrage.--The extent to which the price for the 
        swap is sufficiently related to the price of another contract 
        traded on a regulated market based upon the same underlying 
        commodity so as to permit market participants to effectively 
        arbitrage between the markets by simultaneously maintaining 
        positions or executing trades in the swaps on a frequent and 
        recurring basis.
            ``(C) Material price reference.--The extent to which, on a 
        frequent and recurring basis, bids, offers, or transactions in 
        a contract traded on a regulated market are directly based on, 
        or are determined by referencing, the price generated by the 
        swap.
            ``(D) Material liquidity.--The extent to which the volume 
        of swaps being traded in the commodity is sufficient to have a 
        material effect on another contract traded on a regulated 
        market.
            ``(E) Other material factors.--Such other material factors 
        as the Commission specifies by rule or regulation as relevant 
        to determine whether a swap serves a significant price 
        discovery function with respect to a regulated market.
        ``(5) Economically equivalent contracts.--
            ``(A) Notwithstanding any other provision of this section, 
        the Commission shall establish limits on the amount of 
        positions, including aggregate position limits, as appropriate, 
        other than bona fide hedge positions, that may be held by any 
        person with respect to swaps that are economically equivalent 
        to contracts of sale for future delivery or to options on the 
        contracts or commodities traded on or subject to the rules of a 
        designated contract market subject to paragraph (2).
            ``(B) In establishing limits pursuant to subparagraph (A), 
        the Commission shall--
                ``(i) develop the limits concurrently with limits 
            established under paragraph (2), and the limits shall have 
            similar requirements as under paragraph (3)(B); and
                ``(ii) establish the limits simultaneously with limits 
            established under paragraph (2).
        ``(6) Aggregate position limits.--The Commission shall, by rule 
    or regulation, establish limits (including related hedge exemption 
    provisions) on the aggregate number or amount of positions in 
    contracts based upon the same underlying commodity (as defined by 
    the Commission) that may be held by any person, including any group 
    or class of traders, for each month across--
            ``(A) contracts listed by designated contract markets;
            ``(B) with respect to an agreement contract, or transaction 
        that settles against any price (including the daily or final 
        settlement price) of 1 or more contracts listed for trading on 
        a registered entity, contracts traded on a foreign board of 
        trade that provides members or other participants located in 
        the United States with direct access to its electronic trading 
        and order matching system; and
            ``(C) swap contracts that perform or affect a significant 
        price discovery function with respect to regulated entities.
        ``(7) Exemptions.--The Commission, by rule, regulation, or 
    order, may exempt, conditionally or unconditionally, any person or 
    class of persons, any swap or class of swaps, any contract of sale 
    of a commodity for future delivery or class of such contracts, any 
    option or class of options, or any transaction or class of 
    transactions from any requirement it may establish under this 
    section with respect to position limits.''.
    (b) Conforming Amendments.--Section 4a(b) of the Commodity Exchange 
Act (7 U.S.C. 6a(b)) is amended--
        (1) in paragraph (1), by striking ``or derivatives transaction 
    execution facility or facilities or electronic trading facility'' 
    and inserting ``or swap execution facility or facilities''; and
        (2) in paragraph (2), by striking ``or derivatives transaction 
    execution facility or facilities or electronic trading facility'' 
    and inserting ``or swap execution facility''.
    (c) Bona Fide Hedging Transaction.--Section 4a(c) of the Commodity 
Exchange Act is amended--
        (1) by inserting ``(1)'' after ``(c)''; and
        (2) by adding at the end the following:
        ``(2) For the purposes of implementation of subsection (a)(2) 
    for contracts of sale for future delivery or options on the 
    contracts or commodities, the Commission shall define what 
    constitutes a bona fide hedging transaction or position as a 
    transaction or position that--
            ``(A)(i) represents a substitute for transactions made or 
        to be made or positions taken or to be taken at a later time in 
        a physical marketing channel;
            ``(ii) is economically appropriate to the reduction of 
        risks in the conduct and management of a commercial enterprise; 
        and
            ``(iii) arises from the potential change in the value of--
                ``(I) assets that a person owns, produces, 
            manufactures, processes, or merchandises or anticipates 
            owning, producing, manufacturing, processing, or 
            merchandising;
                ``(II) liabilities that a person owns or anticipates 
            incurring; or
                ``(III) services that a person provides, purchases, or 
            anticipates providing or purchasing; or
            ``(B) reduces risks attendant to a position resulting from 
        a swap that--
                ``(i) was executed opposite a counterparty for which 
            the transaction would qualify as a bona fide hedging 
            transaction pursuant to subparagraph (A); or
                ``(ii) meets the requirements of subparagraph (A).''.
    (d) Effective Date.--This section and the amendments made by this 
section shall become effective on the date of the enactment of this 
section.
    SEC. 738. FOREIGN BOARDS OF TRADE.
    (a) In General.--Section 4(b) of the Commodity Exchange Act (7 
U.S.C. 6(b)) is amended--
        (1) in the first sentence, by striking ``The Commission'' and 
    inserting the following:
        ``(2) Persons located in the united states.--
            ``(A) In general.--The Commission'';
        (2) in the second sentence, by striking ``Such rules and 
    regulations'' and inserting the following:
            ``(B) Different requirements.--Rules and regulations 
        described in subparagraph (A)'';
        (3) in the third sentence--
            (A) by striking ``No rule or regulation'' and inserting the 
        following:
            ``(C) Prohibition.--Except as provided in paragraphs (1) 
        and (2), no rule or regulation'';
            (B) by striking ``that (1) requires'' and inserting the 
        following: ``that--
                ``(i) requires''; and
            (C) by striking ``market, or (2) governs'' and inserting 
        the following: ``market; or
                ``(ii) governs''; and
        (4) by inserting before paragraph (2) (as designated by 
    paragraph (1)) the following:
        ``(1) Foreign boards of trade.--
            ``(A) Registration.--The Commission may adopt rules and 
        regulations requiring registration with the Commission for a 
        foreign board of trade that provides the members of the foreign 
        board of trade or other participants located in the United 
        States with direct access to the electronic trading and order 
        matching system of the foreign board of trade, including rules 
        and regulations prescribing procedures and requirements 
        applicable to the registration of such foreign boards of trade. 
        For purposes of this paragraph, `direct access' refers to an 
        explicit grant of authority by a foreign board of trade to an 
        identified member or other participant located in the United 
        States to enter trades directly into the trade matching system 
        of the foreign board of trade. In adopting such rules and 
        regulations, the commission shall consider--
                ``(i) whether any such foreign board of trade is 
            subject to comparable, comprehensive supervision and 
            regulation by the appropriate governmental authorities in 
            the foreign board of trade's home country; and
                ``(ii) any previous commission findings that the 
            foreign board of trade is subject to comparable 
            comprehensive supervision and regulation by the appropriate 
            government authorities in the foreign board of trade's home 
            country.
            ``(B) Linked contracts.--The Commission may not permit a 
        foreign board of trade to provide to the members of the foreign 
        board of trade or other participants located in the United 
        States direct access to the electronic trading and order-
        matching system of the foreign board of trade with respect to 
        an agreement, contract, or transaction that settles against any 
        price (including the daily or final settlement price) of 1 or 
        more contracts listed for trading on a registered entity, 
        unless the Commission determines that--
                ``(i) the foreign board of trade makes public daily 
            trading information regarding the agreement, contract, or 
            transaction that is comparable to the daily trading 
            information published by the registered entity for the 1 or 
            more contracts against which the agreement, contract, or 
            transaction traded on the foreign board of trade settles; 
            and
                ``(ii) the foreign board of trade (or the foreign 
            futures authority that oversees the foreign board of 
            trade)--

                    ``(I) adopts position limits (including related 
                hedge exemption provisions) for the agreement, 
                contract, or transaction that are comparable to the 
                position limits (including related hedge exemption 
                provisions) adopted by the registered entity for the 1 
                or more contracts against which the agreement, 
                contract, or transaction traded on the foreign board of 
                trade settles;
                    ``(II) has the authority to require or direct 
                market participants to limit, reduce, or liquidate any 
                position the foreign board of trade (or the foreign 
                futures authority that oversees the foreign board of 
                trade) determines to be necessary to prevent or reduce 
                the threat of price manipulation, excessive speculation 
                as described in section 4a, price distortion, or 
                disruption of delivery or the cash settlement process;
                    ``(III) agrees to promptly notify the Commission, 
                with regard to the agreement, contract, or transaction 
                that settles against any price (including the daily or 
                final settlement price) of 1 or more contracts listed 
                for trading on a registered entity, of any change 
                regarding--

                        ``(aa) the information that the foreign board 
                    of trade will make publicly available;
                        ``(bb) the position limits that the foreign 
                    board of trade or foreign futures authority will 
                    adopt and enforce;
                        ``(cc) the position reductions required to 
                    prevent manipulation, excessive speculation as 
                    described in section 4a, price distortion, or 
                    disruption of delivery or the cash settlement 
                    process; and
                        ``(dd) any other area of interest expressed by 
                    the Commission to the foreign board of trade or 
                    foreign futures authority;

                    ``(IV) provides information to the Commission 
                regarding large trader positions in the agreement, 
                contract, or transaction that is comparable to the 
                large trader position information collected by the 
                Commission for the 1 or more contracts against which 
                the agreement, contract, or transaction traded on the 
                foreign board of trade settles; and
                    ``(V) provides the Commission such information as 
                is necessary to publish reports on aggregate trader 
                positions for the agreement, contract, or transaction 
                traded on the foreign board of trade that are 
                comparable to such reports on aggregate trader 
                positions for the 1 or more contracts against which the 
                agreement, contract, or transaction traded on the 
                foreign board of trade settles.

            ``(C) Existing foreign boards of trade.--Subparagraphs (A) 
        and (B) shall not be effective with respect to any foreign 
        board of trade to which, prior to the date of enactment of this 
        paragraph, the Commission granted direct access permission 
        until the date that is 180 days after that date of 
        enactment.''.
    (b) Liability of Registered Persons Trading on a Foreign Board of 
Trade.--Section 4 of the Commodity Exchange Act (7 U.S.C. 6) is 
amended--
        (1) in subsection (a), in the matter preceding paragraph (1), 
    by inserting ``or by subsection (e)'' after ``Unless exempted by 
    the Commission pursuant to subsection (c)''; and
        (2) by adding at the end the following:
    ``(e) Liability of Registered Persons Trading on a Foreign Board of 
Trade.--
        ``(1) In general.--A person registered with the Commission, or 
    exempt from registration by the Commission, under this Act may not 
    be found to have violated subsection (a) with respect to a 
    transaction in, or in connection with, a contract of sale of a 
    commodity for future delivery if the person--
            ``(A) has reason to believe that the transaction and the 
        contract is made on or subject to the rules of a foreign board 
        of trade that is--
                ``(i) legally organized under the laws of a foreign 
            country;
                ``(ii) authorized to act as a board of trade by a 
            foreign futures authority; and
                ``(iii) subject to regulation by the foreign futures 
            authority; and
            ``(B) has not been determined by the Commission to be 
        operating in violation of subsection (a).
        ``(2) Rule of construction.--Nothing in this subsection shall 
    be construed as implying or creating any presumption that a board 
    of trade, exchange, or market is located outside the United States, 
    or its territories or possessions, for purposes of subsection 
    (a).''.
    (c) Contract Enforcement for Foreign Futures Contracts.--Section 
22(a) of the Commodity Exchange Act (7 U.S.C. 25(a)) (as amended by 
section 739) is amended by adding at the end the following:
    ``(6) Contract Enforcement for Foreign Futures Contracts.--A 
contract of sale of a commodity for future delivery traded or executed 
on or through the facilities of a board of trade, exchange, or market 
located outside the United States for purposes of section 4(a) shall 
not be void, voidable, or unenforceable, and a party to such a contract 
shall not be entitled to rescind or recover any payment made with 
respect to the contract, based on the failure of the foreign board of 
trade to comply with any provision of this Act.''.
    SEC. 739. LEGAL CERTAINTY FOR SWAPS.
    Section 22(a) of the Commodity Exchange Act (7 U.S.C. 25(a)) is 
amended by striking paragraph (4) and inserting the following:
    ``(4) Contract Enforcement Between Eligible Counterparties.--
        ``(A) In general.--No hybrid instrument sold to any investor 
    shall be void, voidable, or unenforceable, and no party to a hybrid 
    instrument shall be entitled to rescind, or recover any payment 
    made with respect to, the hybrid instrument under this section or 
    any other provision of Federal or State law, based solely on the 
    failure of the hybrid instrument to comply with the terms or 
    conditions of section 2(f) or regulations of the Commission.
        ``(B) Swaps.--No agreement, contract, or transaction between 
    eligible contract participants or persons reasonably believed to be 
    eligible contract participants shall be void, voidable, or 
    unenforceable, and no party to such agreement, contract, or 
    transaction shall be entitled to rescind, or recover any payment 
    made with respect to, the agreement, contract, or transaction under 
    this section or any other provision of Federal or State law, based 
    solely on the failure of the agreement, contract, or transaction--
            ``(i) to meet the definition of a swap under section 1a; or
            ``(ii) to be cleared in accordance with section 2(h)(1).
    ``(5) Legal Certainty for Long-term Swaps Entered Into Before the 
Date of Enactment of the Wall Street Transparency and Accountability 
Act of 2010.--
        ``(A) Effect on swaps.--Unless specifically reserved in the 
    applicable swap, neither the enactment of the Wall Street 
    Transparency and Accountability Act of 2010, nor any requirement 
    under that Act or an amendment made by that Act, shall constitute a 
    termination event, force majeure, illegality, increased costs, 
    regulatory change, or similar event under a swap (including any 
    related credit support arrangement) that would permit a party to 
    terminate, renegotiate, modify, amend, or supplement 1 or more 
    transactions under the swap.
        ``(B) Position limits.--Any position limit established under 
    the Wall Street Transparency and Accountability Act of 2010 shall 
    not apply to a position acquired in good faith prior to the 
    effective date of any rule, regulation, or order under the Act that 
    establishes the position limit; provided, however, that such 
    positions shall be attributed to the trader if the trader's 
    position is increased after the effective date of such position 
    limit rule, regulation, or order.''.
    SEC. 740. MULTILATERAL CLEARING ORGANIZATIONS.
    Sections 408 and 409 of the Federal Deposit Insurance Corporation 
Improvement Act of 1991 (12 U.S.C. 4421, 4422) are repealed.
    SEC. 741. ENFORCEMENT.
    (a) Enforcement Authority.--The Commodity Exchange Act is amended 
by inserting after section 4b (7 U.S.C. 6b) the following:
``SEC. 4b-1. ENFORCEMENT AUTHORITY.
    ``(a) Commodity Futures Trading Commission.--Except as provided in 
subsections (b), (c), and (d), the Commission shall have exclusive 
authority to enforce the provisions of subtitle A of the Wall Street 
Transparency and Accountability Act of 2010 with respect to any person.
    ``(b) Prudential Regulators.--The prudential regulators shall have 
exclusive authority to enforce the provisions of section 4s(e) with 
respect to swap dealers or major swap participants for which they are 
the prudential regulator.
    ``(c) Referrals.--
        ``(1) Prudential regulators.--If the prudential regulator for a 
    swap dealer or major swap participant has cause to believe that the 
    swap dealer or major swap participant, or any affiliate or division 
    of the swap dealer or major swap participant, may have engaged in 
    conduct that constitutes a violation of the nonprudential 
    requirements of this Act (including section 4s or rules adopted by 
    the Commission under that section), the prudential regulator may 
    promptly notify the Commission in a written report that includes--
            ``(A) a request that the Commission initiate an enforcement 
        proceeding under this Act; and
            ``(B) an explanation of the facts and circumstances that 
        led to the preparation of the written report.
        ``(2) Commission.--If the Commission has cause to believe that 
    a swap dealer or major swap participant that has a prudential 
    regulator may have engaged in conduct that constitutes a violation 
    of any prudential requirement of section 4s or rules adopted by the 
    Commission under that section, the Commission may notify the 
    prudential regulator of the conduct in a written report that 
    includes--
            ``(A) a request that the prudential regulator initiate an 
        enforcement proceeding under this Act or any other Federal law 
        (including regulations); and
            ``(B) an explanation of the concerns of the Commission, and 
        a description of the facts and circumstances, that led to the 
        preparation of the written report.
    ``(d) Backstop Enforcement Authority.--
        ``(1) Initiation of enforcement proceeding by prudential 
    regulator.--If the Commission does not initiate an enforcement 
    proceeding before the end of the 90-day period beginning on the 
    date on which the Commission receives a written report under 
    subsection (c)(1), the prudential regulator may initiate an 
    enforcement proceeding.
        ``(2) Initiation of enforcement proceeding by commission.--If 
    the prudential regulator does not initiate an enforcement 
    proceeding before the end of the 90-day period beginning on the 
    date on which the prudential regulator receives a written report 
    under subsection (c)(2), the Commission may initiate an enforcement 
    proceeding.''.
    (b) Conforming Amendments.--
        (1) Section 4b of the Commodity Exchange Act (7 U.S.C. 6b) is 
    amended--
            (A) in subsection (a)(2), by striking ``or other agreement, 
        contract, or transaction subject to paragraphs (1) and (2) of 
        section 5a(g),'' and inserting ``or swap,'';
            (B) in subsection (b), by striking ``or other agreement, 
        contract or transaction subject to paragraphs (1) and (2) of 
        section 5a(g),'' and inserting ``or swap,''; and
            (C) by adding at the end the following:
    ``(e) It shall be unlawful for any person, directly or indirectly, 
by the use of any means or instrumentality of interstate commerce, or 
of the mails, or of any facility of any registered entity, in or in 
connection with any order to make, or the making of, any contract of 
sale of any commodity for future delivery (or option on such a 
contract), or any swap, on a group or index of securities (or any 
interest therein or based on the value thereof)--
        ``(1) to employ any device, scheme, or artifice to defraud;
        ``(2) to make any untrue statement of a material fact or to 
    omit to state a material fact necessary in order to make the 
    statements made, in the light of the circumstances under which they 
    were made, not misleading; or
        ``(3) to engage in any act, practice, or course of business 
    which operates or would operate as a fraud or deceit upon any 
    person.''.
        (2) Section 4c(a)(1) of the Commodity Exchange Act (7 U.S.C. 
    6c(a)(1)) is amended by inserting ``or swap'' before ``if the 
    transaction is used or may be used''.
        (3) Section 6(c) of the Commodity Exchange Act (7 U.S.C. 9) is 
    amended in the first sentence by inserting ``or of any swap,'' 
    before ``or has willfully made''.
        (4) Section 6(d) of the Commodity Exchange Act (7 U.S.C. 13b) 
    is amended in the first sentence, in the matter preceding the 
    proviso, by inserting ``or of any swap,'' before ``or otherwise is 
    violating''.
        (5) Section 6c(a) of the Commodity Exchange Act (7 U.S.C. 13a-
    1(a)) is amended in the matter preceding the proviso by inserting 
    ``or any swap'' after ``commodity for future delivery''.
        (6) Section 9 of the Commodity Exchange Act (7 U.S.C. 13) is 
    amended--
            (A) in subsection (a)--
                (i) in paragraph (2), by inserting ``or of any swap,'' 
            before ``or to corner''; and
                (ii) in paragraph (4), by inserting ``swap data 
            repository,'' before ``or futures association'' and
            (B) in subsection (e)(1)--
                (i) by inserting ``swap data repository,'' before ``or 
            registered futures association''; and
                (ii) by inserting ``, or swaps,'' before ``on the 
            basis''.
        (7) Section 9(a) of the Commodity Exchange Act (7 U.S.C. 13(a)) 
    is amended by adding at the end the following:
        ``(6) Any person to abuse the end user clearing exemption under 
    section 2(h)(4), as determined by the Commission.''.
        (8) Section 2(c)(2)(B) of the Commodity Exchange Act (7 U.S.C. 
    2(c)(2)(B)) is amended--
            (A) by striking ``(dd),'' each place it appears;
            (B) in clause (iii), by inserting ``, and accounts or 
        pooled investment vehicles described in clause (vi),'' before 
        ``shall be subject to''; and
            (C) by adding at the end the following:
                ``(vi) This Act applies to, and the Commission shall 
            have jurisdiction over, an account or pooled investment 
            vehicle that is offered for the purpose of trading, or that 
            trades, any agreement, contract, or transaction in foreign 
            currency described in clause (i).''.
        (9) Section 2(c)(2)(C) of the Commodity Exchange Act (7 U.S.C. 
    2(c)(2)(C)) is amended--
            (A) by striking ``(dd),'' each place it appears;
            (B) in clause (ii)(I), by inserting ``, and accounts or 
        pooled investment vehicles described in clause (vii),'' before 
        ``shall be subject to''; and
            (C) by adding at the end the following:
                ``(vii) This Act applies to, and the Commission shall 
            have jurisdiction over, an account or pooled investment 
            vehicle that is offered for the purpose of trading, or that 
            trades, any agreement, contract, or transaction in foreign 
            currency described in clause (i).''.
        (10) Section 1a(19)(A)(iv)(II) of the Commodity Exchange Act (7 
    U.S.C. 1a(19)(A)(iv)(II)) (as redesignated by section 721(a)(1)) is 
    amended by inserting before the semicolon at the end the following: 
    ``provided, however, that for purposes of section 2(c)(2)(B)(vi) 
    and section 2(c)(2)(C)(vii), the term `eligible contract 
    participant' shall not include a commodity pool in which any 
    participant is not otherwise an eligible contract participant''.
        (11) Section 6(e) of the Commodity Exchange Act (7 U.S.C. 9a) 
    is amended by adding at the end the following:
        ``(4) Any designated clearing organization that knowingly or 
    recklessly evades or participates in or facilitates an evasion of 
    the requirements of section 2(h) shall be liable for a civil money 
    penalty in twice the amount otherwise available for a violation of 
    section 2(h).
        ``(5) Any swap dealer or major swap participant that knowingly 
    or recklessly evades or participates in or facilitates an evasion 
    of the requirements of section 2(h) shall be liable for a civil 
    money penalty in twice the amount otherwise available for a 
    violation of section 2(h).''.
    (c) Savings Clause.--Notwithstanding any other provision of this 
title, nothing in this subtitle shall be construed as divesting any 
appropriate Federal banking agency of any authority it may have to 
establish or enforce, with respect to a person for which such agency is 
the appropriate Federal banking agency, prudential or other standards 
pursuant to authority granted by Federal law other than this title.
    SEC. 742. RETAIL COMMODITY TRANSACTIONS.
    (a) In General.--Section 2(c) of the Commodity Exchange Act (7 
U.S.C. 2(c)) is amended--
        (1) in paragraph (1), by striking ``5a (to the extent provided 
    in section 5a(g)), 5b, 5d, or 12(e)(2)(B))'' and inserting ``, 5b, 
    or 12(e)(2)(B))''; and
        (2) in paragraph (2), by adding at the end the following:
            ``(D) Retail commodity transactions.--
                ``(i) Applicability.--Except as provided in clause 
            (ii), this subparagraph shall apply to any agreement, 
            contract, or transaction in any commodity that is--

                    ``(I) entered into with, or offered to (even if not 
                entered into with), a person that is not an eligible 
                contract participant or eligible commercial entity; and
                    ``(II) entered into, or offered (even if not 
                entered into), on a leveraged or margined basis, or 
                financed by the offeror, the counterparty, or a person 
                acting in concert with the offeror or counterparty on a 
                similar basis.

                ``(ii) Exceptions.--This subparagraph shall not apply 
            to--

                    ``(I) an agreement, contract, or transaction 
                described in paragraph (1) or subparagraphs (A), (B), 
                or (C), including any agreement, contract, or 
                transaction specifically excluded from subparagraph 
                (A), (B), or (C);
                    ``(II) any security;
                    ``(III) a contract of sale that--

                        ``(aa) results in actual delivery within 28 
                    days or such other longer period as the Commission 
                    may determine by rule or regulation based upon the 
                    typical commercial practice in cash or spot markets 
                    for the commodity involved; or
                        ``(bb) creates an enforceable obligation to 
                    deliver between a seller and a buyer that have the 
                    ability to deliver and accept delivery, 
                    respectively, in connection with the line of 
                    business of the seller and buyer; or

                    ``(IV) an agreement, contract, or transaction that 
                is listed on a national securities exchange registered 
                under section 6(a) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78f(a)); or
                    ``(V) an identified banking product, as defined in 
                section 402(b) of the Legal Certainty for Bank Products 
                Act of 2000 (7 U.S.C.27(b)).

                ``(iii) Enforcement.--Sections 4(a), 4(b), and 4b apply 
            to any agreement, contract, or transaction described in 
            clause (i), as if the agreement, contract, or transaction 
            was a contract of sale of a commodity for future delivery.
                ``(iv) Eligible commercial entity.--For purposes of 
            this subparagraph, an agricultural producer, packer, or 
            handler shall be considered to be an eligible commercial 
            entity for any agreement, contract, or transaction for a 
            commodity in connection with the line of business of the 
            agricultural producer, packer, or handler.''.
    (b) Gramm-Leach-Bliley Act.--Section 206(a) of the Gramm-Leach-
Bliley Act (Public Law 106-102; 15 U.S.C. 78c note) is amended, in the 
matter preceding paragraph (1), by striking ``For purposes of'' and 
inserting ``Except as provided in subsection (e), for purposes of''.
    (c) Conforming Amendments Relating to Retail Foreign Exchange 
Transactions.--
        (1) Section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act (7 
    U.S.C. 2(c)(2)(B)(i)(II)) is amended--
            (A) in item (aa), by inserting ``United States'' before 
        ``financial institution'';
            (B) by striking items (dd) and (ff);
            (C) by redesignating items (ee) and (gg) as items (dd) and 
        (ff), respectively; and
            (D) in item (dd) (as so redesignated), by striking the 
        semicolon and inserting ``; or''.
        (2) Section 2(c)(2) of the Commodity Exchange Act (7 U.S.C. 
    2(c)(2)) (as amended by subsection (a)(2)) is amended by adding at 
    the end the following:
            ``(E) Prohibition.--
                ``(i) Definition of federal regulatory agency.--In this 
            subparagraph, the term `Federal regulatory agency' means--

                    ``(I) the Commission;
                    ``(II) the Securities and Exchange Commission;
                    ``(III) an appropriate Federal banking agency;
                    ``(IV) the National Credit Union Association; and
                    ``(V) the Farm Credit Administration.

                ``(ii) Prohibition.--

                    ``(I) In general.--Except as provided in subclause 
                (II), a person described in subparagraph (B)(i)(II) for 
                which there is a Federal regulatory agency shall not 
                offer to, or enter into with, a person that is not an 
                eligible contract participant, any agreement, contract, 
                or transaction in foreign currency described in 
                subparagraph (B)(i)(I) except pursuant to a rule or 
                regulation of a Federal regulatory agency allowing the 
                agreement, contract, or transaction under such terms 
                and conditions as the Federal regulatory agency shall 
                prescribe.
                    ``(II) Effective date.--With regard to persons 
                described in subparagraph (B)(i)(II) for which a 
                Federal regulatory agency has issued a proposed rule 
                concerning agreements, contracts, or transactions in 
                foreign currency described in subparagraph (B)(i)(I) 
                prior to the date of enactment of this subclause, 
                subclause (I) shall take effect 90 days after the date 
                of enactment of this subclause.

                ``(iii) Requirements of rules and regulations.--

                    ``(I) In general.--The rules and regulations 
                described in clause (ii) shall prescribe appropriate 
                requirements with respect to--

                        ``(aa) disclosure;
                        ``(bb) recordkeeping;
                        ``(cc) capital and margin;
                        ``(dd) reporting;
                        ``(ee) business conduct;
                        ``(ff) documentation; and
                        ``(gg) such other standards or requirements as 
                    the Federal regulatory agency shall determine to be 
                    necessary.

                    ``(II) Treatment.--The rules or regulations 
                described in clause (ii) shall treat all agreements, 
                contracts, and transactions in foreign currency 
                described in subparagraph (B)(i)(I), and all 
                agreements, contracts, and transactions in foreign 
                currency that are functionally or economically similar 
                to agreements, contracts, or transactions described in 
                subparagraph (B)(i)(I), similarly.''.

    SEC. 743. OTHER AUTHORITY.
    Unless otherwise provided by the amendments made by this subtitle, 
the amendments made by this subtitle do not divest any appropriate 
Federal banking agency, the Commodity Futures Trading Commission, the 
Securities and Exchange Commission, or other Federal or State agency of 
any authority derived from any other applicable law.
    SEC. 744. RESTITUTION REMEDIES.
    Section 6c(d) of the Commodity Exchange Act (7 U.S.C. 13a-1(d)) is 
amended by adding at the end the following:
        ``(3) Equitable remedies.--In any action brought under this 
    section, the Commission may seek, and the court may impose, on a 
    proper showing, on any person found in the action to have committed 
    any violation, equitable remedies including--
            ``(A) restitution to persons who have sustained losses 
        proximately caused by such violation (in the amount of such 
        losses); and
            ``(B) disgorgement of gains received in connection with 
        such violation.''.
    SEC. 745. ENHANCED COMPLIANCE BY REGISTERED ENTITIES.
    (a) Effect of Interpretation.--Section 5c(a) of the Commodity 
Exchange Act (7 U.S.C. 7a-2(a)) is amended by striking paragraph (2) 
and inserting the following:
        ``(2) Effect of interpretation.--An interpretation issued under 
    paragraph (1) may provide the exclusive means for complying with 
    each section described in paragraph (1).''.
    (b) New Contracts, New Rules, and Rule Amendments.--Section 5c of 
the Commodity Exchange Act (7 U.S.C. 7a-2) is amended by striking 
subsection (c) and inserting the following:
    ``(c) New Contracts, New Rules, and Rule Amendments.--
        ``(1) In general.--A registered entity may elect to list for 
    trading or accept for clearing any new contract, or other 
    instrument, or may elect to approve and implement any new rule or 
    rule amendment, by providing to the Commission (and the Secretary 
    of the Treasury, in the case of a contract of sale of a government 
    security for future delivery (or option on such a contract) or a 
    rule or rule amendment specifically related to such a contract) a 
    written certification that the new contract or instrument or 
    clearing of the new contract or instrument, new rule, or rule 
    amendment complies with this Act (including regulations under this 
    Act).
        ``(2) Rule review.--The new rule or rule amendment described in 
    paragraph (1) shall become effective, pursuant to the certification 
    of the registered entity and notice of such certification to its 
    members (in a manner to be determined by the Commission), on the 
    date that is 10 business days after the date on which the 
    Commission receives the certification (or such shorter period as 
    determined by the Commission by rule or regulation) unless the 
    Commission notifies the registered entity within such time that it 
    is staying the certification because there exist novel or complex 
    issues that require additional time to analyze, an inadequate 
    explanation by the submitting registered entity, or a potential 
    inconsistency with this Act (including regulations under this Act).
        ``(3) Stay of certification for rules.--
            ``(A) A notification by the Commission pursuant to 
        paragraph (2) shall stay the certification of the new rule or 
        rule amendment for up to an additional 90 days from the date of 
        the notification.
            ``(B) A rule or rule amendment subject to a stay pursuant 
        to subparagraph (A) shall become effective, pursuant to the 
        certification of the registered entity, at the expiration of 
        the period described in subparagraph (A) unless the 
        Commission--
                ``(i) withdraws the stay prior to that time; or
                ``(ii) notifies the registered entity during such 
            period that it objects to the proposed certification on the 
            grounds that it is inconsistent with this Act (including 
            regulations under this Act).
            ``(C) The Commission shall provide a not less than 30-day 
        public comment period, within the 90-day period in which the 
        stay is in effect as described in subparagraph (A), whenever 
        the Commission reviews a rule or rule amendment pursuant to a 
        notification by the Commission under this paragraph.
        ``(4) Prior approval.--
            ``(A) In general.--A registered entity may request that the 
        Commission grant prior approval to any new contract or other 
        instrument, new rule, or rule amendment.
            ``(B) Prior approval required.--Notwithstanding any other 
        provision of this section, a designated contract market shall 
        submit to the Commission for prior approval each rule amendment 
        that materially changes the terms and conditions, as determined 
        by the Commission, in any contract of sale for future delivery 
        of a commodity specifically enumerated in section 1a(10) (or 
        any option thereon) traded through its facilities if the rule 
        amendment applies to contracts and delivery months which have 
        already been listed for trading and have open interest.
            ``(C) Deadline.--If prior approval is requested under 
        subparagraph (A), the Commission shall take final action on the 
        request not later than 90 days after submission of the request, 
        unless the person submitting the request agrees to an extension 
        of the time limitation established under this subparagraph.
        ``(5) Approval.--
            ``(A) Rules.--The Commission shall approve a new rule, or 
        rule amendment, of a registered entity unless the Commission 
        finds that the new rule, or rule amendment, is inconsistent 
        with this subtitle (including regulations).
            ``(B) Contracts and instruments.--The Commission shall 
        approve a new contract or other instrument unless the 
        Commission finds that the new contract or other instrument 
        would violate this Act (including regulations).
            ``(C) Special rule for review and approval of event 
        contracts and swaps contracts.--
                ``(i) Event contracts.--In connection with the listing 
            of agreements, contracts, transactions, or swaps in 
            excluded commodities that are based upon the occurrence, 
            extent of an occurrence, or contingency (other than a 
            change in the price, rate, value, or levels of a commodity 
            described in section 1a(2)(i)), by a designated contract 
            market or swap execution facility, the Commission may 
            determine that such agreements, contracts, or transactions 
            are contrary to the public interest if the agreements, 
            contracts, or transactions involve--

                    ``(I) activity that is unlawful under any Federal 
                or State law;
                    ``(II) terrorism;
                    ``(III) assassination;
                    ``(IV) war;
                    ``(V) gaming; or
                    ``(VI) other similar activity determined by the 
                Commission, by rule or regulation, to be contrary to 
                the public interest.

                ``(ii) Prohibition.--No agreement, contract, or 
            transaction determined by the Commission to be contrary to 
            the public interest under clause (i) may be listed or made 
            available for clearing or trading on or through a 
            registered entity.
                ``(iii) Swaps contracts.--

                    ``(I) In general.--In connection with the listing 
                of a swap for clearing by a derivatives clearing 
                organization, the Commission shall determine, upon 
                request or on its own motion, the initial eligibility, 
                or the continuing qualification, of a derivatives 
                clearing organization to clear such a swap under those 
                criteria, conditions, or rules that the Commission, in 
                its discretion, determines.
                    ``(II) Requirements.--Any such criteria, 
                conditions, or rules shall consider--

                        ``(aa) the financial integrity of the 
                    derivatives clearing organization; and
                        ``(bb) any other factors which the Commission 
                    determines may be appropriate.
                ``(iv) Deadline.--The Commission shall take final 
            action under clauses (i) and (ii) in not later than 90 days 
            from the commencement of its review unless the party 
            seeking to offer the contract or swap agrees to an 
            extension of this time limitation.''.
    (c) Violation of Core Principles.--Section 5c of the Commodity 
Exchange Act (7 U.S.C. 7a-2) is amended by striking subsection (d).
    SEC. 746. INSIDER TRADING.
    Section 4c(a) of the Commodity Exchange Act (7 U.S.C. 6c(a)) is 
amended by adding at the end the following:
        ``(3) Contract of sale.--It shall be unlawful for any employee 
    or agent of any department or agency of the Federal Government who, 
    by virtue of the employment or position of the employee or agent, 
    acquires information that may affect or tend to affect the price of 
    any commodity in interstate commerce, or for future delivery, or 
    any swap, and which information has not been disseminated by the 
    department or agency of the Federal Government holding or creating 
    the information in a manner which makes it generally available to 
    the trading public, or disclosed in a criminal, civil, or 
    administrative hearing, or in a congressional, administrative, or 
    Government Accountability Office report, hearing, audit, or 
    investigation, to use the information in his personal capacity and 
    for personal gain to enter into, or offer to enter into--
            ``(A) a contract of sale of a commodity for future delivery 
        (or option on such a contract);
            ``(B) an option (other than an option executed or traded on 
        a national securities exchange registered pursuant to section 
        6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a)); 
        or
            ``(C) a swap.
        ``(4) Nonpublic information.--
            ``(A) Imparting of nonpublic information.--It shall be 
        unlawful for any employee or agent of any department or agency 
        of the Federal Government who, by virtue of the employment or 
        position of the employee or agent, acquires information that 
        may affect or tend to affect the price of any commodity in 
        interstate commerce, or for future delivery, or any swap, and 
        which information has not been disseminated by the department 
        or agency of the Federal Government holding or creating the 
        information in a manner which makes it generally available to 
        the trading public, or disclosed in a criminal, civil, or 
        administrative hearing, or in a congressional, administrative, 
        or Government Accountability Office report, hearing, audit, or 
        investigation, to impart the information in his personal 
        capacity and for personal gain with intent to assist another 
        person, directly or indirectly, to use the information to enter 
        into, or offer to enter into--
                ``(i) a contract of sale of a commodity for future 
            delivery (or option on such a contract);
                ``(ii) an option (other than an option executed or 
            traded on a national securities exchange registered 
            pursuant to section 6(a) of the Securities Exchange Act of 
            1934 (15 U.S.C. 78f(a)); or
                ``(iii) a swap.
            ``(B) Knowing use.--It shall be unlawful for any person who 
        receives information imparted by any employee or agent of any 
        department or agency of the Federal Government as described in 
        subparagraph (A) to knowingly use such information to enter 
        into, or offer to enter into--
                ``(i) a contract of sale of a commodity for future 
            delivery (or option on such a contract);
                ``(ii) an option (other than an option executed or 
            traded on a national securities exchange registered 
            pursuant to section 6(a) of the Securities Exchange Act of 
            1934 (15 U.S.C. 78f(a)); or
                ``(iii) a swap.
            ``(C) Theft of nonpublic information.--It shall be unlawful 
        for any person to steal, convert, or misappropriate, by any 
        means whatsoever, information held or created by any department 
        or agency of the Federal Government that may affect or tend to 
        affect the price of any commodity in interstate commerce, or 
        for future delivery, or any swap, where such person knows, or 
        acts in reckless disregard of the fact, that such information 
        has not been disseminated by the department or agency of the 
        Federal Government holding or creating the information in a 
        manner which makes it generally available to the trading 
        public, or disclosed in a criminal, civil, or administrative 
        hearing, or in a congressional, administrative, or Government 
        Accountability Office report, hearing, audit, or investigation, 
        and to use such information, or to impart such information with 
        the intent to assist another person, directly or indirectly, to 
        use such information to enter into, or offer to enter into--
                ``(i) a contract of sale of a commodity for future 
            delivery (or option on such a contract);
                ``(ii) an option (other than an option executed or 
            traded on a national securities exchange registered 
            pursuant to section 6(a) of the Securities Exchange Act of 
            1934 (15 U.S.C. 78f(a)); or
                ``(iii) a swap, provided, however, that nothing in this 
            subparagraph shall preclude a person that has provided 
            information concerning, or generated by, the person, its 
            operations or activities, to any employee or agent of any 
            department or agency of the Federal Government, voluntarily 
            or as required by law, from using such information to enter 
            into, or offer to enter into, a contract of sale, option, 
            or swap described in clauses (i), (ii), or (iii).''.
    SEC. 747. ANTIDISRUPTIVE PRACTICES AUTHORITY.
    Section 4c(a) of the Commodity Exchange Act (7 U.S.C. 6c(a)) (as 
amended by section 746) is amended by adding at the end the following:
        ``(5) Disruptive practices.--It shall be unlawful for any 
    person to engage in any trading, practice, or conduct on or subject 
    to the rules of a registered entity that--
            ``(A) violates bids or offers;
            ``(B) demonstrates intentional or reckless disregard for 
        the orderly execution of transactions during the closing 
        period; or
            ``(C) is, is of the character of, or is commonly known to 
        the trade as, `spoofing' (bidding or offering with the intent 
        to cancel the bid or offer before execution).
        ``(6) Rulemaking authority.--The Commission may make and 
    promulgate such rules and regulations as, in the judgment of the 
    Commission, are reasonably necessary to prohibit the trading 
    practices described in paragraph (5) and any other trading practice 
    that is disruptive of fair and equitable trading.
        ``(7) Use of swaps to defraud.--It shall be unlawful for any 
    person to enter into a swap knowing, or acting in reckless 
    disregard of the fact, that its counterparty will use the swap as 
    part of a device, scheme, or artifice to defraud any third 
    party.''.
    SEC. 748. COMMODITY WHISTLEBLOWER INCENTIVES AND PROTECTION.
    The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended by 
adding at the end the following:
  ``SEC. 23. COMMODITY WHISTLEBLOWER INCENTIVES AND PROTECTION.
    ``(a) Definitions.--In this section:
        ``(1) Covered judicial or administrative action.--The term 
    `covered judicial or administrative action' means any judicial or 
    administrative action brought by the Commission under this Act that 
    results in monetary sanctions exceeding $1,000,000.
        ``(2) Fund.--The term `Fund' means the Commodity Futures 
    Trading Commission Customer Protection Fund established under 
    subsection (g).
        ``(3) Monetary sanctions.--The term `monetary sanctions', when 
    used with respect to any judicial or administrative action means--
            ``(A) any monies, including penalties, disgorgement, 
        restitution, and interest ordered to be paid; and
            ``(B) any monies deposited into a disgorgement fund or 
        other fund pursuant to section 308(b) of the Sarbanes-Oxley Act 
        of 2002 (15 U.S.C. 7246(b)), as a result of such action or any 
        settlement of such action.
        ``(4) Original information.--The term `original information' 
    means information that--
            ``(A) is derived from the independent knowledge or analysis 
        of a whistleblower;
            ``(B) is not known to the Commission from any other source, 
        unless the whistleblower is the original source of the 
        information; and
            ``(C) is not exclusively derived from an allegation made in 
        a judicial or administrative hearing, in a governmental report, 
        hearing, audit, or investigation, or from the news media, 
        unless the whistleblower is a source of the information.
        ``(5) Related action.--The term `related action', when used 
    with respect to any judicial or administrative action brought by 
    the Commission under this Act, means any judicial or administrative 
    action brought by an entity described in subclauses (I) through 
    (VI) of subsection (h)(2)(C) that is based upon the original 
    information provided by a whistleblower pursuant to subsection (a) 
    that led to the successful enforcement of the Commission action.
        ``(6) Successful resolution.--The term `successful resolution', 
    when used with respect to any judicial or administrative action 
    brought by the Commission under this Act, includes any settlement 
    of such action.
        ``(7) Whistleblower.--The term `whistleblower' means any 
    individual, or 2 or more individuals acting jointly, who provides 
    information relating to a violation of this Act to the Commission, 
    in a manner established by rule or regulation by the Commission.
    ``(b) Awards.--
        ``(1) In general.--In any covered judicial or administrative 
    action, or related action, the Commission, under regulations 
    prescribed by the Commission and subject to subsection (c), shall 
    pay an award or awards to 1 or more whistleblowers who voluntarily 
    provided original information to the Commission that led to the 
    successful enforcement of the covered judicial or administrative 
    action, or related action, in an aggregate amount equal to--
            ``(A) not less than 10 percent, in total, of what has been 
        collected of the monetary sanctions imposed in the action or 
        related actions; and
            ``(B) not more than 30 percent, in total, of what has been 
        collected of the monetary sanctions imposed in the action or 
        related actions.
        ``(2) Payment of awards.--Any amount paid under paragraph (1) 
    shall be paid from the Fund.
    ``(c) Determination of Amount of Award; Denial of Award.--
        ``(1) Determination of amount of award.--
            ``(A) Discretion.--The determination of the amount of an 
        award made under subsection (b) shall be in the discretion of 
        the Commission.
            ``(B) Criteria.--In determining the amount of an award made 
        under subsection (b), the Commission--
                ``(i) shall take into consideration--

                    ``(I) the significance of the information provided 
                by the whistleblower to the success of the covered 
                judicial or administrative action;
                    ``(II) the degree of assistance provided by the 
                whistleblower and any legal representative of the 
                whistleblower in a covered judicial or administrative 
                action;
                    ``(III) the programmatic interest of the Commission 
                in deterring violations of the Act (including 
                regulations under the Act) by making awards to 
                whistleblowers who provide information that leads to 
                the successful enforcement of such laws; and
                    ``(IV) such additional relevant factors as the 
                Commission may establish by rule or regulation; and

                ``(ii) shall not take into consideration the balance of 
            the Fund.
        ``(2) Denial of award.--No award under subsection (b) shall be 
    made--
            ``(A) to any whistleblower who is, or was at the time the 
        whistleblower acquired the original information submitted to 
        the Commission, a member, officer, or employee of--
                ``(i) a appropriate regulatory agency;
                ``(ii) the Department of Justice;
                ``(iii) a registered entity;
                ``(iv) a registered futures association;
                ``(v) a self-regulatory organization as defined in 
            section 3(a) of the Securities Exchange Act of 1934 (15 
            U.S.C. 78c(a)); or
                ``(vi) a law enforcement organization;
            ``(B) to any whistleblower who is convicted of a criminal 
        violation related to the judicial or administrative action for 
        which the whistleblower otherwise could receive an award under 
        this section;
            ``(C) to any whistleblower who submits information to the 
        Commission that is based on the facts underlying the covered 
        action submitted previously by another whistleblower;
            ``(D) to any whistleblower who fails to submit information 
        to the Commission in such form as the Commission may, by rule 
        or regulation, require.
    ``(d) Representation.--
        ``(1) Permitted representation.--Any whistleblower who makes a 
    claim for an award under subsection (b) may be represented by 
    counsel.
        ``(2) Required representation.--
            ``(A) In general.--Any whistleblower who anonymously makes 
        a claim for an award under subsection (b) shall be represented 
        by counsel if the whistleblower submits the information upon 
        which the claim is based.
            ``(B) Disclosure of identity.--Prior to the payment of an 
        award, a whistleblower shall disclose the identity of the 
        whistleblower and provide such other information as the 
        Commission may require, directly or through counsel for the 
        whistleblower.
    ``(e) No Contract Necessary.--No contract with the Commission is 
necessary for any whistleblower to receive an award under subsection 
(b), unless otherwise required by the Commission, by rule or 
regulation.
    ``(f) Appeals.--
        ``(1) In general.--Any determination made under this section, 
    including whether, to whom, or in what amount to make awards, shall 
    be in the discretion of the Commission.
        ``(2) Appeals.--Any determination described in paragraph (1) 
    may be appealed to the appropriate court of appeals of the United 
    States not more than 30 days after the determination is issued by 
    the Commission.
        ``(3) Review.--The court shall review the determination made by 
    the Commission in accordance with section 7064 of title 5, United 
    States Code.
    ``(g) Commodity Futures Trading Commission Customer Protection 
Fund.--
        ``(1) Establishment.--There is established in the Treasury of 
    the United States a revolving fund to be known as the `Commodity 
    Futures Trading Commission Customer Protection Fund'.
        ``(2) Use of fund.--The Fund shall be available to the 
    Commission, without further appropriation or fiscal year 
    limitation, for--
            ``(A) the payment of awards to whistleblowers as provided 
        in subsection (a); and
            ``(B) the funding of customer education initiatives 
        designed to help customers protect themselves against fraud or 
        other violations of this Act, or the rules and regulations 
        thereunder.
        ``(3) Deposits and credits.--There shall be deposited into or 
    credited to the Fund:
            ``(A) Monetary sanctions.--Any monetary sanctions collected 
        by the Commission in any covered judicial or administrative 
        action that is not otherwise distributed to victims of a 
        violation of this Act or the rules and regulations thereunder 
        underlying such action, unless the balance of the Fund at the 
        time the monetary judgment is collected exceeds $100,000,000.
            ``(B) Additional amounts.--If the amounts deposited into or 
        credited to the Fund under subparagraph (A) are not sufficient 
        to satisfy an award made under subsection (b), there shall be 
        deposited into or credited to the Fund an amount equal to the 
        unsatisfied portion of the award from any monetary sanction 
        collected by the Commission in any judicial or administrative 
        action brought by the Commission under this Act that is based 
        on information provided by a whistleblower.
            ``(C) Investment income.--All income from investments made 
        under paragraph (4).
        ``(4) Investments.--
            ``(A) Amounts in fund may be invested.--The Commission may 
        request the Secretary of the Treasury to invest the portion of 
        the Fund that is not, in the Commission's judgment, required to 
        meet the current needs of the Fund.
            ``(B) Eligible investments.--Investments shall be made by 
        the Secretary of the Treasury in obligations of the United 
        States or obligations that are guaranteed as to principal and 
        interest by the United States, with maturities suitable to the 
        needs of the Fund as determined by the Commission.
            ``(C) Interest and proceeds credited.--The interest on, and 
        the proceeds from the sale or redemption of, any obligations 
        held in the Fund shall be credited to, and form a part of, the 
        Fund.
        ``(5) Reports to congress.--Not later than October 30 of each 
    year, the Commission shall transmit to the Committee on 
    Agriculture, Nutrition, and Forestry of the Senate, and the 
    Committee on Agriculture of the House of Representatives a report 
    on--
            ``(A) the Commission's whistleblower award program under 
        this section, including a description of the number of awards 
        granted and the types of cases in which awards were granted 
        during the preceding fiscal year;
            ``(B) customer education initiatives described in paragraph 
        (2)(B) that were funded by the Fund during the preceding fiscal 
        year;
            ``(C) the balance of the Fund at the beginning of the 
        preceding fiscal year;
            ``(D) the amounts deposited into or credited to the Fund 
        during the preceding fiscal year;
            ``(E) the amount of earnings on investments of amounts in 
        the Fund during the preceding fiscal year;
            ``(F) the amount paid from the Fund during the preceding 
        fiscal year to whistleblowers pursuant to subsection (b);
            ``(G) the amount paid from the Fund during the preceding 
        fiscal year for customer education initiatives described in 
        paragraph (2)(B);
            ``(H) the balance of the Fund at the end of the preceding 
        fiscal year; and
            ``(I) a complete set of audited financial statements, 
        including a balance sheet, income statement, and cash flow 
        analysis.
    ``(h) Protection of Whistleblowers.--
        ``(1) Prohibition against retaliation.--
            ``(A) In general.--No employer may discharge, demote, 
        suspend, threaten, harass, directly or indirectly, or in any 
        other manner discriminate against, a whistleblower in the terms 
        and conditions of employment because of any lawful act done by 
        the whistleblower--
                ``(i) in providing information to the Commission in 
            accordance with subsection (b); or
                ``(ii) in assisting in any investigation or judicial or 
            administrative action of the Commission based upon or 
            related to such information.
            ``(B) Enforcement.--
                ``(i) Cause of action.--An individual who alleges 
            discharge or other discrimination in violation of 
            subparagraph (A) may bring an action under this subsection 
            in the appropriate district court of the United States for 
            the relief provided in subparagraph (C), unless the 
            individual who is alleging discharge or other 
            discrimination in violation of subparagraph (A) is an 
            employee of the Federal Government, in which case the 
            individual shall only bring an action under section 1221 of 
            title 5, United States Code.
                ``(ii) Subpoenas.--A subpoena requiring the attendance 
            of a witness at a trial or hearing conducted under this 
            subsection may be served at any place in the United States.
                ``(iii) Statute of limitations.--An action under this 
            subsection may not be brought more than 2 years after the 
            date on which the violation reported in subparagraph (A) is 
            committed.
            ``(C) Relief.--Relief for an individual prevailing in an 
        action brought under subparagraph (B) shall include--
                ``(i) reinstatement with the same seniority status that 
            the individual would have had, but for the discrimination;
                ``(ii) the amount of back pay otherwise owed to the 
            individual, with interest; and
                ``(iii) compensation for any special damages sustained 
            as a result of the discharge or discrimination, including 
            litigation costs, expert witness fees, and reasonable 
            attorney's fees.
        ``(2) Confidentiality.--
            ``(A) In general.--Except as provided in subparagraphs (B) 
        and (C), the Commission, and any officer or employee of the 
        Commission, shall not disclose any information, including 
        information provided by a whistleblower to the Commission, 
        which could reasonably be expected to reveal the identity of a 
        whistleblower, except in accordance with the provisions of 
        section 552a of title 5, United States Code, unless and until 
        required to be disclosed to a defendant or respondent in 
        connection with a public proceeding instituted by the 
        Commission or any entity described in subparagraph (C). For 
        purposes of section 552 of title 5, United States Code, this 
        paragraph shall be considered a statute described in subsection 
        (b)(3)(B) of such section 552.
            ``(B) Effect.--Nothing in this paragraph is intended to 
        limit the ability of the Attorney General to present such 
        evidence to a grand jury or to share such evidence with 
        potential witnesses or defendants in the course of an ongoing 
        criminal investigation.
            ``(C) Availability to government agencies.--
                ``(i) In general.--Without the loss of its status as 
            confidential in the hands of the Commission, all 
            information referred to in subparagraph (A) may, in the 
            discretion of the Commission, when determined by the 
            Commission to be necessary or appropriate to accomplish the 
            purposes of this Act and protect customers and in 
            accordance with clause (ii), be made available to--

                    ``(I) the Department of Justice;
                    ``(II) an appropriate department or agency of the 
                Federal Government, acting within the scope of its 
                jurisdiction;
                    ``(III) a registered entity, registered futures 
                association, or self-regulatory organization as defined 
                in section 3(a) of the Securities Exchange Act of 1934 
                (15 U.S.C. 78c(a));
                    ``(IV) a State attorney general in connection with 
                any criminal investigation;
                    ``(V) an appropriate department or agency of any 
                State, acting within the scope of its jurisdiction; and
                    ``(VI) a foreign futures authority.

                ``(ii) Maintenance of information.--Each of the 
            entities, agencies, or persons described in clause (i) 
            shall maintain information described in that clause as 
            confidential, in accordance with the requirements in 
            subparagraph (A).
                ``(iii) Study on impact of foia exemption on commodity 
            futures trading commission.--

                    ``(I) Study.--The Inspector General of the 
                Commission shall conduct a study--

                        ``(aa) on whether the exemption under section 
                    552(b)(3) of title 5, United States Code (known as 
                    the Freedom of Information Act) established in 
                    paragraph (2)(A) aids whistleblowers in disclosing 
                    information to the Commission;
                        ``(bb) on what impact the exemption has had on 
                    the public's ability to access information about 
                    the Commission's regulation of commodity futures 
                    and option markets; and
                        ``(cc) to make any recommendations on whether 
                    the Commission should continue to use the 
                    exemption.

                    ``(II) Report.--Not later than 30 months after the 
                date of enactment of this clause, the Inspector General 
                shall--

                        ``(aa) submit a report on the findings of the 
                    study required under this clause to the Committee 
                    on Banking, Housing, and Urban Affairs of the 
                    Senate and the Committee on Financial Services of 
                    the House of Representatives; and
                        ``(bb) make the report available to the public 
                    through publication of a report on the website of 
                    the Commission.
        ``(3) Rights retained.--Nothing in this section shall be deemed 
    to diminish the rights, privileges, or remedies of any 
    whistleblower under any Federal or State law, or under any 
    collective bargaining agreement.
    ``(i) Rulemaking Authority.--The Commission shall have the 
authority to issue such rules and regulations as may be necessary or 
appropriate to implement the provisions of this section consistent with 
the purposes of this section.
    ``(j) Implementing Rules.--The Commission shall issue final rules 
or regulations implementing the provisions of this section not later 
than 270 days after the date of enactment of the Wall Street 
Transparency and Accountability Act of 2010.
    ``(k) Original Information.--Information submitted to the 
Commission by a whistleblower in accordance with rules or regulations 
implementing this section shall not lose its status as original 
information solely because the whistleblower submitted such information 
prior to the effective date of such rules or regulations, provided such 
information was submitted after the date of enactment of the Wall 
Street Transparency and Accountability Act of 2010.
    ``(l) Awards.--A whistleblower may receive an award pursuant to 
this section regardless of whether any violation of a provision of this 
Act, or a rule or regulation thereunder, underlying the judicial or 
administrative action upon which the award is based occurred prior to 
the date of enactment of the Wall Street Transparency and 
Accountability Act of 2010.
    ``(m) Provision of False Information.--A whistleblower who 
knowingly and willfully makes any false, fictitious, or fraudulent 
statement or representation, or who makes or uses any false writing or 
document knowing the same to contain any false, fictitious, or 
fraudulent statement or entry, shall not be entitled to an award under 
this section and shall be subject to prosecution under section 1001 of 
title 18, United States Code.
    ``(n) Nonenforceability of Certain Provisions Waiving Rights and 
Remedies or Requiring Arbitration of Disputes.--
        ``(1) Waiver of rights and remedies.--The rights and remedies 
    provided for in this section may not be waived by any agreement, 
    policy form, or condition of employment including by a predispute 
    arbitration agreement.
        ``(2) Predispute arbitration agreements.--No predispute 
    arbitration agreement shall be valid or enforceable, if the 
    agreement requires arbitration of a dispute arising under this 
    section.''.
    SEC. 749. CONFORMING AMENDMENTS.
    (a) Section 4d of the Commodity Exchange Act (7 U.S.C. 6d) (as 
amended by section 724) is amended--
        (1) in subsection (a)--
            (A) in the matter preceding paragraph (1)--
                (i) by striking ``engage as'' and inserting ``be a''; 
            and
                (ii) by striking ``or introducing broker'' and all that 
            follows through ``or derivatives transaction execution 
            facility'';
            (B) in paragraph (1), by striking ``or introducing 
        broker''; and
            (C) in paragraph (2), by striking ``if a futures commission 
        merchant,''; and
        (2) by adding at the end the following:
    ``(g) It shall be unlawful for any person to be an introducing 
broker unless such person shall have registered under this Act with the 
Commission as an introducing broker and such registration shall not 
have expired nor been suspended nor revoked.''.
    (b) Section 4m(3) of the Commodity Exchange Act (7 U.S.C. 6m(3)) is 
amended--
        (1) by striking ``(3) Subsection (1) of this section'' and 
    inserting the following:
    ``(3) Exception.--
        ``(A) In general.--Paragraph (1)''; and
        (2) by striking ``to any investment trust'' and all that 
    follows through the period at the end and inserting the following: 
    ``to any commodity pool that is engaged primarily in trading 
    commodity interests.
        ``(B) Engaged primarily.--For purposes of subparagraph (A), a 
    commodity trading advisor or a commodity pool shall be considered 
    to be `engaged primarily' in the business of being a commodity 
    trading advisor or commodity pool if it is or holds itself out to 
    the public as being engaged primarily, or proposes to engage 
    primarily, in the business of advising on commodity interests or 
    investing, reinvesting, owning, holding, or trading in commodity 
    interests, respectively.
        ``(C) Commodity interests.--For purposes of this paragraph, 
    commodity interests shall include contracts of sale of a commodity 
    for future delivery, options on such contracts, security futures, 
    swaps, leverage contracts, foreign exchange, spot and forward 
    contracts on physical commodities, and any monies held in an 
    account used for trading commodity interests.''.
    (c) Section 5c of the Commodity Exchange Act (7 U.S.C. 7a-2) is 
amended--
        (1) in subsection (a)(1)--
            (A) by striking ``, 5a(d),''; and
            (B) by striking ``and section (2)(h)(7) with respect to 
        significant price discovery contracts,''; and
        (2) in subsection (f)(1), by striking ``section 4d(c) of this 
    Act'' and inserting ``section 4d(e)''.
    (d) Section 5e of the Commodity Exchange Act (7 U.S.C. 7b) is 
amended by striking ``or revocation of the right of an electronic 
trading facility to rely on the exemption set forth in section 2(h)(3) 
with respect to a significant price discovery contract,''.
    (e) Section 6(b) of the Commodity Exchange Act (7 U.S.C. 8(b)) is 
amended in the first sentence by striking ``, or to revoke the right of 
an electronic trading facility to rely on the exemption set forth in 
section 2(h)(3) with respect to a significant price discovery 
contract,''.
    (f) Section 12(e)(2)(B) of the Commodity Exchange Act (7 U.S.C. 
16(e)(2)(B)) is amended--
        (1) by striking ``section 2(c), 2(d), 2(f), or 2(g) of this 
    Act'' and inserting ``section 2(c) or 2(f) of this Act''; and
        (2) by striking ``2(h) or''.
    (g) Section 17(r)(1) of the Commodity Exchange Act (7 U.S.C. 
21(r)(1)) is amended by striking ``section 4d(c) of this Act'' and 
inserting ``section 4d(e)''.
    (h) Section 22 of the Commodity Exchange Act is amended--
        (1) in subsection (a)(1)(B), by--
            (A) inserting ``or any swap'' after ``commodity)''; and
            (B) inserting ``or any swap'' after ``such contract'';
        (2) in subsection (a)(1)(C), by adding at the end the 
    following:
                ``(iv) a swap; or''; and
        (3) in subsection (b)(1)(A), by striking ``section 2(h)(7) or 
    sections 5 through 5c'' and inserting ``section 5, 5b, 5c, 5h, or 
    21''.
    (i) Section 408(2)(C) of the Federal Deposit Insurance Corporation 
Improvement Act of 1991 (12 U.S.C. 4421(2)(C)) is amended--
        (1) by striking ``section 2(c), 2(d), 2(f), or (2)(g) of such 
    Act'' and inserting ``section 2(c), 2(f), or 2(i) of that Act''; 
    and
        (2) by striking ``2(h) or''.
    SEC. 750. STUDY ON OVERSIGHT OF CARBON MARKETS.
    (a) Interagency Working Group.--There is established to carry out 
this section an interagency working group (referred to in this section 
as the ``interagency group'') composed of the following members or 
designees:
        (1) The Chairman of the Commodity Futures Trading Commission 
    (referred to in this section as the ``Commission''), who shall 
    serve as Chairman of the interagency group.
        (2) The Secretary of Agriculture.
        (3) The Secretary of the Treasury.
        (4) The Chairman of the Securities and Exchange Commission.
        (5) The Administrator of the Environmental Protection Agency.
        (6) The Chairman of the Federal Energy Regulatory Commission.
        (7) The Commissioner of the Federal Trade Commission.
        (8) The Administrator of the Energy Information Administration.
    (b) Administrative Support.--The Commission shall provide the 
interagency group such administrative support services as are necessary 
to enable the interagency group to carry out the functions of the 
interagency group under this section.
    (c) Consultation.--In carrying out this section, the interagency 
group shall consult with representatives of exchanges, clearinghouses, 
self-regulatory bodies, major carbon market participants, consumers, 
and the general public, as the interagency group determines to be 
appropriate.
    (d) Study.--The interagency group shall conduct a study on the 
oversight of existing and prospective carbon markets to ensure an 
efficient, secure, and transparent carbon market, including oversight 
of spot markets and derivative markets.
    (e) Report.--Not later than 180 days after the date of enactment of 
this Act, the interagency group shall submit to Congress a report on 
the results of the study conducted under subsection (b), including 
recommendations for the oversight of existing and prospective carbon 
markets to ensure an efficient, secure, and transparent carbon market, 
including oversight of spot markets and derivative markets.
    SEC. 751. ENERGY AND ENVIRONMENTAL MARKETS ADVISORY COMMITTEE.
    Section 2(a) of the Commodity Exchange Act (7 U.S.C. 2(a)) (as 
amended by section 727) is amended by adding at the end the following:
        ``(15) Energy and environmental markets advisory committee.--
            ``(A) Establishment.--
                ``(i) In general.--An Energy and Environmental Markets 
            Advisory Committee is hereby established.
                ``(ii) Membership.--The Committee shall have 9 members.
                ``(iii) Activities.--The Committee's objectives and 
            scope of activities shall be--

                    ``(I) to conduct public meetings;
                    ``(II) to submit reports and recommendations to the 
                Commission (including dissenting or minority views, if 
                any); and
                    ``(III) otherwise to serve as a vehicle for 
                discussion and communication on matters of concern to 
                exchanges, firms, end users, and regulators regarding 
                energy and environmental markets and their regulation 
                by the Commission.

            ``(B) Requirements.--
                ``(i) In general.--The Committee shall hold public 
            meetings at such intervals as are necessary to carry out 
            the functions of the Committee, but not less frequently 
            than 2 times per year.
                ``(ii) Members.--Members shall be appointed to 3-year 
            terms, but may be removed for cause by vote of the 
            Commission.
            ``(C) Appointment.--The Commission shall appoint members 
        with a wide diversity of opinion and who represent a broad 
        spectrum of interests, including hedgers and consumers.
            ``(D) Reimbursement.--Members shall be entitled to per diem 
        and travel expense reimbursement by the Commission.
            ``(E) FACA.--The Committee shall not be subject to the 
        Federal Advisory Committee Act (5 U.S.C. App.).''.
    SEC. 752. INTERNATIONAL HARMONIZATION.
    (a) In order to promote effective and consistent global regulation 
of swaps and security-based swaps, the Commodity Futures Trading 
Commission, the Securities and Exchange Commission, and the prudential 
regulators (as that term is defined in section 1a(39) of the Commodity 
Exchange Act), as appropriate, shall consult and coordinate with 
foreign regulatory authorities on the establishment of consistent 
international standards with respect to the regulation (including fees) 
of swaps, security-based swaps, swap entities, and security-based swap 
entities and may agree to such information-sharing arrangements as may 
be deemed to be necessary or appropriate in the public interest or for 
the protection of investors, swap counterparties, and security-based 
swap counterparties.
    (b) In order to promote effective and consistent global regulation 
of contracts of sale of a commodity for future delivery and options on 
such contracts, the Commodity Futures Trading Commission shall consult 
and coordinate with foreign regulatory authorities on the establishment 
of consistent international standards with respect to the regulation of 
contracts of sale of a commodity for future delivery and options on 
such contracts, and may agree to such information-sharing arrangements 
as may be deemed necessary or appropriate in the public interest for 
the protection of users of contracts of sale of a commodity for future 
delivery.
    SEC. 753. ANTI-MANIPULATION AUTHORITY.
    (a) Prohibition Regarding Manipulation and False Information.--
Subsection (c) of section 6 of the Commodity Exchange Act (7 U.S.C. 9, 
15) is amended to read as follows:
    ``(c) Prohibition Regarding Manipulation and False Information.--
        ``(1) Prohibition against manipulation.--It shall be unlawful 
    for any person, directly or indirectly, to use or employ, or 
    attempt to use or employ, in connection with any swap, or a 
    contract of sale of any commodity in interstate commerce, or for 
    future delivery on or subject to the rules of any registered 
    entity, any manipulative or deceptive device or contrivance, in 
    contravention of such rules and regulations as the Commission shall 
    promulgate by not later than 1 year after the date of enactment of 
    the Dodd-Frank Wall Street Reform and Consumer Protection Act, 
    provided no rule or regulation promulgated by the Commission shall 
    require any person to disclose to another person nonpublic 
    information that may be material to the market price, rate, or 
    level of the commodity transaction, except as necessary to make any 
    statement made to the other person in or in connection with the 
    transaction not misleading in any material respect.
            ``(A) Special provision for manipulation by false 
        reporting.--Unlawful manipulation for purposes of this 
        paragraph shall include, but not be limited to, delivering, or 
        causing to be delivered for transmission through the mails or 
        interstate commerce, by any means of communication whatsoever, 
        a false or misleading or inaccurate report concerning crop or 
        market information or conditions that affect or tend to affect 
        the price of any commodity in interstate commerce, knowing, or 
        acting in reckless disregard of the fact that such report is 
        false, misleading or inaccurate.
            ``(B) Effect on other law.--Nothing in this paragraph shall 
        affect, or be construed to affect, the applicability of section 
        9(a)(2).
            ``(C) Good faith mistakes.--Mistakenly transmitting, in 
        good faith, false or misleading or inaccurate information to a 
        price reporting service would not be sufficient to violate 
        subsection (c)(1)(A).
        ``(2) Prohibition regarding false information.--It shall be 
    unlawful for any person to make any false or misleading statement 
    of a material fact to the Commission, including in any registration 
    application or any report filed with the Commission under this Act, 
    or any other information relating to a swap, or a contract of sale 
    of a commodity, in interstate commerce, or for future delivery on 
    or subject to the rules of any registered entity, or to omit to 
    state in any such statement any material fact that is necessary to 
    make any statement of a material fact made not misleading in any 
    material respect, if the person knew, or reasonably should have 
    known, the statement to be false or misleading.
        ``(3) Other manipulation.--In addition to the prohibition in 
    paragraph (1), it shall be unlawful for any person, directly or 
    indirectly, to manipulate or attempt to manipulate the price of any 
    swap, or of any commodity in interstate commerce, or for future 
    delivery on or subject to the rules of any registered entity.
        ``(4) Enforcement.--
            ``(A) Authority of commission.--If the Commission has 
        reason to believe that any person (other than a registered 
        entity) is violating or has violated this subsection, or any 
        other provision of this Act (including any rule, regulation, or 
        order of the Commission promulgated in accordance with this 
        subsection or any other provision of this Act), the Commission 
        may serve upon the person a complaint.
            ``(B) Contents of complaint.--A complaint under 
        subparagraph (A) shall--
                ``(i) contain a description of the charges against the 
            person that is the subject of the complaint; and
                ``(ii) have attached or contain a notice of hearing 
            that specifies the date and location of the hearing 
            regarding the complaint.
            ``(C) Hearing.--A hearing described in subparagraph 
        (B)(ii)--
                ``(i) shall be held not later than 3 days after service 
            of the complaint described in subparagraph (A);
                ``(ii) shall require the person to show cause regarding 
            why--

                    ``(I) an order should not be made--

                        ``(aa) to prohibit the person from trading on, 
                    or subject to the rules of, any registered entity; 
                    and
                        ``(bb) to direct all registered entities to 
                    refuse all privileges to the person until further 
                    notice of the Commission; and

                    ``(II) the registration of the person, if 
                registered with the Commission in any capacity, should 
                not be suspended or revoked; and

                ``(iii) may be held before--

                    ``(I) the Commission; or
                    ``(II) an administrative law judge designated by 
                the Commission, under which the administrative law 
                judge shall ensure that all evidence is recorded in 
                written form and submitted to the Commission.

        ``(5) Subpoena.--For the purpose of securing effective 
    enforcement of the provisions of this Act, for the purpose of any 
    investigation or proceeding under this Act, and for the purpose of 
    any action taken under section 12(f), any member of the Commission 
    or any Administrative Law Judge or other officer designated by the 
    Commission (except as provided in paragraph (7)) may administer 
    oaths and affirmations, subpoena witnesses, compel their 
    attendance, take evidence, and require the production of any books, 
    papers, correspondence, memoranda, or other records that the 
    Commission deems relevant or material to the inquiry.
        ``(6) Witnesses.--The attendance of witnesses and the 
    production of any such records may be required from any place in 
    the United States, any State, or any foreign country or 
    jurisdiction at any designated place of hearing.
        ``(7) Service.--A subpoena issued under this section may be 
    served upon any person who is not to be found within the 
    territorial jurisdiction of any court of the United States in such 
    manner as the Federal Rules of Civil Procedure prescribe for 
    service of process in a foreign country, except that a subpoena to 
    be served on a person who is not to be found within the territorial 
    jurisdiction of any court of the United States may be issued only 
    on the prior approval of the Commission.
        ``(8) Refusal to obey.--In case of contumacy by, or refusal to 
    obey a subpoena issued to, any person, the Commission may invoke 
    the aid of any court of the United States within the jurisdiction 
    in which the investigation or proceeding is conducted, or where 
    such person resides or transacts business, in requiring the 
    attendance and testimony of witnesses and the production of books, 
    papers, correspondence, memoranda, and other records. Such court 
    may issue an order requiring such person to appear before the 
    Commission or member or Administrative Law Judge or other officer 
    designated by the Commission, there to produce records, if so 
    ordered, or to give testimony touching the matter under 
    investigation or in question.
        ``(9) Failure to obey.--Any failure to obey such order of the 
    court may be punished by the court as a contempt thereof. All 
    process in any such case may be served in the judicial district 
    wherein such person is an inhabitant or transacts business or 
    wherever such person may be found.
        ``(10) Evidence.--On the receipt of evidence under paragraph 
    (4)(C)(iii), the Commission may--
            ``(A) prohibit the person that is the subject of the 
        hearing from trading on, or subject to the rules of, any 
        registered entity and require all registered entities to refuse 
        the person all privileges on the registered entities for such 
        period as the Commission may require in the order;
            ``(B) if the person is registered with the Commission in 
        any capacity, suspend, for a period not to exceed 180 days, or 
        revoke, the registration of the person;
            ``(C) assess such person--
                ``(i) a civil penalty of not more than an amount equal 
            to the greater of--

                    ``(I) $140,000; or
                    ``(II) triple the monetary gain to such person for 
                each such violation; or

                ``(ii) in any case of manipulation or attempted 
            manipulation in violation of this subsection or section 
            9(a)(2), a civil penalty of not more than an amount equal 
            to the greater of--

                    ``(I) $1,000,000; or
                    ``(II) triple the monetary gain to the person for 
                each such violation; and

            ``(D) require restitution to customers of damages 
        proximately caused by violations of the person.
        ``(11) Orders.--
            ``(A) Notice.--The Commission shall provide to a person 
        described in paragraph (10) and the appropriate governing board 
        of the registered entity notice of the order described in 
        paragraph (10) by--
                ``(i) registered mail;
                ``(ii) certified mail; or
                ``(iii) personal delivery.
            ``(B) Review.--
                ``(i) In general.--A person described in paragraph (10) 
            may obtain a review of the order or such other equitable 
            relief as determined to be appropriate by a court described 
            in clause (ii).
                ``(ii) Petition.--To obtain a review or other relief 
            under clause (i), a person may, not later than 15 days 
            after notice is given to the person under clause (i), file 
            a written petition to set aside the order with the United 
            States Court of Appeals--

                    ``(I) for the circuit in which the petitioner 
                carries out the business of the petitioner; or
                    ``(II) in the case of an order denying 
                registration, the circuit in which the principal place 
                of business of the petitioner is located, as listed on 
                the application for registration of the petitioner.

            ``(C) Procedure.--
                ``(i) Duty of clerk of appropriate court.--The clerk of 
            the appropriate court under subparagraph (B)(ii) shall 
            transmit to the Commission a copy of a petition filed under 
            subparagraph (B)(ii).
                ``(ii) Duty of commission.--In accordance with section 
            2112 of title 28, United States Code, the Commission shall 
            file in the appropriate court described in subparagraph 
            (B)(ii) the record theretofore made.
                ``(iii) Jurisdiction of appropriate court.--Upon the 
            filing of a petition under subparagraph (B)(ii), the 
            appropriate court described in subparagraph (B)(ii) may 
            affirm, set aside, or modify the order of the 
            Commission.''.
    (b) Cease and Desist Orders, Fines.--Section 6(d) of the Commodity 
Exchange Act (7 U.S.C. 13b) is amended to read as follows:
    ``(d) If any person (other than a registered entity), is violating 
or has violated subsection (c) or any other provisions of this Act or 
of the rules, regulations, or orders of the Commission thereunder, the 
Commission may, upon notice and hearing, and subject to appeal as in 
other cases provided for in subsection (c), make and enter an order 
directing that such person shall cease and desist therefrom and, if 
such person thereafter and after the lapse of the period allowed for 
appeal of such order or after the affirmance of such order, shall 
knowingly fail or refuse to obey or comply with such order, such 
person, upon conviction thereof, shall be fined not more than the 
higher of $140,000 or triple the monetary gain to such person, or 
imprisoned for not more than 1 year, or both, except that if such 
knowing failure or refusal to obey or comply with such order involves 
any offense within subsection (a) or (b) of section 9, such person, 
upon conviction thereof, shall be subject to the penalties of said 
subsection (a) or (b):  Provided, That any such cease and desist order 
under this subsection against any respondent in any case of 
manipulation shall be issued only in conjunction with an order issued 
against such respondent under subsection (c).''.
    (c) Manipulations; Private Rights of Action.--Section 22(a)(1) of 
the Commodity Exchange Act (7 U.S.C. 25(a)(1)) is amended by striking 
subparagraph (D) and inserting the following:
        ``(D) who purchased or sold a contract referred to in 
    subparagraph (B) hereof or swap if the violation constitutes--
            ``(i) the use or employment of, or an attempt to use or 
        employ, in connection with a swap, or a contract of sale of a 
        commodity, in interstate commerce, or for future delivery on or 
        subject to the rules of any registered entity, any manipulative 
        device or contrivance in contravention of such rules and 
        regulations as the Commission shall promulgate by not later 
        than 1 year after the date of enactment of the Dodd-Frank Wall 
        Street Reform and Consumer Protection Act; or
            ``(ii) a manipulation of the price of any such contract or 
        swap or the price of the commodity underlying such contract or 
        swap.''.
    (d) Effective Date.--
        (1) The amendments made by this section shall take effect on 
    the date on which the final rule promulgated by the Commodity 
    Futures Trading Commission pursuant to this Act takes effect.
        (2) Paragraph (1) shall not preclude the Commission from 
    undertaking prior to the effective date any rulemaking necessary to 
    implement the amendments contained in this section.
    SEC. 754. EFFECTIVE DATE.
    Unless otherwise provided in this title, the provisions of this 
subtitle shall take effect on the later of 360 days after the date of 
the enactment of this subtitle or, to the extent a provision of this 
subtitle requires a rulemaking, not less than 60 days after publication 
of the final rule or regulation implementing such provision of this 
subtitle.

         Subtitle B--Regulation of Security-Based Swap Markets

    SEC. 761. DEFINITIONS UNDER THE SECURITIES EXCHANGE ACT OF 1934.
    (a) Definitions.--Section 3(a) of the Securities Exchange Act of 
1934 (15 U.S.C. 78c(a)) is amended--
        (1) in subparagraphs (A) and (B) of paragraph (5), by inserting 
    ``(not including security-based swaps, other than security-based 
    swaps with or for persons that are not eligible contract 
    participants)'' after ``securities'' each place that term appears;
        (2) in paragraph (10), by inserting ``security-based swap,'' 
    after ``security future,'';
        (3) in paragraph (13), by adding at the end the following: 
    ``For security-based swaps, such terms include the execution, 
    termination (prior to its scheduled maturity date), assignment, 
    exchange, or similar transfer or conveyance of, or extinguishing of 
    rights or obligations under, a security-based swap, as the context 
    may require.'';
        (4) in paragraph (14), by adding at the end the following: 
    ``For security-based swaps, such terms include the execution, 
    termination (prior to its scheduled maturity date), assignment, 
    exchange, or similar transfer or conveyance of, or extinguishing of 
    rights or obligations under, a security-based swap, as the context 
    may require.'';
        (5) in paragraph (39)--
            (A) in subparagraph (B)(i)--
                (i) in subclause (I), by striking ``or government 
            securities dealer'' and inserting ``government securities 
            dealer, security-based swap dealer, or major security-based 
            swap participant''; and
                (ii) in subclause (II), by inserting ``security-based 
            swap dealer, major security-based swap participant,'' after 
            ``government securities dealer,'';
            (B) in subparagraph (C), by striking ``or government 
        securities dealer'' and inserting ``government securities 
        dealer, security-based swap dealer, or major security-based 
        swap participant''; and
            (C) in subparagraph (D), by inserting ``security-based swap 
        dealer, major security-based swap participant,'' after 
        ``government securities dealer,''; and
        (6) by adding at the end the following:
        ``(65) Eligible contract participant.--The term `eligible 
    contract participant' has the same meaning as in section 1a of the 
    Commodity Exchange Act (7 U.S.C. 1a).
        ``(66) Major swap participant.--The term `major swap 
    participant' has the same meaning as in section 1a of the Commodity 
    Exchange Act (7 U.S.C. 1a).
        ``(67) Major security-based swap participant.--
            ``(A) In general.--The term `major security-based swap 
        participant' means any person--
                ``(i) who is not a security-based swap dealer; and
                ``(ii)(I) who maintains a substantial position in 
            security-based swaps for any of the major security-based 
            swap categories, as such categories are determined by the 
            Commission, excluding both positions held for hedging or 
            mitigating commercial risk and positions maintained by any 
            employee benefit plan (or any contract held by such a plan) 
            as defined in paragraphs (3) and (32) of section 3 of the 
            Employee Retirement Income Security Act of 1974 (29 U.S.C. 
            1002) for the primary purpose of hedging or mitigating any 
            risk directly associated with the operation of the plan;
                ``(II) whose outstanding security-based swaps create 
            substantial counterparty exposure that could have serious 
            adverse effects on the financial stability of the United 
            States banking system or financial markets; or
                ``(III) that is a financial entity that--

                    ``(aa) is highly leveraged relative to the amount 
                of capital such entity holds and that is not subject to 
                capital requirements established by an appropriate 
                Federal banking agency; and
                    ``(bb) maintains a substantial position in 
                outstanding security-based swaps in any major security-
                based swap category, as such categories are determined 
                by the Commission.

            ``(B) Definition of substantial position.--For purposes of 
        subparagraph (A), the Commission shall define, by rule or 
        regulation, the term `substantial position' at the threshold 
        that the Commission determines to be prudent for the effective 
        monitoring, management, and oversight of entities that are 
        systemically important or can significantly impact the 
        financial system of the United States. In setting the 
        definition under this subparagraph, the Commission shall 
        consider the person's relative position in uncleared as opposed 
        to cleared security-based swaps and may take into consideration 
        the value and quality of collateral held against counterparty 
        exposures.
            ``(C) Scope of designation.--For purposes of subparagraph 
        (A), a person may be designated as a major security-based swap 
        participant for 1 or more categories of security-based swaps 
        without being classified as a major security-based swap 
        participant for all classes of security-based swaps.
        ``(68) Security-based swap.--
            ``(A) In general.--Except as provided in subparagraph (B), 
        the term `security-based swap' means any agreement, contract, 
        or transaction that--
                ``(i) is a swap, as that term is defined under section 
            1a of the Commodity Exchange Act (without regard to 
            paragraph (47)(B)(x) of such section); and
                ``(ii) is based on--

                    ``(I) an index that is a narrow-based security 
                index, including any interest therein or on the value 
                thereof;
                    ``(II) a single security or loan, including any 
                interest therein or on the value thereof; or
                    ``(III) the occurrence, nonoccurrence, or extent of 
                the occurrence of an event relating to a single issuer 
                of a security or the issuers of securities in a narrow-
                based security index, provided that such event directly 
                affects the financial statements, financial condition, 
                or financial obligations of the issuer.

            ``(B) Rule of construction regarding master agreements.--
        The term `security-based swap' shall be construed to include a 
        master agreement that provides for an agreement, contract, or 
        transaction that is a security-based swap pursuant to 
        subparagraph (A), together with all supplements to any such 
        master agreement, without regard to whether the master 
        agreement contains an agreement, contract, or transaction that 
        is not a security-based swap pursuant to subparagraph (A), 
        except that the master agreement shall be considered to be a 
        security-based swap only with respect to each agreement, 
        contract, or transaction under the master agreement that is a 
        security-based swap pursuant to subparagraph (A).
            ``(C) Exclusions.--The term `security-based swap' does not 
        include any agreement, contract, or transaction that meets the 
        definition of a security-based swap only because such 
        agreement, contract, or transaction references, is based upon, 
        or settles through the transfer, delivery, or receipt of an 
        exempted security under paragraph (12), as in effect on the 
        date of enactment of the Futures Trading Act of 1982 (other 
        than any municipal security as defined in paragraph (29) as in 
        effect on the date of enactment of the Futures Trading Act of 
        1982), unless such agreement, contract, or transaction is of 
        the character of, or is commonly known in the trade as, a put, 
        call, or other option.
            ``(D) Mixed swap.--The term `security-based swap' includes 
        any agreement, contract, or transaction that is as described in 
        subparagraph (A) and also is based on the value of 1 or more 
        interest or other rates, currencies, commodities, instruments 
        of indebtedness, indices, quantitative measures, other 
        financial or economic interest or property of any kind (other 
        than a single security or a narrow-based security index), or 
        the occurrence, non-occurrence, or the extent of the occurrence 
        of an event or contingency associated with a potential 
        financial, economic, or commercial consequence (other than an 
        event described in subparagraph (A)(ii)(III)).
            ``(E) Rule of construction regarding use of the term 
        index.--The term `index' means an index or group of securities, 
        including any interest therein or based on the value thereof.
        ``(69) Swap.--The term `swap' has the same meaning as in 
    section 1a of the Commodity Exchange Act (7 U.S.C. 1a).
        ``(70) Person associated with a security-based swap dealer or 
    major security-based swap participant.--
            ``(A) In general.--The term `person associated with a 
        security-based swap dealer or major security-based swap 
        participant' or `associated person of a security-based swap 
        dealer or major security-based swap participant' means--
                ``(i) any partner, officer, director, or branch manager 
            of such security-based swap dealer or major security-based 
            swap participant (or any person occupying a similar status 
            or performing similar functions);
                ``(ii) any person directly or indirectly controlling, 
            controlled by, or under common control with such security-
            based swap dealer or major security-based swap participant; 
            or
                ``(iii) any employee of such security-based swap dealer 
            or major security-based swap participant.
            ``(B) Exclusion.--Other than for purposes of section 
        15F(l)(2), the term `person associated with a security-based 
        swap dealer or major security-based swap participant' or 
        `associated person of a security-based swap dealer or major 
        security-based swap participant' does not include any person 
        associated with a security-based swap dealer or major security-
        based swap participant whose functions are solely clerical or 
        ministerial.
        ``(71) Security-based swap dealer.--
            ``(A) In general.--The term `security-based swap dealer' 
        means any person who--
                ``(i) holds themself out as a dealer in security-based 
            swaps;
                ``(ii) makes a market in security-based swaps;
                ``(iii) regularly enters into security-based swaps with 
            counterparties as an ordinary course of business for its 
            own account; or
                ``(iv) engages in any activity causing it to be 
            commonly known in the trade as a dealer or market maker in 
            security-based swaps.
            ``(B) Designation by type or class.--A person may be 
        designated as a security-based swap dealer for a single type or 
        single class or category of security-based swap or activities 
        and considered not to be a security-based swap dealer for other 
        types, classes, or categories of security-based swaps or 
        activities.
            ``(C) Exception.--The term `security-based swap dealer' 
        does not include a person that enters into security-based swaps 
        for such person's own account, either individually or in a 
        fiduciary capacity, but not as a part of regular business.
            ``(D) De minimis exception.--The Commission shall exempt 
        from designation as a security-based swap dealer an entity that 
        engages in a de minimis quantity of security-based swap dealing 
        in connection with transactions with or on behalf of its 
        customers. The Commission shall promulgate regulations to 
        establish factors with respect to the making of any 
        determination to exempt.
        ``(72) Appropriate federal banking agency.--The term 
    `appropriate Federal banking agency' has the same meaning as in 
    section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
    1813(q)).
        ``(73) Board.--The term `Board' means the Board of Governors of 
    the Federal Reserve System.
        ``(74) Prudential regulator.--The term `prudential regulator' 
    has the same meaning as in section 1a of the Commodity Exchange Act 
    (7 U.S.C. 1a).
        ``(75) Security-based swap data repository.--The term 
    `security-based swap data repository' means any person that 
    collects and maintains information or records with respect to 
    transactions or positions in, or the terms and conditions of, 
    security-based swaps entered into by third parties for the purpose 
    of providing a centralized recordkeeping facility for security-
    based swaps.
        ``(76) Swap dealer.--The term `swap dealer' has the same 
    meaning as in section 1a of the Commodity Exchange Act (7 U.S.C. 
    1a).
        ``(77) Security-based swap execution facility.--The term 
    `security-based swap execution facility' means a trading system or 
    platform in which multiple participants have the ability to execute 
    or trade security-based swaps by accepting bids and offers made by 
    multiple participants in the facility or system, through any means 
    of interstate commerce, including any trading facility, that--
            ``(A) facilitates the execution of security-based swaps 
        between persons; and
            ``(B) is not a national securities exchange.
        ``(78) Security-based swap agreement.--
            ``(A) In general.--For purposes of sections 9, 10, 16, 20, 
        and 21A of this Act, and section 17 of the Securities Act of 
        1933 (15 U.S.C. 77q), the term `security-based swap agreement' 
        means a swap agreement as defined in section 206A of the Gramm-
        Leach-Bliley Act (15 U.S.C. 78c note) of which a material term 
        is based on the price, yield, value, or volatility of any 
        security or any group or index of securities, or any interest 
        therein.
            ``(B) Exclusions.--The term `security-based swap agreement' 
        does not include any security-based swap.''.
    (b) Authority To Further Define Terms.--The Securities and Exchange 
Commission may, by rule, further define--
        (1) the term ``commercial risk'';
        (2) any other term included in an amendment to the Securities 
    Exchange Act of 1934 (15 U.S.C. 78c(a)) made by this subtitle; and
        (3) the terms ``security-based swap'', ``security-based swap 
    dealer'', ``major security-based swap participant'', and ``eligible 
    contract participant'', with regard to security-based swaps (as 
    such terms are defined in the amendments made by subsection (a)) 
    for the purpose of including transactions and entities that have 
    been structured to evade this subtitle or the amendments made by 
    this subtitle.
    SEC. 762. REPEAL OF PROHIBITION ON REGULATION OF SECURITY-BASED 
      SWAP AGREEMENTS.
    (a) Repeal.--Sections 206B and 206C of the Gramm-Leach-Bliley Act 
(Public Law 106-102; 15 U.S.C. 78c note) are repealed.
    (b) Conforming Amendments to Gramm-Leach-Bliley.--Section 206A(a) 
of the Gramm-Leach-Bliley Act (15 U.S.C. 78c note) is amended in the 
material preceding paragraph (1), by striking ``Except as'' and all 
that follows through ``that--'' and inserting the following: ``Except 
as provided in subsection (b), as used in this section, the term `swap 
agreement' means any agreement, contract, or transaction that--''.
    (c) Conforming Amendments to the Securities Act of 1933.--
        (1) Section 2A of the Securities Act of 1933 (15 U.S.C. 77b-1) 
    is amended--
            (A) by striking subsection (a) and reserving that 
        subsection; and
            (B) by striking ``(as defined in section 206B of the Gramm-
        Leach-Bliley Act)'' each place that such term appears and 
        inserting ``(as defined in section 3(a)(78) of the Securities 
        Exchange Act of 1934)''.
        (2) Section 17 of the Securities Act of 1933 (15 U.S.C. 77q) is 
    amended--
            (A) in subsection (a)--
                (i) by inserting ``(including security-based swaps)'' 
            after ``securities''; and
                (ii) by striking ``(as defined in section 206B of the 
            Gramm-Leach-Bliley Act)'' and inserting ``(as defined in 
            section 3(a)(78) of the Securities Exchange Act)''; and
            (B) in subsection (d), by striking ``206B of the Gramm-
        Leach-Bliley Act'' and inserting ``3(a)(78) of the Securities 
        Exchange Act of 1934''.
    (d) Conforming Amendments to the Securities Exchange Act of 1934.--
The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended--
        (1) in section 3A (15 U.S.C. 78c-1)--
            (A) by striking subsection (a) and reserving that 
        subsection; and
            (B) by striking ``(as defined in section 206B of the Gramm-
        Leach-Bliley Act)'' each place that the term appears;
        (2) in section 9 (15 U.S.C. 78i)--
            (A) in subsection (a), by striking paragraphs (2) through 
        (5) and inserting the following:
    ``(2) To effect, alone or with 1 or more other persons, a series of 
transactions in any security registered on a national securities 
exchange, any security not so registered, or in connection with any 
security-based swap or security-based swap agreement with respect to 
such security creating actual or apparent active trading in such 
security, or raising or depressing the price of such security, for the 
purpose of inducing the purchase or sale of such security by others.
    ``(3) If a dealer, broker, security-based swap dealer, major 
security-based swap participant, or other person selling or offering 
for sale or purchasing or offering to purchase the security, a 
security-based swap, or a security-based swap agreement with respect to 
such security, to induce the purchase or sale of any security 
registered on a national securities exchange, any security not so 
registered, any security-based swap, or any security-based swap 
agreement with respect to such security by the circulation or 
dissemination in the ordinary course of business of information to the 
effect that the price of any such security will or is likely to rise or 
fall because of market operations of any 1 or more persons conducted 
for the purpose of raising or depressing the price of such security.
    ``(4) If a dealer, broker, security-based swap dealer, major 
security-based swap participant, or other person selling or offering 
for sale or purchasing or offering to purchase the security, a 
security-based swap, or security-based swap agreement with respect to 
such security, to make, regarding any security registered on a national 
securities exchange, any security not so registered, any security-based 
swap, or any security-based swap agreement with respect to such 
security, for the purpose of inducing the purchase or sale of such 
security, such security-based swap, or such security-based swap 
agreement any statement which was at the time and in the light of the 
circumstances under which it was made, false or misleading with respect 
to any material fact, and which that person knew or had reasonable 
ground to believe was so false or misleading.
    ``(5) For a consideration, received directly or indirectly from a 
broker, dealer, security-based swap dealer, major security-based swap 
participant, or other person selling or offering for sale or purchasing 
or offering to purchase the security, a security-based swap, or 
security-based swap agreement with respect to such security, to induce 
the purchase of any security registered on a national securities 
exchange, any security not so registered, any security-based swap, or 
any security-based swap agreement with respect to such security by the 
circulation or dissemination of information to the effect that the 
price of any such security will or is likely to rise or fall because of 
the market operations of any 1 or more persons conducted for the 
purpose of raising or depressing the price of such security.''; and
            (B) in subsection (i), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act)'';
        (3) in section 10 (15 U.S.C. 78j)--
            (A) in subsection (b), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act),'' each place that term 
        appears; and
            (B) in the matter following subsection (b), by striking 
        ``(as defined in section 206B of the Gramm-Leach-Bliley Act), 
        in each place that such terms appear'';
        (4) in section 15 (15 U.S.C. 78o)--
            (A) in subsection (c)(1)(A), by striking ``(as defined in 
        section 206B of the Gramm-Leach-Bliley Act),'';
            (B) in subparagraphs (B) and (C) of subsection (c)(1), by 
        striking ``(as defined in section 206B of the Gramm-Leach-
        Bliley Act)'' each place that term appears;
            (C) by redesignating subsection (i), as added by section 
        303(f) of the Commodity Futures Modernization Act of 2000 
        (Public Law 106-554; 114 Stat. 2763A-455)), as subsection (j); 
        and
            (D) in subsection (j), as redesignated by subparagraph (C), 
        by striking ``(as defined in section 206B of the Gramm-Leach-
        Bliley Act)'';
        (5) in section 16 (15 U.S.C. 78p)--
            (A) in subsection (a)(2)(C), by striking ``(as defined in 
        section 206(b) of the Gramm-Leach-Bliley Act (15 U.S.C. 78c 
        note))'';
            (B) in subsection (a)(3)(B), by inserting ``or security-
        based swaps'' after ``security-based swap agreement'';
            (C) in the first sentence of subsection (b), by striking 
        ``(as defined in section 206B of the Gramm-Leach-Bliley Act)'';
            (D) in the third sentence of subsection (b), by striking 
        ``(as defined in section 206B of the Gramm-Leach Bliley Act)'' 
        and inserting ``or a security-based swap''; and
            (E) in subsection (g), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act)'';
        (6) in section 20 (15 U.S.C. 78t),
            (A) in subsection (d), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act)''; and
            (B) in subsection (f), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act)''; and
        (7) in section 21A (15 U.S.C. 78u-1)--
            (A) in subsection (a)(1), by striking ``(as defined in 
        section 206B of the Gramm-Leach-Bliley Act)''; and
            (B) in subsection (g), by striking ``(as defined in section 
        206B of the Gramm-Leach-Bliley Act)''.
    SEC. 763. AMENDMENTS TO THE SECURITIES EXCHANGE ACT OF 1934.
    (a) Clearing for Security-based Swaps.--The Securities Exchange Act 
of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after section 
3B (as added by section 717 of this Act):
  ``SEC. 3C. CLEARING FOR SECURITY-BASED SWAPS.
    ``(a) In General.--
        ``(1) Standard for clearing.--It shall be unlawful for any 
    person to engage in a security-based swap unless that person 
    submits such security-based swap for clearing to a clearing agency 
    that is registered under this Act or a clearing agency that is 
    exempt from registration under this Act if the security-based swap 
    is required to be cleared.
        ``(2) Open access.--The rules of a clearing agency described in 
    paragraph (1) shall--
            ``(A) prescribe that all security-based swaps submitted to 
        the clearing agency with the same terms and conditions are 
        economically equivalent within the clearing agency and may be 
        offset with each other within the clearing agency; and
            ``(B) provide for non-discriminatory clearing of a 
        security-based swap executed bilaterally or on or through the 
        rules of an unaffiliated national securities exchange or 
        security-based swap execution facility.
    ``(b) Commission Review.--
        ``(1) Commission-initiated review.--
            ``(A) The Commission on an ongoing basis shall review each 
        security-based swap, or any group, category, type, or class of 
        security-based swaps to make a determination that such 
        security-based swap, or group, category, type, or class of 
        security-based swaps should be required to be cleared.
            ``(B) The Commission shall provide at least a 30-day public 
        comment period regarding any determination under subparagraph 
        (A).
        ``(2) Swap submissions.--
            ``(A) A clearing agency shall submit to the Commission each 
        security-based swap, or any group, category, type, or class of 
        security-based swaps that it plans to accept for clearing and 
        provide notice to its members (in a manner to be determined by 
        the Commission) of such submission.
            ``(B) Any security-based swap or group, category, type, or 
        class of security-based swaps listed for clearing by a clearing 
        agency as of the date of enactment of this subsection shall be 
        considered submitted to the Commission.
            ``(C) The Commission shall--
                ``(i) make available to the public any submission 
            received under subparagraphs (A) and (B);
                ``(ii) review each submission made under subparagraphs 
            (A) and (B), and determine whether the security-based swap, 
            or group, category, type, or class of security-based swaps, 
            described in the submission is required to be cleared; and
                ``(iii) provide at least a 30-day public comment period 
            regarding its determination whether the clearing 
            requirement under subsection (a)(1) shall apply to the 
            submission.
        ``(3) Deadline.--The Commission shall make its determination 
    under paragraph (2)(C) not later than 90 days after receiving a 
    submission made under paragraphs (2)(A) and (2)(B), unless the 
    submitting clearing agency agrees to an extension for the time 
    limitation established under this paragraph.
        ``(4) Determination.--
            ``(A) In reviewing a submission made under paragraph (2), 
        the Commission shall review whether the submission is 
        consistent with section 17A.
            ``(B) In reviewing a security-based swap, group of 
        security-based swaps or class of security-based swaps pursuant 
        to paragraph (1) or a submission made under paragraph (2), the 
        Commission shall take into account the following factors:
                ``(i) The existence of significant outstanding notional 
            exposures, trading liquidity and adequate pricing data.
                ``(ii) The availability of rule framework, capacity, 
            operational expertise and resources, and credit support 
            infrastructure to clear the contract on terms that are 
            consistent with the material terms and trading conventions 
            on which the contract is then traded.
                ``(iii) The effect on the mitigation of systemic risk, 
            taking into account the size of the market for such 
            contract and the resources of the clearing agency available 
            to clear the contract.
                ``(iv) The effect on competition, including appropriate 
            fees and charges applied to clearing.
                ``(v) The existence of reasonable legal certainty in 
            the event of the insolvency of the relevant clearing agency 
            or 1 or more of its clearing members with regard to the 
            treatment of customer and security-based swap counterparty 
            positions, funds, and property.
            ``(C) In making a determination under subsection (b)(1) or 
        paragraph (2)(C) that the clearing requirement shall apply, the 
        Commission may require such terms and conditions to the 
        requirement as the Commission determines to be appropriate.
        ``(5) Rules.--Not later than 1 year after the date of the 
    enactment of this section, the Commission shall adopt rules for a 
    clearing agency's submission for review, pursuant to this 
    subsection, of a security-based swap, or a group, category, type, 
    or class of security-based swaps, that it seeks to accept for 
    clearing. Nothing in this paragraph limits the Commission from 
    making a determination under paragraph (2)(C) for security-based 
    swaps described in paragraph (2)(B).
    ``(c) Stay of Clearing Requirement.--
        ``(1) In general.--After making a determination pursuant to 
    subsection (b)(2), the Commission, on application of a counterparty 
    to a security-based swap or on its own initiative, may stay the 
    clearing requirement of subsection (a)(1) until the Commission 
    completes a review of the terms of the security-based swap (or the 
    group, category, type, or class of security-based swaps) and the 
    clearing arrangement.
        ``(2) Deadline.--The Commission shall complete a review 
    undertaken pursuant to paragraph (1) not later than 90 days after 
    issuance of the stay, unless the clearing agency that clears the 
    security-based swap, or group, category, type, or class of 
    security-based swaps, agrees to an extension of the time limitation 
    established under this paragraph.
        ``(3) Determination.--Upon completion of the review undertaken 
    pursuant to paragraph (1), the Commission may--
            ``(A) determine, unconditionally or subject to such terms 
        and conditions as the Commission determines to be appropriate, 
        that the security-based swap, or group, category, type, or 
        class of security-based swaps, must be cleared pursuant to this 
        subsection if it finds that such clearing is consistent with 
        subsection (b)(4); or
            ``(B) determine that the clearing requirement of subsection 
        (a)(1) shall not apply to the security-based swap, or group, 
        category, type, or class of security-based swaps.
        ``(4) Rules.--Not later than 1 year after the date of the 
    enactment of this section, the Commission shall adopt rules for 
    reviewing, pursuant to this subsection, a clearing agency's 
    clearing of a security-based swap, or a group, category, type, or 
    class of security-based swaps, that it has accepted for clearing.
    ``(d) Prevention of Evasion.--
        ``(1) In general.--The Commission shall prescribe rules under 
    this section (and issue interpretations of rules prescribed under 
    this section), as determined by the Commission to be necessary to 
    prevent evasions of the mandatory clearing requirements under this 
    Act.
        ``(2) Duty of commission to investigate and take certain 
    actions.--To the extent the Commission finds that a particular 
    security-based swap or any group, category, type, or class of 
    security-based swaps that would otherwise be subject to mandatory 
    clearing but no clearing agency has listed the security-based swap 
    or the group, category, type, or class of security-based swaps for 
    clearing, the Commission shall--
            ``(A) investigate the relevant facts and circumstances;
            ``(B) within 30 days issue a public report containing the 
        results of the investigation; and
            ``(C) take such actions as the Commission determines to be 
        necessary and in the public interest, which may include 
        requiring the retaining of adequate margin or capital by 
        parties to the security-based swap or the group, category, 
        type, or class of security-based swaps.
        ``(3) Effect on authority.--Nothing in this subsection--
            ``(A) authorizes the Commission to adopt rules requiring a 
        clearing agency to list for clearing a security-based swap or 
        any group, category, type, or class of security-based swaps if 
        the clearing of the security-based swap or the group, category, 
        type, or class of security-based swaps would threaten the 
        financial integrity of the clearing agency; and
            ``(B) affects the authority of the Commission to enforce 
        the open access provisions of subsection (a)(2) with respect to 
        a security-based swap or the group, category, type, or class of 
        security-based swaps that is listed for clearing by a clearing 
        agency.
    ``(e) Reporting Transition Rules.--Rules adopted by the Commission 
under this section shall provide for the reporting of data, as follows:
        ``(1) Security-based swaps entered into before the date of the 
    enactment of this section shall be reported to a registered 
    security-based swap data repository or the Commission no later than 
    180 days after the effective date of this section.
        ``(2) Security-based swaps entered into on or after such date 
    of enactment shall be reported to a registered security-based swap 
    data repository or the Commission no later than the later of--
            ``(A) 90 days after such effective date; or
            ``(B) such other time after entering into the security-
        based swap as the Commission may prescribe by rule or 
        regulation.
    ``(f) Clearing Transition Rules.--
        ``(1) Security-based swaps entered into before the date of the 
    enactment of this section are exempt from the clearing requirements 
    of this subsection if reported pursuant to subsection (e)(1).
        ``(2) Security-based swaps entered into before application of 
    the clearing requirement pursuant to this section are exempt from 
    the clearing requirements of this section if reported pursuant to 
    subsection (e)(2).
    ``(g) Exceptions.--
        ``(1) In general.--The requirements of subsection (a)(1) shall 
    not apply to a security-based swap if 1 of the counterparties to 
    the security-based swap--
            ``(A) is not a financial entity;
            ``(B) is using security-based swaps to hedge or mitigate 
        commercial risk; and
            ``(C) notifies the Commission, in a manner set forth by the 
        Commission, how it generally meets its financial obligations 
        associated with entering into non-cleared security-based swaps.
        ``(2) Option to clear.--The application of the clearing 
    exception in paragraph (1) is solely at the discretion of the 
    counterparty to the security-based swap that meets the conditions 
    of subparagraphs (A) through (C) of paragraph (1).
        ``(3) Financial entity definition.--
            ``(A) In general.--For the purposes of this subsection, the 
        term `financial entity' means--
                ``(i) a swap dealer;
                ``(ii) a security-based swap dealer;
                ``(iii) a major swap participant;
                ``(iv) a major security-based swap participant;
                ``(v) a commodity pool as defined in section 1a(10) of 
            the Commodity Exchange Act;
                ``(vi) a private fund as defined in section 202(a) of 
            the Investment Advisers Act of 1940 (15 U.S.C. 80-b-2(a));
                ``(vii) an employee benefit plan as defined in 
            paragraphs (3) and (32) of section 3 of the Employee 
            Retirement Income Security Act of 1974 (29 U.S.C. 1002);
                ``(viii) a person predominantly engaged in activities 
            that are in the business of banking or financial in nature, 
            as defined in section 4(k) of the Bank Holding Company Act 
            of 1956.
            ``(B) Exclusion.--The Commission shall consider whether to 
        exempt small banks, savings associations, farm credit system 
        institutions, and credit unions, including--
                ``(i) depository institutions with total assets of 
            $10,000,000,000 or less;
                ``(ii) farm credit system institutions with total 
            assets of $10,000,000,000 or less; or
                ``(iii) credit unions with total assets of 
            $10,000,000,000 or less.
        ``(4) Treatment of affiliates.--
            ``(A) In general.--An affiliate of a person that qualifies 
        for an exception under this subsection (including affiliate 
        entities predominantly engaged in providing financing for the 
        purchase of the merchandise or manufactured goods of the 
        person) may qualify for the exception only if the affiliate, 
        acting on behalf of the person and as an agent, uses the 
        security-based swap to hedge or mitigate the commercial risk of 
        the person or other affiliate of the person that is not a 
        financial entity.
            ``(B) Prohibition relating to certain affiliates.--The 
        exception in subparagraph (A) shall not apply if the affiliate 
        is--
                ``(i) a swap dealer;
                ``(ii) a security-based swap dealer;
                ``(iii) a major swap participant;
                ``(iv) a major security-based swap participant;
                ``(v) an issuer that would be an investment company, as 
            defined in section 3 of the Investment Company Act of 1940 
            (15 U.S.C. 80a-3), but for paragraph (1) or (7) of 
            subsection (c) of that Act (15 U.S.C. 80a-3(c));
                ``(vi) a commodity pool; or
                ``(vii) a bank holding company with over 
            $50,000,000,000 in consolidated assets.
            ``(C) Transition rule for affiliates.--An affiliate, 
        subsidiary, or a wholly owned entity of a person that qualifies 
        for an exception under subparagraph (A) and is predominantly 
        engaged in providing financing for the purchase or lease of 
        merchandise or manufactured goods of the person shall be exempt 
        from the margin requirement described in section 15F(e) and the 
        clearing requirement described in subsection (a) with regard to 
        security-based swaps entered into to mitigate the risk of the 
        financing activities for not less than a 2-year period 
        beginning on the date of enactment of this subparagraph.
        ``(5) Election of counterparty.--
            ``(A) Security-based swaps required to be cleared.--With 
        respect to any security-based swap that is subject to the 
        mandatory clearing requirement under subsection (a) and entered 
        into by a security-based swap dealer or a major security-based 
        swap participant with a counterparty that is not a swap dealer, 
        major swap participant, security-based swap dealer, or major 
        security-based swap participant, the counterparty shall have 
        the sole right to select the clearing agency at which the 
        security-based swap will be cleared.
            ``(B) Security-based swaps not required to be cleared.--
        With respect to any security-based swap that is not subject to 
        the mandatory clearing requirement under subsection (a) and 
        entered into by a security-based swap dealer or a major 
        security-based swap participant with a counterparty that is not 
        a swap dealer, major swap participant, security-based swap 
        dealer, or major security-based swap participant, the 
        counterparty--
                ``(i) may elect to require clearing of the security-
            based swap; and
                ``(ii) shall have the sole right to select the clearing 
            agency at which the security-based swap will be cleared.
        ``(6) Abuse of exception.--The Commission may prescribe such 
    rules or issue interpretations of the rules as the Commission 
    determines to be necessary to prevent abuse of the exceptions 
    described in this subsection. The Commission may also request 
    information from those persons claiming the clearing exception as 
    necessary to prevent abuse of the exceptions described in this 
    subsection.
    ``(h) Trade Execution.--
        ``(1) In general.--With respect to transactions involving 
    security-based swaps subject to the clearing requirement of 
    subsection (a)(1), counterparties shall--
            ``(A) execute the transaction on an exchange; or
            ``(B) execute the transaction on a security-based swap 
        execution facility registered under section 3D or a security-
        based swap execution facility that is exempt from registration 
        under section 3D(e).
        ``(2) Exception.--The requirements of subparagraphs (A) and (B) 
    of paragraph (1) shall not apply if no exchange or security-based 
    swap execution facility makes the security-based swap available to 
    trade or for security-based swap transactions subject to the 
    clearing exception under subsection (g).
    ``(i) Board Approval.--Exemptions from the requirements of this 
section to clear a security-based swap or execute a security-based swap 
through a national securities exchange or security-based swap execution 
facility shall be available to a counterparty that is an issuer of 
securities that are registered under section 12 or that is required to 
file reports pursuant to section 15(d), only if an appropriate 
committee of the issuer's board or governing body has reviewed and 
approved the issuer's decision to enter into security-based swaps that 
are subject to such exemptions.
    ``(j) Designation of Chief Compliance Officer.--
        ``(1) In general.--Each registered clearing agency shall 
    designate an individual to serve as a chief compliance officer.
        ``(2) Duties.--The chief compliance officer shall--
            ``(A) report directly to the board or to the senior officer 
        of the clearing agency;
            ``(B) in consultation with its board, a body performing a 
        function similar thereto, or the senior officer of the 
        registered clearing agency, resolve any conflicts of interest 
        that may arise;
            ``(C) be responsible for administering each policy and 
        procedure that is required to be established pursuant to this 
        section;
            ``(D) ensure compliance with this title (including 
        regulations issued under this title) relating to agreements, 
        contracts, or transactions, including each rule prescribed by 
        the Commission under this section;
            ``(E) establish procedures for the remediation of 
        noncompliance issues identified by the compliance officer 
        through any--
                ``(i) compliance office review;
                ``(ii) look-back;
                ``(iii) internal or external audit finding;
                ``(iv) self-reported error; or
                ``(v) validated complaint; and
            ``(F) establish and follow appropriate procedures for the 
        handling, management response, remediation, retesting, and 
        closing of noncompliance issues.
        ``(3) Annual reports.--
            ``(A) In general.--In accordance with rules prescribed by 
        the Commission, the chief compliance officer shall annually 
        prepare and sign a report that contains a description of--
                ``(i) the compliance of the registered clearing agency 
            or security-based swap execution facility of the compliance 
            officer with respect to this title (including regulations 
            under this title); and
                ``(ii) each policy and procedure of the registered 
            clearing agency of the compliance officer (including the 
            code of ethics and conflict of interest policies of the 
            registered clearing agency).
            ``(B) Requirements.--A compliance report under subparagraph 
        (A) shall--
                ``(i) accompany each appropriate financial report of 
            the registered clearing agency that is required to be 
            furnished to the Commission pursuant to this section; and
                ``(ii) include a certification that, under penalty of 
            law, the compliance report is accurate and complete.''.
    (b) Clearing Agency Requirements.--Section 17A of the Securities 
Exchange Act of 1934 (15 U.S.C. 78q-1) is amended by adding at the end 
the following:
    ``(g) Registration Requirement.--It shall be unlawful for a 
clearing agency, unless registered with the Commission, directly or 
indirectly to make use of the mails or any means or instrumentality of 
interstate commerce to perform the functions of a clearing agency with 
respect to a security-based swap.
    ``(h) Voluntary Registration.--A person that clears agreements, 
contracts, or transactions that are not required to be cleared under 
this title may register with the Commission as a clearing agency.
    ``(i) Standards for Clearing Agencies Clearing Security-based Swap 
Transactions.--To be registered and to maintain registration as a 
clearing agency that clears security-based swap transactions, a 
clearing agency shall comply with such standards as the Commission may 
establish by rule. In establishing any such standards, and in the 
exercise of its oversight of such a clearing agency pursuant to this 
title, the Commission may conform such standards or oversight to 
reflect evolving United States and international standards. Except 
where the Commission determines otherwise by rule or regulation, a 
clearing agency shall have reasonable discretion in establishing the 
manner in which it complies with any such standards.
    ``(j) Rules.--The Commission shall adopt rules governing persons 
that are registered as clearing agencies for security-based swaps under 
this title.
    ``(k) Exemptions.--The Commission may exempt, conditionally or 
unconditionally, a clearing agency from registration under this section 
for the clearing of security-based swaps if the Commission determines 
that the clearing agency is subject to comparable, comprehensive 
supervision and regulation by the Commodity Futures Trading Commission 
or the appropriate government authorities in the home country of the 
agency. Such conditions may include, but are not limited to, requiring 
that the clearing agency be available for inspection by the Commission 
and make available all information requested by the Commission.
    ``(l) Existing Depository Institutions and Derivative Clearing 
Organizations.--
        ``(1) In general.--A depository institution or derivative 
    clearing organization registered with the Commodity Futures Trading 
    Commission under the Commodity Exchange Act that is required to be 
    registered as a clearing agency under this section is deemed to be 
    registered under this section solely for the purpose of clearing 
    security-based swaps to the extent that, before the date of 
    enactment of this subsection--
            ``(A) the depository institution cleared swaps as a 
        multilateral clearing organization; or
            ``(B) the derivative clearing organization cleared swaps 
        pursuant to an exemption from registration as a clearing 
        agency.
        ``(2) Conversion of depository institutions.--A depository 
    institution to which this subsection applies may, by the vote of 
    the shareholders owning not less than 51 percent of the voting 
    interests of the depository institution, be converted into a State 
    corporation, partnership, limited liability company, or similar 
    legal form pursuant to a plan of conversion, if the conversion is 
    not in contravention of applicable State law.
        ``(3) Sharing of information.--The Commodity Futures Trading 
    Commission shall make available to the Commission, upon request, 
    all information determined to be relevant by the Commodity Futures 
    Trading Commission regarding a derivatives clearing organization 
    deemed to be registered with the Commission under paragraph (1).
    ``(m) Modification of Core Principles.--The Commission may conform 
the core principles established in this section to reflect evolving 
United States and international standards.''.
    (c) Security-based Swap Execution Facilities.--The Securities 
Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting 
after section 3C (as added by subsection (a) of this section) the 
following:
  ``SEC. 3D. SECURITY-BASED SWAP EXECUTION FACILITIES.
    ``(a) Registration.--
        ``(1) In general.--No person may operate a facility for the 
    trading or processing of security-based swaps, unless the facility 
    is registered as a security-based swap execution facility or as a 
    national securities exchange under this section.
        ``(2) Dual registration.--Any person that is registered as a 
    security-based swap execution facility under this section shall 
    register with the Commission regardless of whether the person also 
    is registered with the Commodity Futures Trading Commission as a 
    swap execution facility.
    ``(b) Trading and Trade Processing.--A security-based swap 
execution facility that is registered under subsection (a) may--
        ``(1) make available for trading any security-based swap; and
        ``(2) facilitate trade processing of any security-based swap.
    ``(c) Identification of Facility Used To Trade Security-based Swaps 
by National Securities Exchanges.--A national securities exchange 
shall, to the extent that the exchange also operates a security-based 
swap execution facility and uses the same electronic trade execution 
system for listing and executing trades of security-based swaps on or 
through the exchange and the facility, identify whether electronic 
trading of such security-based swaps is taking place on or through the 
national securities exchange or the security-based swap execution 
facility.
    ``(d) Core Principles for Security-based Swap Execution 
Facilities.--
        ``(1) Compliance with core principles.--
            ``(A) In general.--To be registered, and maintain 
        registration, as a security-based swap execution facility, the 
        security-based swap execution facility shall comply with--
                ``(i) the core principles described in this subsection; 
            and
                ``(ii) any requirement that the Commission may impose 
            by rule or regulation.
            ``(B) Reasonable discretion of security-based swap 
        execution facility.--Unless otherwise determined by the 
        Commission, by rule or regulation, a security-based swap 
        execution facility described in subparagraph (A) shall have 
        reasonable discretion in establishing the manner in which it 
        complies with the core principles described in this subsection.
        ``(2) Compliance with rules.--A security-based swap execution 
    facility shall--
            ``(A) establish and enforce compliance with any rule 
        established by such security-based swap execution facility, 
        including--
                ``(i) the terms and conditions of the security-based 
            swaps traded or processed on or through the facility; and
                ``(ii) any limitation on access to the facility;
            ``(B) establish and enforce trading, trade processing, and 
        participation rules that will deter abuses and have the 
        capacity to detect, investigate, and enforce those rules, 
        including means--
                ``(i) to provide market participants with impartial 
            access to the market; and
                ``(ii) to capture information that may be used in 
            establishing whether rule violations have occurred; and
            ``(C) establish rules governing the operation of the 
        facility, including rules specifying trading procedures to be 
        used in entering and executing orders traded or posted on the 
        facility, including block trades.
        ``(3) Security-based swaps not readily susceptible to 
    manipulation.--The security-based swap execution facility shall 
    permit trading only in security-based swaps that are not readily 
    susceptible to manipulation.
        ``(4) Monitoring of trading and trade processing.--The 
    security-based swap execution facility shall--
            ``(A) establish and enforce rules or terms and conditions 
        defining, or specifications detailing--
                ``(i) trading procedures to be used in entering and 
            executing orders traded on or through the facilities of the 
            security-based swap execution facility; and
                ``(ii) procedures for trade processing of security-
            based swaps on or through the facilities of the security-
            based swap execution facility; and
            ``(B) monitor trading in security-based swaps to prevent 
        manipulation, price distortion, and disruptions of the delivery 
        or cash settlement process through surveillance, compliance, 
        and disciplinary practices and procedures, including methods 
        for conducting real-time monitoring of trading and 
        comprehensive and accurate trade reconstructions.
        ``(5) Ability to obtain information.--The security-based swap 
    execution facility shall--
            ``(A) establish and enforce rules that will allow the 
        facility to obtain any necessary information to perform any of 
        the functions described in this subsection;
            ``(B) provide the information to the Commission on request; 
        and
            ``(C) have the capacity to carry out such international 
        information-sharing agreements as the Commission may require.
        ``(6) Financial integrity of transactions.--The security-based 
    swap execution facility shall establish and enforce rules and 
    procedures for ensuring the financial integrity of security-based 
    swaps entered on or through the facilities of the security-based 
    swap execution facility, including the clearance and settlement of 
    security-based swaps pursuant to section 3C(a)(1).
        ``(7) Emergency authority.--The security-based swap execution 
    facility shall adopt rules to provide for the exercise of emergency 
    authority, in consultation or cooperation with the Commission, as 
    is necessary and appropriate, including the authority to liquidate 
    or transfer open positions in any security-based swap or to suspend 
    or curtail trading in a security-based swap.
        ``(8) Timely publication of trading information.--
            ``(A) In general.--The security-based swap execution 
        facility shall make public timely information on price, trading 
        volume, and other trading data on security-based swaps to the 
        extent prescribed by the Commission.
            ``(B) Capacity of security-based swap execution facility.--
        The security-based swap execution facility shall be required to 
        have the capacity to electronically capture and transmit and 
        disseminate trade information with respect to transactions 
        executed on or through the facility.
        ``(9) Recordkeeping and reporting.--
            ``(A) In general.--A security-based swap execution facility 
        shall--
                ``(i) maintain records of all activities relating to 
            the business of the facility, including a complete audit 
            trail, in a form and manner acceptable to the Commission 
            for a period of 5 years; and
                ``(ii) report to the Commission, in a form and manner 
            acceptable to the Commission, such information as the 
            Commission determines to be necessary or appropriate for 
            the Commission to perform the duties of the Commission 
            under this title.
            ``(B) Requirements.--The Commission shall adopt data 
        collection and reporting requirements for security-based swap 
        execution facilities that are comparable to corresponding 
        requirements for clearing agencies and security-based swap data 
        repositories.
        ``(10) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this title, the security-
    based swap execution facility shall not--
            ``(A) adopt any rules or taking any actions that result in 
        any unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on trading 
        or clearing.
        ``(11) Conflicts of interest.--The security-based swap 
    execution facility shall--
            ``(A) establish and enforce rules to minimize conflicts of 
        interest in its decision-making process; and
            ``(B) establish a process for resolving the conflicts of 
        interest.
        ``(12) Financial resources.--
            ``(A) In general.--The security-based swap execution 
        facility shall have adequate financial, operational, and 
        managerial resources to discharge each responsibility of the 
        security-based swap execution facility, as determined by the 
        Commission.
            ``(B) Determination of resource adequacy.--The financial 
        resources of a security-based swap execution facility shall be 
        considered to be adequate if the value of the financial 
        resources--
                ``(i) enables the organization to meet its financial 
            obligations to its members and participants notwithstanding 
            a default by the member or participant creating the largest 
            financial exposure for that organization in extreme but 
            plausible market conditions; and
                ``(ii) exceeds the total amount that would enable the 
            security-based swap execution facility to cover the 
            operating costs of the security-based swap execution 
            facility for a 1-year period, as calculated on a rolling 
            basis.
        ``(13) System safeguards.--The security-based swap execution 
    facility shall--
            ``(A) establish and maintain a program of risk analysis and 
        oversight to identify and minimize sources of operational risk, 
        through the development of appropriate controls and procedures, 
        and automated systems, that--
                ``(i) are reliable and secure; and
                ``(ii) have adequate scalable capacity;
            ``(B) establish and maintain emergency procedures, backup 
        facilities, and a plan for disaster recovery that allow for--
                ``(i) the timely recovery and resumption of operations; 
            and
                ``(ii) the fulfillment of the responsibilities and 
            obligations of the security-based swap execution facility; 
            and
            ``(C) periodically conduct tests to verify that the backup 
        resources of the security-based swap execution facility are 
        sufficient to ensure continued--
                ``(i) order processing and trade matching;
                ``(ii) price reporting;
                ``(iii) market surveillance; and
                ``(iv) maintenance of a comprehensive and accurate 
            audit trail.
        ``(14) Designation of chief compliance officer.--
            ``(A) In general.--Each security-based swap execution 
        facility shall designate an individual to serve as a chief 
        compliance officer.
            ``(B) Duties.--The chief compliance officer shall--
                ``(i) report directly to the board or to the senior 
            officer of the facility;
                ``(ii) review compliance with the core principles in 
            this subsection;
                ``(iii) in consultation with the board of the facility, 
            a body performing a function similar to that of a board, or 
            the senior officer of the facility, resolve any conflicts 
            of interest that may arise;
                ``(iv) be responsible for establishing and 
            administering the policies and procedures required to be 
            established pursuant to this section;
                ``(v) ensure compliance with this title and the rules 
            and regulations issued under this title, including rules 
            prescribed by the Commission pursuant to this section;
                ``(vi) establish procedures for the remediation of 
            noncompliance issues found during--

                    ``(I) compliance office reviews;
                    ``(II) look backs;
                    ``(III) internal or external audit findings;
                    ``(IV) self-reported errors; or
                    ``(V) through validated complaints; and

                ``(vii) establish and follow appropriate procedures for 
            the handling, management response, remediation, retesting, 
            and closing of noncompliance issues.
            ``(C) Annual reports.--
                ``(i) In general.--In accordance with rules prescribed 
            by the Commission, the chief compliance officer shall 
            annually prepare and sign a report that contains a 
            description of--

                    ``(I) the compliance of the security-based swap 
                execution facility with this title; and
                    ``(II) the policies and procedures, including the 
                code of ethics and conflict of interest policies, of 
                the security-based security-based swap execution 
                facility.

                ``(ii) Requirements.--The chief compliance officer 
            shall--

                    ``(I) submit each report described in clause (i) 
                with the appropriate financial report of the security-
                based swap execution facility that is required to be 
                submitted to the Commission pursuant to this section; 
                and
                    ``(II) include in the report a certification that, 
                under penalty of law, the report is accurate and 
                complete.

    ``(e) Exemptions.--The Commission may exempt, conditionally or 
unconditionally, a security-based swap execution facility from 
registration under this section if the Commission finds that the 
facility is subject to comparable, comprehensive supervision and 
regulation on a consolidated basis by the Commodity Futures Trading 
Commission.
    ``(f) Rules.--The Commission shall prescribe rules governing the 
regulation of security-based swap execution facilities under this 
section.''.
    (d) Segregation of Assets Held as Collateral in Security-based Swap 
Transactions.--The Securities Exchange Act of 1934 (15 U.S.C. 78a et 
seq.) is amended by inserting after section 3D (as added by subsection 
(b)) the following:
  ``SEC. 3E. SEGREGATION OF ASSETS HELD AS COLLATERAL IN SECURITY-BASED 
      SWAP TRANSACTIONS.
    ``(a) Registration Requirement.--It shall be unlawful for any 
person to accept any money, securities, or property (or to extend any 
credit in lieu of money, securities, or property) from, for, or on 
behalf of a security-based swaps customer to margin, guarantee, or 
secure a security-based swap cleared by or through a clearing agency 
(including money, securities, or property accruing to the customer as 
the result of such a security-based swap), unless the person shall have 
registered under this title with the Commission as a broker, dealer, or 
security-based swap dealer, and the registration shall not have expired 
nor been suspended nor revoked.
    ``(b) Cleared Security-based Swaps.--
        ``(1) Segregation required.--A broker, dealer, or security-
    based swap dealer shall treat and deal with all money, securities, 
    and property of any security-based swaps customer received to 
    margin, guarantee, or secure a security-based swap cleared by or 
    though a clearing agency (including money, securities, or property 
    accruing to the security-based swaps customer as the result of such 
    a security-based swap) as belonging to the security-based swaps 
    customer.
        ``(2) Commingling prohibited.--Money, securities, and property 
    of a security-based swaps customer described in paragraph (1) shall 
    be separately accounted for and shall not be commingled with the 
    funds of the broker, dealer, or security-based swap dealer or be 
    used to margin, secure, or guarantee any trades or contracts of any 
    security-based swaps customer or person other than the person for 
    whom the same are held.
    ``(c) Exceptions.--
        ``(1) Use of funds.--
            ``(A) In general.--Notwithstanding subsection (b), money, 
        securities, and property of a security-based swaps customer of 
        a broker, dealer, or security-based swap dealer described in 
        subsection (b) may, for convenience, be commingled and 
        deposited in the same 1 or more accounts with any bank or trust 
        company or with a clearing agency.
            ``(B) Withdrawal.--Notwithstanding subsection (b), such 
        share of the money, securities, and property described in 
        subparagraph (A) as in the normal course of business shall be 
        necessary to margin, guarantee, secure, transfer, adjust, or 
        settle a cleared security-based swap with a clearing agency, or 
        with any member of the clearing agency, may be withdrawn and 
        applied to such purposes, including the payment of commissions, 
        brokerage, interest, taxes, storage, and other charges, 
        lawfully accruing in connection with the cleared security-based 
        swap.
        ``(2) Commission action.--Notwithstanding subsection (b), in 
    accordance with such terms and conditions as the Commission may 
    prescribe by rule, regulation, or order, any money, securities, or 
    property of the security-based swaps customer of a broker, dealer, 
    or security-based swap dealer described in subsection (b) may be 
    commingled and deposited as provided in this section with any other 
    money, securities, or property received by the broker, dealer, or 
    security-based swap dealer and required by the Commission to be 
    separately accounted for and treated and dealt with as belonging to 
    the security-based swaps customer of the broker, dealer, or 
    security-based swap dealer.
    ``(d) Permitted Investments.--Money described in subsection (b) may 
be invested in obligations of the United States, in general obligations 
of any State or of any political subdivision of a State, and in 
obligations fully guaranteed as to principal and interest by the United 
States, or in any other investment that the Commission may by rule or 
regulation prescribe, and such investments shall be made in accordance 
with such rules and regulations and subject to such conditions as the 
Commission may prescribe.
    ``(e) Prohibition.--It shall be unlawful for any person, including 
any clearing agency and any depository institution, that has received 
any money, securities, or property for deposit in a separate account or 
accounts as provided in subsection (b) to hold, dispose of, or use any 
such money, securities, or property as belonging to the depositing 
broker, dealer, or security-based swap dealer or any person other than 
the swaps customer of the broker, dealer, or security-based swap 
dealer.
    ``(f) Segregation Requirements for Uncleared Security-based 
Swaps.--
        ``(1) Segregation of assets held as collateral in uncleared 
    security-based swap transactions.--
            ``(A) Notification.--A security-based swap dealer or major 
        security-based swap participant shall be required to notify the 
        counterparty of the security-based swap dealer or major 
        security-based swap participant at the beginning of a security-
        based swap transaction that the counterparty has the right to 
        require segregation of the funds of other property supplied to 
        margin, guarantee, or secure the obligations of the 
        counterparty.
            ``(B) Segregation and maintenance of funds.--At the request 
        of a counterparty to a security-based swap that provides funds 
        or other property to a security-based swap dealer or major 
        security-based swap participant to margin, guarantee, or secure 
        the obligations of the counterparty, the security-based swap 
        dealer or major security-based swap participant shall--
                ``(i) segregate the funds or other property for the 
            benefit of the counterparty; and
                ``(ii) in accordance with such rules and regulations as 
            the Commission may promulgate, maintain the funds or other 
            property in a segregated account separate from the assets 
            and other interests of the security-based swap dealer or 
            major security-based swap participant.
        ``(2) Applicability.--The requirements described in paragraph 
    (1) shall--
            ``(A) apply only to a security-based swap between a 
        counterparty and a security-based swap dealer or major 
        security-based swap participant that is not submitted for 
        clearing to a clearing agency; and
            ``(B)(i) not apply to variation margin payments; or
            ``(ii) not preclude any commercial arrangement regarding--
                ``(I) the investment of segregated funds or other 
            property that may only be invested in such investments as 
            the Commission may permit by rule or regulation; and
                ``(II) the related allocation of gains and losses 
            resulting from any investment of the segregated funds or 
            other property.
        ``(3) Use of independent third-party custodians.--The 
    segregated account described in paragraph (1) shall be--
            ``(A) carried by an independent third-party custodian; and
            ``(B) designated as a segregated account for and on behalf 
        of the counterparty.
        ``(4) Reporting requirement.--If the counterparty does not 
    choose to require segregation of the funds or other property 
    supplied to margin, guarantee, or secure the obligations of the 
    counterparty, the security-based swap dealer or major security-
    based swap participant shall report to the counterparty of the 
    security-based swap dealer or major security-based swap participant 
    on a quarterly basis that the back office procedures of the 
    security-based swap dealer or major security-based swap participant 
    relating to margin and collateral requirements are in compliance 
    with the agreement of the counterparties.
    ``(g) Bankruptcy.--A security-based swap, as defined in section 
3(a)(68) shall be considered to be a security as such term is used in 
section 101(53A)(B) and subchapter III of title 11, United States Code. 
An account that holds a security-based swap, other than a portfolio 
margining account referred to in section 15(c)(3)(C) shall be 
considered to be a securities account, as that term is defined in 
section 741 of title 11, United States Code. The definitions of the 
terms `purchase' and `sale' in section 3(a)(13) and (14) shall be 
applied to the terms `purchase' and `sale', as used in section 741 of 
title 11, United States Code. The term `customer', as defined in 
section 741 of title 11, United States Code, excludes any person, to 
the extent that such person has a claim based on any open repurchase 
agreement, open reverse repurchase agreement, stock borrowed agreement, 
non-cleared option, or non-cleared security-based swap except to the 
extent of any margin delivered to or by the customer with respect to 
which there is a customer protection requirement under section 15(c)(3) 
or a segregation requirement.''.
    (e) Trading in Security-based Swaps.--Section 6 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78f) is amended by adding at the end 
the following:
    ``(l) Security-based Swaps.--It shall be unlawful for any person to 
effect a transaction in a security-based swap with or for a person that 
is not an eligible contract participant, unless such transaction is 
effected on a national securities exchange registered pursuant to 
subsection (b).''.
    (f) Additions of Security-based Swaps to Certain Enforcement 
Provisions.--Section 9(b) of the Securities Exchange Act of 1934 (15 
U.S.C. 78i(b)) is amended by striking paragraphs (1) through (3) and 
inserting the following:
        ``(1) any transaction in connection with any security whereby 
    any party to such transaction acquires--
            ``(A) any put, call, straddle, or other option or privilege 
        of buying the security from or selling the security to another 
        without being bound to do so;
            ``(B) any security futures product on the security; or
            ``(C) any security-based swap involving the security or the 
        issuer of the security;
        ``(2) any transaction in connection with any security with 
    relation to which such person has, directly or indirectly, any 
    interest in any--
            ``(A) such put, call, straddle, option, or privilege;
            ``(B) such security futures product; or
            ``(C) such security-based swap; or
        ``(3) any transaction in any security for the account of any 
    person who such person has reason to believe has, and who actually 
    has, directly or indirectly, any interest in any--
            ``(A) such put, call, straddle, option, or privilege;
            ``(B) such security futures product with relation to such 
        security; or
            ``(C) any security-based swap involving such security or 
        the issuer of such security.''.
    (g) Rulemaking Authority To Prevent Fraud, Manipulation and 
Deceptive Conduct in Security-based Swaps.--Section 9 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78i) is amended by adding at the end 
the following:
    ``(j) It shall be unlawful for any person, directly or indirectly, 
by the use of any means or instrumentality of interstate commerce or of 
the mails, or of any facility of any national securities exchange, to 
effect any transaction in, or to induce or attempt to induce the 
purchase or sale of, any security-based swap, in connection with which 
such person engages in any fraudulent, deceptive, or manipulative act 
or practice, makes any fictitious quotation, or engages in any 
transaction, practice, or course of business which operates as a fraud 
or deceit upon any person. The Commission shall, for the purposes of 
this subsection, by rules and regulations define, and prescribe means 
reasonably designed to prevent, such transactions, acts, practices, and 
courses of business as are fraudulent, deceptive, or manipulative, and 
such quotations as are fictitious.''.
    (h) Position Limits and Position Accountability for Security-based 
Swaps.--The Securities Exchange Act of 1934 is amended by inserting 
after section 10A (15 U.S.C. 78j-1) the following:
    ``SEC. 10B. POSITION LIMITS AND POSITION ACCOUNTABILITY FOR 
      SECURITY-BASED SWAPS AND LARGE TRADER REPORTING.
    ``(a) Position Limits.--As a means reasonably designed to prevent 
fraud and manipulation, the Commission shall, by rule or regulation, as 
necessary or appropriate in the public interest or for the protection 
of investors, establish limits (including related hedge exemption 
provisions) on the size of positions in any security-based swap that 
may be held by any person. In establishing such limits, the Commission 
may require any person to aggregate positions in--
        ``(1) any security-based swap and any security or loan or group 
    of securities or loans on which such security-based swap is based, 
    which such security-based swap references, or to which such 
    security-based swap is related as described in paragraph (68) of 
    section 3(a), and any other instrument relating to such security or 
    loan or group or index of securities or loans; or
        ``(2) any security-based swap and--
            ``(A) any security or group or index of securities, the 
        price, yield, value, or volatility of which, or of which any 
        interest therein, is the basis for a material term of such 
        security-based swap as described in paragraph (68) of section 
        3(a); and
            ``(B) any other instrument relating to the same security or 
        group or index of securities described under subparagraph (A).
    ``(b) Exemptions.--The Commission, by rule, regulation, or order, 
may conditionally or unconditionally exempt any person or class of 
persons, any security-based swap or class of security-based swaps, or 
any transaction or class of transactions from any requirement the 
Commission may establish under this section with respect to position 
limits.
    ``(c) SRO Rules.--
        ``(1) In general.--As a means reasonably designed to prevent 
    fraud or manipulation, the Commission, by rule, regulation, or 
    order, as necessary or appropriate in the public interest, for the 
    protection of investors, or otherwise in furtherance of the 
    purposes of this title, may direct a self-regulatory organization--
            ``(A) to adopt rules regarding the size of positions in any 
        security-based swap that may be held by--
                ``(i) any member of such self-regulatory organization; 
            or
                ``(ii) any person for whom a member of such self-
            regulatory organization effects transactions in such 
            security-based swap; and
            ``(B) to adopt rules reasonably designed to ensure 
        compliance with requirements prescribed by the Commission under 
        this subsection.
        ``(2) Requirement to aggregate positions.--In establishing the 
    limits under paragraph (1), the self-regulatory organization may 
    require such member or person to aggregate positions in--
            ``(A) any security-based swap and any security or loan or 
        group or narrow-based security index of securities or loans on 
        which such security-based swap is based, which such security-
        based swap references, or to which such security-based swap is 
        related as described in section 3(a)(68), and any other 
        instrument relating to such security or loan or group or 
        narrow-based security index of securities or loans; or
            ``(B)(i) any security-based swap; and
            ``(ii) any security-based swap and any other instrument 
        relating to the same security or group or narrow-based security 
        index of securities.
    ``(d) Large Trader Reporting.--The Commission, by rule or 
regulation, may require any person that effects transactions for such 
person's own account or the account of others in any securities-based 
swap or uncleared security-based swap and any security or loan or group 
or narrow-based security index of securities or loans as set forth in 
paragraphs (1) and (2) of subsection (a) under this section to report 
such information as the Commission may prescribe regarding any position 
or positions in any security-based swap or uncleared security-based 
swap and any security or loan or group or narrow-based security index 
of securities or loans and any other instrument relating to such 
security or loan or group or narrow-based security index of securities 
or loans as set forth in paragraphs (1) and (2) of subsection (a) under 
this section.''.
    (i) Public Reporting and Repositories for Security-based Swaps.--
Section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m) is 
amended by adding at the end the following:
    ``(m) Public Availability of Security-based Swap Transaction 
Data.--
        ``(1) In general.--
            ``(A) Definition of real-time public reporting.--In this 
        paragraph, the term `real-time public reporting' means to 
        report data relating to a security-based swap transaction, 
        including price and volume, as soon as technologically 
        practicable after the time at which the security-based swap 
        transaction has been executed.
            ``(B) Purpose.--The purpose of this subsection is to 
        authorize the Commission to make security-based swap 
        transaction and pricing data available to the public in such 
        form and at such times as the Commission determines appropriate 
        to enhance price discovery.
            ``(C) General rule.--The Commission is authorized to 
        provide by rule for the public availability of security-based 
        swap transaction, volume, and pricing data as follows:
                ``(i) With respect to those security-based swaps that 
            are subject to the mandatory clearing requirement described 
            in section 3C(a)(1) (including those security-based swaps 
            that are excepted from the requirement pursuant to section 
            3C(g)), the Commission shall require real-time public 
            reporting for such transactions.
                ``(ii) With respect to those security-based swaps that 
            are not subject to the mandatory clearing requirement 
            described in section 3C(a)(1), but are cleared at a 
            registered clearing agency, the Commission shall require 
            real-time public reporting for such transactions.
                ``(iii) With respect to security-based swaps that are 
            not cleared at a registered clearing agency and which are 
            reported to a security-based swap data repository or the 
            Commission under section 3C(a)(6), the Commission shall 
            require real-time public reporting for such transactions, 
            in a manner that does not disclose the business 
            transactions and market positions of any person.
                ``(iv) With respect to security-based swaps that are 
            determined to be required to be cleared under section 3C(b) 
            but are not cleared, the Commission shall require real-time 
            public reporting for such transactions.
            ``(D) Registered entities and public reporting.--The 
        Commission may require registered entities to publicly 
        disseminate the security-based swap transaction and pricing 
        data required to be reported under this paragraph.
            ``(E) Rulemaking required.--With respect to the rule 
        providing for the public availability of transaction and 
        pricing data for security-based swaps described in clauses (i) 
        and (ii) of subparagraph (C), the rule promulgated by the 
        Commission shall contain provisions--
                ``(i) to ensure such information does not identify the 
            participants;
                ``(ii) to specify the criteria for determining what 
            constitutes a large notional security-based swap 
            transaction (block trade) for particular markets and 
            contracts;
                ``(iii) to specify the appropriate time delay for 
            reporting large notional security-based swap transactions 
            (block trades) to the public; and
                ``(iv) that take into account whether the public 
            disclosure will materially reduce market liquidity.
            ``(F) Timeliness of reporting.--Parties to a security-based 
        swap (including agents of the parties to a security-based swap) 
        shall be responsible for reporting security-based swap 
        transaction information to the appropriate registered entity in 
        a timely manner as may be prescribed by the Commission.
            ``(G) Reporting of swaps to registered security-based swap 
        data repositories.--Each security-based swap (whether cleared 
        or uncleared) shall be reported to a registered security-based 
        swap data repository.
            ``(H) Registration of clearing agencies.--A clearing agency 
        may register as a security-based swap data repository.
        ``(2) Semiannual and annual public reporting of aggregate 
    security-based swap data.--
            ``(A) In general.--In accordance with subparagraph (B), the 
        Commission shall issue a written report on a semiannual and 
        annual basis to make available to the public information 
        relating to--
                ``(i) the trading and clearing in the major security-
            based swap categories; and
                ``(ii) the market participants and developments in new 
            products.
            ``(B) Use; consultation.--In preparing a report under 
        subparagraph (A), the Commission shall--
                ``(i) use information from security-based swap data 
            repositories and clearing agencies; and
                ``(ii) consult with the Office of the Comptroller of 
            the Currency, the Bank for International Settlements, and 
            such other regulatory bodies as may be necessary.
            ``(C) Authority of commission.--The Commission may, by 
        rule, regulation, or order, delegate the public reporting 
        responsibilities of the Commission under this paragraph in 
        accordance with such terms and conditions as the Commission 
        determines to be appropriate and in the public interest.
    ``(n) Security-based Swap Data Repositories.--
        ``(1) Registration requirement.--It shall be unlawful for any 
    person, unless registered with the Commission, directly or 
    indirectly, to make use of the mails or any means or 
    instrumentality of interstate commerce to perform the functions of 
    a security-based swap data repository.
        ``(2) Inspection and examination.--Each registered security-
    based swap data repository shall be subject to inspection and 
    examination by any representative of the Commission.
        ``(3) Compliance with core principles.--
            ``(A) In general.--To be registered, and maintain 
        registration, as a security-based swap data repository, the 
        security-based swap data repository shall comply with--
                ``(i) the requirements and core principles described in 
            this subsection; and
                ``(ii) any requirement that the Commission may impose 
            by rule or regulation.
            ``(B) Reasonable discretion of security-based swap data 
        repository.--Unless otherwise determined by the Commission, by 
        rule or regulation, a security-based swap data repository 
        described in subparagraph (A) shall have reasonable discretion 
        in establishing the manner in which the security-based swap 
        data repository complies with the core principles described in 
        this subsection.
        ``(4) Standard setting.--
            ``(A) Data identification.--
                ``(i) In general.--In accordance with clause (ii), the 
            Commission shall prescribe standards that specify the data 
            elements for each security-based swap that shall be 
            collected and maintained by each registered security-based 
            swap data repository.
                ``(ii) Requirement.--In carrying out clause (i), the 
            Commission shall prescribe consistent data element 
            standards applicable to registered entities and reporting 
            counterparties.
            ``(B) Data collection and maintenance.--The Commission 
        shall prescribe data collection and data maintenance standards 
        for security-based swap data repositories.
            ``(C) Comparability.--The standards prescribed by the 
        Commission under this subsection shall be comparable to the 
        data standards imposed by the Commission on clearing agencies 
        in connection with their clearing of security-based swaps.
        ``(5) Duties.--A security-based swap data repository shall--
            ``(A) accept data prescribed by the Commission for each 
        security-based swap under subsection (b);
            ``(B) confirm with both counterparties to the security-
        based swap the accuracy of the data that was submitted;
            ``(C) maintain the data described in subparagraph (A) in 
        such form, in such manner, and for such period as may be 
        required by the Commission;
            ``(D)(i) provide direct electronic access to the Commission 
        (or any designee of the Commission, including another 
        registered entity); and
            ``(ii) provide the information described in subparagraph 
        (A) in such form and at such frequency as the Commission may 
        require to comply with the public reporting requirements set 
        forth in subsection (m);
            ``(E) at the direction of the Commission, establish 
        automated systems for monitoring, screening, and analyzing 
        security-based swap data;
            ``(F) maintain the privacy of any and all security-based 
        swap transaction information that the security-based swap data 
        repository receives from a security-based swap dealer, 
        counterparty, or any other registered entity; and
            ``(G) on a confidential basis pursuant to section 24, upon 
        request, and after notifying the Commission of the request, 
        make available all data obtained by the security-based swap 
        data repository, including individual counterparty trade and 
        position data, to--
                ``(i) each appropriate prudential regulator;
                ``(ii) the Financial Stability Oversight Council;
                ``(iii) the Commodity Futures Trading Commission;
                ``(iv) the Department of Justice; and
                ``(v) any other person that the Commission determines 
            to be appropriate, including--

                    ``(I) foreign financial supervisors (including 
                foreign futures authorities);
                    ``(II) foreign central banks; and
                    ``(III) foreign ministries.

            ``(H) Confidentiality and indemnification agreement.--
        Before the security-based swap data repository may share 
        information with any entity described in subparagraph (G)--
                ``(i) the security-based swap data repository shall 
            receive a written agreement from each entity stating that 
            the entity shall abide by the confidentiality requirements 
            described in section 24 relating to the information on 
            security-based swap transactions that is provided; and
                ``(ii) each entity shall agree to indemnify the 
            security-based swap data repository and the Commission for 
            any expenses arising from litigation relating to the 
            information provided under section 24.
        ``(6) Designation of chief compliance officer.--
            ``(A) In general.--Each security-based swap data repository 
        shall designate an individual to serve as a chief compliance 
        officer.
            ``(B) Duties.--The chief compliance officer shall--
                ``(i) report directly to the board or to the senior 
            officer of the security-based swap data repository;
                ``(ii) review the compliance of the security-based swap 
            data repository with respect to the requirements and core 
            principles described in this subsection;
                ``(iii) in consultation with the board of the security-
            based swap data repository, a body performing a function 
            similar to the board of the security-based swap data 
            repository, or the senior officer of the security-based 
            swap data repository, resolve any conflicts of interest 
            that may arise;
                ``(iv) be responsible for administering each policy and 
            procedure that is required to be established pursuant to 
            this section;
                ``(v) ensure compliance with this title (including 
            regulations) relating to agreements, contracts, or 
            transactions, including each rule prescribed by the 
            Commission under this section;
                ``(vi) establish procedures for the remediation of 
            noncompliance issues identified by the chief compliance 
            officer through any--

                    ``(I) compliance office review;
                    ``(II) look-back;
                    ``(III) internal or external audit finding;
                    ``(IV) self-reported error; or
                    ``(V) validated complaint; and

                ``(vii) establish and follow appropriate procedures for 
            the handling, management response, remediation, retesting, 
            and closing of noncompliance issues.
            ``(C) Annual reports.--
                ``(i) In general.--In accordance with rules prescribed 
            by the Commission, the chief compliance officer shall 
            annually prepare and sign a report that contains a 
            description of--

                    ``(I) the compliance of the security-based swap 
                data repository of the chief compliance officer with 
                respect to this title (including regulations); and
                    ``(II) each policy and procedure of the security-
                based swap data repository of the chief compliance 
                officer (including the code of ethics and conflict of 
                interest policies of the security-based swap data 
                repository).

                ``(ii) Requirements.--A compliance report under clause 
            (i) shall--

                    ``(I) accompany each appropriate financial report 
                of the security-based swap data repository that is 
                required to be furnished to the Commission pursuant to 
                this section; and
                    ``(II) include a certification that, under penalty 
                of law, the compliance report is accurate and complete.

        ``(7) Core principles applicable to security-based swap data 
    repositories.--
            ``(A) Antitrust considerations.--Unless necessary or 
        appropriate to achieve the purposes of this title, the swap 
        data repository shall not--
                ``(i) adopt any rule or take any action that results in 
            any unreasonable restraint of trade; or
                ``(ii) impose any material anticompetitive burden on 
            the trading, clearing, or reporting of transactions.
            ``(B) Governance arrangements.--Each security-based swap 
        data repository shall establish governance arrangements that 
        are transparent--
                ``(i) to fulfill public interest requirements; and
                ``(ii) to support the objectives of the Federal 
            Government, owners, and participants.
            ``(C) Conflicts of interest.--Each security-based swap data 
        repository shall--
                ``(i) establish and enforce rules to minimize conflicts 
            of interest in the decision-making process of the security-
            based swap data repository; and
                ``(ii) establish a process for resolving any conflicts 
            of interest described in clause (i).
            ``(D) Additional duties developed by commission.--
                ``(i) In general.--The Commission may develop 1 or more 
            additional duties applicable to security-based swap data 
            repositories.
                ``(ii) Consideration of evolving standards.--In 
            developing additional duties under subparagraph (A), the 
            Commission may take into consideration any evolving 
            standard of the United States or the international 
            community.
                ``(iii) Additional duties for commission designees.--
            The Commission shall establish additional duties for any 
            registrant described in section 13(m)(2)(C) in order to 
            minimize conflicts of interest, protect data, ensure 
            compliance, and guarantee the safety and security of the 
            security-based swap data repository.
        ``(8) Required registration for security-based swap data 
    repositories.--Any person that is required to be registered as a 
    security-based swap data repository under this subsection shall 
    register with the Commission, regardless of whether that person is 
    also licensed under the Commodity Exchange Act as a swap data 
    repository.
        ``(9) Rules.--The Commission shall adopt rules governing 
    persons that are registered under this subsection.''.
    SEC. 764. REGISTRATION AND REGULATION OF SECURITY-BASED SWAP 
      DEALERS AND MAJOR SECURITY-BASED SWAP PARTICIPANTS.
    (a) In General.--The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended by inserting after section 15E (15 U.S.C. 78o-7) 
the following:
    ``SEC. 15F. REGISTRATION AND REGULATION OF SECURITY-BASED SWAP 
      DEALERS AND MAJOR SECURITY-BASED SWAP PARTICIPANTS.
    ``(a) Registration.--
        ``(1) Security-based swap dealers.--It shall be unlawful for 
    any person to act as a security-based swap dealer unless the person 
    is registered as a security-based swap dealer with the Commission.
        ``(2) Major security-based swap participants.--It shall be 
    unlawful for any person to act as a major security-based swap 
    participant unless the person is registered as a major security-
    based swap participant with the Commission.
    ``(b) Requirements.--
        ``(1) In general.--A person shall register as a security-based 
    swap dealer or major security-based swap participant by filing a 
    registration application with the Commission.
        ``(2) Contents.--
            ``(A) In general.--The application shall be made in such 
        form and manner as prescribed by the Commission, and shall 
        contain such information, as the Commission considers necessary 
        concerning the business in which the applicant is or will be 
        engaged.
            ``(B) Continual reporting.--A person that is registered as 
        a security-based swap dealer or major security-based swap 
        participant shall continue to submit to the Commission reports 
        that contain such information pertaining to the business of the 
        person as the Commission may require.
        ``(3) Expiration.--Each registration under this section shall 
    expire at such time as the Commission may prescribe by rule or 
    regulation.
        ``(4) Rules.--Except as provided in subsections (d) and (e), 
    the Commission may prescribe rules applicable to security-based 
    swap dealers and major security-based swap participants, including 
    rules that limit the activities of non-bank security-based swap 
    dealers and major security-based swap participants.
        ``(5) Transition.--Not later than 1 year after the date of 
    enactment of the Wall Street Transparency and Accountability Act of 
    2010, the Commission shall issue rules under this section to 
    provide for the registration of security-based swap dealers and 
    major security-based swap participants.
        ``(6) Statutory disqualification.--Except to the extent 
    otherwise specifically provided by rule, regulation, or order of 
    the Commission, it shall be unlawful for a security-based swap 
    dealer or a major security-based swap participant to permit any 
    person associated with a security-based swap dealer or a major 
    security-based swap participant who is subject to a statutory 
    disqualification to effect or be involved in effecting security-
    based swaps on behalf of the security-based swap dealer or major 
    security-based swap participant, if the security-based swap dealer 
    or major security-based swap participant knew, or in the exercise 
    of reasonable care should have known, of the statutory 
    disqualification.
    ``(c) Dual Registration.--
        ``(1) Security-based swap dealer.--Any person that is required 
    to be registered as a security-based swap dealer under this section 
    shall register with the Commission, regardless of whether the 
    person also is registered with the Commodity Futures Trading 
    Commission as a swap dealer.
        ``(2) Major security-based swap participant.--Any person that 
    is required to be registered as a major security-based swap 
    participant under this section shall register with the Commission, 
    regardless of whether the person also is registered with the 
    Commodity Futures Trading Commission as a major swap participant.
    ``(d) Rulemaking.--
        ``(1) In general.--The Commission shall adopt rules for persons 
    that are registered as security-based swap dealers or major 
    security-based swap participants under this section.
        ``(2) Exception for prudential requirements.--
            ``(A) In general.--The Commission may not prescribe rules 
        imposing prudential requirements on security-based swap dealers 
        or major security-based swap participants for which there is a 
        prudential regulator.
            ``(B) Applicability.--Subparagraph (A) does not limit the 
        authority of the Commission to prescribe rules as directed 
        under this section.
    ``(e) Capital and Margin Requirements.--
        ``(1) In general.--
            ``(A) Security-based swap dealers and major security-based 
        swap participants that are banks.--Each registered security-
        based swap dealer and major security-based swap participant for 
        which there is not a prudential regulator shall meet such 
        minimum capital requirements and minimum initial and variation 
        margin requirements as the prudential regulator shall by rule 
        or regulation prescribe under paragraph (2)(A).
            ``(B) Security-based swap dealers and major security-based 
        swap participants that are not banks.--Each registered 
        security-based swap dealer and major security-based swap 
        participant for which there is not a prudential regulator shall 
        meet such minimum capital requirements and minimum initial and 
        variation margin requirements as the Commission shall by rule 
        or regulation prescribe under paragraph (2)(B).
        ``(2) Rules.--
            ``(A) Security-based swap dealers and major security-based 
        swap participants that are banks.--The prudential regulators, 
        in consultation with the Commission and the Commodity Futures 
        Trading Commission, shall adopt rules for security-based swap 
        dealers and major security-based swap participants, with 
        respect to their activities as a swap dealer or major swap 
        participant, for which there is a prudential regulator 
        imposing--
                ``(i) capital requirements; and
                ``(ii) both initial and variation margin requirements 
            on all security-based swaps that are not cleared by a 
            registered clearing agency.
            ``(B) Security-based swap dealers and major security-based 
        swap participants that are not banks.--The Commission shall 
        adopt rules for security-based swap dealers and major security-
        based swap participants, with respect to their activities as a 
        swap dealer or major swap participant, for which there is not a 
        prudential regulator imposing--
                ``(i) capital requirements; and
                ``(ii) both initial and variation margin requirements 
            on all swaps that are not cleared by a registered clearing 
            agency.
            ``(C) Capital.--In setting capital requirements for a 
        person that is designated as a security-based swap dealer or a 
        major security-based swap participant for a single type or 
        single class or category of security-based swap or activities, 
        the prudential regulator and the Commission shall take into 
        account the risks associated with other types of security-based 
        swaps or classes of security-based swaps or categories of 
        security-based swaps engaged in and the other activities 
        conducted by that person that are not otherwise subject to 
        regulation applicable to that person by virtue of the status of 
        the person.
        ``(3) Standards for capital and margin.--
            ``(A) In general.--To offset the greater risk to the 
        security-based swap dealer or major security-based swap 
        participant and the financial system arising from the use of 
        security-based swaps that are not cleared, the requirements 
        imposed under paragraph (2) shall --
                ``(i) help ensure the safety and soundness of the 
            security-based swap dealer or major security-based swap 
            participant; and
                ``(ii) be appropriate for the risk associated with the 
            non-cleared security-based swaps held as a security-based 
            swap dealer or major security-based swap participant.
            ``(B) Rule of construction.--
                ``(i) In general.--Nothing in this section shall limit, 
            or be construed to limit, the authority--

                    ``(I) of the Commission to set financial 
                responsibility rules for a broker or dealer registered 
                pursuant to section 15(b) (except for section 15(b)(11) 
                thereof) in accordance with section 15(c)(3); or
                    ``(II) of the Commodity Futures Trading Commission 
                to set financial responsibility rules for a futures 
                commission merchant or introducing broker registered 
                pursuant to section 4f(a) of the Commodity Exchange Act 
                (except for section 4f(a)(3) thereof) in accordance 
                with section 4f(b) of the Commodity Exchange Act.

                ``(ii) Futures commission merchants and other 
            dealers.--A futures commission merchant, introducing 
            broker, broker, or dealer shall maintain sufficient capital 
            to comply with the stricter of any applicable capital 
            requirements to which such futures commission merchant, 
            introducing broker, broker, or dealer is subject to under 
            this title or the Commodity Exchange Act.
            ``(C) Margin requirements.--In prescribing margin 
        requirements under this subsection, the prudential regulator 
        with respect to security-based swap dealers and major security-
        based swap participants that are depository institutions, and 
        the Commission with respect to security-based swap dealers and 
        major security-based swap participants that are not depository 
        institutions shall permit the use of noncash collateral, as the 
        regulator or the Commission determines to be consistent with--
                ``(i) preserving the financial integrity of markets 
            trading security-based swaps; and
                ``(ii) preserving the stability of the United States 
            financial system.
            ``(D) Comparability of capital and margin requirements.--
                ``(i) In general.--The prudential regulators, the 
            Commission, and the Securities and Exchange Commission 
            shall periodically (but not less frequently than annually) 
            consult on minimum capital requirements and minimum initial 
            and variation margin requirements.
                ``(ii) Comparability.--The entities described in clause 
            (i) shall, to the maximum extent practicable, establish and 
            maintain comparable minimum capital requirements and 
            minimum initial and variation margin requirements, 
            including the use of noncash collateral, for--

                    ``(I) security-based swap dealers; and
                    ``(II) major security-based swap participants.

    ``(f) Reporting and Recordkeeping.--
        ``(1) In general.--Each registered security-based swap dealer 
    and major security-based swap participant--
            ``(A) shall make such reports as are required by the 
        Commission, by rule or regulation, regarding the transactions 
        and positions and financial condition of the registered 
        security-based swap dealer or major security-based swap 
        participant;
            ``(B)(i) for which there is a prudential regulator, shall 
        keep books and records of all activities related to the 
        business as a security-based swap dealer or major security-
        based swap participant in such form and manner and for such 
        period as may be prescribed by the Commission by rule or 
        regulation; and
            ``(ii) for which there is no prudential regulator, shall 
        keep books and records in such form and manner and for such 
        period as may be prescribed by the Commission by rule or 
        regulation; and
            ``(C) shall keep books and records described in 
        subparagraph (B) open to inspection and examination by any 
        representative of the Commission.
        ``(2) Rules.--The Commission shall adopt rules governing 
    reporting and recordkeeping for security-based swap dealers and 
    major security-based swap participants.
    ``(g) Daily Trading Records.--
        ``(1) In general.--Each registered security-based swap dealer 
    and major security-based swap participant shall maintain daily 
    trading records of the security-based swaps of the registered 
    security-based swap dealer and major security-based swap 
    participant and all related records (including related cash or 
    forward transactions) and recorded communications, including 
    electronic mail, instant messages, and recordings of telephone 
    calls, for such period as may be required by the Commission by rule 
    or regulation.
        ``(2) Information requirements.--The daily trading records 
    shall include such information as the Commission shall require by 
    rule or regulation.
        ``(3) Counterparty records.--Each registered security-based 
    swap dealer and major security-based swap participant shall 
    maintain daily trading records for each counterparty in a manner 
    and form that is identifiable with each security-based swap 
    transaction.
        ``(4) Audit trail.--Each registered security-based swap dealer 
    and major security-based swap participant shall maintain a complete 
    audit trail for conducting comprehensive and accurate trade 
    reconstructions.
        ``(5) Rules.--The Commission shall adopt rules governing daily 
    trading records for security-based swap dealers and major security-
    based swap participants.
    ``(h) Business Conduct Standards.--
        ``(1) In general.--Each registered security-based swap dealer 
    and major security-based swap participant shall conform with such 
    business conduct standards as prescribed in paragraph (3) and as 
    may be prescribed by the Commission by rule or regulation that 
    relate to--
            ``(A) fraud, manipulation, and other abusive practices 
        involving security-based swaps (including security-based swaps 
        that are offered but not entered into);
            ``(B) diligent supervision of the business of the 
        registered security-based swap dealer and major security-based 
        swap participant;
            ``(C) adherence to all applicable position limits; and
            ``(D) such other matters as the Commission determines to be 
        appropriate.
        ``(2) Responsibilities with respect to special entities.--
            ``(A) Advising special entities.--A security-based swap 
        dealer or major security-based swap participant that acts as an 
        advisor to special entity regarding a security-based swap shall 
        comply with the requirements of paragraph (4) with respect to 
        such special entity.
            ``(B) Entering of security-based swaps with respect to 
        special entities.--A security-based swap dealer that enters 
        into or offers to enter into security-based swap with a special 
        entity shall comply with the requirements of paragraph (5) with 
        respect to such special entity.
            ``(C) Special entity defined.--For purposes of this 
        subsection, the term `special entity' means--
                ``(i) a Federal agency;
                ``(ii) a State, State agency, city, county, 
            municipality, or other political subdivision of a State or;
                ``(iii) any employee benefit plan, as defined in 
            section 3 of the Employee Retirement Income Security Act of 
            1974 (29 U.S.C. 1002);
                ``(iv) any governmental plan, as defined in section 3 
            of the Employee Retirement Income Security Act of 1974 (29 
            U.S.C. 1002); or
                ``(v) any endowment, including an endowment that is an 
            organization described in section 501(c)(3) of the Internal 
            Revenue Code of 1986.
        ``(3) Business conduct requirements.--Business conduct 
    requirements adopted by the Commission shall--
            ``(A) establish a duty for a security-based swap dealer or 
        major security-based swap participant to verify that any 
        counterparty meets the eligibility standards for an eligible 
        contract participant;
            ``(B) require disclosure by the security-based swap dealer 
        or major security-based swap participant to any counterparty to 
        the transaction (other than a security-based swap dealer, major 
        security-based swap participant, security-based swap dealer, or 
        major security-based swap participant) of--
                ``(i) information about the material risks and 
            characteristics of the security-based swap;
                ``(ii) any material incentives or conflicts of interest 
            that the security-based swap dealer or major security-based 
            swap participant may have in connection with the security-
            based swap; and
                ``(iii)(I) for cleared security-based swaps, upon the 
            request of the counterparty, receipt of the daily mark of 
            the transaction from the appropriate derivatives clearing 
            organization; and
                ``(II) for uncleared security-based swaps, receipt of 
            the daily mark of the transaction from the security-based 
            swap dealer or the major security-based swap participant;
            ``(C) establish a duty for a security-based swap dealer or 
        major security-based swap participant to communicate in a fair 
        and balanced manner based on principles of fair dealing and 
        good faith; and
            ``(D) establish such other standards and requirements as 
        the Commission may determine are appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this Act.
        ``(4) Special requirements for security-based swap dealers 
    acting as advisors.--
            ``(A) In general.--It shall be unlawful for a security-
        based swap dealer or major security-based swap participant--
                ``(i) to employ any device, scheme, or artifice to 
            defraud any special entity or prospective customer who is a 
            special entity;
                ``(ii) to engage in any transaction, practice, or 
            course of business that operates as a fraud or deceit on 
            any special entity or prospective customer who is a special 
            entity; or
                ``(iii) to engage in any act, practice, or course of 
            business that is fraudulent, deceptive, or manipulative.
            ``(B) Duty.--Any security-based swap dealer that acts as an 
        advisor to a special entity shall have a duty to act in the 
        best interests of the special entity.
            ``(C) Reasonable efforts.--Any security-based swap dealer 
        that acts as an advisor to a special entity shall make 
        reasonable efforts to obtain such information as is necessary 
        to make a reasonable determination that any security-based swap 
        recommended by the security-based swap dealer is in the best 
        interests of the special entity, including information relating 
        to--
                ``(i) the financial status of the special entity;
                ``(ii) the tax status of the special entity;
                ``(iii) the investment or financing objectives of the 
            special entity; and
                ``(iv) any other information that the Commission may 
            prescribe by rule or regulation.
        ``(5) Special requirements for security-based swap dealers as 
    counterparties to special entities.--
            ``(A) In general.--Any security-based swap dealer or major 
        security-based swap participant that offers to or enters into a 
        security-based swap with a special entity shall--
                ``(i) comply with any duty established by the 
            Commission for a security-based swap dealer or major 
            security-based swap participant, with respect to a 
            counterparty that is an eligible contract participant 
            within the meaning of subclause (I) or (II) of clause (vii) 
            of section 1a(18) of the Commodity Exchange Act, that 
            requires the security-based swap dealer or major security-
            based swap participant to have a reasonable basis to 
            believe that the counterparty that is a special entity has 
            an independent representative that--

                    ``(I) has sufficient knowledge to evaluate the 
                transaction and risks;
                    ``(II) is not subject to a statutory 
                disqualification;
                    ``(III) is independent of the security-based swap 
                dealer or major security-based swap participant;
                    ``(IV) undertakes a duty to act in the best 
                interests of the counterparty it represents;
                    ``(V) makes appropriate disclosures;
                    ``(VI) will provide written representations to the 
                special entity regarding fair pricing and the 
                appropriateness of the transaction; and
                    ``(VII) in the case of employee benefit plans 
                subject to the Employee Retirement Income Security act 
                of 1974, is a fiduciary as defined in section 3 of that 
                Act (29 U.S.C. 1002); and

                ``(ii) before the initiation of the transaction, 
            disclose to the special entity in writing the capacity in 
            which the security-based swap dealer is acting.
            ``(B) Commission authority.--The Commission may establish 
        such other standards and requirements under this paragraph as 
        the Commission may determine are appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this Act.
        ``(6) Rules.--The Commission shall prescribe rules under this 
    subsection governing business conduct standards for security-based 
    swap dealers and major security-based swap participants.
        ``(7) Applicability.--This subsection shall not apply with 
    respect to a transaction that is--
            ``(A) initiated by a special entity on an exchange or 
        security-based swaps execution facility; and
            ``(B) the security-based swap dealer or major security-
        based swap participant does not know the identity of the 
        counterparty to the transaction.''
    ``(i) Documentation Standards.--
        ``(1) In general.--Each registered security-based swap dealer 
    and major security-based swap participant shall conform with such 
    standards as may be prescribed by the Commission, by rule or 
    regulation, that relate to timely and accurate confirmation, 
    processing, netting, documentation, and valuation of all security-
    based swaps.
        ``(2) Rules.--The Commission shall adopt rules governing 
    documentation standards for security-based swap dealers and major 
    security-based swap participants.
    ``(j) Duties.--Each registered security-based swap dealer and major 
security-based swap participant shall, at all times, comply with the 
following requirements:
        ``(1) Monitoring of trading.--The security-based swap dealer or 
    major security-based swap participant shall monitor its trading in 
    security-based swaps to prevent violations of applicable position 
    limits.
        ``(2) Risk management procedures.--The security-based swap 
    dealer or major security-based swap participant shall establish 
    robust and professional risk management systems adequate for 
    managing the day-to-day business of the security-based swap dealer 
    or major security-based swap participant.
        ``(3) Disclosure of general information.--The security-based 
    swap dealer or major security-based swap participant shall disclose 
    to the Commission and to the prudential regulator for the security-
    based swap dealer or major security-based swap participant, as 
    applicable, information concerning--
            ``(A) terms and conditions of its security-based swaps;
            ``(B) security-based swap trading operations, mechanisms, 
        and practices;
            ``(C) financial integrity protections relating to security-
        based swaps; and
            ``(D) other information relevant to its trading in 
        security-based swaps.
        ``(4) Ability to obtain information.--The security-based swap 
    dealer or major security-based swap participant shall--
            ``(A) establish and enforce internal systems and procedures 
        to obtain any necessary information to perform any of the 
        functions described in this section; and
            ``(B) provide the information to the Commission and to the 
        prudential regulator for the security-based swap dealer or 
        major security-based swap participant, as applicable, on 
        request.
        ``(5) Conflicts of interest.--The security-based swap dealer 
    and major security-based swap participant shall implement conflict-
    of-interest systems and procedures that--
            ``(A) establish structural and institutional safeguards to 
        ensure that the activities of any person within the firm 
        relating to research or analysis of the price or market for any 
        security-based swap or acting in a role of providing clearing 
        activities or making determinations as to accepting clearing 
        customers are separated by appropriate informational partitions 
        within the firm from the review, pressure, or oversight of 
        persons whose involvement in pricing, trading, or clearing 
        activities might potentially bias their judgment or supervision 
        and contravene the core principles of open access and the 
        business conduct standards described in this title; and
            ``(B) address such other issues as the Commission 
        determines to be appropriate.
        ``(6) Antitrust considerations.--Unless necessary or 
    appropriate to achieve the purposes of this title, the security-
    based swap dealer or major security-based swap participant shall 
    not--
            ``(A) adopt any process or take any action that results in 
        any unreasonable restraint of trade; or
            ``(B) impose any material anticompetitive burden on trading 
        or clearing.
        ``(7) Rules.--The Commission shall prescribe rules under this 
    subsection governing duties of security-based swap dealers and 
    major security-based swap participants.
    ``(k) Designation of Chief Compliance Officer.--
        ``(1) In general.--Each security-based swap dealer and major 
    security-based swap participant shall designate an individual to 
    serve as a chief compliance officer.
        ``(2) Duties.--The chief compliance officer shall--
            ``(A) report directly to the board or to the senior officer 
        of the security-based swap dealer or major security-based swap 
        participant;
            ``(B) review the compliance of the security-based swap 
        dealer or major security-based swap participant with respect to 
        the security-based swap dealer and major security-based swap 
        participant requirements described in this section;
            ``(C) in consultation with the board of directors, a body 
        performing a function similar to the board, or the senior 
        officer of the organization, resolve any conflicts of interest 
        that may arise;
            ``(D) be responsible for administering each policy and 
        procedure that is required to be established pursuant to this 
        section;
            ``(E) ensure compliance with this title (including 
        regulations) relating to security-based swaps, including each 
        rule prescribed by the Commission under this section;
            ``(F) establish procedures for the remediation of 
        noncompliance issues identified by the chief compliance officer 
        through any--
                ``(i) compliance office review;
                ``(ii) look-back;
                ``(iii) internal or external audit finding;
                ``(iv) self-reported error; or
                ``(v) validated complaint; and
            ``(G) establish and follow appropriate procedures for the 
        handling, management response, remediation, retesting, and 
        closing of noncompliance issues.
        ``(3) Annual reports.--
            ``(A) In general.--In accordance with rules prescribed by 
        the Commission, the chief compliance officer shall annually 
        prepare and sign a report that contains a description of--
                ``(i) the compliance of the security-based swap dealer 
            or major swap participant with respect to this title 
            (including regulations); and
                ``(ii) each policy and procedure of the security-based 
            swap dealer or major security-based swap participant of the 
            chief compliance officer (including the code of ethics and 
            conflict of interest policies).
            ``(B) Requirements.--A compliance report under subparagraph 
        (A) shall--
                ``(i) accompany each appropriate financial report of 
            the security-based swap dealer or major security-based swap 
            participant that is required to be furnished to the 
            Commission pursuant to this section; and
                ``(ii) include a certification that, under penalty of 
            law, the compliance report is accurate and complete.
    ``(l) Enforcement and Administrative Proceeding Authority.--
        ``(1) Primary enforcement authority.--
            ``(A) Securities and exchange commission.--Except as 
        provided in subparagraph (B), (C), or (D), the Commission shall 
        have primary authority to enforce subtitle B, and the 
        amendments made by subtitle B of the Wall Street Transparency 
        and Accountability Act of 2010, with respect to any person.
            ``(B) Prudential regulators.--The prudential regulators 
        shall have exclusive authority to enforce the provisions of 
        subsection (e) and other prudential requirements of this title 
        (including risk management standards), with respect to 
        security-based swap dealers or major security-based swap 
        participants for which they are the prudential regulator.
            ``(C) Referral.--
                ``(i) Violations of nonprudential requirements.--If the 
            appropriate Federal banking agency for security-based swap 
            dealers or major security-based swap participants that are 
            depository institutions has cause to believe that such 
            security-based swap dealer or major security-based swap 
            participant may have engaged in conduct that constitutes a 
            violation of the nonprudential requirements of this section 
            or rules adopted by the Commission thereunder, the agency 
            may recommend in writing to the Commission that the 
            Commission initiate an enforcement proceeding as authorized 
            under this title. The recommendation shall be accompanied 
            by a written explanation of the concerns giving rise to the 
            recommendation.
                ``(ii) Violations of prudential requirements.--If the 
            Commission has cause to believe that a securities-based 
            swap dealer or major securities-based swap participant that 
            has a prudential regulator may have engaged in conduct that 
            constitute a violation of the prudential requirements of 
            subsection (e) or rules adopted thereunder, the Commission 
            may recommend in writing to the prudential regulator that 
            the prudential regulator initiate an enforcement proceeding 
            as authorized under this title. The recommendation shall be 
            accompanied by a written explanation of the concerns giving 
            rise to the recommendation.
            ``(D) Backstop enforcement authority.--
                ``(i) Initiation of enforcement proceeding by 
            prudential regulator.--If the Commission does not initiate 
            an enforcement proceeding before the end of the 90-day 
            period beginning on the date on which the Commission 
            receives a written report under subsection (C)(i), the 
            prudential regulator may initiate an enforcement 
            proceeding.
                ``(ii) Initiation of enforcement proceeding by 
            commission.--If the prudential regulator does not initiate 
            an enforcement proceeding before the end of the 90-day 
            period beginning on the date on which the prudential 
            regulator receives a written report under subsection 
            (C)(ii), the Commission may initiate an enforcement 
            proceeding.
        ``(2) Censure, denial, suspension; notice and hearing.--The 
    Commission, by order, shall censure, place limitations on the 
    activities, functions, or operations of, or revoke the registration 
    of any security-based swap dealer or major security-based swap 
    participant that has registered with the Commission pursuant to 
    subsection (b) if the Commission finds, on the record after notice 
    and opportunity for hearing, that such censure, placing of 
    limitations, or revocation is in the public interest and that such 
    security-based swap dealer or major security-based swap 
    participant, or any person associated with such security-based swap 
    dealer or major security-based swap participant effecting or 
    involved in effecting transactions in security-based swaps on 
    behalf of such security-based swap dealer or major security-based 
    swap participant, whether prior or subsequent to becoming so 
    associated--
            ``(A) has committed or omitted any act, or is subject to an 
        order or finding, enumerated in subparagraph (A), (D), or (E) 
        of paragraph (4) of section 15(b);
            ``(B) has been convicted of any offense specified in 
        subparagraph (B) of such paragraph (4) within 10 years of the 
        commencement of the proceedings under this subsection;
            ``(C) is enjoined from any action, conduct, or practice 
        specified in subparagraph (C) of such paragraph (4);
            ``(D) is subject to an order or a final order specified in 
        subparagraph (F) or (H), respectively, of such paragraph (4); 
        or
            ``(E) has been found by a foreign financial regulatory 
        authority to have committed or omitted any act, or violated any 
        foreign statute or regulation, enumerated in subparagraph (G) 
        of such paragraph (4).
        ``(3) Associated persons.--With respect to any person who is 
    associated, who is seeking to become associated, or, at the time of 
    the alleged misconduct, who was associated or was seeking to become 
    associated with a security-based swap dealer or major security-
    based swap participant for the purpose of effecting or being 
    involved in effecting security-based swaps on behalf of such 
    security-based swap dealer or major security-based swap 
    participant, the Commission, by order, shall censure, place 
    limitations on the activities or functions of such person, or 
    suspend for a period not exceeding 12 months, or bar such person 
    from being associated with a security-based swap dealer or major 
    security-based swap participant, if the Commission finds, on the 
    record after notice and opportunity for a hearing, that such 
    censure, placing of limitations, suspension, or bar is in the 
    public interest and that such person--
            ``(A) has committed or omitted any act, or is subject to an 
        order or finding, enumerated in subparagraph (A), (D), or (E) 
        of paragraph (4) of section 15(b);
            ``(B) has been convicted of any offense specified in 
        subparagraph (B) of such paragraph (4) within 10 years of the 
        commencement of the proceedings under this subsection;
            ``(C) is enjoined from any action, conduct, or practice 
        specified in subparagraph (C) of such paragraph (4);
            ``(D) is subject to an order or a final order specified in 
        subparagraph (F) or (H), respectively, of such paragraph (4); 
        or
            ``(E) has been found by a foreign financial regulatory 
        authority to have committed or omitted any act, or violated any 
        foreign statute or regulation, enumerated in subparagraph (G) 
        of such paragraph (4).
        ``(4) Unlawful conduct.--It shall be unlawful--
            ``(A) for any person as to whom an order under paragraph 
        (3) is in effect, without the consent of the Commission, 
        willfully to become, or to be, associated with a security-based 
        swap dealer or major security-based swap participant in 
        contravention of such order; or
            ``(B) for any security-based swap dealer or major security-
        based swap participant to permit such a person, without the 
        consent of the Commission, to become or remain a person 
        associated with the security-based swap dealer or major 
        security-based swap participant in contravention of such order, 
        if such security-based swap dealer or major security-based swap 
        participant knew, or in the exercise of reasonable care should 
        have known, of such order.''.
    (b) Savings Clause.--Notwithstanding any other provision of this 
title, nothing in this subtitle shall be construed as divesting any 
appropriate Federal banking agency of any authority it may have to 
establish or enforce, with respect to a person for which such agency is 
the appropriate Federal banking agency, prudential or other standards 
pursuant to authority by Federal law other than this title.
    SEC. 765. RULEMAKING ON CONFLICT OF INTEREST.
    (a) In General.--In order to mitigate conflicts of interest, not 
later than 180 days after the date of enactment of the Wall Street 
Transparency and Accountability Act of 2010, the Securities and 
Exchange Commission shall adopt rules which may include numerical 
limits on the control of, or the voting rights with respect to, any 
clearing agency that clears security-based swaps, or on the control of 
any security-based swap execution facility or national securities 
exchange that posts or makes available for trading security-based 
swaps, by a bank holding company (as defined in section 2 of the Bank 
Holding Company Act of 1956 (12 U.S.C. 1841)) with total consolidated 
assets of $50,000,000,000 or more, a nonbank financial company (as 
defined in section 102) supervised by the Board of Governors of the 
Federal Reserve System, affiliate of such a bank holding company or 
nonbank financial company, a security-based swap dealer, major 
security-based swap participant, or person associated with a security-
based swap dealer or major security-based swap participant.
    (b) Purposes.--The Securities and Exchange Commission shall adopt 
rules if the Commission determines, after the review described in 
subsection (a), that such rules are necessary or appropriate to improve 
the governance of, or to mitigate systemic risk, promote competition, 
or mitigate conflicts of interest in connection with a security-based 
swap dealer or major security-based swap participant's conduct of 
business with, a clearing agency, national securities exchange, or 
security-based swap execution facility that clears, posts, or makes 
available for trading security-based swaps and in which such security-
based swap dealer or major security-based swap participant has a 
material debt or equity investment.
    (c) Considerations.--In adopting rules pursuant to this section, 
the Securities and Exchange Commission shall consider any conflicts of 
interest arising from the amount of equity owned by a single investor, 
the ability to vote, cause the vote of, or withhold votes entitled to 
be cast on any matters by the holders of the ownership interest, and 
the governance arrangements of any derivatives clearing organization 
that clears swaps, or swap execution facility or board of trade 
designated as a contract market that posts swaps or makes swaps 
available for trading.
    SEC. 766. REPORTING AND RECORDKEEPING.
    (a) In General.--The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended by inserting after section 13 the following:
    ``SEC. 13A. REPORTING AND RECORDKEEPING FOR CERTAIN SECURITY-BASED 
      SWAPS.
    ``(a) Required Reporting of Security-based Swaps Not Accepted by 
Any Clearing Agency or Derivatives Clearing Organization.--
        ``(1) In general.--Each security-based swap that is not 
    accepted for clearing by any clearing agency or derivatives 
    clearing organization shall be reported to--
            ``(A) a security-based swap data repository described in 
        section 13(n); or
            ``(B) in the case in which there is no security-based swap 
        data repository that would accept the security-based swap, to 
        the Commission pursuant to this section within such time period 
        as the Commission may by rule or regulation prescribe.
        ``(2) Transition rule for preenactment security-based swaps.--
            ``(A) Security-based swaps entered into before the date of 
        enactment of the wall street transparency and accountability 
        act of 2010.--Each security-based swap entered into before the 
        date of enactment of the Wall Street Transparency and 
        Accountability Act of 2010, the terms of which have not expired 
        as of the date of enactment of that Act, shall be reported to a 
        registered security-based swap data repository or the 
        Commission by a date that is not later than--
                ``(i) 30 days after issuance of the interim final rule; 
            or
                ``(ii) such other period as the Commission determines 
            to be appropriate.
            ``(B) Commission rulemaking.--The Commission shall 
        promulgate an interim final rule within 90 days of the date of 
        enactment of this section providing for the reporting of each 
        security-based swap entered into before the date of enactment 
        as referenced in subparagraph (A).
            ``(C) Effective date.--The reporting provisions described 
        in this section shall be effective upon the date of the 
        enactment of this section.
        ``(3) Reporting obligations.--
            ``(A) Security-based swaps in which only 1 counterparty is 
        a security-based swap dealer or major security-based swap 
        participant.--With respect to a security-based swap in which 
        only 1 counterparty is a security-based swap dealer or major 
        security-based swap participant, the security-based swap dealer 
        or major security-based swap participant shall report the 
        security-based swap as required under paragraphs (1) and (2).
            ``(B) Security-based swaps in which 1 counterparty is a 
        security-based swap dealer and the other a major security-based 
        swap participant.--With respect to a security-based swap in 
        which 1 counterparty is a security-based swap dealer and the 
        other a major security-based swap participant, the security-
        based swap dealer shall report the security-based swap as 
        required under paragraphs (1) and (2).
            ``(C) Other security-based swaps.--With respect to any 
        other security-based swap not described in subparagraph (A) or 
        (B), the counterparties to the security-based swap shall select 
        a counterparty to report the security-based swap as required 
        under paragraphs (1) and (2).
    ``(b) Duties of Certain Individuals.--Any individual or entity that 
enters into a security-based swap shall meet each requirement described 
in subsection (c) if the individual or entity did not--
        ``(1) clear the security-based swap in accordance with section 
    3C(a)(1); or
        ``(2) have the data regarding the security-based swap accepted 
    by a security-based swap data repository in accordance with rules 
    (including timeframes) adopted by the Commission under this title.
    ``(c) Requirements.--An individual or entity described in 
subsection (b) shall--
        ``(1) upon written request from the Commission, provide reports 
    regarding the security-based swaps held by the individual or entity 
    to the Commission in such form and in such manner as the Commission 
    may request; and
        ``(2) maintain books and records pertaining to the security-
    based swaps held by the individual or entity in such form, in such 
    manner, and for such period as the Commission may require, which 
    shall be open to inspection by--
            ``(A) any representative of the Commission;
            ``(B) an appropriate prudential regulator;
            ``(C) the Commodity Futures Trading Commission;
            ``(D) the Financial Stability Oversight Council; and
            ``(E) the Department of Justice.
    ``(d) Identical Data.--In prescribing rules under this section, the 
Commission shall require individuals and entities described in 
subsection (b) to submit to the Commission a report that contains data 
that is not less comprehensive than the data required to be collected 
by security-based swap data repositories under this title.''.
    (b) Beneficial Ownership Reporting.--Section 13 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m) is amended--
        (1) in subsection (d)(1), by inserting ``or otherwise becomes 
    or is deemed to become a beneficial owner of any of the foregoing 
    upon the purchase or sale of a security-based swap that the 
    Commission may define by rule, and'' after ``Alaska Native Claims 
    Settlement Act,''; and
        (2) in subsection (g)(1), by inserting ``or otherwise becomes 
    or is deemed to become a beneficial owner of any security of a 
    class described in subsection (d)(1) upon the purchase or sale of a 
    security-based swap that the Commission may define by rule'' after 
    ``subsection (d)(1) of this section''.
    (c) Reports by Institutional Investment Managers.--Section 13(f)(1) 
of the Securities Exchange Act of 1934 (15 U.S.C. 78m(f)(1)) is amended 
by inserting ``or otherwise becomes or is deemed to become a beneficial 
owner of any security of a class described in subsection (d)(1) upon 
the purchase or sale of a security-based swap that the Commission may 
define by rule,'' after ``subsection (d)(1) of this section''.
    (d) Administrative Proceeding Authority.--Section 15(b)(4) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o(b)(4)) is amended--
        (1) in subparagraph (C), by inserting ``security-based swap 
    dealer, major security-based swap participant,'' after ``government 
    securities dealer,''; and
        (2) in subparagraph (F), by striking ``broker or dealer'' and 
    inserting ``broker, dealer, security-based swap dealer, or a major 
    security-based swap participant''.
    (e) Security-based Swap Beneficial Ownership.--Section 13 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78m) is amended by adding at 
the end the following:
    ``(o) Beneficial Ownership.--For purposes of this section and 
section 16, a person shall be deemed to acquire beneficial ownership of 
an equity security based on the purchase or sale of a security-based 
swap, only to the extent that the Commission, by rule, determines after 
consultation with the prudential regulators and the Secretary of the 
Treasury, that the purchase or sale of the security-based swap, or 
class of security-based swap, provides incidents of ownership 
comparable to direct ownership of the equity security, and that it is 
necessary to achieve the purposes of this section that the purchase or 
sale of the security-based swaps, or class of security-based swap, be 
deemed the acquisition of beneficial ownership of the equity 
security.''.
    SEC. 767. STATE GAMING AND BUCKET SHOP LAWS.
    Section 28(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78bb(a)) is amended to read as follows:
    ``(a) Limitation on Judgments.--
        ``(1) In general.--No person permitted to maintain a suit for 
    damages under the provisions of this title shall recover, through 
    satisfaction of judgment in 1 or more actions, a total amount in 
    excess of the actual damages to that person on account of the act 
    complained of. Except as otherwise specifically provided in this 
    title, nothing in this title shall affect the jurisdiction of the 
    securities commission (or any agency or officer performing like 
    functions) of any State over any security or any person insofar as 
    it does not conflict with the provisions of this title or the rules 
    and regulations under this title.
        ``(2) Rule of construction.--Except as provided in subsection 
    (f), the rights and remedies provided by this title shall be in 
    addition to any and all other rights and remedies that may exist at 
    law or in equity.
        ``(3) State bucket shop laws.--No State law which prohibits or 
    regulates the making or promoting of wagering or gaming contracts, 
    or the operation of `bucket shops' or other similar or related 
    activities, shall invalidate--
            ``(A) any put, call, straddle, option, privilege, or other 
        security subject to this title (except any security that has a 
        pari-mutuel payout or otherwise is determined by the 
        Commission, acting by rule, regulation, or order, to be 
        appropriately subject to such laws), or apply to any activity 
        which is incidental or related to the offer, purchase, sale, 
        exercise, settlement, or closeout of any such security;
            ``(B) any security-based swap between eligible contract 
        participants; or
            ``(C) any security-based swap effected on a national 
        securities exchange registered pursuant to section 6(b).
        ``(4) Other state provisions.--No provision of State law 
    regarding the offer, sale, or distribution of securities shall 
    apply to any transaction in a security-based swap or a security 
    futures product, except that this paragraph may not be construed as 
    limiting any State antifraud law of general applicability. A 
    security-based swap may not be regulated as an insurance contract 
    under any provision of State law.''.
    SEC. 768. AMENDMENTS TO THE SECURITIES ACT OF 1933; TREATMENT OF 
      SECURITY-BASED SWAPS.
    (a) Definitions.--Section 2(a) of the Securities Act of 1933 (15 
U.S.C. 77b(a)) is amended--
        (1) in paragraph (1), by inserting ``security-based swap,'' 
    after ``security future,'';
        (2) in paragraph (3), by adding at the end the following: ``Any 
    offer or sale of a security-based swap by or on behalf of the 
    issuer of the securities upon which such security-based swap is 
    based or is referenced, an affiliate of the issuer, or an 
    underwriter, shall constitute a contract for sale of, sale of, 
    offer for sale, or offer to sell such securities.''; and
        (3) by adding at the end the following:
        ``(17) The terms `swap' and `security-based swap' have the same 
    meanings as in section 1a of the Commodity Exchange Act (7 U.S.C. 
    1a).
        ``(18) The terms `purchase' or `sale' of a security-based swap 
    shall be deemed to mean the execution, termination (prior to its 
    scheduled maturity date), assignment, exchange, or similar transfer 
    or conveyance of, or extinguishing of rights or obligations under, 
    a security-based swap, as the context may require.''.
    (b) Registration of Security-based Swaps.--Section 5 of the 
Securities Act of 1933 (15 U.S.C. 77e) is amended by adding at the end 
the following:
    ``(d) Notwithstanding the provisions of section 3 or 4, unless a 
registration statement meeting the requirements of section 10(a) is in 
effect as to a security-based swap, it shall be unlawful for any 
person, directly or indirectly, to make use of any means or instruments 
of transportation or communication in interstate commerce or of the 
mails to offer to sell, offer to buy or purchase or sell a security-
based swap to any person who is not an eligible contract participant as 
defined in section 1a(18) of the Commodity Exchange Act (7 U.S.C. 
1a(18)).''.
    SEC. 769. DEFINITIONS UNDER THE INVESTMENT COMPANY ACT OF 1940.
    Section 2(a) of the Investment Company Act of 1940 (15 U.S.C. 80a-
2) is amended by adding at the end the following:
        ``(54) The terms `commodity pool', `commodity pool operator', 
    `commodity trading advisor', `major swap participant', `swap', 
    `swap dealer', and `swap execution facility' have the same meanings 
    as in section 1a of the Commodity Exchange Act (7 U.S.C. 1a).''.
    SEC. 770. DEFINITIONS UNDER THE INVESTMENT ADVISERS ACT OF 1940.
    Section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-2) is amended by adding at the end the following:
        ``(29) The terms `commodity pool', `commodity pool operator', 
    `commodity trading advisor', `major swap participant', `swap', 
    `swap dealer', and `swap execution facility' have the same meanings 
    as in section 1a of the Commodity Exchange Act (7 U.S.C. 1a).''.
    SEC. 771. OTHER AUTHORITY.
    Unless otherwise provided by its terms, this subtitle does not 
divest any appropriate Federal banking agency, the Securities and 
Exchange Commission, the Commodity Futures Trading Commission, or any 
other Federal or State agency, of any authority derived from any other 
provision of applicable law.
    SEC. 772. JURISDICTION.
    (a) In General.--Section 36 of the Securities Exchange Act of 1934 
(15 U.S.C. 78mm) is amended by adding at the end the following:
    ``(c) Derivatives.--Unless the Commission is expressly authorized 
by any provision described in this subsection to grant exemptions, the 
Commission shall not grant exemptions, with respect to amendments made 
by subtitle B of the Wall Street Transparency and Accountability Act of 
2010, with respect to paragraphs (65), (66), (68), (69), (70), (71), 
(72), (73), (74), (75), (76), and (79) of section 3(a), and sections 
10B(a), 10B(b), 10B(c), 13A, 15F, 17A(g), 17A(h), 17A(i), 17A(j), 
17A(k), and 17A(l); provided that the Commission shall have exemptive 
authority under this title with respect to security-based swaps as to 
the same matters that the Commodity Futures Trading Commission has 
under the Wall Street Transparency and Accountability Act of 2010 with 
respect to swaps, including under section 4(c) of the Commodity 
Exchange Act.''.
    (b) Rule of Construction.--Section 30 of the Securities Exchange 
Act of 1934 (15 U.S.C. 78dd) is amended by adding at the end the 
following:
    ``(c) Rule of Construction.--No provision of this title that was 
added by the Wall Street Transparency and Accountability Act of 2010, 
or any rule or regulation thereunder, shall apply to any person insofar 
as such person transacts a business in security-based swaps without the 
jurisdiction of the United States, unless such person transacts such 
business in contravention of such rules and regulations as the 
Commission may prescribe as necessary or appropriate to prevent the 
evasion of any provision of this title that was added by the Wall 
Street Transparency and Accountability Act of 2010. This subsection 
shall not be construed to limit the jurisdiction of the Commission 
under any provision of this title, as in effect prior to the date of 
enactment of the Wall Street Transparency and Accountability Act of 
2010.''.
    SEC. 773. CIVIL PENALTIES.
    Section 21B of the Securities Exchange Act of 1934 (15 U.S.C. 78p-
2) is amended by adding at the end the following:
    ``(f) Security-based Swaps.--
        ``(1) Clearing agency.--Any clearing agency that knowingly or 
    recklessly evades or participates in or facilitates an evasion of 
    the requirements of section 3C shall be liable for a civil money 
    penalty in twice the amount otherwise available for a violation of 
    section 3C.
        ``(2) Security-based swap dealer or major security-based swap 
    participant.--Any security-based swap dealer or major security-
    based swap participant that knowingly or recklessly evades or 
    participates in or facilitates an evasion of the requirements of 
    section 3C shall be liable for a civil money penalty in twice the 
    amount otherwise available for a violation of section 3C.''.
    SEC. 774. EFFECTIVE DATE.
    Unless otherwise provided, the provisions of this subtitle shall 
take effect on the later of 360 days after the date of the enactment of 
this subtitle or, to the extent a provision of this subtitle requires a 
rulemaking, not less than 60 days after publication of the final rule 
or regulation implementing such provision of this subtitle.

       TITLE VIII--PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION

    SEC. 801. SHORT TITLE.
    This title may be cited as the ``Payment, Clearing, and Settlement 
Supervision Act of 2010''.
    SEC. 802. FINDINGS AND PURPOSES.
    (a) Findings.--Congress finds the following:
        (1) The proper functioning of the financial markets is 
    dependent upon safe and efficient arrangements for the clearing and 
    settlement of payment, securities, and other financial 
    transactions.
        (2) Financial market utilities that conduct or support 
    multilateral payment, clearing, or settlement activities may reduce 
    risks for their participants and the broader financial system, but 
    such utilities may also concentrate and create new risks and thus 
    must be well designed and operated in a safe and sound manner.
        (3) Payment, clearing, and settlement activities conducted by 
    financial institutions also present important risks to the 
    participating financial institutions and to the financial system.
        (4) Enhancements to the regulation and supervision of 
    systemically important financial market utilities and the conduct 
    of systemically important payment, clearing, and settlement 
    activities by financial institutions are necessary--
            (A) to provide consistency;
            (B) to promote robust risk management and safety and 
        soundness;
            (C) to reduce systemic risks; and
            (D) to support the stability of the broader financial 
        system.
    (b) Purpose.--The purpose of this title is to mitigate systemic 
risk in the financial system and promote financial stability by--
        (1) authorizing the Board of Governors to promote uniform 
    standards for the--
            (A) management of risks by systemically important financial 
        market utilities; and
            (B) conduct of systemically important payment, clearing, 
        and settlement activities by financial institutions;
        (2) providing the Board of Governors an enhanced role in the 
    supervision of risk management standards for systemically important 
    financial market utilities;
        (3) strengthening the liquidity of systemically important 
    financial market utilities; and
        (4) providing the Board of Governors an enhanced role in the 
    supervision of risk management standards for systemically important 
    payment, clearing, and settlement activities by financial 
    institutions.
    SEC. 803. DEFINITIONS.
    In this title, the following definitions shall apply:
        (1) Appropriate financial regulator.--The term ``appropriate 
    financial regulator'' means--
            (A) the primary financial regulatory agency, as defined in 
        section 2 of this Act;
            (B) the National Credit Union Administration, with respect 
        to any insured credit union under the Federal Credit Union Act 
        (12 U.S.C. 1751 et seq.); and
            (C) the Board of Governors, with respect to organizations 
        operating under section 25A of the Federal Reserve Act (12 
        U.S.C. 611), and any other financial institution engaged in a 
        designated activity.
        (2) Designated activity.--The term ``designated activity'' 
    means a payment, clearing, or settlement activity that the Council 
    has designated as systemically important under section 804.
        (3) Designated clearing entity.--The term ``designated clearing 
    entity'' means a designated financial market utility that is a 
    derivatives clearing organization registered under section 5b of 
    the Commodity Exchange Act (7 U.S.C. 7a-1) or a clearing agency 
    registered with the Securities and Exchange Commission under 
    section 17A of the Securities Exchange Act of 1934 (15 U.S.C. 78q-
    1).
        (4) Designated financial market utility.--The term ``designated 
    financial market utility'' means a financial market utility that 
    the Council has designated as systemically important under section 
    804.
        (5) Financial institution.--
            (A) In general.--The term ``financial institution'' means--
                (i) a depository institution, as defined in section 3 
            of the Federal Deposit Insurance Act (12 U.S.C. 1813);
                (ii) a branch or agency of a foreign bank, as defined 
            in section 1(b) of the International Banking Act of 1978 
            (12 U.S.C. 3101);
                (iii) an organization operating under section 25 or 25A 
            of the Federal Reserve Act (12 U.S.C. 601-604a and 611 
            through 631);
                (iv) a credit union, as defined in section 101 of the 
            Federal Credit Union Act (12 U.S.C. 1752);
                (v) a broker or dealer, as defined in section 3 of the 
            Securities Exchange Act of 1934 (15 U.S.C. 78c);
                (vi) an investment company, as defined in section 3 of 
            the Investment Company Act of 1940 (15 U.S.C. 80a-3);
                (vii) an insurance company, as defined in section 2 of 
            the Investment Company Act of 1940 (15 U.S.C. 80a-2);
                (viii) an investment adviser, as defined in section 202 
            of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2);
                (ix) a futures commission merchant, commodity trading 
            advisor, or commodity pool operator, as defined in section 
            1a of the Commodity Exchange Act (7 U.S.C. 1a); and
                (x) any company engaged in activities that are 
            financial in nature or incidental to a financial activity, 
            as described in section 4 of the Bank Holding Company Act 
            of 1956 (12 U.S.C. 1843(k)).
            (B) Exclusions.--The term ``financial institution'' does 
        not include designated contract markets, registered futures 
        associations, swap data repositories, and swap execution 
        facilities registered under the Commodity Exchange Act (7 
        U.S.C. 1 et seq.), or national securities exchanges, national 
        securities associations, alternative trading systems, 
        securities information processors solely with respect to the 
        activities of the entity as a securities information processor, 
        security-based swap data repositories, and swap execution 
        facilities registered under the Securities Exchange Act of 1934 
        (15 U.S.C. 78a et seq.), or designated clearing entities, 
        provided that the exclusions in this subparagraph apply only 
        with respect to the activities that require the entity to be so 
        registered.
        (6) Financial market utility.--
            (A) Inclusion.--The term ``financial market utility'' means 
        any person that manages or operates a multilateral system for 
        the purpose of transferring, clearing, or settling payments, 
        securities, or other financial transactions among financial 
        institutions or between financial institutions and the person.
            (B) Exclusions.--The term ``financial market utility'' does 
        not include--
                (i) designated contract markets, registered futures 
            associations, swap data repositories, and swap execution 
            facilities registered under the Commodity Exchange Act (7 
            U.S.C. 1 et seq.), or national securities exchanges, 
            national securities associations, alternative trading 
            systems, security-based swap data repositories, and swap 
            execution facilities registered under the Securities 
            Exchange Act of 1934 (15 U.S.C. 78a et seq.), solely by 
            reason of their providing facilities for comparison of data 
            respecting the terms of settlement of securities or futures 
            transactions effected on such exchange or by means of any 
            electronic system operated or controlled by such entities, 
            provided that the exclusions in this clause apply only with 
            respect to the activities that require the entity to be so 
            registered; and
                (ii) any broker, dealer, transfer agent, or investment 
            company, or any futures commission merchant, introducing 
            broker, commodity trading advisor, or commodity pool 
            operator, solely by reason of functions performed by such 
            institution as part of brokerage, dealing, transfer agency, 
            or investment company activities, or solely by reason of 
            acting on behalf of a financial market utility or a 
            participant therein in connection with the furnishing by 
            the financial market utility of services to its 
            participants or the use of services of the financial market 
            utility by its participants, provided that services 
            performed by such institution do not constitute critical 
            risk management or processing functions of the financial 
            market utility.
        (7) Payment, clearing, or settlement activity.--
            (A) In general.--The term ``payment, clearing, or 
        settlement activity'' means an activity carried out by 1 or 
        more financial institutions to facilitate the completion of 
        financial transactions, but shall not include any offer or sale 
        of a security under the Securities Act of 1933 (15 U.S.C. 77a 
        et seq.), or any quotation, order entry, negotiation, or other 
        pre-trade activity or execution activity.
            (B) Financial transaction.--For the purposes of 
        subparagraph (A), the term ``financial transaction'' includes--
                (i) funds transfers;
                (ii) securities contracts;
                (iii) contracts of sale of a commodity for future 
            delivery;
                (iv) forward contracts;
                (v) repurchase agreements;
                (vi) swaps;
                (vii) security-based swaps;
                (viii) swap agreements;
                (ix) security-based swap agreements;
                (x) foreign exchange contracts;
                (xi) financial derivatives contracts; and
                (xii) any similar transaction that the Council 
            determines to be a financial transaction for purposes of 
            this title.
            (C) Included activities.--When conducted with respect to a 
        financial transaction, payment, clearing, and settlement 
        activities may include--
                (i) the calculation and communication of unsettled 
            financial transactions between counterparties;
                (ii) the netting of transactions;
                (iii) provision and maintenance of trade, contract, or 
            instrument information;
                (iv) the management of risks and activities associated 
            with continuing financial transactions;
                (v) transmittal and storage of payment instructions;
                (vi) the movement of funds;
                (vii) the final settlement of financial transactions; 
            and
                (viii) other similar functions that the Council may 
            determine.
            (D) Exclusion.--Payment, clearing, and settlement 
        activities shall not include public reporting of swap 
        transaction data under section 727 or 763(i) of the Wall Street 
        Transparency and Accountability Act of 2010.
        (8) Supervisory agency.--
            (A) In general.--The term ``Supervisory Agency'' means the 
        Federal agency that has primary jurisdiction over a designated 
        financial market utility under Federal banking, securities, or 
        commodity futures laws, as follows:
                (i) The Securities and Exchange Commission, with 
            respect to a designated financial market utility that is a 
            clearing agency registered with the Securities and Exchange 
            Commission.
                (ii) The Commodity Futures Trading Commission, with 
            respect to a designated financial market utility that is a 
            derivatives clearing organization registered with the 
            Commodity Futures Trading Commission.
                (iii) The appropriate Federal banking agency, with 
            respect to a designated financial market utility that is an 
            institution described in section 3(q) of the Federal 
            Deposit Insurance Act.
                (iv) The Board of Governors, with respect to a 
            designated financial market utility that is otherwise not 
            subject to the jurisdiction of any agency listed in clauses 
            (i), (ii), and (iii).
            (B) Multiple agency jurisdiction.--If a designated 
        financial market utility is subject to the jurisdictional 
        supervision of more than 1 agency listed in subparagraph (A), 
        then such agencies should agree on 1 agency to act as the 
        Supervisory Agency, and if such agencies cannot agree on which 
        agency has primary jurisdiction, the Council shall decide which 
        agency is the Supervisory Agency for purposes of this title.
        (9) Systemically important and systemic importance.--The terms 
    ``systemically important'' and ``systemic importance'' mean a 
    situation where the failure of or a disruption to the functioning 
    of a financial market utility or the conduct of a payment, 
    clearing, or settlement activity could create, or increase, the 
    risk of significant liquidity or credit problems spreading among 
    financial institutions or markets and thereby threaten the 
    stability of the financial system of the United States.
    SEC. 804. DESIGNATION OF SYSTEMIC IMPORTANCE.
    (a) Designation.--
        (1) Financial stability oversight council.--The Council, on a 
    nondelegable basis and by a vote of not fewer than \2/3\ of members 
    then serving, including an affirmative vote by the Chairperson of 
    the Council, shall designate those financial market utilities or 
    payment, clearing, or settlement activities that the Council 
    determines are, or are likely to become, systemically important.
        (2) Considerations.--In determining whether a financial market 
    utility or payment, clearing, or settlement activity is, or is 
    likely to become, systemically important, the Council shall take 
    into consideration the following:
            (A) The aggregate monetary value of transactions processed 
        by the financial market utility or carried out through the 
        payment, clearing, or settlement activity.
            (B) The aggregate exposure of the financial market utility 
        or a financial institution engaged in payment, clearing, or 
        settlement activities to its counterparties.
            (C) The relationship, interdependencies, or other 
        interactions of the financial market utility or payment, 
        clearing, or settlement activity with other financial market 
        utilities or payment, clearing, or settlement activities.
            (D) The effect that the failure of or a disruption to the 
        financial market utility or payment, clearing, or settlement 
        activity would have on critical markets, financial 
        institutions, or the broader financial system.
            (E) Any other factors that the Council deems appropriate.
    (b) Rescission of Designation.--
        (1) In general.--The Council, on a nondelegable basis and by a 
    vote of not fewer than \2/3\ of members then serving, including an 
    affirmative vote by the Chairperson of the Council, shall rescind a 
    designation of systemic importance for a designated financial 
    market utility or designated activity if the Council determines 
    that the utility or activity no longer meets the standards for 
    systemic importance.
        (2) Effect of rescission.--Upon rescission, the financial 
    market utility or financial institutions conducting the activity 
    will no longer be subject to the provisions of this title or any 
    rules or orders prescribed under this title.
    (c) Consultation and Notice and Opportunity for Hearing.--
        (1) Consultation.--Before making any determination under 
    subsection (a) or (b), the Council shall consult with the relevant 
    Supervisory Agency and the Board of Governors.
        (2) Advance notice and opportunity for hearing.--
            (A) In general.--Before making any determination under 
        subsection (a) or (b), the Council shall provide the financial 
        market utility or, in the case of a payment, clearing, or 
        settlement activity, financial institutions with advance notice 
        of the proposed determination of the Council.
            (B) Notice in federal register.--The Council shall provide 
        such advance notice to financial institutions by publishing a 
        notice in the Federal Register.
            (C) Requests for hearing.--Within 30 days from the date of 
        any notice of the proposed determination of the Council, the 
        financial market utility or, in the case of a payment, 
        clearing, or settlement activity, a financial institution 
        engaged in the designated activity may request, in writing, an 
        opportunity for a written or oral hearing before the Council to 
        demonstrate that the proposed designation or rescission of 
        designation is not supported by substantial evidence.
            (D) Written submissions.--Upon receipt of a timely request, 
        the Council shall fix a time, not more than 30 days after 
        receipt of the request, unless extended at the request of the 
        financial market utility or financial institution, and place at 
        which the financial market utility or financial institution may 
        appear, personally or through counsel, to submit written 
        materials, or, at the sole discretion of the Council, oral 
        testimony or oral argument.
        (3) Emergency exception.--
            (A) Waiver or modification by vote of the council.--The 
        Council may waive or modify the requirements of paragraph (2) 
        if the Council determines, by an affirmative vote of not fewer 
        than \2/3\ of members then serving, including an affirmative 
        vote by the Chairperson of the Council, that the waiver or 
        modification is necessary to prevent or mitigate an immediate 
        threat to the financial system posed by the financial market 
        utility or the payment, clearing, or settlement activity.
            (B) Notice of waiver or modification.--The Council shall 
        provide notice of the waiver or modification to the financial 
        market utility concerned or, in the case of a payment, 
        clearing, or settlement activity, to financial institutions, as 
        soon as practicable, which shall be no later than 24 hours 
        after the waiver or modification in the case of a financial 
        market utility and 3 business days in the case of financial 
        institutions. The Council shall provide the notice to financial 
        institutions by posting a notice on the website of the Council 
        and by publishing a notice in the Federal Register.
    (d) Notification of Final Determination.--
        (1) After hearing.--Within 60 days of any hearing under 
    subsection (c)(2), the Council shall notify the financial market 
    utility or financial institutions of the final determination of the 
    Council in writing, which shall include findings of fact upon which 
    the determination of the Council is based.
        (2) When no hearing requested.--If the Council does not receive 
    a timely request for a hearing under subsection (c)(2), the Council 
    shall notify the financial market utility or financial institutions 
    of the final determination of the Council in writing not later than 
    30 days after the expiration of the date by which a financial 
    market utility or a financial institution could have requested a 
    hearing. All notices to financial institutions under this 
    subsection shall be published in the Federal Register.
    (e) Extension of Time Periods.--The Council may extend the time 
periods established in subsections (c) and (d) as the Council 
determines to be necessary or appropriate.
    SEC. 805. STANDARDS FOR SYSTEMICALLY IMPORTANT FINANCIAL MARKET 
      UTILITIES AND PAYMENT, CLEARING, OR SETTLEMENT ACTIVITIES.
    (a) Authority to Prescribe Standards.--
        (1) Board of governors.--Except as provided in paragraph (2), 
    the Board of Governors, by rule or order, and in consultation with 
    the Council and the Supervisory Agencies, shall prescribe risk 
    management standards, taking into consideration relevant 
    international standards and existing prudential requirements, 
    governing--
            (A) the operations related to the payment, clearing, and 
        settlement activities of designated financial market utilities; 
        and
            (B) the conduct of designated activities by financial 
        institutions.
        (2) Special procedures for designated clearing entities and 
    designated activities of certain financial institutions.--
            (A) CFTC and commission.--The Commodity Futures Trading 
        Commission and the Commission may each prescribe regulations, 
        in consultation with the Council and the Board of Governors, 
        containing risk management standards, taking into consideration 
        relevant international standards and existing prudential 
        requirements, for those designated clearing entities and 
        financial institutions engaged in designated activities for 
        which each is the Supervisory Agency or the appropriate 
        financial regulator, governing--
                (i) the operations related to payment, clearing, and 
            settlement activities of such designated clearing entities; 
            and
                (ii) the conduct of designated activities by such 
            financial institutions.
            (B) Review and determination.--The Board of Governors may 
        determine that existing prudential requirements of the 
        Commodity Futures Trading Commission, the Commission, or both 
        (including requirements prescribed pursuant to subparagraph 
        (A)) with respect to designated clearing entities and financial 
        institutions engaged in designated activities for which the 
        Commission or the Commodity Futures Trading Commission is the 
        Supervisory Agency or the appropriate financial regulator are 
        insufficient to prevent or mitigate significant liquidity, 
        credit, operational, or other risks to the financial markets or 
        to the financial stability of the United States.
            (C) Written determination.--Any determination by the Board 
        of Governors under subparagraph (B) shall be provided in 
        writing to the Commodity Futures Trading Commission or the 
        Commission, as applicable, and the Council, and shall explain 
        why existing prudential requirements, considered as a whole, 
        are insufficient to ensure that the operations and activities 
        of the designated clearing entities or the activities of 
        financial institutions described in subparagraph (B) will not 
        pose significant liquidity, credit, operational, or other risks 
        to the financial markets or to the financial stability of the 
        United States. The Board of Governors' determination shall 
        contain a detailed analysis supporting its findings and 
        identify the specific prudential requirements that are 
        insufficient.
            (D) CFTC and commission response.--The Commodity Futures 
        Trading Commission or the Commission, as applicable, shall 
        within 60 days either object to the Board of Governors' 
        determination with a detailed analysis as to why existing 
        prudential requirements are sufficient, or submit an 
        explanation to the Council and the Board of Governors 
        describing the actions to be taken in response to the Board of 
        Governors' determination.
            (E) Authorization.--Upon an affirmative vote by not fewer 
        than 2/3 of members then serving on the Council, the Council 
        shall either find that the response submitted under 
        subparagraph (D) is sufficient, or require the Commodity 
        Futures Trading Commission, or the Commission, as applicable, 
        to prescribe such risk management standards as the Council 
        determines is necessary to address the specific prudential 
        requirements that are determined to be insufficient.''
    (b) Objectives and Principles.--The objectives and principles for 
the risk management standards prescribed under subsection (a) shall be 
to--
        (1) promote robust risk management;
        (2) promote safety and soundness;
        (3) reduce systemic risks; and
        (4) support the stability of the broader financial system.
    (c) Scope.--The standards prescribed under subsection (a) may 
address areas such as--
        (1) risk management policies and procedures;
        (2) margin and collateral requirements;
        (3) participant or counterparty default policies and 
    procedures;
        (4) the ability to complete timely clearing and settlement of 
    financial transactions;
        (5) capital and financial resource requirements for designated 
    financial market utilities; and
        (6) other areas that are necessary to achieve the objectives 
    and principles in subsection (b).
    (d) Limitation on Scope.--Except as provided in subsections (e) and 
(f) of section 807, nothing in this title shall be construed to permit 
the Council or the Board of Governors to take any action or exercise 
any authority granted to the Commodity Futures Trading Commission under 
section 2(h) of the Commodity Exchange Act or the Securities and 
Exchange Commission under section 3C(a) of the Securities Exchange Act 
of 1934, including--
        (1) the approval of, disapproval of, or stay of the clearing 
    requirement for any group, category, type, or class of swaps that a 
    designated clearing entity may accept for clearing;
        (2) the determination that any group, category, type, or class 
    of swaps shall be subject to the mandatory clearing requirement of 
    section 2(h)(1) of the Commodity Exchange Act or section 3C(a)(1) 
    of the Securities Exchange Act of 1934;
        (3) the determination that any person is exempt from the 
    mandatory clearing requirement of section 2(h)(1) of the Commodity 
    Exchange Act or section 3C(a)(1) of the Securities Exchange Act of 
    1934; or
        (4) any authority granted to the Commodity Futures Trading 
    Commission or the Securities and Exchange Commission with respect 
    to transaction reporting or trade execution.
    (e) Threshold Level.--The standards prescribed under subsection (a) 
governing the conduct of designated activities by financial 
institutions shall, where appropriate, establish a threshold as to the 
level or significance of engagement in the activity at which a 
financial institution will become subject to the standards with respect 
to that activity.
    (f) Compliance Required.--Designated financial market utilities and 
financial institutions subject to the standards prescribed under 
subsection (a) for a designated activity shall conduct their operations 
in compliance with the applicable risk management standards.
    SEC. 806. OPERATIONS OF DESIGNATED FINANCIAL MARKET UTILITIES.
    (a) Federal Reserve Account and Services.--The Board of Governors 
may authorize a Federal Reserve Bank to establish and maintain an 
account for a designated financial market utility and provide the 
services listed in section 11A(b) of the Federal Reserve Act (12 U.S.C. 
248a(b)) and deposit accounts under the first undesignated paragraph of 
section 13 of the Federal Reserve Act (12 U.S.C. 342) to the designated 
financial market utility that the Federal Reserve Bank is authorized 
under the Federal Reserve Act to provide to a depository institution, 
subject to any applicable rules, orders, standards, or guidelines 
prescribed by the Board of Governors.
    (b) Advances.--The Board of Governors may authorize a Federal 
Reserve bank under section 10B of the Federal Reserve Act (12 U.S.C. 
347b) to provide to a designated financial market utility discount and 
borrowing privileges only in unusual or exigent circumstances, upon the 
affirmative vote of a majority of the Board of Governors then serving 
(or such other number in accordance with the provisions of section 
11(r)(2) of the Federal Reserve Act (12 U.S.C. 248(r)(2)) after 
consultation with the Secretary, and upon a showing by the designated 
financial market utility that it is unable to secure adequate credit 
accommodations from other banking institutions. All such discounts and 
borrowing privileges shall be subject to such other limitations, 
restrictions, and regulations as the Board of Governors may prescribe. 
Access to discount and borrowing privileges under section 10B of the 
Federal Reserve Act as authorized in this section does not require a 
designated financial market utility to be or become a bank or bank 
holding company.
    (c) Earnings on Federal Reserve Balances.--A Federal Reserve Bank 
may pay earnings on balances maintained by or on behalf of a designated 
financial market utility in the same manner and to the same extent as 
the Federal Reserve Bank may pay earnings to a depository institution 
under the Federal Reserve Act, subject to any applicable rules, orders, 
standards, or guidelines prescribed by the Board of Governors.
    (d) Reserve Requirements.--The Board of Governors may exempt a 
designated financial market utility from, or modify any, reserve 
requirements under section 19 of the Federal Reserve Act (12 U.S.C. 
461) applicable to a designated financial market utility.
    (e) Changes to Rules, Procedures, or Operations.--
        (1) Advance notice.--
            (A) Advance notice of proposed changes required.--A 
        designated financial market utility shall provide notice 60 
        days in advance notice to its Supervisory Agency of any 
        proposed change to its rules, procedures, or operations that 
        could, as defined in rules of each Supervisory Agency, 
        materially affect, the nature or level of risks presented by 
        the designated financial market utility.
            (B) Terms and standards prescribed by the supervisory 
        agencies.--Each Supervisory Agency, in consultation with the 
        Board of Governors, shall prescribe regulations that define and 
        describe the standards for determining when notice is required 
        to be provided under subparagraph (A).
            (C) Contents of notice.--The notice of a proposed change 
        shall describe--
                (i) the nature of the change and expected effects on 
            risks to the designated financial market utility, its 
            participants, or the market; and
                (ii) how the designated financial market utility plans 
            to manage any identified risks.
            (D) Additional information.--The Supervisory Agency may 
        require a designated financial market utility to provide any 
        information necessary to assess the effect the proposed change 
        would have on the nature or level of risks associated with the 
        designated financial market utility's payment, clearing, or 
        settlement activities and the sufficiency of any proposed risk 
        management techniques.
            (E) Notice of objection.--The Supervisory Agency shall 
        notify the designated financial market utility of any objection 
        regarding the proposed change within 60 days from the later 
        of--
                (i) the date that the notice of the proposed change is 
            received; or
                (ii) the date any further information requested for 
            consideration of the notice is received.
            (F) Change not allowed if objection.--A designated 
        financial market utility shall not implement a change to which 
        the Supervisory Agency has an objection.
            (G) Change allowed if no objection within 60 days.--A 
        designated financial market utility may implement a change if 
        it has not received an objection to the proposed change within 
        60 days of the later of--
                (i) the date that the Supervisory Agency receives the 
            notice of proposed change; or
                (ii) the date the Supervisory Agency receives any 
            further information it requests for consideration of the 
            notice.
            (H) Review extension for novel or complex issues.--The 
        Supervisory Agency may, during the 60-day review period, extend 
        the review period for an additional 60 days for proposed 
        changes that raise novel or complex issues, subject to the 
        Supervisory Agency providing the designated financial market 
        utility with prompt written notice of the extension. Any 
        extension under this subparagraph will extend the time periods 
        under subparagraphs (E) and (G).
            (I) Change allowed earlier if notified of no objection.--A 
        designated financial market utility may implement a change in 
        less than 60 days from the date of receipt of the notice of 
        proposed change by the Supervisory Agency, or the date the 
        Supervisory Agency receives any further information it 
        requested, if the Supervisory Agency notifies the designated 
        financial market utility in writing that it does not object to 
        the proposed change and authorizes the designated financial 
        market utility to implement the change on an earlier date, 
        subject to any conditions imposed by the Supervisory Agency.
        (2) Emergency changes.--
            (A) In general.--A designated financial market utility may 
        implement a change that would otherwise require advance notice 
        under this subsection if it determines that--
                (i) an emergency exists; and
                (ii) immediate implementation of the change is 
            necessary for the designated financial market utility to 
            continue to provide its services in a safe and sound 
            manner.
            (B) Notice required within 24 hours.--The designated 
        financial market utility shall provide notice of any such 
        emergency change to its Supervisory Agency, as soon as 
        practicable, which shall be no later than 24 hours after 
        implementation of the change.
            (C) Contents of emergency notice.--In addition to the 
        information required for changes requiring advance notice, the 
        notice of an emergency change shall describe--
                (i) the nature of the emergency; and
                (ii) the reason the change was necessary for the 
            designated financial market utility to continue to provide 
            its services in a safe and sound manner.
            (D) Modification or rescission of change may be required.--
        The Supervisory Agency may require modification or rescission 
        of the change if it finds that the change is not consistent 
        with the purposes of this Act or any applicable rules, orders, 
        or standards prescribed under section 805(a).
        (3) Copying the board of governors.--The Supervisory Agency 
    shall provide the Board of Governors concurrently with a complete 
    copy of any notice, request, or other information it issues, 
    submits, or receives under this subsection.
        (4) Consultation with board of governors.--Before taking any 
    action on, or completing its review of, a change proposed by a 
    designated financial market utility, the Supervisory Agency shall 
    consult with the Board of Governors.
    SEC. 807. EXAMINATION OF AND ENFORCEMENT ACTIONS AGAINST DESIGNATED 
      FINANCIAL MARKET UTILITIES.
    (a) Examination.--Notwithstanding any other provision of law and 
subject to subsection (d), the Supervisory Agency shall conduct 
examinations of a designated financial market utility at least once 
annually in order to determine the following:
        (1) The nature of the operations of, and the risks borne by, 
    the designated financial market utility.
        (2) The financial and operational risks presented by the 
    designated financial market utility to financial institutions, 
    critical markets, or the broader financial system.
        (3) The resources and capabilities of the designated financial 
    market utility to monitor and control such risks.
        (4) The safety and soundness of the designated financial market 
    utility.
        (5) The designated financial market utility's compliance with--
            (A) this title; and
            (B) the rules and orders prescribed under this title.
    (b) Service Providers.--Whenever a service integral to the 
operation of a designated financial market utility is performed for the 
designated financial market utility by another entity, whether an 
affiliate or non-affiliate and whether on or off the premises of the 
designated financial market utility, the Supervisory Agency may examine 
whether the provision of that service is in compliance with applicable 
law, rules, orders, and standards to the same extent as if the 
designated financial market utility were performing the service on its 
own premises.
    (c) Enforcement.--For purposes of enforcing the provisions of this 
title, a designated financial market utility shall be subject to, and 
the appropriate Supervisory Agency shall have authority under the 
provisions of subsections (b) through (n) of section 8 of the Federal 
Deposit Insurance Act (12 U.S.C. 1818) in the same manner and to the 
same extent as if the designated financial market utility was an 
insured depository institution and the Supervisory Agency was the 
appropriate Federal banking agency for such insured depository 
institution.
    (d) Board of Governors Involvement in Examinations.--
        (1) Board of governors consultation on examination planning.--
    The Supervisory Agency shall consult annually with the Board of 
    Governors regarding the scope and methodology of any examination 
    conducted under subsections (a) and (b). The Supervisory Agency 
    shall lead all examinations conducted under subsections (a) and (b)
        (2) Board of governors participation in examination.--The Board 
    of Governors may, in its discretion, participate in any examination 
    led by a Supervisory Agency and conducted under subsections (a) and 
    (b).
    (e) Board of Governors Enforcement Recommendations.--
        (1) Recommendation.--The Board of Governors may, after 
    consulting with the Council and the Supervisory Agency, at any time 
    recommend to the Supervisory Agency that such agency take 
    enforcement action against a designated financial market utility in 
    order to prevent or mitigate significant liquidity, credit, 
    operational, or other risks to the financial markets or to the 
    financial stability of the United States. Any such recommendation 
    for enforcement action shall provide a detailed analysis supporting 
    the recommendation of the Board of Governors.
        (2) Consideration.--The Supervisory Agency shall consider the 
    recommendation of the Board of Governors and submit a response to 
    the Board of Governors within 60 days.
        (3) Binding arbitration.--If the Supervisory Agency rejects, in 
    whole or in part, the recommendation of the Board of Governors, the 
    Board of Governors may refer the recommendation to the Council for 
    a binding decision on whether an enforcement action is warranted.
        (4) Enforcement action.--Upon an affirmative vote by a majority 
    of the Council in favor of the Board of Governors' recommendation 
    under paragraph (3), the Council may require the Supervisory Agency 
    to--
            (A) exercise the enforcement authority referenced in 
        subsection (c); and
            (B) take enforcement action against the designated 
        financial market utility.
    (f) Emergency Enforcement Actions by the Board of Governors.--
        (1) Imminent risk of substantial harm.--The Board of Governors 
    may, after consulting with the Supervisory Agency and upon an 
    affirmative vote by a majority the Council, take enforcement action 
    against a designated financial market utility if the Board of 
    Governors has reasonable cause to conclude that--
            (A) either--
                (i) an action engaged in, or contemplated by, a 
            designated financial market utility (including any change 
            proposed by the designated financial market utility to its 
            rules, procedures, or operations that would otherwise be 
            subject to section 806(e)) poses an imminent risk of 
            substantial harm to financial institutions, critical 
            markets, or the broader financial system of the United 
            States; or
                (ii) the condition of a designated financial market 
            utility poses an imminent risk of substantial harm to 
            financial institutions, critical markets, or the broader 
            financial system; and
            (B) the imminent risk of substantial harm precludes the 
        Board of Governors' use of the procedures in subsection (e).
        (2) Enforcement authority.--For purposes of taking enforcement 
    action under paragraph (1), a designated financial market utility 
    shall be subject to, and the Board of Governors shall have 
    authority under the provisions of subsections (b) through (n) of 
    section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) in 
    the same manner and to the same extent as if the designated 
    financial market utility was an insured depository institution and 
    the Board of Governors was the appropriate Federal banking agency 
    for such insured depository institution.
    SEC. 808. EXAMINATION OF AND ENFORCEMENT ACTIONS AGAINST FINANCIAL 
      INSTITUTIONS SUBJECT TO STANDARDS FOR DESIGNATED ACTIVITIES.
    (a) Examination.--The appropriate financial regulator is authorized 
to examine a financial institution subject to the standards prescribed 
under section 805(a) for a designated activity in order to determine 
the following:
        (1) The nature and scope of the designated activities engaged 
    in by the financial institution.
        (2) The financial and operational risks the designated 
    activities engaged in by the financial institution may pose to the 
    safety and soundness of the financial institution.
        (3) The financial and operational risks the designated 
    activities engaged in by the financial institution may pose to 
    other financial institutions, critical markets, or the broader 
    financial system.
        (4) The resources available to and the capabilities of the 
    financial institution to monitor and control the risks described in 
    paragraphs (2) and (3).
        (5) The financial institution's compliance with this title and 
    the rules and orders prescribed under section 805(a).
    (b) Enforcement.--For purposes of enforcing the provisions of this 
title, and the rules and orders prescribed under this section, a 
financial institution subject to the standards prescribed under section 
805(a) for a designated activity shall be subject to, and the 
appropriate financial regulator shall have authority under the 
provisions of subsections (b) through (n) of section 8 of the Federal 
Deposit Insurance Act (12 U.S.C. 1818) in the same manner and to the 
same extent as if the financial institution was an insured depository 
institution and the appropriate financial regulator was the appropriate 
Federal banking agency for such insured depository institution.
    (c) Technical Assistance.--The Board of Governors shall consult 
with and provide such technical assistance as may be required by the 
appropriate financial regulators to ensure that the rules and orders 
prescribed under this title are interpreted and applied in as 
consistent and uniform a manner as practicable.
    (d) Delegation.--
        (1) Examination.--
            (A) Request to board of governors.--The appropriate 
        financial regulator may request the Board of Governors to 
        conduct or participate in an examination of a financial 
        institution subject to the standards prescribed under section 
        805(a) for a designated activity in order to assess the 
        compliance of such financial institution with--
                (i) this title; or
                (ii) the rules or orders prescribed under this title.
            (B) Examination by board of governors.--Upon receipt of an 
        appropriate written request, the Board of Governors will 
        conduct the examination under such terms and conditions to 
        which the Board of Governors and the appropriate financial 
        regulator mutually agree.
        (2) Enforcement.--
            (A) Request to board of governors.--The appropriate 
        financial regulator may request the Board of Governors to 
        enforce this title or the rules or orders prescribed under this 
        title against a financial institution that is subject to the 
        standards prescribed under section 805(a) for a designated 
        activity.
            (B) Enforcement by board of governors.--Upon receipt of an 
        appropriate written request, the Board of Governors shall 
        determine whether an enforcement action is warranted, and, if 
        so, it shall enforce compliance with this title or the rules or 
        orders prescribed under this title and, if so, the financial 
        institution shall be subject to, and the Board of Governors 
        shall have authority under the provisions of subsections (b) 
        through (n) of section 8 of the Federal Deposit Insurance Act 
        (12 U.S.C. 1818) in the same manner and to the same extent as 
        if the financial institution was an insured depository 
        institution and the Board of Governors was the appropriate 
        Federal banking agency for such insured depository institution.
    (e) Back-up Authority of the Board of Governors.--
        (1) Examination and enforcement.--Notwithstanding any other 
    provision of law, the Board of Governors may--
            (A) conduct an examination of the type described in 
        subsection (a) of any financial institution that is subject to 
        the standards prescribed under section 805(a) for a designated 
        activity; and
            (B) enforce the provisions of this title or any rules or 
        orders prescribed under this title against any financial 
        institution that is subject to the standards prescribed under 
        section 805(a) for a designated activity.
        (2) Limitations.--
            (A) Examination.--The Board of Governors may exercise the 
        authority described in paragraph (1)(A) only if the Board of 
        Governors has--
                (i) reasonable cause to believe that a financial 
            institution is not in compliance with this title or the 
            rules or orders prescribed under this title with respect to 
            a designated activity;
                (ii) notified, in writing, the appropriate financial 
            regulator and the Council of its belief under clause (i) 
            with supporting documentation included;
                (iii) requested the appropriate financial regulator to 
            conduct a prompt examination of the financial institution;
                (iv) either--

                    (I) not been afforded a reasonable opportunity to 
                participate in an examination of the financial 
                institution by the appropriate financial regulator 
                within 30 days after the date of the Board's 
                notification under clause (ii); or
                    (II) reasonable cause to believe that the financial 
                institution's noncompliance with this title or the 
                rules or orders prescribed under this title poses a 
                substantial risk to other financial institutions, 
                critical markets, or the broader financial system, 
                subject to the Board of Governors affording the 
                appropriate financial regulator a reasonable 
                opportunity to participate in the examination; and

                (v) obtained the approval of the Council upon an 
            affirmative vote by a majority of the Council.
            (B) Enforcement.--The Board of Governors may exercise the 
        authority described in paragraph (1)(B) only if the Board of 
        Governors has--
                (i) reasonable cause to believe that a financial 
            institution is not in compliance with this title or the 
            rules or orders prescribed under this title with respect to 
            a designated activity;
                (ii) notified, in writing, the appropriate financial 
            regulator and the Council of its belief under clause (i) 
            with supporting documentation included and with a 
            recommendation that the appropriate financial regulator 
            take 1 or more specific enforcement actions against the 
            financial institution;
                (iii) either--

                    (I) not been notified, in writing, by the 
                appropriate financial regulator of the commencement of 
                an enforcement action recommended by the Board of 
                Governors against the financial institution within 60 
                days from the date of the notification under clause 
                (ii); or
                    (II) reasonable cause to believe that the financial 
                institution's noncompliance with this title or the 
                rules or orders prescribed under this title poses 
                significant liquidity, credit, operational, or other 
                risks to the financial markets or to the financial 
                stability of the United States, subject to the Board of 
                Governors notifying the appropriate financial regulator 
                of the Board's enforcement action; and

                (iv) obtained the approval of the Council upon an 
            affirmative vote by a majority of the Council.
        (3) Enforcement provisions.--For purposes of taking enforcement 
    action under paragraph (1), the financial institution shall be 
    subject to, and the Board of Governors shall have authority under 
    the provisions of subsections (b) through (n) of section 8 of the 
    Federal Deposit Insurance Act (12 U.S.C. 1818) in the same manner 
    and to the same extent as if the financial institution was an 
    insured depository institution and the Board of Governors was the 
    appropriate Federal banking agency for such insured depository 
    institution.
    SEC. 809. REQUESTS FOR INFORMATION, REPORTS, OR RECORDS.
    (a) Information To Assess Systemic Importance.--
        (1) Financial market utilities.--The Council is authorized to 
    require any financial market utility to submit such information as 
    the Council may require for the sole purpose of assessing whether 
    that financial market utility is systemically important, but only 
    if the Council has reasonable cause to believe that the financial 
    market utility meets the standards for systemic importance set 
    forth in section 804.
        (2) Financial institutions engaged in payment, clearing, or 
    settlement activities.--The Council is authorized to require any 
    financial institution to submit such information as the Council may 
    require for the sole purpose of assessing whether any payment, 
    clearing, or settlement activity engaged in or supported by a 
    financial institution is systemically important, but only if the 
    Council has reasonable cause to believe that the activity meets the 
    standards for systemic importance set forth in section 804.
    (b) Reporting After Designation.--
        (1) Designated financial market utilities.--The Board of 
    Governors and the Council may each require a designated financial 
    market utility to submit reports or data to the Board of Governors 
    and the Council in such frequency and form as deemed necessary by 
    the Board of Governors or the Council in order to assess the safety 
    and soundness of the utility and the systemic risk that the 
    utility's operations pose to the financial system.
        (2) Financial institutions subject to standards for designated 
    activities.--The Board of Governors and the Council may each 
    require 1 or more financial institutions subject to the standards 
    prescribed under section 805(a) for a designated activity to 
    submit, in such frequency and form as deemed necessary by the Board 
    of Governors or the Council, reports and data to the Board of 
    Governors and the Council solely with respect to the conduct of the 
    designated activity and solely to assess whether--
            (A) the rules, orders, or standards prescribed under 
        section 805(a) with respect to the designated activity 
        appropriately address the risks to the financial system 
        presented by such activity; and
            (B) the financial institutions are in compliance with this 
        title and the rules and orders prescribed under section 805(a) 
        with respect to the designated activity.
        (3) Limitation.--The Board of Governors may, upon an 
    affirmative vote by a majority of the Council, prescribe 
    regulations under this section that impose a recordkeeping or 
    reporting requirement on designated clearing entities or financial 
    institutions engaged in designated activities that are subject to 
    standards that have been prescribed under section 805(a)(2).
    (c) Coordination With Appropriate Federal Supervisory Agency.--
        (1) Advance coordination.--Before requesting any material 
    information from, or imposing reporting or recordkeeping 
    requirements on, any financial market utility or any financial 
    institution engaged in a payment, clearing, or settlement activity, 
    the Board of Governors or the Council shall coordinate with the 
    Supervisory Agency for a financial market utility or the 
    appropriate financial regulator for a financial institution to 
    determine if the information is available from or may be obtained 
    by the agency in the form, format, or detail required by the Board 
    of Governors or the Council.
        (2) Supervisory reports.--Notwithstanding any other provision 
    of law, the Supervisory Agency, the appropriate financial 
    regulator, and the Board of Governors are authorized to disclose to 
    each other and the Council copies of its examination reports or 
    similar reports regarding any financial market utility or any 
    financial institution engaged in payment, clearing, or settlement 
    activities.
    (d) Timing of Response From Appropriate Federal Supervisory 
Agency.--If the information, report, records, or data requested by the 
Board of Governors or the Council under subsection (c)(1) are not 
provided in full by the Supervisory Agency or the appropriate financial 
regulator in less than 15 days after the date on which the material is 
requested, the Board of Governors or the Council may request the 
information or impose recordkeeping or reporting requirements directly 
on such persons as provided in subsections (a) and (b) with notice to 
the agency.
    (e) Sharing of Information.--
        (1) Material concerns.--Notwithstanding any other provision of 
    law, the Board of Governors, the Council, the appropriate financial 
    regulator, and any Supervisory Agency are authorized to--
            (A) promptly notify each other of material concerns about a 
        designated financial market utility or any financial 
        institution engaged in designated activities; and
            (B) share appropriate reports, information, or data 
        relating to such concerns.
        (2) Other information.--Notwithstanding any other provision of 
    law, the Board of Governors, the Council, the appropriate financial 
    regulator, or any Supervisory Agency may, under such terms and 
    conditions as it deems appropriate, provide confidential 
    supervisory information and other information obtained under this 
    title to each other, and to the Secretary, Federal Reserve Banks, 
    State financial institution supervisory agencies, foreign financial 
    supervisors, foreign central banks, and foreign finance ministries, 
    subject to reasonable assurances of confidentiality, provided, 
    however, that no person or entity receiving information pursuant to 
    this section may disseminate such information to entities or 
    persons other than those listed in this paragraph without complying 
    with applicable law, including section 8 of the Commodity Exchange 
    Act (7 U.S.C. 12).
    (f) Privilege Maintained.--The Board of Governors, the Council, the 
appropriate financial regulator, and any Supervisory Agency providing 
reports or data under this section shall not be deemed to have waived 
any privilege applicable to those reports or data, or any portion 
thereof, by providing the reports or data to the other party or by 
permitting the reports or data, or any copies thereof, to be used by 
the other party.
    (g) Disclosure Exemption.--Information obtained by the Board of 
Governors, the Supervisory Agencies, or the Council under this section 
and any materials prepared by the Board of Governors, the Supervisory 
Agencies, or the Council regarding their assessment of the systemic 
importance of financial market utilities or any payment, clearing, or 
settlement activities engaged in by financial institutions, and in 
connection with their supervision of designated financial market 
utilities and designated activities, shall be confidential supervisory 
information exempt from disclosure under section 552 of title 5, United 
States Code. For purposes of such section 552, this subsection shall be 
considered a statute described in subsection (b)(3) of such section 
552.
    SEC. 810. RULEMAKING.
    The Board of Governors, the Supervisory Agencies, and the Council 
are authorized to prescribe such rules and issue such orders as may be 
necessary to administer and carry out their respective authorities and 
duties granted under this title and prevent evasions thereof.
    SEC. 811. OTHER AUTHORITY.
    Unless otherwise provided by its terms, this title does not divest 
any appropriate financial regulator, any Supervisory Agency, or any 
other Federal or State agency, of any authority derived from any other 
applicable law, except that any standards prescribed by the Board of 
Governors under section 805 shall supersede any less stringent 
requirements established under other authority to the extent of any 
conflict.
    SEC. 812. CONSULTATION.
    (a) CFTC.--The Commodity Futures Trading Commission shall consult 
with the Board of Governors--
        (1) prior to exercising its authorities under sections 
    2(h)(2)(C), 2(h)(3)(A), 2(h)(3)(C), 2(h)(4)(A), and 2(h)(4)(B) of 
    the Commodity Exchange Act, as amended by the Wall Street 
    Transparency and Accountability Act of 2010;
        (2) with respect to any rule or rule amendment of a derivatives 
    clearing organization for which a stay of certification has been 
    issued under section 745(b)(3) of the Wall Street Transparency and 
    Accountability Act of 2010; and
        (3) prior to exercising its rulemaking authorities under 
    section 728 of the Wall Street Transparency and Accountability Act 
    of 2010.
    (b) SEC.--The Commission shall consult with the Board of 
Governors--
        (1) prior to exercising its authorities under sections 
    3C(a)(2)(C), 3C(a)(3)(A), 3C(a)(3)(C), 3C(a)(4)(A), and 3C(a)(4)(B) 
    of the Securities Exchange Act of 1934, as amended by the Wall 
    Street Transparency and Accountability Act of 2010;
        (2) with respect to any proposed rule change of a clearing 
    agency for which an extension of the time for review has been 
    designated under section 19(b)(2) of the Securities Exchange Act of 
    1934; and
        (3) prior to exercising its rulemaking authorities under 
    section 13(n) of the Securities Exchange Act of 1934, as added by 
    section 763(i) of the Wall Street Transparency and Accountability 
    Act of 2010.
    SEC. 813. COMMON FRAMEWORK FOR DESIGNATED CLEARING ENTITY RISK 
      MANAGEMENT.
    The Commodity Futures Trading Commission and the Commission shall 
coordinate with the Board of Governors to jointly develop risk 
management supervision programs for designated clearing entities. Not 
later than 1 year after the date of enactment of this Act, the 
Commodity Futures Trading Commission, the Commission, and the Board of 
Governors shall submit a joint report 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 
recommendations for--
        (1) improving consistency in the designated clearing entity 
    oversight programs of the Commission and the Commodity Futures 
    Trading Commission;
        (2) promoting robust risk management by designated clearing 
    entities;
        (3) promoting robust risk management oversight by regulators of 
    designated clearing entities; and
        (4) improving regulators' ability to monitor the potential 
    effects of designated clearing entity risk management on the 
    stability of the financial system of the United States.
    SEC. 814. EFFECTIVE DATE.
    This title is effective as of the date of enactment of this Act.

 TITLE IX--INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 
                               SECURITIES

    SEC. 901. SHORT TITLE.
    This title may be cited as the ``Investor Protection and Securities 
Reform Act of 2010''.

               Subtitle A--Increasing Investor Protection

    SEC. 911. INVESTOR ADVISORY COMMITTEE ESTABLISHED.
    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. 39. INVESTOR ADVISORY COMMITTEE.
    ``(a) Establishment and Purpose.--
        ``(1) Establishment.--There is established within the 
    Commission the Investor Advisory Committee (referred to in this 
    section as the `Committee').
        ``(2) Purpose.--The Committee shall--
            ``(A) advise and consult with the Commission on--
                ``(i) regulatory priorities of the Commission;
                ``(ii) issues relating to the regulation of securities 
            products, trading strategies, and fee structures, and the 
            effectiveness of disclosure;
                ``(iii) initiatives to protect investor interest; and
                ``(iv) initiatives to promote investor confidence and 
            the integrity of the securities marketplace; and
            ``(B) submit to the Commission such findings and 
        recommendations as the Committee determines are appropriate, 
        including recommendations for proposed legislative changes.
    ``(b) Membership.--
        ``(1) In general.--The members of the Committee shall be--
            ``(A) the Investor Advocate;
            ``(B) a representative of State securities commissions;
            ``(C) a representative of the interests of senior citizens; 
        and
            ``(D) not fewer than 10, and not more than 20, members 
        appointed by the Commission, from among individuals who--
                ``(i) represent the interests of individual equity and 
            debt investors, including investors in mutual funds;
                ``(ii) represent the interests of institutional 
            investors, including the interests of pension funds and 
            registered investment companies;
                ``(iii) are knowledgeable about investment issues and 
            decisions; and
                ``(iv) have reputations of integrity.
        ``(2) Term.--Each member of the Committee appointed under 
    paragraph (1)(B) shall serve for a term of 4 years.
        ``(3) Members not commission employees.--Members appointed 
    under paragraph (1)(B) shall not be deemed to be employees or 
    agents of the Commission solely because of membership on the 
    Committee.
    ``(c) Chairman; Vice Chairman; Secretary; Assistant Secretary.--
        ``(1) In general.--The members of the Committee shall elect, 
    from among the members of the Committee--
            ``(A) a chairman, who may not be employed by an issuer;
            ``(B) a vice chairman, who may not be employed by an 
        issuer;
            ``(C) a secretary; and
            ``(D) an assistant secretary.
        ``(2) 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).
    ``(d) Meetings.--
        ``(1) Frequency of meetings.--The Committee shall meet--
            ``(A) not less frequently than twice annually, at the call 
        of the chairman of the Committee; and
            ``(B) from time to time, at the call of the Commission.
        ``(2) Notice.--The chairman of the Committee shall give the 
    members of the Committee written notice of each meeting, not later 
    than 2 weeks before the date of the meeting.
    ``(e) Compensation and Travel Expenses.--Each member of the 
Committee who is not a full-time employee of the United States shall--
        ``(1) be entitled to receive compensation at a rate not to 
    exceed the daily equivalent of the annual rate of basic pay in 
    effect for a position at level V of the Executive Schedule under 
    section 5316 of title 5, United States Code, for each day during 
    which the member is engaged in the actual performance of the duties 
    of the Committee; and
        ``(2) while away from the home or regular place of business of 
    the member in the performance of services for the Committee, be 
    allowed travel expenses, including per diem in lieu of subsistence, 
    in the same manner as persons employed intermittently in the 
    Government service are allowed expenses under section 5703(b) of 
    title 5, United States Code.
    ``(f) Staff.--The Commission shall make available to the Committee 
such staff as the chairman of the Committee determines are necessary to 
carry out this section.
    ``(g) Review by Commission.--The Commission shall--
        ``(1) review the findings and recommendations of the Committee; 
    and
        ``(2) each time the Committee submits a finding or 
    recommendation to the Commission, promptly issue a public 
    statement--
            ``(A) assessing the finding or recommendation of the 
        Committee; and
            ``(B) disclosing the action, if any, the Commission intends 
        to take with respect to the finding or recommendation.
    ``(h) Committee Findings.--Nothing in this section shall require 
the Commission to agree to or act upon any finding or recommendation of 
the Committee.
    ``(i) Federal Advisory Committee Act.--The Federal Advisory 
Committee Act (5 U.S.C. App.) shall not apply with respect to the 
Committee and its activities.
    ``(j) Authorization of Appropriations.--There is authorized to be 
appropriated to the Commission such sums as are necessary to carry out 
this section.''.
    SEC. 912. CLARIFICATION OF AUTHORITY OF THE COMMISSION TO ENGAGE IN 
      INVESTOR TESTING.
    Section 19 of the Securities Act of 1933 (15 U.S.C. 77s) is amended 
by adding at the end the following:
    ``(e) Evaluation of Rules or Programs.--For the purpose of 
evaluating any rule or program of the Commission issued or carried out 
under any provision of the securities laws, as defined in section 3 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78c), and the purposes 
of considering, proposing, adopting, or engaging in any such rule or 
program or developing new rules or programs, the Commission may--
        ``(1) gather information from and communicate with investors or 
    other members of the public;
        ``(2) engage in such temporary investor testing programs as the 
    Commission determines are in the public interest or would protect 
    investors; and
        ``(3) consult with academics and consultants, as necessary to 
    carry out this subsection.
    ``(f) Rule of Construction.--For purposes of the Paperwork 
Reduction Act (44 U.S.C. 3501 et seq.), any action taken under 
subsection (e) shall not be construed to be a collection of 
information.''.
    SEC. 913. STUDY AND RULEMAKING REGARDING OBLIGATIONS OF BROKERS, 
      DEALERS, AND INVESTMENT ADVISERS.
    (a) Definition.--For purposes of this section, the term ``retail 
customer'' means a natural person, or the legal representative of such 
natural person, who--
        (1) receives personalized investment advice about securities 
    from a broker or dealer or investment adviser; and
        (2) uses such advice primarily for personal, family, or 
    household purposes.
    (b) Study.--The Commission shall conduct a study to evaluate--
        (1) the effectiveness of existing legal or regulatory standards 
    of care for brokers, dealers, investment advisers, persons 
    associated with brokers or dealers, and persons associated with 
    investment advisers for providing personalized investment advice 
    and recommendations about securities to retail customers imposed by 
    the Commission and a national securities association, and other 
    Federal and State legal or regulatory standards; and
        (2) whether there are legal or regulatory gaps, shortcomings, 
    or overlaps in legal or regulatory standards in the protection of 
    retail customers relating to the standards of care for brokers, 
    dealers, investment advisers, persons associated with brokers or 
    dealers, and persons associated with investment advisers for 
    providing personalized investment advice about securities to retail 
    customers that should be addressed by rule or statute.
    (c) Considerations.--In conducting the study required under 
subsection (b), the Commission shall consider--
        (1) the effectiveness of existing legal or regulatory standards 
    of care for brokers, dealers, investment advisers, persons 
    associated with brokers or dealers, and persons associated with 
    investment advisers for providing personalized investment advice 
    and recommendations about securities to retail customers imposed by 
    the Commission and a national securities association, and other 
    Federal and State legal or regulatory standards;
        (2) whether there are legal or regulatory gaps, shortcomings, 
    or overlaps in legal or regulatory standards in the protection of 
    retail customers relating to the standards of care for brokers, 
    dealers, investment advisers, persons associated with brokers or 
    dealers, and persons associated with investment advisers for 
    providing personalized investment advice about securities to retail 
    customers that should be addressed by rule or statute;
        (3) whether retail customers understand that there are 
    different standards of care applicable to brokers, dealers, 
    investment advisers, persons associated with brokers or dealers, 
    and persons associated with investment advisers in the provision of 
    personalized investment advice about securities to retail 
    customers;
        (4) whether the existence of different standards of care 
    applicable to brokers, dealers, investment advisers, persons 
    associated with brokers or dealers, and persons associated with 
    investment advisers is a source of confusion for retail customers 
    regarding the quality of personalized investment advice that retail 
    customers receive;
        (5) the regulatory, examination, and enforcement resources 
    devoted to, and activities of, the Commission, the States, and a 
    national securities association to enforce the standards of care 
    for brokers, dealers, investment advisers, persons associated with 
    brokers or dealers, and persons associated with investment advisers 
    when providing personalized investment advice and recommendations 
    about securities to retail customers, including--
            (A) the effectiveness of the examinations of brokers, 
        dealers, and investment advisers in determining compliance with 
        regulations;
            (B) the frequency of the examinations; and
            (C) the length of time of the examinations;
        (6) the substantive differences in the regulation of brokers, 
    dealers, and investment advisers, when providing personalized 
    investment advice and recommendations about securities to retail 
    customers;
        (7) the specific instances related to the provision of 
    personalized investment advice about securities in which--
            (A) the regulation and oversight of investment advisers 
        provide greater protection to retail customers than the 
        regulation and oversight of brokers and dealers; and
            (B) the regulation and oversight of brokers and dealers 
        provide greater protection to retail customers than the 
        regulation and oversight of investment advisers;
        (8) the existing legal or regulatory standards of State 
    securities regulators and other regulators intended to protect 
    retail customers;
        (9) the potential impact on retail customers, including the 
    potential impact on access of retail customers to the range of 
    products and services offered by brokers and dealers, of imposing 
    upon brokers, dealers, and persons associated with brokers or 
    dealers--
            (A) the standard of care applied under the Investment 
        Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) for providing 
        personalized investment advice about securities to retail 
        customers of investment advisers, as interpreted by the 
        Commission and the courts; and
            (B) other requirements of the Investment Advisers Act of 
        1940 (15 U.S.C. 80b-1 et seq.);
        (10) the potential impact of eliminating the broker and dealer 
    exclusion from the definition of ``investment adviser'' under 
    section 202(a)(11)(C) of the Investment Advisers Act of 1940 (15 
    U.S.C. 80b-2(a)(11)(C)), in terms of--
            (A) the impact and potential benefits and harm to retail 
        customers that could result from such a change, including any 
        potential impact on access to personalized investment advice 
        and recommendations about securities to retail customers or the 
        availability of such advice and recommendations;
            (B) the number of additional entities and individuals that 
        would be required to register under, or become subject to, the 
        Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.), and 
        the additional requirements to which brokers, dealers, and 
        persons associated with brokers and dealers would become 
        subject, including--
                (i) any potential additional associated person 
            licensing, registration, and examination requirements; and
                (ii) the additional costs, if any, to the additional 
            entities and individuals; and
            (C) the impact on Commission and State resources to--
                (i) conduct examinations of registered investment 
            advisers and the representatives of registered investment 
            advisers, including the impact on the examination cycle; 
            and
                (ii) enforce the standard of care and other applicable 
            requirements imposed under the Investment Advisers Act of 
            1940 (15 U.S.C. 80b-1 et seq.);
        (11) the varying level of services provided by brokers, 
    dealers, investment advisers, persons associated with brokers or 
    dealers, and persons associated with investment advisers to retail 
    customers and the varying scope and terms of retail customer 
    relationships of brokers, dealers, investment advisers, persons 
    associated with brokers or dealers, and persons associated with 
    investment advisers with such retail customers;
        (12) the potential impact upon retail customers that could 
    result from potential changes in the regulatory requirements or 
    legal standards of care affecting brokers, dealers, investment 
    advisers, persons associated with brokers or dealers, and persons 
    associated with investment advisers relating to their obligations 
    to retail customers regarding the provision of investment advice, 
    including any potential impact on--
            (A) protection from fraud;
            (B) access to personalized investment advice, and 
        recommendations about securities to retail customers; or
            (C) the availability of such advice and recommendations;
        (13) the potential additional costs and expenses to--
            (A) retail customers regarding and the potential impact on 
        the profitability of their investment decisions; and
            (B) brokers, dealers, and investment advisers resulting 
        from potential changes in the regulatory requirements or legal 
        standards affecting brokers, dealers, investment advisers, 
        persons associated with brokers or dealers, and persons 
        associated with investment advisers relating to their 
        obligations, including duty of care, to retail customers; and
        (14) any other consideration that the Commission considers 
    necessary and appropriate in determining whether to conduct a 
    rulemaking under subsection (f).
    (d) Report.--
        (1) In general.--Not later than 6 months after the date of 
    enactment of this Act, the Commission shall submit a report on the 
    study required under subsection (b) to--
            (A) the Committee on Banking, Housing, and Urban Affairs of 
        the Senate; and
            (B) the Committee on Financial Services of the House of 
        Representatives.
        (2) Content requirements.--The report required under paragraph 
    (1) shall describe the findings, conclusions, and recommendations 
    of the Commission from the study required under subsection (b), 
    including--
            (A) a description of the considerations, analysis, and 
        public and industry input that the Commission considered, as 
        required under subsection (b), to make such findings, 
        conclusions, and policy recommendations; and
            (B) an analysis of whether any identified legal or 
        regulatory gaps, shortcomings, or overlap in legal or 
        regulatory standards in the protection of retail customers 
        relating to the standards of care for brokers, dealers, 
        investment advisers, persons associated with brokers or 
        dealers, and persons associated with investment advisers for 
        providing personalized investment advice about securities to 
        retail customers.
    (e) Public Comment.--The Commission shall seek and consider public 
input, comments, and data in order to prepare the report required under 
subsection (d).
    (f) Rulemaking.--The Commission may commence a rulemaking, as 
necessary or appropriate in the public interest and for the protection 
of retail customers (and such other customers as the Commission may by 
rule provide), to address the legal or regulatory standards of care for 
brokers, dealers, investment advisers, persons associated with brokers 
or dealers, and persons associated with investment advisers for 
providing personalized investment advice about securities to such 
retail customers. The Commission shall consider the findings 
conclusions, and recommendations of the study required under subsection 
(b).
    (g) Authority to Establish a Fiduciary Duty for Brokers and 
Dealers.--
        (1) Securities exchange act of 1934.--Section 15 of the 
    Securities Exchange Act of 1934 (15 U.S.C. 78o) is amended by 
    adding at the end the following:
    ``(k) Standard of Conduct.--
        ``(1) In general.--Notwithstanding any other provision of this 
    Act or the Investment Advisers Act of 1940, the Commission may 
    promulgate rules to provide that, with respect to a broker or 
    dealer, when providing personalized investment advice about 
    securities to a retail customer (and such other customers as the 
    Commission may by rule provide), the standard of conduct for such 
    broker or dealer with respect to such customer shall be the same as 
    the standard of conduct applicable to an investment adviser under 
    section 211 of the Investment Advisers Act of 1940. The receipt of 
    compensation based on commission or other standard compensation for 
    the sale of securities shall not, in and of itself, be considered a 
    violation of such standard applied to a broker or dealer. Nothing 
    in this section shall require a broker or dealer or registered 
    representative to have a continuing duty of care or loyalty to the 
    customer after providing personalized investment advice about 
    securities.
        ``(2) Disclosure of range of products offered.--Where a broker 
    or dealer sells only proprietary or other limited range of 
    products, as determined by the Commission, the Commission may by 
    rule require that such broker or dealer provide notice to each 
    retail customer and obtain the consent or acknowledgment of the 
    customer. The sale of only proprietary or other limited range of 
    products by a broker or dealer shall not, in and of itself, be 
    considered a violation of the standard set forth in paragraph (1).
    ``(l) Other Matters.--The Commission shall--
        ``(1) facilitate the provision of simple and clear disclosures 
    to investors regarding the terms of their relationships with 
    brokers, dealers, and investment advisers, including any material 
    conflicts of interest; and
        ``(2) examine and, where appropriate, promulgate rules 
    prohibiting or restricting certain sales practices, conflicts of 
    interest, and compensation schemes for brokers, dealers, and 
    investment advisers that the Commission deems contrary to the 
    public interest and the protection of investors.''.
        (2) Investment advisers act of 1940.--Section 211 of the 
    Investment Advisers Act of 1940, is further amended by adding at 
    the end the following new subsections:
    ``(g) Standard of Conduct.--
        ``(1) In general.--The Commission may promulgate rules to 
    provide that the standard of conduct for all brokers, dealers, and 
    investment advisers, when providing personalized investment advice 
    about securities to retail customers (and such other customers as 
    the Commission may by rule provide), shall be to act in the best 
    interest of the customer without regard to the financial or other 
    interest of the broker, dealer, or investment adviser providing the 
    advice. In accordance with such rules, any material conflicts of 
    interest shall be disclosed and may be consented to by the 
    customer. Such rules shall provide that such standard of conduct 
    shall be no less stringent than the standard applicable to 
    investment advisers under section 206(1) and (2) of this Act when 
    providing personalized investment advice about securities, except 
    the Commission shall not ascribe a meaning to the term `customer' 
    that would include an investor in a private fund managed by an 
    investment adviser, where such private fund has entered into an 
    advisory contract with such adviser. The receipt of compensation 
    based on commission or fees shall not, in and of itself, be 
    considered a violation of such standard applied to a broker, 
    dealer, or investment adviser.
        ``(2) Retail customer defined.--For purposes of this 
    subsection, the term `retail customer' means a natural person, or 
    the legal representative of such natural person, who--
            ``(A) receives personalized investment advice about 
        securities from a broker, dealer, or investment adviser; and
            ``(B) uses such advice primarily for personal, family, or 
        household purposes.
    ``(h) Other Matters.--The Commission shall--
        ``(1) facilitate the provision of simple and clear disclosures 
    to investors regarding the terms of their relationships with 
    brokers, dealers, and investment advisers, including any material 
    conflicts of interest; and
        ``(2) examine and, where appropriate, promulgate rules 
    prohibiting or restricting certain sales practices, conflicts of 
    interest, and compensation schemes for brokers, dealers, and 
    investment advisers that the Commission deems contrary to the 
    public interest and the protection of investors.''.
    (h) Harmonization of Enforcement.--
        (1) Securities exchange act of 1934.--Section 15 of the 
    Securities Exchange Act of 1934, as amended by subsection (g)(1), 
    is further amended by adding at the end the following new 
    subsection:
    ``(m) Harmonization of Enforcement.--The enforcement authority of 
the Commission with respect to violations of the standard of conduct 
applicable to a broker or dealer providing personalized investment 
advice about securities to a retail customer shall include--
        ``(1) the enforcement authority of the Commission with respect 
    to such violations provided under this Act; and
        ``(2) the enforcement authority of the Commission with respect 
    to violations of the standard of conduct applicable to an 
    investment adviser under the Investment Advisers Act of 1940, 
    including the authority to impose sanctions for such violations, 
    and
the Commission shall seek to prosecute and sanction violators of the 
standard of conduct applicable to a broker or dealer providing 
personalized investment advice about securities to a retail customer 
under this Act to same extent as the Commission prosecutes and 
sanctions violators of the standard of conduct applicable to an 
investment advisor under the Investment Advisers Act of 1940.''.
        (2) Investment advisers act of 1940.--Section 211 of the 
    Investment Advisers Act of 1940, as amended by subsection (g)(2), 
    is further amended by adding at the end the following new 
    subsection:
    ``(i) Harmonization of Enforcement.--The enforcement authority of 
the Commission with respect to violations of the standard of conduct 
applicable to an investment adviser shall include--
        ``(1) the enforcement authority of the Commission with respect 
    to such violations provided under this Act; and
        ``(2) the enforcement authority of the Commission with respect 
    to violations of the standard of conduct applicable to a broker or 
    dealer providing personalized investment advice about securities to 
    a retail customer under the Securities Exchange Act of 1934, 
    including the authority to impose sanctions for such violations, 
    and
the Commission shall seek to prosecute and sanction violators of the 
standard of conduct applicable to an investment adviser under this Act 
to same extent as the Commission prosecutes and sanctions violators of 
the standard of conduct applicable to a broker or dealer providing 
personalized investment advice about securities to a retail customer 
under the Securities Exchange Act of 1934.''.
    SEC. 914. STUDY ON ENHANCING INVESTMENT ADVISER EXAMINATIONS.
    (a) Study Required.--
        (1) In general.--The Commission shall review and analyze the 
    need for enhanced examination and enforcement resources for 
    investment advisers.
        (2) Areas of consideration.--The study required by this 
    subsection shall examine--
            (A) the number and frequency of examinations of investment 
        advisers by the Commission over the 5 years preceding the date 
        of the enactment of this subtitle;
            (B) the extent to which having Congress authorize the 
        Commission to designate one or more self-regulatory 
        organizations to augment the Commission's efforts in overseeing 
        investment advisers would improve the frequency of examinations 
        of investment advisers; and
            (C) current and potential approaches to examining the 
        investment advisory activities of dually registered broker-
        dealers and investment advisers or affiliated broker-dealers 
        and investment advisers.
    (b) Report Required.--The Commission shall report its findings to 
the Committee on Financial Services of the House of Representatives and 
the Committee on Banking, Housing, and Urban Affairs of the Senate, not 
later than 180 days after the date of enactment of this subtitle, and 
shall use such findings to revise its rules and regulations, as 
necessary. The report shall include a discussion of regulatory or 
legislative steps that are recommended or that may be necessary to 
address concerns identified in the study.
    SEC. 915. OFFICE OF THE INVESTOR ADVOCATE.
    Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d) is 
amended by adding at the end the following:
    ``(g) Office of the Investor Advocate.--
        ``(1) Office established.--There is established within the 
    Commission the Office of the Investor Advocate (in this subsection 
    referred to as the `Office').
        ``(2) Investor advocate.--
            ``(A) In general.--The head of the Office shall be the 
        Investor Advocate, who shall--
                ``(i) report directly to the Chairman; and
                ``(ii) be appointed by the Chairman, in consultation 
            with the Commission, from among individuals having 
            experience in advocating for the interests of investors in 
            securities and investor protection issues, from the 
            perspective of investors.
            ``(B) Compensation.--The annual rate of pay for the 
        Investor Advocate shall be equal to the highest rate of annual 
        pay for other senior executives who report to the Chairman of 
        the Commission.
            ``(C) Limitation on service.--An individual who serves as 
        the Investor Advocate may not be employed by the Commission--
                ``(i) during the 2-year period ending on the date of 
            appointment as Investor Advocate; or
                ``(ii) during the 5-year period beginning on the date 
            on which the person ceases to serve as the Investor 
            Advocate.
        ``(3) Staff of office.--The Investor Advocate, after 
    consultation with the Chairman of the Commission, may retain or 
    employ independent counsel, research staff, and service staff, as 
    the Investor Advocate deems necessary to carry out the functions, 
    powers, and duties of the Office.
        ``(4) Functions of the investor advocate.--The Investor 
    Advocate shall--
            ``(A) assist retail investors in resolving significant 
        problems such investors may have with the Commission or with 
        self-regulatory organizations;
            ``(B) identify areas in which investors would benefit from 
        changes in the regulations of the Commission or the rules of 
        self-regulatory organizations;
            ``(C) identify problems that investors have with financial 
        service providers and investment products;
            ``(D) analyze the potential impact on investors of--
                ``(i) proposed regulations of the Commission; and
                ``(ii) proposed rules of self-regulatory organizations 
            registered under this title; and
            ``(E) to the extent practicable, propose to the Commission 
        changes in the regulations or orders of the Commission and to 
        Congress any legislative, administrative, or personnel changes 
        that may be appropriate to mitigate problems identified under 
        this paragraph and to promote the interests of investors.
        ``(5) Access to documents.--The Commission shall ensure that 
    the Investor Advocate has full access to the documents of the 
    Commission and any self-regulatory organization, as necessary to 
    carry out the functions of the Office.
        ``(6) Annual reports.--
            ``(A) Report on objectives.--
                ``(i) In general.--Not later than June 30 of each year 
            after 2010, the Investor Advocate shall submit to the 
            Committee on Banking, Housing, and Urban Affairs of the 
            Senate and the Committee on Financial Services of the House 
            of Representatives a report on the objectives of the 
            Investor Advocate for the following fiscal year.
                ``(ii) Contents.--Each report required under clause (i) 
            shall contain full and substantive analysis and 
            explanation.
            ``(B) Report on activities.--
                ``(i) In general.--Not later than December 31 of each 
            year after 2010, the Investor Advocate shall submit to the 
            Committee on Banking, Housing, and Urban Affairs of the 
            Senate and the Committee on Financial Services of the House 
            of Representatives a report on the activities of the 
            Investor Advocate during the immediately preceding fiscal 
            year.
                ``(ii) Contents.--Each report required under clause (i) 
            shall include--

                    ``(I) appropriate statistical information and full 
                and substantive analysis;
                    ``(II) information on steps that the Investor 
                Advocate has taken during the reporting period to 
                improve investor services and the responsiveness of the 
                Commission and self-regulatory organizations to 
                investor concerns;
                    ``(III) a summary of the most serious problems 
                encountered by investors during the reporting period;
                    ``(IV) an inventory of the items described in 
                subclause (III) that includes--

                        ``(aa) identification of any action taken by 
                    the Commission or the self-regulatory organization 
                    and the result of such action;
                        ``(bb) the length of time that each item has 
                    remained on such inventory; and
                        ``(cc) for items on which no action has been 
                    taken, the reasons for inaction, and an 
                    identification of any official who is responsible 
                    for such action;

                    ``(V) recommendations for such administrative and 
                legislative actions as may be appropriate to resolve 
                problems encountered by investors; and
                    ``(VI) any other information, as determined 
                appropriate by the Investor Advocate.

                ``(iii) Independence.--Each report required under this 
            paragraph shall be provided directly to the Committees 
            listed in clause (i) without any prior review or comment 
            from the Commission, any commissioner, any other officer or 
            employee of the Commission, or the Office of Management and 
            Budget.
                ``(iv) Confidentiality.--No report required under 
            clause (i) may contain confidential information.
        ``(7) Regulations.--The Commission shall, by regulation, 
    establish procedures requiring a formal response to all 
    recommendations submitted to the Commission by the Investor 
    Advocate, not later than 3 months after the date of such 
    submission.''.
    SEC. 916. STREAMLINING OF FILING PROCEDURES FOR SELF-REGULATORY 
      ORGANIZATIONS.
    (a) Filing Procedures.--Section 19(b) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78s(b)) is amended by striking paragraph (2) 
(including the undesignated matter immediately following subparagraph 
(B)) and inserting the following:
        ``(2) Approval process.--
            ``(A) Approval process established.--
                ``(i) In general.--Except as provided in clause (ii), 
            not later than 45 days after the date of publication of a 
            proposed rule change under paragraph (1), the Commission 
            shall--

                    ``(I) by order, approve or disapprove the proposed 
                rule change; or
                    ``(II) institute proceedings under subparagraph (B) 
                to determine whether the proposed rule change should be 
                disapproved.

                ``(ii) Extension of time period.--The Commission may 
            extend the period established under clause (i) 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 self-regulatory organization that filed 
                the proposed rule change consents to the longer period.

            ``(B) Proceedings.--
                ``(i) Notice and hearing.--If the Commission does not 
            approve or disapprove a proposed rule change under 
            subparagraph (A), the Commission shall provide to the self-
            regulatory organization that filed the proposed rule 
            change--

                    ``(I) notice of the grounds for disapproval under 
                consideration; and
                    ``(II) opportunity for hearing, to be concluded not 
                later than 180 days after the date of publication of 
                notice of the filing of the proposed rule change.

                ``(ii) Order of approval or disapproval.--

                    ``(I) In general.--Except as provided in subclause 
                (II), not later than 180 days after the date of 
                publication under paragraph (1), the Commission shall 
                issue an order approving or disapproving the proposed 
                rule change.
                    ``(II) Extension of time period.--The Commission 
                may extend the period for issuance under clause (I) by 
                not more than 60 days, if--

                        ``(aa) the Commission determines that a longer 
                    period is appropriate and publishes the reasons for 
                    such determination; or
                        ``(bb) the self-regulatory organization that 
                    filed the proposed rule change consents to the 
                    longer period.
            ``(C) Standards for approval and disapproval.--
                ``(i) Approval.--The Commission shall approve a 
            proposed rule change of a self-regulatory organization if 
            it finds that such proposed rule change is consistent with 
            the requirements of this title and the rules and 
            regulations issued under this title that are applicable to 
            such organization.
                ``(ii) Disapproval.--The Commission shall disapprove a 
            proposed rule change of a self-regulatory organization if 
            it does not make a finding described in clause (i).
                ``(iii) Time for approval.--The Commission may not 
            approve a proposed rule change earlier than 30 days after 
            the date of publication under paragraph (1), unless the 
            Commission finds good cause for so doing and publishes the 
            reason for the finding.
            ``(D) Result of failure to institute or conclude 
        proceedings.--A proposed rule change shall be deemed to have 
        been approved by the Commission, if--
                ``(i) the Commission does not approve or disapprove the 
            proposed rule change or begin proceedings under 
            subparagraph (B) within the period described in 
            subparagraph (A); or
                ``(ii) the Commission does not issue an order approving 
            or disapproving the proposed rule change under subparagraph 
            (B) within the period described in subparagraph (B)(ii).
            ``(E) Publication date based on federal register 
        publishing.--For purposes of this paragraph, if, after filing a 
        proposed rule change with the Commission pursuant to paragraph 
        (1), a self-regulatory organization publishes a notice of the 
        filing of such proposed rule change, together with the 
        substantive terms of such proposed rule change, on a publicly 
        accessible website, the Commission shall thereafter send the 
        notice to the Federal Register for publication thereof under 
        paragraph (1) within 15 days of the date on which such website 
        publication is made. If the Commission fails to send the notice 
        for publication thereof within such 15 day period, then the 
        date of publication shall be deemed to be the date on which 
        such website publication was made.
            ``(F) Rulemaking.--
                ``(i) In general.--Not later than 180 days after the 
            date of enactment of the Investor Protection and Securities 
            Reform Act of 2010, after consultation with other 
            regulatory agencies, the Commission shall promulgate rules 
            setting forth the procedural requirements of the 
            proceedings required under this paragraph.
                ``(ii) Notice and comment not required.--The rules 
            promulgated by the Commission under clause (i) are not 
            required to include republication of proposed rule changes 
            or solicitation of public comment.''.
    (b) Clarification of Filing Date.--
        (1) Rule of construction.--Section 19(b) of the Securities 
    Exchange Act of 1934 (15 U.S.C. 78s(b)) is amended by adding at the 
    end the following:
        ``(10) Rule of construction relating to filing date of proposed 
    rule changes.--
            ``(A) In general.--For purposes of this subsection, the 
        date of filing of a proposed rule change shall be deemed to be 
        the date on which the Commission receives the proposed rule 
        change.
            ``(B) Exception.--A proposed rule change has not been 
        received by the Commission for purposes of subparagraph (A) if, 
        not later than 7 business days after the date of receipt by the 
        Commission, the Commission notifies the self-regulatory 
        organization that such proposed rule change does not comply 
        with the rules of the Commission relating to the required form 
        of a proposed rule change, except that if the Commission 
        determines that the proposed rule change is unusually lengthy 
        and is complex or raises novel regulatory issues, the 
        Commission shall inform the self-regulatory organization of 
        such determination not later than 7 business days after the 
        date of receipt by the Commission and, for the purposes of 
        subparagraph (A), a proposed rule change has not been received 
        by the Commission, if, not later than 21 days after the date of 
        receipt by the Commission, the Commission notifies the self-
        regulatory organization that such proposed rule change does not 
        comply with the rules of the Commission relating to the 
        required form of a proposed rule change.''.
        (2) Publication.--Section 19(b)(1) of the Securities Exchange 
    Act of 1934 (15 U.S.C. 78s(b)(1)) is amended by striking ``upon'' 
    and inserting ``as soon as practicable after the date of''.
    (c) Effective Date of Proposed Rules.--Section 19(b)(3) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78s(b)(3)) is amended--
        (1) in subparagraph (A)--
            (A) by striking ``may take effect'' and inserting ``shall 
        take effect''; and
            (B) by inserting ``on any person, whether or not the person 
        is a member of the self-regulatory organization'' after 
        ``charge imposed by the self-regulatory organization''; and
        (2) in subparagraph (C)--
            (A) by amending the second sentence to read as follows: 
        ``At any time within the 60-day period beginning on the date of 
        filing of such a proposed rule change in accordance with the 
        provisions of paragraph (1), the Commission summarily may 
        temporarily suspend the change in the rules of the self-
        regulatory organization made thereby, if it appears to the 
        Commission that such action is necessary or appropriate in the 
        public interest, for the protection of investors, or otherwise 
        in furtherance of the purposes of this title.'';
            (B) by inserting after the second sentence the following: 
        ``If the Commission takes such action, the Commission shall 
        institute proceedings under paragraph (2)(B) to determine 
        whether the proposed rule should be approved or disapproved.''; 
        and
            (C) in the third sentence, by striking ``the preceding 
        sentence'' and inserting ``this subparagraph''.
    (d) Conforming Change.--Section 19(b)(4)(D) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78s(b)(4)(D)) is amended to read as 
follows:
            ``(D)(i) The Commission shall order the temporary 
        suspension of any change in the rules of a clearing agency made 
        by a proposed rule change that has taken effect under paragraph 
        (3), if the appropriate regulatory agency for the clearing 
        agency notifies the Commission not later than 30 days after the 
        date on which the proposed rule change was filed of--
                ``(I) the determination by the appropriate regulatory 
            agency that the rules of such clearing agency, as so 
            changed, may be inconsistent with the safeguarding of 
            securities or funds in the custody or control of such 
            clearing agency or for which it is responsible; and
                ``(II) the reasons for the determination described in 
            subclause (I).
            ``(ii) If the Commission takes action under clause (i), the 
        Commission shall institute proceedings under paragraph (2)(B) 
        to determine if the proposed rule change should be approved or 
        disapproved.''.
    SEC. 917. STUDY REGARDING FINANCIAL LITERACY AMONG INVESTORS.
    (a) In General.--The Commission shall conduct a study to identify--
        (1) the existing level of financial literacy among retail 
    investors, including subgroups of investors identified by the 
    Commission;
        (2) methods to improve the timing, content, and format of 
    disclosures to investors with respect to financial intermediaries, 
    investment products, and investment services;
        (3) the most useful and understandable relevant information 
    that retail investors need to make informed financial decisions 
    before engaging a financial intermediary or purchasing an 
    investment product or service that is typically sold to retail 
    investors, including shares of open-end companies, as that term is 
    defined in section 5 of the Investment Company Act of 1940 (15 
    U.S.C. 80a-5) that are registered under section 8 of that Act;
        (4) methods to increase the transparency of expenses and 
    conflicts of interests in transactions involving investment 
    services and products, including shares of open-end companies 
    described in paragraph (3);
        (5) the most effective existing private and public efforts to 
    educate investors; and
        (6) in consultation with the Financial Literacy and Education 
    Commission, a strategy (including, to the extent practicable, 
    measurable goals and objectives) to increase the financial literacy 
    of investors in order to bring about a positive change in investor 
    behavior.
    (b) Report.--Not later than 2 years after the date of enactment of 
this Act, the Commission shall submit a report on the study required 
under subsection (a) to--
        (1) the Committee on Banking, Housing, and Urban Affairs of the 
    Senate; and
        (2) the Committee on Financial Services of the House of 
    Representatives.
    SEC. 918. STUDY REGARDING MUTUAL FUND ADVERTISING.
    (a) In General.--The Comptroller General of the United States shall 
conduct a study on mutual fund advertising to identify--
        (1) existing and proposed regulatory requirements for open-end 
    investment company advertisements;
        (2) current marketing practices for the sale of open-end 
    investment company shares, including the use of past performance 
    data, funds that have merged, and incubator funds;
        (3) the impact of such advertising on consumers; and
        (4) recommendations to improve investor protections in mutual 
    fund advertising and additional information necessary to ensure 
    that investors can make informed financial decisions when 
    purchasing shares.
    (b) Report.--Not later than 18 months after the date of enactment 
of this Act, the Comptroller General of the United States shall submit 
a report on the results of the study conducted under subsection (a) 
to--
        (1) the Committee on Banking, Housing, and Urban Affairs of the 
    United States Senate; and
        (2) the Committee on Financial Services of the House of 
    Representatives.
    SEC. 919. CLARIFICATION OF COMMISSION AUTHORITY TO REQUIRE INVESTOR 
      DISCLOSURES BEFORE PURCHASE OF INVESTMENT PRODUCTS AND SERVICES.
    Section 15 of the Securities Exchange Act of 1934 (15 U.S.C. 78o) 
is amended by adding at the end the following:
    ``(n) Disclosures to Retail Investors.--
        ``(1) In general.--Notwithstanding any other provision of the 
    securities laws, the Commission may issue rules designating 
    documents or information that shall be provided by a broker or 
    dealer to a retail investor before the purchase of an investment 
    product or service by the retail investor.
        ``(2) Considerations.--In developing any rules under paragraph 
    (1), the Commission shall consider whether the rules will promote 
    investor protection, efficiency, competition, and capital 
    formation.
        ``(3) Form and contents of documents and information.--Any 
    documents or information designated under a rule promulgated under 
    paragraph (1) shall--
            ``(A) be in a summary format; and
            ``(B) contain clear and concise information about--
                ``(i) investment objectives, strategies, costs, and 
            risks; and
                ``(ii) any compensation or other financial incentive 
            received by a broker, dealer, or other intermediary in 
            connection with the purchase of retail investment 
            products.''.
SEC. 919A. STUDY ON CONFLICTS OF INTEREST.
    (a) In General.--The Comptroller General of the United States shall 
conduct a study--
        (1) to identify and examine potential conflicts of interest 
    that exist between the staffs of the investment banking and equity 
    and fixed income securities analyst functions within the same firm; 
    and
        (2) to make recommendations to Congress designed to protect 
    investors in light of such conflicts.
    (b) Considerations.--In conducting the study under subsection (a), 
the Comptroller General shall--
        (1) consider--
            (A) the potential for investor harm resulting from 
        conflicts, including consideration of the forms of misconduct 
        engaged in by the several securities firms and individuals that 
        entered into the Global Analyst Research Settlements in 2003 
        (also known as the ``Global Settlement'');
            (B) the nature and benefits of the undertakings to which 
        those firms agreed in enforcement proceedings, including 
        firewalls between research and investment banking, separate 
        reporting lines, dedicated legal and compliance staffs, 
        allocation of budget, physical separation, compensation, 
        employee performance evaluations, coverage decisions, 
        limitations on soliciting investment banking business, 
        disclosures, transparency, and other measures;
            (C) whether any such undertakings should be codified and 
        applied permanently to securities firms, or whether the 
        Commission should adopt rules applying any such undertakings to 
        securities firms; and
            (D) whether to recommend regulatory or legislative measures 
        designed to mitigate possible adverse consequences to investors 
        arising from the conflicts of interest or to enhance investor 
        protection or confidence in the integrity of the securities 
        markets; and
        (2) consult with State attorneys general, State securities 
    officials, the Commission, the Financial Industry Regulatory 
    Authority (``FINRA''), NYSE Regulation, investor advocates, 
    brokers, dealers, retail investors, institutional investors, and 
    academics.
    (c) Report.--The Comptroller General shall submit a report on the 
results of the study required by this section to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives, not later than 18 
months after the date of enactment of this Act.
SEC. 919B. STUDY ON IMPROVED INVESTOR ACCESS TO INFORMATION ON 
INVESTMENT ADVISERS AND BROKER-DEALERS.
    (a) Study.--
        (1) In general.--Not later than 6 months after the date of 
    enactment of this Act, the Commission shall complete a study, 
    including recommendations, of ways to improve the access of 
    investors to registration information (including disciplinary 
    actions, regulatory, judicial, and arbitration proceedings, and 
    other information) about registered and previously registered 
    investment advisers, associated persons of investment advisers, 
    brokers and dealers and their associated persons on the existing 
    Central Registration Depository and Investment Adviser Registration 
    Depository systems, as well as identify additional information that 
    should be made publicly available.
        (2) Contents.--The study required by subsection (a) shall 
    include an analysis of the advantages and disadvantages of further 
    centralizing access to the information contained in the 2 systems, 
    including--
            (A) identification of those data pertinent to investors; 
        and
            (B) the identification of the method and format for 
        displaying and publishing such data to enhance accessibility by 
        and utility to investors.
    (b) Implementation.--Not later than 18 months after the date of 
completion of the study required by subsection (a), the Commission 
shall implement any recommendations of the study.
SEC. 919C. STUDY ON FINANCIAL PLANNERS AND THE USE OF FINANCIAL 
DESIGNATIONS.
    (a) In General.--The Comptroller General of the United States shall 
conduct a study to evaluate--
        (1) the effectiveness of State and Federal regulations to 
    protect investors and other consumers from individuals who hold 
    themselves out as financial planners through the use of misleading 
    titles, designations, or marketing materials;
        (2) current State and Federal oversight structure and 
    regulations for financial planners; and
        (3) legal or regulatory gaps in the regulation of financial 
    planners and other individuals who provide or offer to provide 
    financial planning services to consumers.
    (b) Considerations.--In conducting the study required under 
subsection (a), the Comptroller General shall consider--
        (1) the role of financial planners in providing advice 
    regarding the management of financial resources, including 
    investment planning, income tax planning, education planning, 
    retirement planning, estate planning, and risk management;
        (2) whether current regulations at the State and Federal level 
    provide adequate ethical and professional standards for financial 
    planners;
        (3) the possible risk posed to investors and other consumers by 
    individuals who hold themselves out as financial planners or as 
    otherwise providing financial planning services in connection with 
    the sale of financial products, including insurance and securities;
        (4) the possible risk posed to investors and other consumers by 
    individuals who otherwise use titles, designations, or marketing 
    materials in a misleading way in connection with the delivery of 
    financial advice;
        (6) the ability of investors and other consumers to understand 
    licensing requirements and standards of care that apply to 
    individuals who hold themselves out as financial planners or as 
    otherwise providing financial planning services;
        (7) the possible benefits to investors and other consumers of 
    regulation and professional oversight of financial planners; and
        (8) any other consideration that the Comptroller General deems 
    necessary or appropriate to effectively execute the study required 
    under subsection (a).
    (c) Recommendations.--In providing recommendations for the 
appropriate regulation of financial planners and other individuals who 
provide or offer to provide financial planning services, in order to 
protect investors and other consumers of financial planning services, 
the Comptroller General shall consider--
        (1) the appropriate structure for regulation of financial 
    planners and individuals providing financial planning services; and
        (2) the appropriate scope of the regulations needed to protect 
    investors and other consumers, including but not limited to the 
    need to establish competency standards, practice standards, ethical 
    guidelines, disciplinary authority, and transparency to investors 
    and other consumers.
    (d) Report.--
        (1) In general.--Not later than 180 days after the date of 
    enactment of this Act, the Comptroller General shall submit a 
    report on the study required under subsection (a) to--
            (A) the Committee on Banking, Housing, and Urban Affairs of 
        the Senate;
            (B) the Special Committee on Aging of the Senate; and
            (C) the Committee on Financial Services of the House of 
        Representatives.
        (2) Content requirements.--The report required under paragraph 
    (1) shall describe the findings and determinations made by the 
    Comptroller General in carrying out the study required under 
    subsection (a), including a description of the considerations, 
    analysis, and government, public, industry, nonprofit and consumer 
    input that the Comptroller General considered to make such 
    findings, conclusions, and legislative, regulatory, or other 
    recommendations.
SEC. 919D. OMBUDSMAN.
    Section 4(g) of the Securities Exchange Act of 1934, as added by 
section 914, is amended by adding at the end the following:
        ``(8) Ombudsman.--
            ``(A) Appointment.--Not later than 180 days after the date 
        on which the first Investor Advocate is appointed under 
        paragraph (2)(A)(i), the Investor Advocate shall appoint an 
        Ombudsman, who shall report directly to the Investor Advocate.
            ``(B) Duties.--The Ombudsman appointed under subparagraph 
        (A) shall--
                ``(i) act as a liaison between the Commission and any 
            retail investor in resolving problems that retail investors 
            may have with the Commission or with self-regulatory 
            organizations;
                ``(ii) review and make recommendations regarding 
            policies and procedures to encourage persons to present 
            questions to the Investor Advocate regarding compliance 
            with the securities laws; and
                ``(iii) establish safeguards to maintain the 
            confidentiality of communications between the persons 
            described in clause (ii) and the Ombudsman.
            ``(C) Limitation.--In carrying out the duties of the 
        Ombudsman under subparagraph (B), the Ombudsman shall utilize 
        personnel of the Commission to the extent practicable. Nothing 
        in this paragraph shall be construed as replacing, altering, or 
        diminishing the activities of any ombudsman or similar office 
        of any other agency.
            ``(D) Report.--The Ombudsman shall submit a semiannual 
        report to the Investor Advocate that describes the activities 
        and evaluates the effectiveness of the Ombudsman during the 
        preceding year. The Investor Advocate shall include the reports 
        required under this section in the reports required to be 
        submitted by the Inspector Advocate under paragraph (6).''.

       Subtitle B--Increasing Regulatory Enforcement and Remedies

    SEC. 921. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE ARBITRATION.
    (a) Amendment to Securities Exchange Act of 1934.--Section 15 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78o), as amended by this 
title, is further amended by adding at the end the following new 
subsection:
    ``(o) Authority to Restrict Mandatory Pre-dispute Arbitration.--The 
Commission, by rule, may prohibit, or impose conditions or limitations 
on the use of, agreements that require customers or clients of any 
broker, dealer, or municipal securities dealer to arbitrate any future 
dispute between them arising under the Federal securities laws, the 
rules and regulations thereunder, or the rules of a self-regulatory 
organization if it finds that such prohibition, imposition of 
conditions, or limitations are in the public interest and for the 
protection of investors.''.
    (b) Amendment to Investment Advisers Act of 1940.--Section 205 of 
the Investment Advisers Act of 1940 (15 U.S.C. 80b-5) is amended by 
adding at the end the following new subsection:
    ``(f) Authority to Restrict Mandatory Pre-dispute Arbitration.--The 
Commission, by rule, may prohibit, or impose conditions or limitations 
on the use of, agreements that require customers or clients of any 
investment adviser to arbitrate any future dispute between them arising 
under the Federal securities laws, the rules and regulations 
thereunder, or the rules of a self-regulatory organization if it finds 
that such prohibition, imposition of conditions, or limitations are in 
the public interest and for the protection of investors.''.
    SEC. 922. WHISTLEBLOWER PROTECTION.
    (a) In General.--The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended by inserting after section 21E the following:
    ``SEC. 21F. SECURITIES WHISTLEBLOWER INCENTIVES AND PROTECTION.
    ``(a) Definitions.--In this section the following definitions shall 
apply:
        ``(1) Covered judicial or administrative action.--The term 
    `covered judicial or administrative action' means any judicial or 
    administrative action brought by the Commission under the 
    securities laws that results in monetary sanctions exceeding 
    $1,000,000.
        ``(2) Fund.--The term `Fund' means the Securities and Exchange 
    Commission Investor Protection Fund.
        ``(3) Original information.--The term `original information' 
    means information that--
            ``(A) is derived from the independent knowledge or analysis 
        of a whistleblower;
            ``(B) is not known to the Commission from any other source, 
        unless the whistleblower is the original source of the 
        information; and
            ``(C) is not exclusively derived from an allegation made in 
        a judicial or administrative hearing, in a governmental report, 
        hearing, audit, or investigation, or from the news media, 
        unless the whistleblower is a source of the information.
        ``(4) Monetary sanctions.--The term `monetary sanctions', when 
    used with respect to any judicial or administrative action, means--
            ``(A) any monies, including penalties, disgorgement, and 
        interest, ordered to be paid; and
            ``(B) any monies deposited into a disgorgement fund or 
        other fund pursuant to section 308(b) of the Sarbanes-Oxley Act 
        of 2002 (15 U.S.C. 7246(b)), as a result of such action or any 
        settlement of such action.
        ``(5) Related action.--The term `related action', when used 
    with respect to any judicial or administrative action brought by 
    the Commission under the securities laws, means any judicial or 
    administrative action brought by an entity described in subclauses 
    (I) through (IV) of subsection (h)(2)(D)(i) that is based upon the 
    original information provided by a whistleblower pursuant to 
    subsection (a) that led to the successful enforcement of the 
    Commission action.
        ``(6) Whistleblower.--The term `whistleblower' means any 
    individual who provides, or 2 or more individuals acting jointly 
    who provide, information relating to a violation of the securities 
    laws to the Commission, in a manner established, by rule or 
    regulation, by the Commission.
    ``(b) Awards.--
        ``(1) In general.--In any covered judicial or administrative 
    action, or related action, the Commission, under regulations 
    prescribed by the Commission and subject to subsection (c), shall 
    pay an award or awards to 1 or more whistleblowers who voluntarily 
    provided original information to the Commission that led to the 
    successful enforcement of the covered judicial or administrative 
    action, or related action, in an aggregate amount equal to--
            ``(A) not less than 10 percent, in total, of what has been 
        collected of the monetary sanctions imposed in the action or 
        related actions; and
            ``(B) not more than 30 percent, in total, of what has been 
        collected of the monetary sanctions imposed in the action or 
        related actions.
        ``(2) Payment of awards.--Any amount paid under paragraph (1) 
    shall be paid from the Fund.
    ``(c) Determination of Amount of Award; Denial of Award.--
        ``(1) Determination of amount of award.--
            ``(A) Discretion.--The determination of the amount of an 
        award made under subsection (b) shall be in the discretion of 
        the Commission.
            ``(B) Criteria.--In determining the amount of an award made 
        under subsection (b), the Commission--
                ``(i) shall take into consideration--

                    ``(I) the significance of the information provided 
                by the whistleblower to the success of the covered 
                judicial or administrative action;
                    ``(II) the degree of assistance provided by the 
                whistleblower and any legal representative of the 
                whistleblower in a covered judicial or administrative 
                action;
                    ``(III) the programmatic interest of the Commission 
                in deterring violations of the securities laws by 
                making awards to whistleblowers who provide information 
                that lead to the successful enforcement of such laws; 
                and
                    ``(IV) such additional relevant factors as the 
                Commission may establish by rule or regulation; and

                ``(ii) shall not take into consideration the balance of 
            the Fund.
        ``(2) Denial of award.--No award under subsection (b) shall be 
    made--
            ``(A) to any whistleblower who is, or was at the time the 
        whistleblower acquired the original information submitted to 
        the Commission, a member, officer, or employee of--
                ``(i) an appropriate regulatory agency;
                ``(ii) the Department of Justice;
                ``(iii) a self-regulatory organization;
                ``(iv) the Public Company Accounting Oversight Board; 
            or
                ``(v) a law enforcement organization;
            ``(B) to any whistleblower who is convicted of a criminal 
        violation related to the judicial or administrative action for 
        which the whistleblower otherwise could receive an award under 
        this section;
            ``(C) to any whistleblower who gains the information 
        through the performance of an audit of financial statements 
        required under the securities laws and for whom such submission 
        would be contrary to the requirements of section 10A of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78j-1); or
            ``(D) to any whistleblower who fails to submit information 
        to the Commission in such form as the Commission may, by rule, 
        require.
    ``(d) Representation.--
        ``(1) Permitted representation.--Any whistleblower who makes a 
    claim for an award under subsection (b) may be represented by 
    counsel.
        ``(2) Required representation.--
            ``(A) In general.--Any whistleblower who anonymously makes 
        a claim for an award under subsection (b) shall be represented 
        by counsel if the whistleblower anonymously submits the 
        information upon which the claim is based.
            ``(B) Disclosure of identity.--Prior to the payment of an 
        award, a whistleblower shall disclose the identity of the 
        whistleblower and provide such other information as the 
        Commission may require, directly or through counsel for the 
        whistleblower.
    ``(e) No Contract Necessary.--No contract with the Commission is 
necessary for any whistleblower to receive an award under subsection 
(b), unless otherwise required by the Commission by rule or regulation.
    ``(f) Appeals.--Any determination made under this section, 
including whether, to whom, or in what amount to make awards, shall be 
in the discretion of the Commission. Any such determination, except the 
determination of the amount of an award if the award was made in 
accordance with subsection (b), may be appealed to the appropriate 
court of appeals of the United States not more than 30 days after the 
determination is issued by the Commission. The court shall review the 
determination made by the Commission in accordance with section 706 of 
title 5, United States Code.
    ``(g) Investor Protection Fund.--
        ``(1) Fund established.--There is established in the Treasury 
    of the United States a fund to be known as the `Securities and 
    Exchange Commission Investor Protection Fund'.
        ``(2) Use of fund.--The Fund shall be available to the 
    Commission, without further appropriation or fiscal year 
    limitation, for--
            ``(A) paying awards to whistleblowers as provided in 
        subsection (b); and
            ``(B) funding the activities of the Inspector General of 
        the Commission under section 4(i).
        ``(3) Deposits and credits.--
            ``(A)  In general.--There shall be deposited into or 
        credited to the Fund an amount equal to--
                ``(i) any monetary sanction collected by the Commission 
            in any judicial or administrative action brought by the 
            Commission under the securities laws that is not added to a 
            disgorgement fund or other fund under section 308 of the 
            Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246) or otherwise 
            distributed to victims of a violation of the securities 
            laws, or the rules and regulations thereunder, underlying 
            such action, unless the balance of the Fund at the time the 
            monetary sanction is collected exceeds $300,000,000;
                ``(ii) any monetary sanction added to a disgorgement 
            fund or other fund under section 308 of the Sarbanes-Oxley 
            Act of 2002 (15 U.S.C. 7246) that is not distributed to the 
            victims for whom the Fund was established, unless the 
            balance of the disgorgement fund at the time the 
            determination is made not to distribute the monetary 
            sanction to such victims exceeds $200,000,000; and
                ``(iii) all income from investments made under 
            paragraph (4).
            ``(B) Additional amounts.--If the amounts deposited into or 
        credited to the Fund under subparagraph (A) are not sufficient 
        to satisfy an award made under subsection (b), there shall be 
        deposited into or credited to the Fund an amount equal to the 
        unsatisfied portion of the award from any monetary sanction 
        collected by the Commission in the covered judicial or 
        administrative action on which the award is based.
        ``(4) Investments.--
            ``(A) Amounts in fund may be invested.--The Commission may 
        request the Secretary of the Treasury to invest the portion of 
        the Fund that is not, in the discretion of the Commission, 
        required to meet the current needs of the Fund.
            ``(B) Eligible investments.--Investments shall be made by 
        the Secretary of the Treasury in obligations of the United 
        States or obligations that are guaranteed as to principal and 
        interest by the United States, with maturities suitable to the 
        needs of the Fund as determined by the Commission on the 
        record.
            ``(C) Interest and proceeds credited.--The interest on, and 
        the proceeds from the sale or redemption of, any obligations 
        held in the Fund shall be credited to the Fund.
        ``(5) Reports to congress.--Not later than October 30 of each 
    fiscal year beginning after the date of enactment of this 
    subsection, the Commission shall submit to the Committee on 
    Banking, Housing, and Urban Affairs of the Senate, and the 
    Committee on Financial Services of the House of Representatives a 
    report on--
            ``(A) the whistleblower award program, established under 
        this section, including--
                ``(i) a description of the number of awards granted; 
            and
                ``(ii) the types of cases in which awards were granted 
            during the preceding fiscal year;
            ``(B) the balance of the Fund at the beginning of the 
        preceding fiscal year;
            ``(C) the amounts deposited into or credited to the Fund 
        during the preceding fiscal year;
            ``(D) the amount of earnings on investments made under 
        paragraph (4) during the preceding fiscal year;
            ``(E) the amount paid from the Fund during the preceding 
        fiscal year to whistleblowers pursuant to subsection (b);
            ``(F) the balance of the Fund at the end of the preceding 
        fiscal year; and
            ``(G) a complete set of audited financial statements, 
        including--
                ``(i) a balance sheet;
                ``(ii) income statement; and
                ``(iii) cash flow analysis.
    ``(h) Protection of Whistleblowers.--
        ``(1) Prohibition against retaliation.--
            ``(A) In general.--No employer may discharge, demote, 
        suspend, threaten, harass, directly or indirectly, or in any 
        other manner discriminate against, a whistleblower in the terms 
        and conditions of employment because of any lawful act done by 
        the whistleblower--
                ``(i) in providing information to the Commission in 
            accordance with this section;
                ``(ii) in initiating, testifying in, or assisting in 
            any investigation or judicial or administrative action of 
            the Commission based upon or related to such information; 
            or
                ``(iii) in making disclosures that are required or 
            protected under the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
            7201 et seq.), the Securities Exchange Act of 1934 (15 
            U.S.C. 78a et seq.), including section 10A(m) of such Act 
            (15 U.S.C. 78f(m)), section 1513(e) of title 18, United 
            States Code, and any other law, rule, or regulation subject 
            to the jurisdiction of the Commission.
            ``(B) Enforcement.--
                ``(i) Cause of action.--An individual who alleges 
            discharge or other discrimination in violation of 
            subparagraph (A) may bring an action under this subsection 
            in the appropriate district court of the United States for 
            the relief provided in subparagraph (C).
                ``(ii) Subpoenas.--A subpoena requiring the attendance 
            of a witness at a trial or hearing conducted under this 
            section may be served at any place in the United States.
                ``(iii) Statute of limitations.--

                    ``(I) In general.--An action under this subsection 
                may not be brought--

                        ``(aa) more than 6 years after the date on 
                    which the violation of subparagraph (A) occurred; 
                    or
                        ``(bb) more than 3 years after the date when 
                    facts material to the right of action are known or 
                    reasonably should have been known by the employee 
                    alleging a violation of subparagraph (A).

                    ``(II) Required action within 10 years.--
                Notwithstanding subclause (I), an action under this 
                subsection may not in any circumstance be brought more 
                than 10 years after the date on which the violation 
                occurs.

            ``(C) Relief.--Relief for an individual prevailing in an 
        action brought under subparagraph (B) shall include--
                ``(i) reinstatement with the same seniority status that 
            the individual would have had, but for the discrimination;
                ``(ii) 2 times the amount of back pay otherwise owed to 
            the individual, with interest; and
                ``(iii) compensation for litigation costs, expert 
            witness fees, and reasonable attorneys' fees.
        ``(2) Confidentiality.--
            ``(A) In general.--Except as provided in subparagraphs (B) 
        and (C), the Commission and any officer or employee of the 
        Commission shall not disclose any information, including 
        information provided by a whistleblower to the Commission, 
        which could reasonably be expected to reveal the identity of a 
        whistleblower, except in accordance with the provisions of 
        section 552a of title 5, United States Code, unless and until 
        required to be disclosed to a defendant or respondent in 
        connection with a public proceeding instituted by the 
        Commission or any entity described in subparagraph (C). For 
        purposes of section 552 of title 5, United States Code, this 
        paragraph shall be considered a statute described in subsection 
        (b)(3)(B) of such section.
            ``(B) Exempted statute.--For purposes of section 552 of 
        title 5, United States Code, this paragraph shall be considered 
        a statute described in subsection (b)(3)(B) of such section 
        552.
            ``(C) Rule of construction.--Nothing in this section is 
        intended to limit, or shall be construed to limit, the ability 
        of the Attorney General to present such evidence to a grand 
        jury or to share such evidence with potential witnesses or 
        defendants in the course of an ongoing criminal investigation.
            ``(D) Availability to government agencies.--
                ``(i) In general.--Without the loss of its status as 
            confidential in the hands of the Commission, all 
            information referred to in subparagraph (A) may, in the 
            discretion of the Commission, when determined by the 
            Commission to be necessary to accomplish the purposes of 
            this Act and to protect investors, be made available to--

                    ``(I) the Attorney General of the United States;
                    ``(II) an appropriate regulatory authority;
                    ``(III) a self-regulatory organization;
                    ``(IV) a State attorney general in connection with 
                any criminal investigation;
                    ``(V) any appropriate State regulatory authority;
                    ``(VI) the Public Company Accounting Oversight 
                Board;
                    ``(VII) a foreign securities authority; and
                    ``(VIII) a foreign law enforcement authority.

                ``(ii) Confidentiality.--

                    ``(I) In general.--Each of the entities described 
                in subclauses (I) through (VI) of clause (i) shall 
                maintain such information as confidential in accordance 
                with the requirements established under subparagraph 
                (A).
                    ``(II) Foreign authorities.--Each of the entities 
                described in subclauses (VII) and (VIII) of clause (i) 
                shall maintain such information in accordance with such 
                assurances of confidentiality as the Commission 
                determines appropriate.

        ``(3) Rights retained.--Nothing in this section shall be deemed 
    to diminish the rights, privileges, or remedies of any 
    whistleblower under any Federal or State law, or under any 
    collective bargaining agreement.
    ``(i) Provision of False Information.--A whistleblower shall not be 
entitled to an award under this section if the whistleblower--
        ``(1) knowingly and willfully makes any false, fictitious, or 
    fraudulent statement or representation; or
        ``(2) uses any false writing or document knowing the writing or 
    document contains any false, fictitious, or fraudulent statement or 
    entry.
    ``(j) Rulemaking Authority.--The Commission shall have the 
authority to issue such rules and regulations as may be necessary or 
appropriate to implement the provisions of this section consistent with 
the purposes of this section.''.
    (b) Protection for Employees of Nationally Recognized Statistical 
Rating Organizations.--Section 1514A(a) of title 18, United States 
Code, is amended--
        (1) by inserting ``or nationally recognized statistical rating 
    organization (as defined in section 3(a) of the Securities Exchange 
    Act of 1934 (15 U.S.C. 78c),'' after ``78o(d)),''; and
        (2) by inserting ``or nationally recognized statistical rating 
    organization'' after ``such company''.
    (c) Section 1514A of Title 18, United States Code.--
        (1) Statute of limitations; jury trial.--Section 1514A(b)(2) of 
    title 18, United States Code, is amended--
            (A) in subparagraph (D)--
                (i) by striking ``90'' and inserting ``180''; and
                (ii) by striking the period at the end and inserting 
            ``, or after the date on which the employee became aware of 
            the violation.''; and
            (B) by adding at the end the following:
            ``(E) Jury trial.--A party to an action brought under 
        paragraph (1)(B) shall be entitled to trial by jury.''.
        (2) Private securities litigation witnesses; nonenforceability; 
    information.--Section 1514A of title 18, United States Code, is 
    amended by adding at the end the following:
    ``(e) Nonenforceability of Certain Provisions Waiving Rights and 
Remedies or Requiring Arbitration of Disputes.--
        ``(1) Waiver of rights and remedies.--The rights and remedies 
    provided for in this section may not be waived by any agreement, 
    policy form, or condition of employment, including by a predispute 
    arbitration agreement.
        ``(2) Predispute arbitration agreements.--No predispute 
    arbitration agreement shall be valid or enforceable, if the 
    agreement requires arbitration of a dispute arising under this 
    section.''.
    (d) Study of Whistleblower Protection Program.--
        (1) Study.--The Inspector General of the Commission shall 
    conduct a study of the whistleblower protections established under 
    the amendments made by this section, including--
            (A) whether the final rules and regulation issued under the 
        amendments made by this section have made the whistleblower 
        protection program (referred to in this subsection as the 
        ``program'') clearly defined and user-friendly;
            (B) whether the program is promoted on the website of the 
        Commission and has been widely publicized;
            (C) whether the Commission is prompt in--
                (i) responding to--

                    (I) information provided by whistleblowers; and
                    (II) applications for awards filed by 
                whistleblowers;

                (ii) updating whistleblowers about the status of their 
            applications; and
                (iii) otherwise communicating with the interested 
            parties;
            (D) whether the minimum and maximum reward levels are 
        adequate to entice whistleblowers to come forward with 
        information and whether the reward levels are so high as to 
        encourage illegitimate whistleblower claims;
            (E) whether the appeals process has been unduly burdensome 
        for the Commission;
            (F) whether the funding mechanism for the Investor 
        Protection Fund is adequate;
            (G) whether, in the interest of protecting investors and 
        identifying and preventing fraud, it would be useful for 
        Congress to consider empowering whistleblowers or other 
        individuals, who have already attempted to pursue the case 
        through the Commission, to have a private right of action to 
        bring suit based on the facts of the same case, on behalf of 
        the Government and themselves, against persons who have 
        committee securities fraud;
            (H)(i) whether the exemption under section 552(b)(3) of 
        title 5 (known as the Freedom of Information Act) established 
        in section 21F(h)(2)(A) of the Securities Exchange Act of 1934, 
        as added by this Act, aids whistleblowers in disclosing 
        information to the Commission;
            (ii) what impact the exemption described in clause (i) has 
        had on the ability of the public to access information about 
        the regulation and enforcement by the Commission of securities; 
        and
            (iii) any recommendations on whether the exemption 
        described in clause (i) should remain in effect; and
            (I) such other matters as the Inspector General deems 
        appropriate.
        (2) Report.--Not later than 30 months after the date of 
    enactment of this Act, the Inspector General shall--
            (A) submit a report on the findings of the study required 
        under paragraph (1) to the Committee on Banking, Housing, and 
        Urban Affairs of the Senate and the Committee on Financial 
        Services of the House; and
            (B) make the report described in subparagraph (A) available 
        to the public through publication of the report on the website 
        of the Commission.
    SEC. 923. CONFORMING AMENDMENTS FOR WHISTLEBLOWER PROTECTION.
    (a) In General.--
        (1) Securities act of 1933.--Section 20(d)(3)(A) of the 
    Securities Act of 1933 (15 U.S.C. 77t(d)(3)(A)) is amended by 
    inserting ``and section 21F of the Securities Exchange Act of 
    1934'' after ``the Sarbanes-Oxley Act of 2002''.
        (2) Investment company act of 1940.--Section 42(e)(3)(A) of the 
    Investment Company Act of 1940 (15 U.S.C. 80a-41(e)(3)(A)) is 
    amended by inserting ``and section 21F of the Securities Exchange 
    Act of 1934'' after ``the Sarbanes-Oxley Act of 2002''.
        (3) Investment advisers act of 1940.--Section 209(e)(3)(A) of 
    the Investment Advisers Act of 1940 (15 U.S.C. 80b-9(e)(3)(A)) is 
    amended by inserting ``and section 21F of the Securities Exchange 
    Act of 1934'' after ``the Sarbanes-Oxley Act of 2002''.
    (b) Securities Exchange Act.--
        (1) Section 21.--Section 21(d)(3)(C)(i) of the Securities 
    Exchange Act of 1934 (15 U.S.C. 78u(d)(3)(C)(i)) is amended by 
    inserting ``and section 21F of this title'' after ``the Sarbanes-
    Oxley Act of 2002''.
        (2) Section 21a.--Section 21A of the Securities Exchange Act of 
    1934 (15 U.S.C. 78u-1) is amended--
            (A) in subsection (d)(1) by--
                (i) striking ``(subject to subsection (e))''; and
                (ii) inserting ``and section 21F of this title'' after 
            ``the Sarbanes-Oxley Act of 2002'';
            (B) by striking subsection (e); and
            (C) by redesignating subsections (f) and (g) as subsections 
        (e) and (f), respectively.
    SEC. 924. IMPLEMENTATION AND TRANSITION PROVISIONS FOR 
      WHISTLEBLOWER PROTECTION.
    (a) Implementing Rules.--The Commission shall issue final 
regulations implementing the provisions of section 21F of the 
Securities Exchange Act of 1934, as added by this subtitle, not later 
than 270 days after the date of enactment of this Act.
    (b) Original Information.--Information provided to the Commission 
in writing by a whistleblower shall not lose the status of original 
information (as defined in section 21F(a)(3) of the Securities Exchange 
Act of 1934, as added by this subtitle) solely because the 
whistleblower provided the information prior to the effective date of 
the regulations, if the information is provided by the whistleblower 
after the date of enactment of this subtitle.
    (c) Awards.--A whistleblower may receive an award pursuant to 
section 21F of the Securities Exchange Act of 1934, as added by this 
subtitle, regardless of whether any violation of a provision of the 
securities laws, or a rule or regulation thereunder, underlying the 
judicial or administrative action upon which the award is based, 
occurred prior to the date of enactment of this subtitle.
    (d) Administration and Enforcement.--The Securities and Exchange 
Commission shall establish a separate office within the Commission to 
administer and enforce the provisions of section 21F of the Securities 
Exchange Act of 1934 (as add by section 922(a)). Such office shall 
report annually to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of the House of 
Representatives on its activities, whistleblower complaints, and the 
response of the Commission to such complaints.
    SEC. 925. COLLATERAL BARS.
    (a) Securities Exchange Act of 1934.--
        (1) Section 15.--Section 15(b)(6)(A) of the Securities Exchange 
    Act of 1934 (15 U.S.C. 78o(b)(6)(A)) is amended by striking ``12 
    months, or bar such person from being associated with a broker or 
    dealer,'' and inserting ``12 months, or bar any such person from 
    being associated with a broker, dealer, investment adviser, 
    municipal securities dealer, municipal advisor, transfer agent, or 
    nationally recognized statistical rating organization,''.
        (2) Section 15b.--Section 15B(c)(4) of the Securities Exchange 
    Act of 1934 (15 U.S.C. 78o-4(c)(4)) is amended by striking ``twelve 
    months or bar any such person from being associated with a 
    municipal securities dealer,'' and inserting ``12 months or bar any 
    such person from being associated with a broker, dealer, investment 
    adviser, municipal securities dealer, municipal advisor, transfer 
    agent, or nationally recognized statistical rating organization,''.
        (3) Section 17a.--Section 17A(c)(4)(C) of the Securities 
    Exchange Act of 1934 (15 U.S.C. 78q-1(c)(4)(C)) is amended by 
    striking ``twelve months or bar any such person from being 
    associated with the transfer agent,'' and inserting ``12 months or 
    bar any such person from being associated with any transfer agent, 
    broker, dealer, investment adviser, municipal securities dealer, 
    municipal advisor, or nationally recognized statistical rating 
    organization,''.
    (b) Investment Advisers Act of 1940.--Section 203(f) of the 
Investment Advisers Act of 1940 (15 U.S.C. 80b-3(f)) is amended by 
striking ``twelve months or bar any such person from being associated 
with an investment adviser,'' and inserting ``12 months or bar any such 
person from being associated with an investment adviser, broker, 
dealer, municipal securities dealer, municipal advisor, transfer agent, 
or nationally recognized statistical rating organization,''.
    SEC. 926. DISQUALIFYING FELONS AND OTHER ``BAD ACTORS'' FROM 
      REGULATION D OFFERINGS.
    Not later than 1 year after the date of enactment of this Act, the 
Commission shall issue rules for the disqualification of offerings and 
sales of securities made under section 230.506 of title 17, Code of 
Federal Regulations, that--
        (1) are substantially similar to the provisions of section 
    230.262 of title 17, Code of Federal Regulations, or any successor 
    thereto; and
        (2) disqualify any offering or sale of securities by a person 
    that--
            (A) is subject to a final order of a State securities 
        commission (or an agency or officer of a State performing like 
        functions), a State authority that supervises or examines 
        banks, savings associations, or credit unions, a State 
        insurance commission (or an agency or officer of a State 
        performing like functions), an appropriate Federal banking 
        agency, or the National Credit Union Administration, that--
                (i) bars the person from--

                    (I) association with an entity regulated by such 
                commission, authority, agency, or officer;
                    (II) engaging in the business of securities, 
                insurance, or banking; or
                    (III) engaging in savings association or credit 
                union activities; or

                (ii) constitutes a final order based on a violation of 
            any law or regulation that prohibits fraudulent, 
            manipulative, or deceptive conduct within the 10-year 
            period ending on the date of the filing of the offer or 
            sale; or
            (B) has been convicted of any felony or misdemeanor in 
        connection with the purchase or sale of any security or 
        involving the making of any false filing with the Commission.
    SEC. 927. EQUAL TREATMENT OF SELF-REGULATORY ORGANIZATION RULES.
    Section 29(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78cc(a)) is amended by striking ``an exchange required thereby'' and 
inserting ``a self-regulatory organization,''.
    SEC. 928. CLARIFICATION THAT SECTION 205 OF THE INVESTMENT ADVISERS 
      ACT OF 1940 DOES NOT APPLY TO STATE-REGISTERED ADVISERS.
    Section 205(a) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-5(a)) is amended, in the matter preceding paragraph (1)--
        (1) by striking ``, unless exempt from registration pursuant to 
    section 203(b),'' and inserting ``registered or required to be 
    registered with the Commission'';
        (2) by striking ``make use of the mails or any means or 
    instrumentality of interstate commerce, directly or indirectly, 
    to''; and
        (3) by striking ``to'' after ``in any way''.
    SEC. 929. UNLAWFUL MARGIN LENDING.
    Section 7(c)(1)(A) of the Securities Exchange Act of 1934 (15 
U.S.C. 78g(c)(1)(A)) is amended by striking ``; and'' and inserting ``; 
or''.
SEC. 929A. PROTECTION FOR EMPLOYEES OF SUBSIDIARIES AND AFFILIATES OF 
PUBLICLY TRADED COMPANIES.
    Section 1514A of title 18, United States Code, is amended by 
inserting ``including any subsidiary or affiliate whose financial 
information is included in the consolidated financial statements of 
such company'' after ``the Securities Exchange Act of 1934 (15 U.S.C. 
78o(d))''.
SEC. 929B. FAIR FUND AMENDMENTS.
    Section 308 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246(a)) 
is amended--
        (1) by striking subsection (a) and inserting the following:
    ``(a) Civil Penalties to Be Used for the Relief of Victims.--If, in 
any judicial or administrative action brought by the Commission under 
the securities laws, the Commission obtains a civil penalty against any 
person for a violation of such laws, or such person agrees, in 
settlement of any such action, to such civil penalty, the amount of 
such civil penalty 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) in subsection (b)--
            (A) by striking ``for a disgorgement fund described in 
        subsection (a)'' and inserting ``for a disgorgement fund or 
        other fund described in subsection (a)''; and
            (B) by striking ``in the disgorgement fund'' and inserting 
        ``in such fund''; and
        (3) by striking subsection (e).
SEC. 929C. INCREASING THE BORROWING LIMIT ON TREASURY LOANS.
    Section 4(h) of the Securities Investor Protection Act of 1970 (15 
U.S.C. 78ddd(h)) is amended in the first sentence, by striking 
``$1,000,000,000'' and inserting ``$2,500,000,000''.
SEC. 929D. LOST AND STOLEN SECURITIES.
    Section 17(f)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 
78q(f)(1)) is amended--
        (1) in subparagraph (A), by striking ``missing, lost, 
    counterfeit, or stolen securities'' and inserting ``securities that 
    are missing, lost, counterfeit, stolen, or cancelled''; and
        (2) in subparagraph (B), by striking ``or stolen'' and 
    inserting ``stolen, cancelled, or reported in such other manner as 
    the Commission, by rule, may prescribe''.
SEC. 929E. NATIONWIDE SERVICE OF SUBPOENAS.
    (a) Securities Act of 1933.--Section 22(a) of the Securities Act of 
1933 (15 U.S.C. 77v(a)) is amended by inserting after the second 
sentence the following: ``In any action or proceeding instituted by the 
Commission under this title in a United States district court for any 
judicial district, a subpoena issued to compel the attendance of a 
witness or the production of documents or tangible things (or both) at 
a hearing or trial may be served at any place within the United States. 
Rule 45(c)(3)(A)(ii) of the Federal Rules of Civil Procedure shall not 
apply to a subpoena issued under the preceding sentence.''.
    (b) Securities Exchange Act of 1934.--Section 27 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78aa) is amended by inserting after the 
third sentence the following: ``In any action or proceeding instituted 
by the Commission under this title in a United States district court 
for any judicial district, a subpoena issued to compel the attendance 
of a witness or the production of documents or tangible things (or 
both) at a hearing or trial may be served at any place within the 
United States. Rule 45(c)(3)(A)(ii) of the Federal Rules of Civil 
Procedure shall not apply to a subpoena issued under the preceding 
sentence.''.
    (c) Investment Company Act of 1940.--Section 44 of the Investment 
Company Act of 1940 (15 U.S.C. 80a-43) is amended by inserting after 
the fourth sentence the following: ``In any action or proceeding 
instituted by the Commission under this title in a United States 
district court for any judicial district, a subpoena issued to compel 
the attendance of a witness or the production of documents or tangible 
things (or both) at a hearing or trial may be served at any place 
within the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules of 
Civil Procedure shall not apply to a subpoena issued under the 
preceding sentence.''.
    (d) Investment Advisers Act of 1940.--Section 214 of the Investment 
Advisers Act of 1940 (15 U.S.C. 80b-14) is amended by inserting after 
the third sentence the following: ``In any action or proceeding 
instituted by the Commission under this title in a United States 
district court for any judicial district, a subpoena issued to compel 
the attendance of a witness or the production of documents or tangible 
things (or both) at a hearing or trial may be served at any place 
within the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules of 
Civil Procedure shall not apply to a subpoena issued under the 
preceding sentence.''.
SEC. 929F. FORMERLY ASSOCIATED PERSONS.
    (a) Member or Employee of the Municipal Securities Rulemaking 
Board.--Section 15B(c)(8) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-4(c)(8)) is amended by striking ``any member or employee'' 
and inserting ``any person who is, or at the time of the alleged 
violation or abuse was, a member or employee''.
    (b) Person Associated With a Government Securities Broker or 
Dealer.--Section 15C(c) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-5(c)) is amended--
        (1) in paragraph (1)(C), by striking ``any person associated, 
    or seeking to become associated,'' and inserting ``any person who 
    is, or at the time of the alleged misconduct was, associated or 
    seeking to become associated''; and
        (2) in paragraph (2)--
            (A) in subparagraph (A), by inserting ``, seeking to become 
        associated, or, at the time of the alleged misconduct, 
        associated or seeking to become associated'' after ``any person 
        associated''; and
            (B) in subparagraph (B), by inserting ``, seeking to become 
        associated, or, at the time of the alleged misconduct, 
        associated or seeking to become associated'' after ``any person 
        associated''.
    (c) Person Associated With a Member of a National Securities 
Exchange or Registered Securities Association.--Section 21(a)(1) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78u(a)(1)) is amended, in 
the first sentence, by inserting ``, or, as to any act or practice, or 
omission to act, while associated with a member, formerly associated'' 
after ``member or a person associated''.
    (d) Participant of a Registered Clearing Agency.--Section 21(a)(1) 
of the Securities Exchange Act of 1934 (15 U.S.C. 78u(a)(1)) is 
amended, in the first sentence, by inserting ``or, as to any act or 
practice, or omission to act, while a participant, was a participant,'' 
after ``in which such person is a participant,''.
    (e) Officer or Director of a Self-regulatory Organization.--Section 
19(h)(4) of the Securities Exchange Act of 1934 (15 U.S.C. 78s(h)(4)) 
is amended--
        (1) by striking ``any officer or director'' and inserting ``any 
    person who is, or at the time of the alleged misconduct was, an 
    officer or director''; and
        (2) by striking ``such officer or director'' and inserting 
    ``such person''.
    (f) Officer or Director of an Investment Company.--Section 36(a) of 
the Investment Company Act of 1940 (15 U.S.C. 80a-35(a)) is amended--
        (1) by striking ``a person serving or acting'' and inserting 
    ``a person who is, or at the time of the alleged misconduct was, 
    serving or acting''; and
        (2) by striking ``such person so serves or acts'' and inserting 
    ``such person so serves or acts, or at the time of the alleged 
    misconduct, so served or acted''.
    (g) Person Associated With a Public Accounting Firm.--
        (1) Sarbanes-oxley act of 2002 amendment.--Section 2(a)(9) of 
    the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201(9)) is amended by 
    adding at the end the following:
            ``(C) Investigative and enforcement authority.--For 
        purposes of sections 3(c), 101(c), 105, and 107(c) and the 
        rules of the Board and Commission issued thereunder, except to 
        the extent specifically excepted by such rules, the terms 
        defined in subparagraph (A) shall include any person 
        associated, seeking to become associated, or formerly 
        associated with a public accounting firm, except that--
                ``(i) the authority to conduct an investigation of such 
            person under section 105(b) shall apply only with respect 
            to any act or practice, or omission to act, by the person 
            while such person was associated or seeking to become 
            associated with a registered public accounting firm; and
                ``(ii) the authority to commence a disciplinary 
            proceeding under section 105(c)(1), or impose sanctions 
            under section 105(c)(4), against such person shall apply 
            only with respect to--

                    ``(I) conduct occurring while such person was 
                associated or seeking to become associated with a 
                registered public accounting firm; or
                    ``(II) non-cooperation, as described in section 
                105(b)(3), with respect to a demand in a Board 
                investigation for testimony, documents, or other 
                information relating to a period when such person was 
                associated or seeking to become associated with a 
                registered public accounting firm.''.

        (2) Securities exchange act of 1934 amendment.--Section 
    21(a)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 
    78u(a)(1)) is amended by striking ``or a person associated with 
    such a firm'' and inserting ``, a person associated with such a 
    firm, or, as to any act, practice, or omission to act, while 
    associated with such firm, a person formerly associated with such a 
    firm''.
    (h) Supervisory Personnel of an Audit Firm.--Section 105(c)(6) of 
the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(c)(6)) is amended--
        (1) in subparagraph (A), by striking ``the supervisory 
    personnel'' and inserting ``any person who is, or at the time of 
    the alleged failure reasonably to supervise was, a supervisory 
    person''; and
        (2) in subparagraph (B)--
            (A) by striking ``No associated person'' and inserting ``No 
        current or former supervisory person''; and
            (B) by striking ``any other person'' and inserting ``any 
        associated person''.
    (i) Member of the Public Company Accounting Oversight Board.--
Section 107(d)(3) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7217(d)(3)) is amended by striking ``any member'' and inserting ``any 
person who is, or at the time of the alleged misconduct was, a 
member''.
SEC. 929G. STREAMLINED HIRING AUTHORITY FOR MARKET SPECIALISTS.
    (a) Appointment Authority.--Section 3114 of title 5, United States 
Code, is amended by striking the section heading and all that follows 
through the end of subsection (a) and inserting the following:
``Sec. 3114. Appointment of candidates to certain positions in the 
    competitive service by the Securities and Exchange Commission
    ``(a) Applicability.--This section applies with respect to any 
position of accountant, economist, and securities compliance examiner 
at the Commission that is in the competitive service, and any position 
at the Commission in the competitive service that requires specialized 
knowledge of financial and capital market formation or regulation, 
financial market structures or surveillance, or information 
technology.''.
    (b) Clerical Amendment.--The table of sections for chapter 31 of 
title 5, United States Code, is amended by striking the item relating 
to section 3114 and inserting the following:

``3114. Appointment of candidates to positions in the competitive 
          service by the Securities and Exchange Commission.''.

    (c) Pay Authority.--The Commission may set the rate of pay for 
experts and consultants appointed under the authority of section 3109 
of title 5, United States Code, in the same manner in which it sets the 
rate of pay for employees of the Commission.
SEC. 929H. SIPC REFORMS.
    (a) Increasing the Cash Limit of Protection.--Section 9 of the 
Securities Investor Protection Act of 1970 (15 U.S.C. 78fff-3) is 
amended--
        (1) in subsection (a)(1), by striking ``$100,000 for each such 
    customer'' and inserting ``the standard maximum cash advance amount 
    for each such customer, as determined in accordance with subsection 
    (d)''; and
        (2) by adding the following new subsections:
    ``(d) Standard Maximum Cash Advance Amount Defined.--For purposes 
of this section, the term `standard maximum cash advance amount' means 
$250,000, as such amount may be adjusted after December 31, 2010, as 
provided under subsection (e).
    ``(e) Inflation Adjustment.--
        ``(1) In general.--Not later than January 1, 2011, and every 5 
    years thereafter, and subject to the approval of the Commission as 
    provided under section 3(e)(2), the Board of Directors of SIPC 
    shall determine whether an inflation adjustment to the standard 
    maximum cash advance amount is appropriate. If the Board of 
    Directors of SIPC determines such an adjustment is appropriate, 
    then the standard maximum cash advance amount shall be an amount 
    equal to--
            ``(A) $250,000 multiplied by--
            ``(B) the ratio of the annual value of the Personal 
        Consumption Expenditures Chain-Type Price Index (or any 
        successor index thereto), published by the Department of 
        Commerce, for the calendar year preceding the year in which 
        such determination is made, to the published annual value of 
        such index for the calendar year preceding the year in which 
        this subsection was enacted.
    The index values used in calculations under this paragraph shall 
    be, as of the date of the calculation, the values most recently 
    published by the Department of Commerce.
        ``(2) Rounding.--If the standard maximum cash advance amount 
    determined under paragraph (1) for any period is not a multiple of 
    $10,000, the amount so determined shall be rounded down to the 
    nearest $10,000.
        ``(3) Publication and report to the congress.--Not later than 
    April 5 of any calendar year in which a determination is required 
    to be made under paragraph (1)--
            ``(A) the Commission shall publish in the Federal Register 
        the standard maximum cash advance amount; and
            ``(B) the Board of Directors of SIPC shall submit a report 
        to the Congress stating the standard maximum cash advance 
        amount.
        ``(4) Implementation period.--Any adjustment to the standard 
    maximum cash advance amount shall take effect on January 1 of the 
    year immediately succeeding the calendar year in which such 
    adjustment is made.
        ``(5) Inflation adjustment considerations.--In making any 
    determination under paragraph (1) to increase the standard maximum 
    cash advance amount, the Board of Directors of SIPC shall 
    consider--
            ``(A) the overall state of the fund and the economic 
        conditions affecting members of SIPC;
            ``(B) the potential problems affecting members of SIPC; and
            ``(C) such other factors as the Board of Directors of SIPC 
        may determine appropriate.''.
    (b) Liquidation of a Carrying Broker-dealer.--Section 5(a)(3) of 
the Securities Investor Protection Act of 1970 (15 U.S.C. 78eee(a)(3)) 
is amended--
        (1) by striking the undesignated matter immediately following 
    subparagraph (B);
        (2) in subparagraph (A), by striking ``any member of SIPC'' and 
    inserting ``the member'';
        (3) in subparagraph (B), by striking the comma at the end and 
    inserting a period;
        (4) by striking ``If SIPC'' and inserting the following:
            ``(A) In general.--SIPC may, upon notice to a member of 
        SIPC, file an application for a protective decree with any 
        court of competent jurisdiction specified in section 21(e) or 
        27 of the Securities Exchange Act of 1934, except that no such 
        application shall be filed with respect to a member, the only 
        customers of which are persons whose claims could not be 
        satisfied by SIPC advances pursuant to section 9, if SIPC''; 
        and
        (5) by adding at the end the following:
            ``(B) Consent required.--No member of SIPC that has a 
        customer may enter into an insolvency, receivership, or 
        bankruptcy proceeding, under Federal or State law, without the 
        specific consent of SIPC, except as provided in title II of the 
        Dodd-Frank Wall Street Reform and Consumer Protection Act.''.
SEC. 929I. PROTECTING CONFIDENTIALITY OF MATERIALS SUBMITTED TO THE 
COMMISSION.
    (a) Securities Exchange Act of 1934.--Section 24 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78x) is amended--
        (1) in subsection (d), by striking ``subsection (e)'' and 
    inserting ``subsection (f)'';
        (2) by redesignating subsection (e) as subsection (f); and
        (3) by inserting after subsection (d) the following:
    ``(e) Records Obtained From Registered Persons.--
        ``(1) In general.--Except as provided in subsection (f), the 
    Commission shall not be compelled to disclose records or 
    information obtained pursuant to section 17(b), or records or 
    information based upon or derived from such records or information, 
    if such records or information have been obtained by the Commission 
    for use in furtherance of the purposes of this title, including 
    surveillance, risk assessments, or other regulatory and oversight 
    activities.
        ``(2) Treatment of information.--For purposes of section 552 of 
    title 5, United States Code, this subsection shall be considered a 
    statute described in subsection (b)(3)(B) of such section 552. 
    Collection of information pursuant to section 17 shall be an 
    administrative action involving an agency against specific 
    individuals or agencies pursuant to section 3518(c)(1) of title 44, 
    United States Code.''.
    (b) Investment Company Act of 1940.--Section 31 of the Investment 
Company Act of 1940 (15 U.S.C. 80a-30) is amended--
        (1) by striking subsection (c) and inserting the following:
    ``(c) Limitations on Disclosure by Commission.--Notwithstanding any 
other provision of law, the Commission shall not be compelled to 
disclose any records or information provided to the Commission under 
this section, or records or information based upon or derived from such 
records or information, if such records or information have been 
obtained by the Commission for use in furtherance of the purposes of 
this title, including surveillance, risk assessments, or other 
regulatory and oversight activities. Nothing in this subsection 
authorizes the Commission to withhold information from the Congress or 
prevent the Commission from complying with a request for information 
from any other Federal department or agency requesting the information 
for purposes within the scope of jurisdiction of that department or 
agency, or complying with an order of a court of the United States in 
an action brought by the United States or the Commission. For purposes 
of section 552 of title 5, United States Code, this section shall be 
considered a statute described in subsection (b)(3)(B) of such section 
552. Collection of information pursuant to section 31 shall be an 
administrative action involving an agency against specific individuals 
or agencies pursuant to section 3518(c)(1) of title 44, United States 
Code.'';
        (2) by striking subsection (d); and
        (3) by redesignating subsections (e) and (f) as subsections (d) 
    and (e), respectively.
    (c) Investment Advisers Act of 1940.--Section 210 of the Investment 
Advisers Act of 1940 (15 U.S.C. 80b-10) is amended by adding at the end 
the following:
    ``(d) Limitations on Disclosure by the Commission.--Notwithstanding 
any other provision of law, the Commission shall not be compelled to 
disclose any records or information provided to the Commission under 
section 204, or records or information based upon or derived from such 
records or information, if such records or information have been 
obtained by the Commission for use in furtherance of the purposes of 
this title, including surveillance, risk assessments, or other 
regulatory and oversight activities. Nothing in this subsection 
authorizes the Commission to withhold information from the Congress or 
prevent the Commission from complying with a request for information 
from any other Federal department or agency requesting the information 
for purposes within the scope of jurisdiction of that department or 
agency, or complying with an order of a court of the United States in 
an action brought by the United States or the Commission. For purposes 
of section 552 of title 5, United States Code, this subsection shall be 
considered a statute described in subsection (b)(3)(B) of such section 
552. Collection of information pursuant to section 204 shall be an 
administrative action involving an agency against specific individuals 
or agencies pursuant to section 3518(c)(1) of title 44, United States 
Code.''.
SEC. 929J. EXPANSION OF AUDIT INFORMATION TO BE PRODUCED AND EXCHANGED.
    Section 106 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7216) is 
amended--
        (1) by striking subsection (b) and inserting the following:
    ``(b) Production of Documents.--
        ``(1) Production by foreign firms.--If a foreign public 
    accounting firm performs material services upon which a registered 
    public accounting firm relies in the conduct of an audit or interim 
    review, issues an audit report, performs audit work, or conducts 
    interim reviews, the foreign public accounting firm shall--
            ``(A) produce the audit work papers of the foreign public 
        accounting firm and all other documents of the firm related to 
        any such audit work or interim review to the Commission or the 
        Board, upon request of the Commission or the Board; and
            ``(B) be subject to the jurisdiction of the courts of the 
        United States for purposes of enforcement of any request for 
        such documents.
        ``(2) Other production.--Any registered public accounting firm 
    that relies, in whole or in part, on the work of a foreign public 
    accounting firm in issuing an audit report, performing audit work, 
    or conducting an interim review, shall--
            ``(A) produce the audit work papers of the foreign public 
        accounting firm and all other documents related to any such 
        work in response to a request for production by the Commission 
        or the Board; and
            ``(B) secure the agreement of any foreign public accounting 
        firm to such production, as a condition of the reliance by the 
        registered public accounting firm on the work of that foreign 
        public accounting firm.'';
        (2) by redesignating subsection (d) as subsection (g); and
        (3) by inserting after subsection (c) the following:
    ``(d) Service of Requests or Process.--
        ``(1) In general.--Any foreign public accounting firm that 
    performs work for a domestic registered public accounting firm 
    shall furnish to the domestic registered public accounting firm a 
    written irrevocable consent and power of attorney that designates 
    the domestic registered public accounting firm as an agent upon 
    whom may be served any request by the Commission or the Board under 
    this section or upon whom may be served any process, pleadings, or 
    other papers in any action brought to enforce this section.
        ``(2) Specific audit work.--Any foreign public accounting firm 
    that performs material services upon which a registered public 
    accounting firm relies in the conduct of an audit or interim 
    review, issues an audit report, performs audit work, or, performs 
    interim reviews, shall designate to the Commission or the Board an 
    agent in the United States upon whom may be served any request by 
    the Commission or the Board under this section or upon whom may be 
    served any process, pleading, or other papers in any action brought 
    to enforce this section.
    ``(e) Sanctions.--A willful refusal to comply, in whole in or in 
part, with any request by the Commission or the Board under this 
section, shall be deemed a violation of this Act.
    ``(f) Other Means of Satisfying Production Obligations.--
Notwithstanding any other provisions of this section, the staff of the 
Commission or the Board may allow a foreign public accounting firm that 
is subject to this section to meet production obligations under this 
section through alternate means, such as through foreign counterparts 
of the Commission or the Board.''.
SEC. 929K. SHARING PRIVILEGED INFORMATION WITH OTHER AUTHORITIES.
    Section 24 of the Securities Exchange Act of 1934 (15 U.S.C. 78x) 
is amended--
        (1) in subsection (d), as amended by subsection (d)(1)(A), by 
    striking ``subsection (f)'' and inserting ``subsection (g)'';
        (2) in subsection (e), as added by subsection (d)(1)(C), by 
    striking ``subsection (f)'' and inserting ``subsection (g)'';
        (3) by redesignating subsection (f) as subsection (g); and
        (4) by inserting after subsection (e) the following:
    ``(f) Sharing Privileged Information With Other Authorities.--
        ``(1) Privileged information provided by the commission.--The 
    Commission shall not be deemed to have waived any privilege 
    applicable to any information by transferring that information to 
    or permitting that information to be used by--
            ``(A) any agency (as defined in section 6 of title 18, 
        United States Code);
            ``(B) the Public Company Accounting Oversight Board;
            ``(C) any self-regulatory organization;
            ``(D) any foreign securities authority;
            ``(E) any foreign law enforcement authority; or
            ``(F) any State securities or law enforcement authority.
        ``(2) Nondisclosure of privileged information provided to the 
    commission.--The Commission shall not be compelled to disclose 
    privileged information obtained from any foreign securities 
    authority, or foreign law enforcement authority, if the authority 
    has in good faith determined and represented to the Commission that 
    the information is privileged.
        ``(3) Nonwaiver of privileged information provided to the 
    commission.--
            ``(A) In general.--Federal agencies, State securities and 
        law enforcement authorities, self-regulatory organizations, and 
        the Public Company Accounting Oversight Board shall not be 
        deemed to have waived any privilege applicable to any 
        information by transferring that information to or permitting 
        that information to be used by the Commission.
            ``(B) Exception.--The provisions of subparagraph (A) shall 
        not apply to a self-regulatory organization or the Public 
        Company Accounting Oversight Board with respect to information 
        used by the Commission in an action against such organization.
        ``(4) Definitions.--For purposes of this subsection--
            ``(A) the term `privilege' includes any work-product 
        privilege, attorney-client privilege, governmental privilege, 
        or other privilege recognized under Federal, State, or foreign 
        law;
            ``(B) the term `foreign law enforcement authority' means 
        any foreign authority that is empowered under foreign law to 
        detect, investigate or prosecute potential violations of law; 
        and
            ``(C) the term `State securities or law enforcement 
        authority' means the authority of any State or territory that 
        is empowered under State or territory law to detect, 
        investigate, or prosecute potential violations of law.''.
SEC. 929L. ENHANCED APPLICATION OF ANTIFRAUD PROVISIONS.
    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended--
        (1) in section 9--
            (A) by striking ``registered on a national securities 
        exchange'' each place that term appears and inserting ``other 
        than a government security'';
            (B) in subsection (b), by striking ``by use of any facility 
        of a national securities exchange,''; and
            (C) in subsection (c), by inserting after ``unlawful for 
        any'' the following: ``broker, dealer, or'';
        (2) in section 10(a)(1), by striking ``registered on a national 
    securities exchange'' and inserting ``other than a government 
    security''; and
        (3) in section 15(c)(1)(A), by striking ``otherwise than on a 
    national securities exchange of which it is a member''.
SEC. 929M. AIDING AND ABETTING AUTHORITY UNDER THE SECURITIES ACT AND 
THE INVESTMENT COMPANY ACT.
    (a) Under the Securities Act of 1933.--Section 15 of the Securities 
Act of 1933 (15 U.S.C. 77o) is amended--
        (1) by striking ``Every person who'' and inserting ``(a) 
    Controlling Persons.--Every person who''; and
        (2) by adding at the end the following:
    ``(b) Prosecution of Persons Who Aid and Abet Violations.--For 
purposes of any action brought by the Commission under subparagraph (b) 
or (d) of section 20, any person that knowingly or recklessly provides 
substantial assistance to another person in violation of a provision of 
this Act, or of any rule or regulation issued under this Act, shall be 
deemed to be in violation of such provision to the same extent as the 
person to whom such assistance is provided.''.
    (b) Under the Investment Company Act of 1940.--Section 48 of the 
Investment Company Act of 1940 (15 U.S.C. 80a-48) is amended by 
redesignating subsection (b) as subsection (c) and inserting after 
subsection (a) the following:
    ``(b) For purposes of any action brought by the Commission under 
subsection (d) or (e) of section 42, any person that knowingly or 
recklessly provides substantial assistance to another person in 
violation of a provision of this Act, or of any rule or regulation 
issued under this Act, shall be deemed to be in violation of such 
provision to the same extent as the person to whom such assistance is 
provided.''.
SEC. 929N. AUTHORITY TO IMPOSE PENALTIES FOR AIDING AND ABETTING 
VIOLATIONS OF THE INVESTMENT ADVISERS ACT.
    Section 209 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
9) is amended by inserting at the end the following new subsection:
    ``(f) Aiding and Abetting.--For purposes of any action brought by 
the Commission under subsection (e), any person that knowingly or 
recklessly has aided, abetted, counseled, commanded, induced, or 
procured a violation of any provision of this Act, or of any rule, 
regulation, or order hereunder, shall be deemed to be in violation of 
such provision, rule, regulation, or order to the same extent as the 
person that committed such violation.''.
SEC. 929O. AIDING AND ABETTING STANDARD OF KNOWLEDGE SATISFIED BY 
RECKLESSNESS.
    Section 20(e) of the Securities Exchange Act of 1934 (15 U.S.C. 
78t(e)) is amended by inserting ``or recklessly'' after ``knowingly''.
SEC. 929P. STRENGTHENING ENFORCEMENT BY THE COMMISSION.
    (a) Authority to Impose Civil Penalties in Cease and Desist 
Proceedings.--
        (1) Under the securities act of 1933.--Section 8A of the 
    Securities Act of 1933 (15 U.S.C. 77h-1) is amended by adding at 
    the end the following new subsection:
    ``(g) Authority to Impose Money Penalties.--
        ``(1) Grounds.--In any cease-and-desist proceeding under 
    subsection (a), the Commission may impose a civil penalty on a 
    person if the Commission finds, on the record, after notice and 
    opportunity for hearing, that--
            ``(A) such person--
                ``(i) is violating or has violated any provision of 
            this title, or any rule or regulation issued under this 
            title; or
                ``(ii) is or was a cause of the violation of any 
            provision of this title, or any rule or regulation 
            thereunder; and
            ``(B) such penalty is in the public interest.
        ``(2) Maximum amount of penalty.--
            ``(A) First tier.--The maximum amount of a penalty for each 
        act or omission described in paragraph (1) shall be $7,500 for 
        a natural person or $75,000 for any other person.
            ``(B) Second tier.--Notwithstanding subparagraph (A), the 
        maximum amount of penalty for each such act or omission shall 
        be $75,000 for a natural person or $375,000 for any other 
        person, if the act or omission described in paragraph (1) 
        involved fraud, deceit, manipulation, or deliberate or reckless 
        disregard of a regulatory requirement.
            ``(C) Third tier.--Notwithstanding subparagraphs (A) and 
        (B), the maximum amount of penalty for each such act or 
        omission shall be $150,000 for a natural person or $725,000 for 
        any other person, 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--

                    ``(I) substantial losses or created a significant 
                risk of substantial losses to other persons; or
                    ``(II) substantial pecuniary gain to the person who 
                committed the act or omission.

        ``(3) Evidence concerning ability to pay.--In any proceeding in 
    which the Commission may impose a penalty under this section, a 
    respondent may present evidence of the ability of the respondent to 
    pay such penalty. The Commission may, in its discretion, consider 
    such evidence in determining whether such penalty is in the public 
    interest. Such evidence may relate to the extent of the ability of 
    the respondent to continue in business and the collectability of a 
    penalty, taking into account any other claims of the United States 
    or third parties upon the assets of the respondent and the amount 
    of the assets of the respondent.''.
        (2) Under the securities exchange act of 1934.--Section 21B(a) 
    of the Securities Exchange Act of 1934 (15 U.S.C. 78u-2(a)) is 
    amended--
            (A) by striking the matter following paragraph (4);
            (B) in the matter preceding paragraph (1), by inserting 
        after ``opportunity for hearing,'' the following: ``that such 
        penalty is in the public interest and'';
            (C) by redesignating paragraphs (1) through (4) as 
        subparagraphs (A) through (D), respectively, and adjusting the 
        margins accordingly;
            (D) by striking ``In any proceeding'' and inserting the 
        following:
        ``(1) In general.--In any proceeding''; and
            (E) by adding at the end the following:
        ``(2) Cease-and-desist proceedings.--In any proceeding 
    instituted under section 21C against any person, the Commission may 
    impose a civil penalty, if the Commission finds, on the record 
    after notice and opportunity for hearing, that such person--
            ``(A) is violating or has violated any provision of this 
        title, or any rule or regulation issued under this title; or
            ``(B) is or was a cause of the violation of any provision 
        of this title, or any rule or regulation issued under this 
        title.''.
        (3) Under the investment company act of 1940.--Section 9(d)(1) 
    of the Investment Company Act of 1940 (15 U.S.C. 80a-9(d)(1)) is 
    amended--
            (A) by striking the matter following subparagraph (C);
            (B) in the matter preceding subparagraph (A), by inserting 
        after ``opportunity for hearing,'' the following: ``that such 
        penalty is in the public interest, and'';
            (C) by redesignating subparagraphs (A) through (C) as 
        clauses (i) through (iii), respectively, and adjusting the 
        margins accordingly;
            (D) by striking ``In any proceeding'' and inserting the 
        following:
            ``(A) In general.--In any proceeding''; and
            (E) by adding at the end the following:
            ``(B) Cease-and-desist proceedings.--In any proceeding 
        instituted pursuant to subsection (f) against any person, the 
        Commission may impose a civil penalty if the Commission finds, 
        on the record, after notice and opportunity for hearing, that 
        such person--
                ``(i) is violating or has violated any provision of 
            this title, or any rule or regulation issued under this 
            title; or
                ``(ii) is or was a cause of the violation of any 
            provision of this title, or any rule or regulation issued 
            under this title.''.
        (4) Under the investment advisers act of 1940.--Section 
    203(i)(1) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
    3(i)(1)) is amended--
            (A) by striking the matter following subparagraph (D);
            (B) in the matter preceding subparagraph (A), by inserting 
        after ``opportunity for hearing,'' the following: ``that such 
        penalty is in the public interest and'';
            (C) by redesignating subparagraphs (A) through (D) as 
        clauses (i) through (iv), respectively, and adjusting the 
        margins accordingly;
            (D) by striking ``In any proceeding'' and inserting the 
        following:
            ``(A) In general.--In any proceeding''; and
            (E) by adding at the end the following new subparagraph:
            ``(B) Cease-and-desist proceedings.--In any proceeding 
        instituted pursuant to subsection (k) against any person, the 
        Commission may impose a civil penalty if the Commission finds, 
        on the record, after notice and opportunity for hearing, that 
        such person--
                ``(i) is violating or has violated any provision of 
            this title, or any rule or regulation issued under this 
            title; or
                ``(ii) is or was a cause of the violation of any 
            provision of this title, or any rule or regulation issued 
            under this title.''.
    (b) Extraterritorial Jurisdiction of the Antifraud Provisions of 
the Federal Securities Laws.--
        (1) Under the securities act of 1933.--Section 22 of the 
    Securities Act of 1933 (15 U.S.C. 77v(a)) is amended by adding at 
    the end the following new subsection:
    ``(c) Extraterritorial Jurisdiction.--The district courts of the 
United States and the United States courts of any Territory shall have 
jurisdiction of an action or proceeding brought or instituted by the 
Commission or the United States alleging a violation of section 17(a) 
involving--
        ``(1) conduct within the United States that constitutes 
    significant steps in furtherance of the violation, even if the 
    securities transaction occurs outside the United States and 
    involves only foreign investors; or
        ``(2) conduct occurring outside the United States that has a 
    foreseeable substantial effect within the United States.''.
        (2) Under the securities exchange act of 1934.--Section 27 of 
    the Securities Exchange Act of 1934 (15 U.S.C. 78aa) is amended--
            (A) by striking ``The district'' and inserting the 
        following:
    ``(a) In General.--The district''; and
            (B) by adding at the end the following new subsection:
    ``(b) Extraterritorial Jurisdiction.--The district courts of the 
United States and the United States courts of any Territory shall have 
jurisdiction of an action or proceeding brought or instituted by the 
Commission or the United States alleging a violation of the antifraud 
provisions of this title involving--
        ``(1) conduct within the United States that constitutes 
    significant steps in furtherance of the violation, even if the 
    securities transaction occurs outside the United States and 
    involves only foreign investors; or
        ``(2) conduct occurring outside the United States that has a 
    foreseeable substantial effect within the United States.''.
        (3) Under the investment advisers act of 1940.--Section 214 of 
    the Investment Advisers Act of 1940 (15 U.S.C. 80b-14) is amended--
            (A) by striking ``The district'' and inserting the 
        following:
    ``(a) In General.--The district''; and
            (B) by adding at the end the following new subsection:
    ``(b) Extraterritorial Jurisdiction.--The district courts of the 
United States and the United States courts of any Territory shall have 
jurisdiction of an action or proceeding brought or instituted by the 
Commission or the United States alleging a violation of section 206 
involving--
        ``(1) conduct within the United States that constitutes 
    significant steps in furtherance of the violation, even if the 
    violation is committed by a foreign adviser and involves only 
    foreign investors; or
        ``(2) conduct occurring outside the United States that has a 
    foreseeable substantial effect within the United States.''.
    (c) Control Person Liability Under the Securities Exchange Act of 
1934.--Section 20(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78t(a)) is amended by inserting after ``controlled person is liable'' 
the following: ``(including to the Commission in any action brought 
under paragraph (1) or (3) of section 21(d))''.
SEC. 929Q. REVISION TO RECORDKEEPING RULE.
    (a) Investment Company Act of 1940 Amendments.--Section 31 of the 
Investment Company Act of 1940 (15 U.S.C. 80a-30) is amended--
        (1) in subsection (a)(1), by adding at the end the following: 
    ``Each person having custody or use of the securities, deposits, or 
    credits of a registered investment company shall maintain and 
    preserve all records that relate to the custody or use by such 
    person of the securities, deposits, or credits of the registered 
    investment company for such period or periods as the Commission, by 
    rule or regulation, may prescribe, as necessary or appropriate in 
    the public interest or for the protection of investors.''; and
        (2) in subsection (b), by adding at the end the following:
        ``(4) Records of persons with custody or use.--
            ``(A) In general.--Records of persons having custody or use 
        of the securities, deposits, or credits of a registered 
        investment company that relate to such custody or use, are 
        subject at any time, or from time to time, to such reasonable 
        periodic, special, or other examinations and other information 
        and document requests by representatives of the Commission, as 
        the Commission deems necessary or appropriate in the public 
        interest or for the protection of investors.
            ``(B) Certain persons subject to other regulation.--Any 
        person that is subject to regulation and examination by a 
        Federal financial institution regulatory agency (as such term 
        is defined under section 212(c)(2) of title 18, United States 
        Code) may satisfy any examination request, information request, 
        or document request described under subparagraph (A), by 
        providing to the Commission a detailed listing, in writing, of 
        the securities, deposits, or credits of the registered 
        investment company within the custody or use of such person.''.
    (b) Investment Advisers Act of 1940 Amendment.--Section 204 of the 
Investment Advisers Act of 1940 (15 U.S.C. 80b-4) is amended by adding 
at the end the following new subsection:
    ``(d) Records of Persons With Custody or Use.--
        ``(1) In general.--Records of persons having custody or use of 
    the securities, deposits, or credits of a client, that relate to 
    such custody or use, are subject at any time, or from time to time, 
    to such reasonable periodic, special, or other examinations and 
    other information and document requests by representatives of the 
    Commission, as the Commission deems necessary or appropriate in the 
    public interest or for the protection of investors.
        ``(2) Certain persons subject to other regulation.--Any person 
    that is subject to regulation and examination by a Federal 
    financial institution regulatory agency (as such term is defined 
    under section 212(c)(2) of title 18, United States Code) may 
    satisfy any examination request, information request, or document 
    request described under paragraph (1), by providing the Commission 
    with a detailed listing, in writing, of the securities, deposits, 
    or credits of the client within the custody or use of such 
    person.''.
SEC. 929R. BENEFICIAL OWNERSHIP AND SHORT-SWING PROFIT REPORTING.
    (a) Beneficial Ownership Reporting.--Section 13 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m) is amended--
        (1) in subsection (d)(1)--
            (A) by inserting after ``within ten days after such 
        acquisition'' the following: ``or within such shorter time as 
        the Commission may establish by rule''; and
            (B) by striking ``send to the issuer of the security at its 
        principal executive office, by registered or certified mail, 
        send to each exchange where the security is traded, and'';
        (2) in subsection (d)(2)--
            (A) by striking ``in the statements to the issuer and the 
        exchange, and''; and
            (B) by striking ``shall be transmitted to the issuer and 
        the exchange and'';
        (3) in subsection (g)(1), by striking ``shall send to the 
    issuer of the security and''; and
        (4) in subsection (g)(2)--
            (A) by striking ``sent to the issuer and''; and
            (B) by striking ``shall be transmitted to the issuer and''.
    (b) Short-swing Profit Reporting.--Section 16(a) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78p(a)) is amended--
        (1) in paragraph (1), by striking ``(and, if such security is 
    registered on a national securities exchange, also with the 
    exchange)''; and
        (2) in paragraph (2)(B), by inserting after ``officer'' the 
    following: ``, or within such shorter time as the Commission may 
    establish by rule''.
SEC. 929S. FINGERPRINTING.
    Section 17(f)(2) of the Securities Exchange Act of 1934 (15 U.S.C. 
78q(f)(2)) is amended--
        (1) in the first sentence, by striking ``and registered 
    clearing agency,'' and inserting ``registered clearing agency, 
    registered securities information processor, national securities 
    exchange, and national securities association''; and
        (2) in the second sentence, by striking ``or clearing agency,'' 
    and inserting ``clearing agency, securities information processor, 
    national securities exchange, or national securities 
    association,''.
SEC. 929T. EQUAL TREATMENT OF SELF-REGULATORY ORGANIZATION RULES.
    Section 29(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78cc(a)) is amended by striking ``an exchange required thereby'' and 
inserting ``a self-regulatory organization,''.
SEC. 929U. DEADLINE FOR COMPLETING EXAMINATIONS, INSPECTIONS AND 
ENFORCEMENT ACTIONS.
    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 4D the following new section:
  ``SEC. 4E. DEADLINE FOR COMPLETING ENFORCEMENT INVESTIGATIONS AND 
      COMPLIANCE EXAMINATIONS AND INSPECTIONS.
    ``(a) Enforcement Investigations.--
        ``(1) In general.--Not later than 180 days after the date on 
    which Commission staff provide a written Wells notification to any 
    person, the Commission staff shall either file an action against 
    such person or provide notice to the Director of the Division of 
    Enforcement of its intent to not file an action.
        ``(2) Exceptions for certain complex actions.--Notwithstanding 
    paragraph (1), if the Director of the Division of Enforcement of 
    the Commission or the Director's designee determines that a 
    particular enforcement investigation is sufficiently complex such 
    that a determination regarding the filing of an action against a 
    person cannot be completed within the deadline specified in 
    paragraph (1), the Director of the Division of Enforcement of the 
    Commission or the Director's designee may, after providing notice 
    to the Chairman of the Commission, extend such deadline as needed 
    for one additional 180-day period. If after the additional 180-day 
    period the Director of the Division of Enforcement of the 
    Commission or the Director's designee determines that a particular 
    enforcement investigation is sufficiently complex such that a 
    determination regarding the filing of an action against a person 
    cannot be completed within the additional 180-day period, the 
    Director of the Division of Enforcement of the Commission or the 
    Director's designee may, after providing notice to and receiving 
    approval of the Commission, extend such deadline as needed for one 
    or more additional successive 180-day periods.
    ``(b) Compliance Examinations and Inspections.--
        ``(1) In general.--Not later than 180 days after the date on 
    which Commission staff completes the on-site portion of its 
    compliance examination or inspection or receives all records 
    requested from the entity being examined or inspected, whichever is 
    later, Commission staff shall provide the entity being examined or 
    inspected with written notification indicating either that the 
    examination or inspection has concluded, has concluded without 
    findings, or that the staff requests the entity undertake 
    corrective action.
        ``(2) Exception for certain complex actions.--Notwithstanding 
    paragraph (1), if the head of any division or office within the 
    Commission responsible for compliance examinations and inspections 
    or his designee determines that a particular compliance examination 
    or inspection is sufficiently complex such that a determination 
    regarding concluding the examination or inspection, or regarding 
    the staff requests the entity undertake corrective action, cannot 
    be completed within the deadline specified in paragraph (1), the 
    head of any division or office within the Commission responsible 
    for compliance examinations and inspections or his designee may, 
    after providing notice to the Chairman of the Commission, extend 
    such deadline as needed for one additional 180-day period.''.
SEC. 929V. SECURITY INVESTOR PROTECTION ACT AMENDMENTS.
    (a) Increasing the Minimum Assessment Paid by SIPC Members.--
Section 4(d)(1)(C) of the Securities Investor Protection Act of 1970 
(15 U.S.C. 78ddd(d)(1)(C)) is amended by striking ``$150 per annum'' 
and inserting the following: ``0.02 percent of the gross revenues from 
the securities business of such member of SIPC''.
    (b) Increasing the Fine for Prohibited Acts Under SIPA.--Section 
14(c) of the Securities Investor Protection Act of 1970 (15 U.S.C. 
78jjj(c)) is amended--
        (1) in paragraph (1), by striking ``$50,000'' and inserting 
    ``$250,000''; and
        (2) in paragraph (2), by striking ``$50,000'' and inserting 
    ``$250,000''.
    (c) Penalty for Misrepresentation of SIPC Membership or 
Protection.--Section 14 of the Securities Investor Protection Act of 
1970 (15 U.S.C. 78jjj) is amended by adding at the end the following 
new subsection:
    ``(d) Misrepresentation of SIPC Membership or Protection.--
        ``(1) In general.--Any person who falsely represents by any 
    means (including, without limitation, through the Internet or any 
    other medium of mass communication), with actual knowledge of the 
    falsity of the representation and with an intent to deceive or 
    cause injury to another, that such person, or another person, is a 
    member of SIPC or that any person or account is protected or is 
    eligible for protection under this Act or by SIPC, shall be liable 
    for any damages caused thereby and shall be fined not more than 
    $250,000 or imprisoned for not more than 5 years.
        ``(2) Injunctions.--Any court having jurisdiction of a civil 
    action arising under this Act may grant temporary injunctions and 
    final injunctions on such terms as the court deems reasonable to 
    prevent or restrain any violation of paragraph (1). Any such 
    injunction may be served anywhere in the United States on the 
    person enjoined, shall be operative throughout the United States, 
    and shall be enforceable, by proceedings in contempt or otherwise, 
    by any United States court having jurisdiction over that person. 
    The clerk of the court granting the injunction shall, when 
    requested by any other court in which enforcement of the injunction 
    is sought, transmit promptly to the other court a certified copy of 
    all papers in the case on file in such clerk's office.''.
SEC. 929W. NOTICE TO MISSING SECURITY HOLDERS.
    Section 17A of the Securities Exchange Act of 1934 (15 U.S.C. 78q-
1) is amended by adding at the end the following new subsection:
    ``(g) Due Diligence for the Delivery of Dividends, Interest, and 
Other Valuable Property Rights.--
        ``(1) Revision of rules required.--The Commission shall revise 
    its regulations in section 240.17Ad-17 of title 17, Code of Federal 
    Regulations, as in effect on December 8, 1997, to extend the 
    application of such section to brokers and dealers and to provide 
    for the following:
            ``(A) A requirement that the paying agent provide a single 
        written notification to each missing security holder that the 
        missing security holder has been sent a check that has not yet 
        been negotiated. The written notification may be sent along 
        with a check or other mailing subsequently sent to the missing 
        security holder but must be provided no later than 7 months 
        after the sending of the not yet negotiated check.
            ``(B) An exclusion for paying agents from the notification 
        requirements when the value of the not yet negotiated check is 
        less than $25.
            ``(C) A provision clarifying that the requirements 
        described in subparagraph (A) shall have no effect on State 
        escheatment laws.
            ``(D) For purposes of such revised regulations--
                ``(i) a security holder shall be considered a `missing 
            security holder' if a check is sent to the security holder 
            and the check is not negotiated before the earlier of the 
            paying agent sending the next regularly scheduled check or 
            the elapsing of 6 months after the sending of the not yet 
            negotiated check; and
                ``(ii) the term `paying agent' includes any issuer, 
            transfer agent, broker, dealer, investment adviser, 
            indenture trustee, custodian, or any other person that 
            accepts payments from the issuer of a security and 
            distributes the payments to the holders of the security.
        ``(2) Rulemaking.--The Commission shall adopt such rules, 
    regulations, and orders necessary to implement this subsection no 
    later than 1 year after the date of enactment of this subsection. 
    In proposing such rules, the Commission shall seek to minimize 
    disruptions to current systems used by or on behalf of paying 
    agents to process payment to account holders and avoid requiring 
    multiple paying agents to send written notification to a missing 
    security holder regarding the same not yet negotiated check.''.
SEC. 929X. SHORT SALE REFORMS.
    (a) Short Sale Disclosure.--Section 13(f) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m(f)) is amended by redesignating 
paragraphs (2), (3), (4), and (5) as paragraphs (3), (4), (5), and (6), 
respectively, and inserting after paragraph (1) the following:
        ``(2) The Commission shall prescribe rules providing for the 
    public disclosure of the name of the issuer and the title, class, 
    CUSIP number, aggregate amount of the number of short sales of each 
    security, and any additional information determined by the 
    Commission following the end of the reporting period. At a minimum, 
    such public disclosure shall occur every month.''.
    (b) Short Selling Enforcement.--Section 9 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78i) is amended--
        (1) by redesignating subsections (d), (e), (f), (g), (h), and 
    (i) as subsections (e), (f), (g), (h), (i), and (j), respectively; 
    and
        (2) inserting after subsection (c), the following new 
    subsection:
    ``(d) Transactions Relating to Short Sales of Securities.--It shall 
be unlawful for any person, directly or indirectly, by the use of the 
mails or any means or instrumentality of interstate commerce, or of any 
facility of any national securities exchange, or for any member of a 
national securities exchange to effect, alone or with one or more other 
persons, a manipulative short sale of any security. The Commission 
shall issue such other rules as are necessary or appropriate to ensure 
that the appropriate enforcement options and remedies are available for 
violations of this subsection in the public interest or for the 
protection of investors.''.
    (c) Investor Notification.--Section 15 of the Securities Exchange 
Act of 1934 (15 U.S.C. 78o) is amended--
        (1) by redesignating subsections (e), (f), (g), (h), and (i) as 
    subsections (f), (g), (h), (i), and (j), respectively; and
        (2) inserting after subsection (d) the following new 
    subsection:
    ``(e) Notices to Customers Regarding Securities Lending.--Every 
registered broker or dealer shall provide notice to its customers that 
they may elect not to allow their fully paid securities to be used in 
connection with short sales. If a broker or dealer uses a customer's 
securities in connection with short sales, the broker or dealer shall 
provide notice to its customer that the broker or dealer may receive 
compensation in connection with lending the customer's securities. The 
Commission, by rule, as it deems necessary or appropriate in the public 
interest and for the protection of investors, may prescribe the form, 
content, time, and manner of delivery of any notice required under this 
paragraph.''.
SEC. 929Y. STUDY ON EXTRATERRITORIAL PRIVATE RIGHTS OF ACTION.
    (a) In General.--The Securities and Exchange Commission of the 
United States shall solicit public comment and thereafter conduct a 
study to determine the extent to which private rights of action under 
the antifraud provisions of the Securities and Exchange Act of 1934 (15 
U.S.C. 78u-4) should be extended to cover--
        (1) conduct within the United States that constitutes a 
    significant step in the furtherance of the violation, even if the 
    securities transaction occurs outside the United States and 
    involves only foreign investors; and
        (2) conduct occurring outside the United States that has a 
    foreseeable substantial effect within the United States.
    (b) Contents.--The study shall consider and analyze, among other 
things--
        (1) the scope of such a private right of action, including 
    whether it should extend to all private actors or whether it should 
    be more limited to extend just to institutional investors or 
    otherwise;
        (2) what implications such a private right of action would have 
    on international comity;
        (3) the economic costs and benefits of extending a private 
    right of action for transnational securities frauds; and
        (4) whether a narrower extraterritorial standard should be 
    adopted.
    (c) Report.--A report of the study shall be submitted and 
recommendations made to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services of the 
House not later than 18 months after the date of enactment of this Act.
SEC. 929Z. GAO STUDY ON SECURITIES LITIGATION.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study on the impact of authorizing a private right of action 
against any person who aids or abets another person in violation of the 
securities laws. To the extent feasible, this study shall include--
        (1) a review of the role of secondary actors in companies 
    issuance of securities;
        (2) the courts interpretation of the scope of liability for 
    secondary actors under Federal securities laws after January 14, 
    2008; and
        (3) the types of lawsuits decided under the Private Securities 
    Litigation Act of 1995.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, the Comptroller General shall submit a report to Congress on 
the findings of the study required under subsection (a).

  Subtitle C--Improvements to the Regulation of Credit Rating Agencies

    SEC. 931. FINDINGS.
    Congress finds the following:
        (1) Because of the systemic importance of credit ratings and 
    the reliance placed on credit ratings by individual and 
    institutional investors and financial regulators, the activities 
    and performances of credit rating agencies, including nationally 
    recognized statistical rating organizations, are matters of 
    national public interest, as credit rating agencies are central to 
    capital formation, investor confidence, and the efficient 
    performance of the United States economy.
        (2) Credit rating agencies, including nationally recognized 
    statistical rating organizations, play a critical ``gatekeeper'' 
    role in the debt market that is functionally similar to that of 
    securities analysts, who evaluate the quality of securities in the 
    equity market, and auditors, who review the financial statements of 
    firms. Such role justifies a similar level of public oversight and 
    accountability.
        (3) Because credit rating agencies perform evaluative and 
    analytical services on behalf of clients, much as other financial 
    ``gatekeepers'' do, the activities of credit rating agencies are 
    fundamentally commercial in character and should be subject to the 
    same standards of liability and oversight as apply to auditors, 
    securities analysts, and investment bankers.
        (4) In certain activities, particularly in advising arrangers 
    of structured financial products on potential ratings of such 
    products, credit rating agencies face conflicts of interest that 
    need to be carefully monitored and that therefore should be 
    addressed explicitly in legislation in order to give clearer 
    authority to the Securities and Exchange Commission.
        (5) In the recent financial crisis, the ratings on structured 
    financial products have proven to be inaccurate. This inaccuracy 
    contributed significantly to the mismanagement of risks by 
    financial institutions and investors, which in turn adversely 
    impacted the health of the economy in the United States and around 
    the world. Such inaccuracy necessitates increased accountability on 
    the part of credit rating agencies.
    SEC. 932. ENHANCED REGULATION, ACCOUNTABILITY, AND TRANSPARENCY OF 
      NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATIONS.
    (a) In General.--Section 15E of the Securities Exchange Act of 1934 
(15 U.S.C. 78o-7) is amended--
        (1) in subsection (b)--
            (A) in paragraph (1)(A), by striking ``furnished'' and 
        inserting ``filed'' and by striking ``furnishing'' and 
        inserting ``filing'';
            (B) in paragraph (1)(B), by striking ``furnishing'' and 
        inserting ``filing''; and
            (C) in the first sentence of paragraph (2), by striking 
        ``furnish to'' and inserting ``file with'';
        (2) in subsection (c)--
            (A) in paragraph (2)--
                (i) in the second sentence, by inserting ``any other 
            provision of this section, or'' after ``Notwithstanding''; 
            and
                (ii) by inserting after the period at the end the 
            following: ``Nothing in this paragraph may be construed to 
            afford a defense against any action or proceeding brought 
            by the Commission to enforce the antifraud provisions of 
            the securities laws.''; and
            (B) by adding at the end the following:
        ``(3) Internal controls over processes for determining credit 
    ratings.--
            ``(A) In general.--Each nationally recognized statistical 
        rating organization shall establish, maintain, enforce, and 
        document an effective internal control structure governing the 
        implementation of and adherence to policies, procedures, and 
        methodologies for determining credit ratings, taking into 
        consideration such factors as the Commission may prescribe, by 
        rule.
            ``(B) Attestation requirement.--The Commission shall 
        prescribe rules requiring each nationally recognized 
        statistical rating organization to submit to the Commission an 
        annual internal controls report, which shall contain--
                ``(i) a description of the responsibility of the 
            management of the nationally recognized statistical rating 
            organization in establishing and maintaining an effective 
            internal control structure under subparagraph (A);
                ``(ii) an assessment of the effectiveness of the 
            internal control structure of the nationally recognized 
            statistical rating organization; and
                ``(iii) the attestation of the chief executive officer, 
            or equivalent individual, of the nationally recognized 
            statistical rating organization.'';
        (3) in subsection (d)--
            (A) by inserting after ``or revoke the registration of any 
        nationally recognized statistical rating organization'' the 
        following: ``, or with respect to any person who is associated 
        with, who is seeking to become associated with, or, at the time 
        of the alleged misconduct, who was associated or was seeking to 
        become associated with a nationally recognized statistical 
        rating organization, the Commission, by order, shall censure, 
        place limitations on the activities or functions of such 
        person, suspend for a period not exceeding 1 year, or bar such 
        person from being associated with a nationally recognized 
        statistical rating organization,'';
            (B) by inserting ``bar'' after ``placing of limitations, 
        suspension,'';
            (C) in paragraph (2), by striking ``furnished to'' and 
        inserting ``filed with'';
            (D) in paragraph (2), by redesignating subparagraphs (A) 
        and (B) as clauses (i) and (ii), respectively, and adjusting 
        the clause margins accordingly;
            (E) by redesignating paragraphs (1) through (5) as 
        subparagraphs (A) through (E), respectively, and adjusting the 
        subparagraph margins accordingly;
            (F) in the matter preceding subparagraph (A), as so 
        redesignated, by striking ``The Commission'' and inserting the 
        following:
        ``(1) In general.--The Commission'';
            (G) in subparagraph (D), as so redesignated--
                (i) by striking ``furnish'' and inserting ``file''; and
                (ii) by striking ``or'' at the end.
            (H) in subparagraph (E), as so redesignated, by striking 
        the period at the end and inserting a semicolon; and
            (I) by adding at the end the following:
            ``(F) has failed reasonably to supervise, with a view to 
        preventing a violation of the securities laws, an individual 
        who commits such a violation, if the individual is subject to 
        the supervision of that person.
        ``(2) Suspension or revocation for particular class of 
    securities.--
            ``(A) In general.--The Commission may temporarily suspend 
        or permanently revoke the registration of a nationally 
        recognized statistical rating organization with respect to a 
        particular class or subclass of securities, if the Commission 
        finds, on the record after notice and opportunity for hearing, 
        that the nationally recognized statistical rating organization 
        does not have adequate financial and managerial resources to 
        consistently produce credit ratings with integrity.
            ``(B) Considerations.--In making any determination under 
        subparagraph (A), the Commission shall consider--
                ``(i) whether the nationally recognized statistical 
            rating organization has failed over a sustained period of 
            time, as determined by the Commission, to produce ratings 
            that are accurate for that class or subclass of securities; 
            and
                ``(ii) such other factors as the Commission may 
            determine.'';
        (4) in subsection (h), by adding at the end the following:
        ``(3) Separation of ratings from sales and marketing.--
            ``(A) Rules required.--The Commission shall issue rules to 
        prevent the sales and marketing considerations of a nationally 
        recognized statistical rating organization from influencing the 
        production of ratings by the nationally recognized statistical 
        rating organization.
            ``(B) Contents of rules.--The rules issued under 
        subparagraph (A) shall provide for--
                ``(i) exceptions for small nationally recognized 
            statistical rating organizations with respect to which the 
            Commission determines that the separation of the production 
            of ratings and sales and marketing activities is not 
            appropriate; and
                ``(ii) suspension or revocation of the registration of 
            a nationally recognized statistical rating organization, if 
            the Commission finds, on the record, after notice and 
            opportunity for a hearing, that--

                    ``(I) the nationally recognized statistical rating 
                organization has committed a violation of a rule issued 
                under this subsection; and
                    ``(II) the violation of a rule issued under this 
                subsection affected a rating.

        ``(4) Look-back requirement.--
            ``(A) Review by the nationally recognized statistical 
        rating organization.--Each nationally recognized statistical 
        rating organization shall establish, maintain, and enforce 
        policies and procedures reasonably designed to ensure that, in 
        any case in which an employee of a person subject to a credit 
        rating of the nationally recognized statistical rating 
        organization or the issuer, underwriter, or sponsor of a 
        security or money market instrument subject to a credit rating 
        of the nationally recognized statistical rating organization 
        was employed by the nationally recognized statistical rating 
        organization and participated in any capacity in determining 
        credit ratings for the person or the securities or money market 
        instruments during the 1-year period preceding the date an 
        action was taken with respect to the credit rating, the 
        nationally recognized statistical rating organization shall--
                ``(i) conduct a review to determine whether any 
            conflicts of interest of the employee influenced the credit 
            rating; and
                ``(ii) take action to revise the rating if appropriate, 
            in accordance with such rules as the Commission shall 
            prescribe.
            ``(B) Review by commission.--
                ``(i) In general.--The Commission shall conduct 
            periodic reviews of the policies described in subparagraph 
            (A) and the implementation of the policies at each 
            nationally recognized statistical rating organization to 
            ensure they are reasonably designed and implemented to most 
            effectively eliminate conflicts of interest.
                ``(ii) Timing of reviews.--The Commission shall review 
            the code of ethics and conflict of interest policy of each 
            nationally recognized statistical rating organization--

                    ``(I) not less frequently than annually; and
                    ``(II) whenever such policies are materially 
                modified or amended.

        ``(5) Report to commission on certain employment transitions.--
            ``(A) Report required.--Each nationally recognized 
        statistical rating organization shall report to the Commission 
        any case such organization knows or can reasonably be expected 
        to know where a person associated with such organization within 
        the previous 5 years obtains employment with any obligor, 
        issuer, underwriter, or sponsor of a security or money market 
        instrument for which the organization issued a credit rating 
        during the 12-month period prior to such employment, if such 
        employee--
                ``(i) was a senior officer of such organization;
                ``(ii) participated in any capacity in determining 
            credit ratings for such obligor, issuer, underwriter, or 
            sponsor; or
                ``(iii) supervised an employee described in clause 
            (ii).
            ``(B) Public disclosure.--Upon receiving such a report, the 
        Commission shall make such information publicly available.'';
        (5) in subsection (j)--
            (A) by striking ``Each'' and inserting the following:
        ``(1) In general.--Each''; and
            (B) by adding at the end the following:
        ``(2) Limitations.--
            ``(A) In general.--Except as provided in subparagraph (B), 
        an individual designated under paragraph (1) may not, while 
        serving in the designated capacity--
                ``(i) perform credit ratings;
                ``(ii) participate in the development of ratings 
            methodologies or models;
                ``(iii) perform marketing or sales functions; or
                ``(iv) participate in establishing compensation levels, 
            other than for employees working for that individual.
            ``(B) Exception.--The Commission may exempt a small 
        nationally recognized statistical rating organization from the 
        limitations under this paragraph, if the Commission finds that 
        compliance with such limitations would impose an unreasonable 
        burden on the nationally recognized statistical rating 
        organization.
        ``(3) Other duties.--Each individual designated under paragraph 
    (1) shall establish procedures for the receipt, retention, and 
    treatment of--
            ``(A) complaints regarding credit ratings, models, 
        methodologies, and compliance with the securities laws and the 
        policies and procedures developed under this section; and
            ``(B) confidential, anonymous complaints by employees or 
        users of credit ratings.
        ``(4) Compensation.--The compensation of each compliance 
    officer appointed under paragraph (1) shall not be linked to the 
    financial performance of the nationally recognized statistical 
    rating organization and shall be arranged so as to ensure the 
    independence of the officer's judgment.
        ``(5) Annual reports required.--
            ``(A) Annual reports required.--Each individual designated 
        under paragraph (1) shall submit to the nationally recognized 
        statistical rating organization an annual report on the 
        compliance of the nationally recognized statistical rating 
        organization with the securities laws and the policies and 
        procedures of the nationally recognized statistical rating 
        organization that includes--
                ``(i) a description of any material changes to the code 
            of ethics and conflict of interest policies of the 
            nationally recognized statistical rating organization; and
                ``(ii) a certification that the report is accurate and 
            complete.
            ``(B) Submission of reports to the commission.--Each 
        nationally recognized statistical rating organization shall 
        file the reports required under subparagraph (A) together with 
        the financial report that is required to be submitted to the 
        Commission under this section.'';
        (6) in subsection (k), by striking ``furnish to'' and inserting 
    ``file with'';
        (7) in subsection (l)(2)(A)(i), by striking ``furnished'' and 
    inserting ``filed''; and
        (8) by striking subsection (p) and inserting the following:
    ``(p) Regulation of Nationally Recognized Statistical Rating 
Organizations.--
        ``(1) Establishment of office of credit ratings.--
            ``(A) Office established.--The Commission shall establish 
        within the Commission an Office of Credit Ratings (referred to 
        in this subsection as the `Office') to administer the rules of 
        the Commission--
                ``(i) with respect to the practices of nationally 
            recognized statistical rating organizations in determining 
            ratings, for the protection of users of credit ratings and 
            in the public interest;
                ``(ii) to promote accuracy in credit ratings issued by 
            nationally recognized statistical rating organizations; and
                ``(iii) to ensure that such ratings are not unduly 
            influenced by conflicts of interest.
            ``(B) Director of the office.--The head of the Office shall 
        be the Director, who shall report to the Chairman.
        ``(2) Staffing.--The Office established under this subsection 
    shall be staffed sufficiently to carry out fully the requirements 
    of this section. The staff shall include persons with knowledge of 
    and expertise in corporate, municipal, and structured debt finance.
        ``(3) Commission examinations.--
            ``(A) Annual examinations required.--The Office shall 
        conduct an examination of each nationally recognized 
        statistical rating organization at least annually.
            ``(B) Conduct of examinations.--Each examination under 
        subparagraph (A) shall include a review of--
                ``(i) whether the nationally recognized statistical 
            rating organization conducts business in accordance with 
            the policies, procedures, and rating methodologies of the 
            nationally recognized statistical rating organization;
                ``(ii) the management of conflicts of interest by the 
            nationally recognized statistical rating organization;
                ``(iii) implementation of ethics policies by the 
            nationally recognized statistical rating organization;
                ``(iv) the internal supervisory controls of the 
            nationally recognized statistical rating organization;
                ``(v) the governance of the nationally recognized 
            statistical rating organization;
                ``(vi) the activities of the individual designated by 
            the nationally recognized statistical rating organization 
            under subsection (j)(1);
                ``(vii) the processing of complaints by the nationally 
            recognized statistical rating organization; and
                ``(viii) the policies of the nationally recognized 
            statistical rating organization governing the post-
            employment activities of former staff of the nationally 
            recognized statistical rating organization.
            ``(C) Inspection reports.--The Commission shall make 
        available to the public, in an easily understandable format, an 
        annual report summarizing--
                ``(i) the essential findings of all examinations 
            conducted under subparagraph (A), as deemed appropriate by 
            the Commission;
                ``(ii) the responses by the nationally recognized 
            statistical rating organizations to any material regulatory 
            deficiencies identified by the Commission under clause (i); 
            and
                ``(iii) whether the nationally recognized statistical 
            rating organizations have appropriately addressed the 
            recommendations of the Commission contained in previous 
            reports under this subparagraph.
        ``(4) Rulemaking authority.--The Commission shall--
            ``(A) establish, by rule, fines, and other penalties 
        applicable to any nationally recognized statistical rating 
        organization that violates the requirements of this section and 
        the rules thereunder; and
            ``(B) issue such rules as may be necessary to carry out 
        this section.
    ``(q) Transparency of Ratings Performance.--
        ``(1) Rulemaking required.--The Commission shall, by rule, 
    require that each nationally recognized statistical rating 
    organization publicly disclose information on the initial credit 
    ratings determined by the nationally recognized statistical rating 
    organization for each type of obligor, security, and money market 
    instrument, and any subsequent changes to such credit ratings, for 
    the purpose of allowing users of credit ratings to evaluate the 
    accuracy of ratings and compare the performance of ratings by 
    different nationally recognized statistical rating organizations.
        ``(2) Content.--The rules of the Commission under this 
    subsection shall require, at a minimum, disclosures that--
            ``(A) are comparable among nationally recognized 
        statistical rating organizations, to allow users of credit 
        ratings to compare the performance of credit ratings across 
        nationally recognized statistical rating organizations;
            ``(B) are clear and informative for investors having a wide 
        range of sophistication who use or might use credit ratings;
            ``(C) include performance information over a range of years 
        and for a variety of types of credit ratings, including for 
        credit ratings withdrawn by the nationally recognized 
        statistical rating organization;
            ``(D) are published and made freely available by the 
        nationally recognized statistical rating organization, on an 
        easily accessible portion of its website, and in writing, when 
        requested;
            ``(E) are appropriate to the business model of a nationally 
        recognized statistical rating organization; and
            ``(F) each nationally recognized statistical rating 
        organization include an attestation with any credit rating it 
        issues affirming that no part of the rating was influenced by 
        any other business activities, that the rating was based solely 
        on the merits of the instruments being rated, and that such 
        rating was an independent evaluation of the risks and merits of 
        the instrument.
    ``(r) Credit Ratings Methodologies.--The Commission shall prescribe 
rules, for the protection of investors and in the public interest, with 
respect to the procedures and methodologies, including qualitative and 
quantitative data and models, used by nationally recognized statistical 
rating organizations that require each nationally recognized 
statistical rating organization--
        ``(1) to ensure that credit ratings are determined using 
    procedures and methodologies, including qualitative and 
    quantitative data and models, that are--
            ``(A) approved by the board of the nationally recognized 
        statistical rating organization, a body performing a function 
        similar to that of a board; and
            ``(B) in accordance with the policies and procedures of the 
        nationally recognized statistical rating organization for the 
        development and modification of credit rating procedures and 
        methodologies;
        ``(2) to ensure that when material changes to credit rating 
    procedures and methodologies (including changes to qualitative and 
    quantitative data and models) are made, that--
            ``(A) the changes are applied consistently to all credit 
        ratings to which the changed procedures and methodologies 
        apply;
            ``(B) to the extent that changes are made to credit rating 
        surveillance procedures and methodologies, the changes are 
        applied to then-current credit ratings by the nationally 
        recognized statistical rating organization within a reasonable 
        time period determined by the Commission, by rule; and
            ``(C) the nationally recognized statistical rating 
        organization publicly discloses the reason for the change; and
        ``(3) to notify users of credit ratings--
            ``(A) of the version of a procedure or methodology, 
        including the qualitative methodology or quantitative inputs, 
        used with respect to a particular credit rating;
            ``(B) when a material change is made to a procedure or 
        methodology, including to a qualitative model or quantitative 
        inputs;
            ``(C) when a significant error is identified in a procedure 
        or methodology, including a qualitative or quantitative model, 
        that may result in credit rating actions; and
            ``(D) of the likelihood of a material change described in 
        subparagraph (B) resulting in a change in current credit 
        ratings.
    ``(s) Transparency of Credit Rating Methodologies and Information 
Reviewed.--
        ``(1) Form for disclosures.--The Commission shall require, by 
    rule, each nationally recognized statistical rating organization to 
    prescribe a form to accompany the publication of each credit rating 
    that discloses--
            ``(A) information relating to--
                ``(i) the assumptions underlying the credit rating 
            procedures and methodologies;
                ``(ii) the data that was relied on to determine the 
            credit rating; and
                ``(iii) if applicable, how the nationally recognized 
            statistical rating organization used servicer or remittance 
            reports, and with what frequency, to conduct surveillance 
            of the credit rating; and
            ``(B) information that can be used by investors and other 
        users of credit ratings to better understand credit ratings in 
        each class of credit rating issued by the nationally recognized 
        statistical rating organization.
        ``(2) Format.--The form developed under paragraph (1) shall--
            ``(A) be easy to use and helpful for users of credit 
        ratings to understand the information contained in the report;
            ``(B) require the nationally recognized statistical rating 
        organization to provide the content described in paragraph 
        (3)(B) in a manner that is directly comparable across types of 
        securities; and
            ``(C) be made readily available to users of credit ratings, 
        in electronic or paper form, as the Commission may, by rule, 
        determine.
        ``(3) Content of form.--
            ``(A) Qualitative content.--Each nationally recognized 
        statistical rating organization shall disclose on the form 
        developed under paragraph (1)--
                ``(i) the credit ratings produced by the nationally 
            recognized statistical rating organization;
                ``(ii) the main assumptions and principles used in 
            constructing procedures and methodologies, including 
            qualitative methodologies and quantitative inputs and 
            assumptions about the correlation of defaults across 
            underlying assets used in rating structured products;
                ``(iii) the potential limitations of the credit 
            ratings, and the types of risks excluded from the credit 
            ratings that the nationally recognized statistical rating 
            organization does not comment on, including liquidity, 
            market, and other risks;
                ``(iv) information on the uncertainty of the credit 
            rating, including--

                    ``(I) information on the reliability, accuracy, and 
                quality of the data relied on in determining the credit 
                rating; and
                    ``(II) a statement relating to the extent to which 
                data essential to the determination of the credit 
                rating were reliable or limited, including--

                        ``(aa) any limits on the scope of historical 
                    data; and
                        ``(bb) any limits in accessibility to certain 
                    documents or other types of information that would 
                    have better informed the credit rating;
                ``(v) whether and to what extent third party due 
            diligence services have been used by the nationally 
            recognized statistical rating organization, a description 
            of the information that such third party reviewed in 
            conducting due diligence services, and a description of the 
            findings or conclusions of such third party;
                ``(vi) a description of the data about any obligor, 
            issuer, security, or money market instrument that were 
            relied upon for the purpose of determining the credit 
            rating;
                ``(vii) a statement containing an overall assessment of 
            the quality of information available and considered in 
            producing a rating for an obligor, security, or money 
            market instrument, in relation to the quality of 
            information available to the nationally recognized 
            statistical rating organization in rating similar 
            issuances;
                ``(viii) information relating to conflicts of interest 
            of the nationally recognized statistical rating 
            organization; and
                ``(ix) such additional information as the Commission 
            may require.
            ``(B) Quantitative content.--Each nationally recognized 
        statistical rating organization shall disclose on the form 
        developed under this subsection--
                ``(i) an explanation or measure of the potential 
            volatility of the credit rating, including--

                    ``(I) any factors that might lead to a change in 
                the credit ratings; and
                    ``(II) the magnitude of the change that a user can 
                expect under different market conditions;

                ``(ii) information on the content of the rating, 
            including--

                    ``(I) the historical performance of the rating; and
                    ``(II) the expected probability of default and the 
                expected loss in the event of default;

                ``(iii) information on the sensitivity of the rating to 
            assumptions made by the nationally recognized statistical 
            rating organization, including--

                    ``(I) 5 assumptions made in the ratings process 
                that, without accounting for any other factor, would 
                have the greatest impact on a rating if the assumptions 
                were proven false or inaccurate; and
                    ``(II) an analysis, using specific examples, of how 
                each of the 5 assumptions identified under subclause 
                (I) impacts a rating;

                ``(iv) such additional information as may be required 
            by the Commission.
        ``(4) Due diligence services for asset-backed securities.--
            ``(A) Findings.--The issuer or underwriter of any asset-
        backed security shall make publicly available the findings and 
        conclusions of any third-party due diligence report obtained by 
        the issuer or underwriter.
            ``(B) Certification required.--In any case in which third-
        party due diligence services are employed by a nationally 
        recognized statistical rating organization, an issuer, or an 
        underwriter, the person providing the due diligence services 
        shall provide to any nationally recognized statistical rating 
        organization that produces a rating to which such services 
        relate, written certification, as provided in subparagraph (C).
            ``(C) Format and content.--The Commission shall establish 
        the appropriate format and content for the written 
        certifications required under subparagraph (B), to ensure that 
        providers of due diligence services have conducted a thorough 
        review of data, documentation, and other relevant information 
        necessary for a nationally recognized statistical rating 
        organization to provide an accurate rating.
            ``(D) Disclosure of certification.--The Commission shall 
        adopt rules requiring a nationally recognized statistical 
        rating organization, at the time at which the nationally 
        recognized statistical rating organization produces a rating, 
        to disclose the certification described in subparagraph (B) to 
        the public in a manner that allows the public to determine the 
        adequacy and level of due diligence services provided by a 
        third party.
    ``(t) Corporate Governance, Organization, and Management of 
Conflicts of Interest.--
        ``(1) Board of directors.--Each nationally recognized 
    statistical rating organization shall have a board of directors.
        ``(2) Independent directors.--
            ``(A) In general.--At least \1/2\ of the board of 
        directors, but not fewer than 2 of the members thereof, shall 
        be independent of the nationally recognized statistical rating 
        agency. A portion of the independent directors shall include 
        users of ratings from a nationally recognized statistical 
        rating organization.
            ``(B) Independence determination.--In order to be 
        considered independent for purposes of this subsection, a 
        member of the board of directors of a nationally recognized 
        statistical rating organization--
                ``(i) may not, other than in his or her capacity as a 
            member of the board of directors or any committee thereof--

                    ``(I) accept any consulting, advisory, or other 
                compensatory fee from the nationally recognized 
                statistical rating organization; or
                    ``(II) be a person associated with the nationally 
                recognized statistical rating organization or with any 
                affiliated company thereof; and

                ``(ii) shall be disqualified from any deliberation 
            involving a specific rating in which the independent board 
            member has a financial interest in the outcome of the 
            rating.
            ``(C) Compensation and term.--The compensation of the 
        independent members of the board of directors of a nationally 
        recognized statistical rating organization shall not be linked 
        to the business performance of the nationally recognized 
        statistical rating organization, and shall be arranged so as to 
        ensure the independence of their judgment. The term of office 
        of the independent directors shall be for a pre-agreed fixed 
        period, not to exceed 5 years, and shall not be renewable.
        ``(3) Duties of board of directors.--In addition to the overall 
    responsibilities of the board of directors, the board shall 
    oversee--
            ``(A) the establishment, maintenance, and enforcement of 
        policies and procedures for determining credit ratings;
            ``(B) the establishment, maintenance, and enforcement of 
        policies and procedures to address, manage, and disclose any 
        conflicts of interest;
            ``(C) the effectiveness of the internal control system with 
        respect to policies and procedures for determining credit 
        ratings; and
            ``(D) the compensation and promotion policies and practices 
        of the nationally recognized statistical rating organization.
        ``(4) Treatment of nrsro subsidiaries.--If a nationally 
    recognized statistical rating organization is a subsidiary of a 
    parent entity, the board of the directors of the parent entity may 
    satisfy the requirements of this subsection by assigning to a 
    committee of such board of directors the duties under paragraph 
    (3), if--
            ``(A) at least \1/2\ of the members of the committee 
        (including the chairperson of the committee) are independent, 
        as defined in this section; and
            ``(B) at least 1 member of the committee is a user of 
        ratings from a nationally recognized statistical rating 
        organization.
        ``(5) Exception authority.--If the Commission finds that 
    compliance with the provisions of this subsection present an 
    unreasonable burden on a small nationally recognized statistical 
    rating organization, the Commission may permit the nationally 
    recognized statistical rating organization to delegate such 
    responsibilities to a committee that includes at least one 
    individual who is a user of ratings of a nationally recognized 
    statistical rating organization.''.
    (b) Conforming Amendment.--Section 3(a)(62) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78c(a)(62)) is amended by striking 
subparagraph (A) and redesignating subparagraphs (B) and (C) as 
subparagraphs (A) and (B), respectively.
    SEC. 933. STATE OF MIND IN PRIVATE ACTIONS.
    (a) Accountability.--Section 15E(m) of the Securities Exchange Act 
of 1934 (15 U.S.C. 78o-7(m)) is amended to read as follows:
    ``(m) Accountability.--
        ``(1) In general.--The enforcement and penalty provisions of 
    this title shall apply to statements made by a credit rating agency 
    in the same manner and to the same extent as such provisions apply 
    to statements made by a registered public accounting firm or a 
    securities analyst under the securities laws, and such statements 
    shall not be deemed forward-looking statements for the purposes of 
    section 21E.
        ``(2) Rulemaking.--The Commission shall issue such rules as may 
    be necessary to carry out this subsection.''.
    (b) State of Mind.--Section 21D(b)(2) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78u-4(b)(2)) is amended--
        (1) by striking ``In any'' and inserting the following:
            ``(A) In general.--Except as provided in subparagraph (B), 
        in any''; and
        (2) by adding at the end the following:
            ``(B) Exception.--In the case of an action for money 
        damages brought against a credit rating agency or a controlling 
        person under this title, it shall be sufficient, for purposes 
        of pleading any required state of mind in relation to such 
        action, that the complaint state with particularity facts 
        giving rise to a strong inference that the credit rating agency 
        knowingly or recklessly failed--
                ``(i) to conduct a reasonable investigation of the 
            rated security with respect to the factual elements relied 
            upon by its own methodology for evaluating credit risk; or
                ``(ii) to obtain reasonable verification of such 
            factual elements (which verification may be based on a 
            sampling technique that does not amount to an audit) from 
            other sources that the credit rating agency considered to 
            be competent and that were independent of the issuer and 
            underwriter.''.
    SEC. 934. REFERRING TIPS TO LAW ENFORCEMENT OR REGULATORY 
      AUTHORITIES.
    Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 78o-
7), as amended by this subtitle, is amended by adding at the end the 
following:
    ``(u) Duty To Report Tips Alleging Material Violations of Law.--
        ``(1) Duty to report.--Each nationally recognized statistical 
    rating organization shall refer to the appropriate law enforcement 
    or regulatory authorities any information that the nationally 
    recognized statistical rating organization receives from a third 
    party and finds credible that alleges that an issuer of securities 
    rated by the nationally recognized statistical rating organization 
    has committed or is committing a material violation of law that has 
    not been adjudicated by a Federal or State court.
        ``(2) Rule of construction.--Nothing in paragraph (1) may be 
    construed to require a nationally recognized statistical rating 
    organization to verify the accuracy of the information described in 
    paragraph (1).''.
    SEC. 935. CONSIDERATION OF INFORMATION FROM SOURCES OTHER THAN THE 
      ISSUER IN RATING DECISIONS.
    Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 78o-
7), as amended by this subtitle, is amended by adding at the end the 
following:
    ``(v) Information From Sources Other Than the Issuer.--In producing 
a credit rating, a nationally recognized statistical rating 
organization shall consider information about an issuer that the 
nationally recognized statistical rating organization has, or receives 
from a source other than the issuer or underwriter, that the nationally 
recognized statistical rating organization finds credible and 
potentially significant to a rating decision.''.
    SEC. 936. QUALIFICATION STANDARDS FOR CREDIT RATING ANALYSTS.
    Not later than 1 year after the date of enactment of this Act, the 
Commission shall issue rules that are reasonably designed to ensure 
that any person employed by a nationally recognized statistical rating 
organization to perform credit ratings--
        (1) meets standards of training, experience, and competence 
    necessary to produce accurate ratings for the categories of issuers 
    whose securities the person rates; and
        (2) is tested for knowledge of the credit rating process.
    SEC. 937. TIMING OF REGULATIONS.
    Unless otherwise specifically provided in this subtitle, the 
Commission shall issue final regulations, as required by this subtitle 
and the amendments made by this subtitle, not later than 1 year after 
the date of enactment of this Act.
    SEC. 938. UNIVERSAL RATINGS SYMBOLS.
    (a) Rulemaking.--The Commission shall require, by rule, each 
nationally recognized statistical rating organization to establish, 
maintain, and enforce written policies and procedures that--
        (1) assess the probability that an issuer of a security or 
    money market instrument will default, fail to make timely payments, 
    or otherwise not make payments to investors in accordance with the 
    terms of the security or money market instrument;
        (2) clearly define and disclose the meaning of any symbol used 
    by the nationally recognized statistical rating organization to 
    denote a credit rating; and
        (3) apply any symbol described in paragraph (2) in a manner 
    that is consistent for all types of securities and money market 
    instruments for which the symbol is used.
    (b) Rule of Construction.--Nothing in this section shall prohibit a 
nationally recognized statistical rating organization from using 
distinct sets of symbols to denote credit ratings for different types 
of securities or money market instruments.
    SEC. 939. REMOVAL OF STATUTORY REFERENCES TO CREDIT RATINGS.
    (a) Federal Deposit Insurance Act.--The Federal Deposit Insurance 
Act (12 U.S.C. 1811 et seq.) is amended--
        (1) in section 7(b)(1)(E)(i), by striking ``credit rating 
    entities, and other private economic'' and insert ``private 
    economic, credit,'';
        (2) in section 28(d)--
            (A) in the subsection heading, by striking ``Not of 
        Investment Grade'';
            (B) in paragraph (1), by striking ``not of investment 
        grade'' and inserting ``that does not meet standards of credit-
        worthiness as established by the Corporation'';
            (C) in paragraph (2), by striking ``not of investment 
        grade'';
            (D) by striking paragraph (3);
            (E) by redesignating paragraph (4) as paragraph (3); and
            (F) in paragraph (3), as so redesignated--
                (i) by striking subparagraph (A);
                (ii) by redesignating subparagraphs (B) and (C) as 
            subparagraphs (A) and (B), respectively; and
                (iii) in subparagraph (B), as so redesignated, by 
            striking ``not of investment grade'' and inserting ``that 
            does not meet standards of credit-worthiness as established 
            by the Corporation''; and
        (3) in section 28(e)--
            (A) in the subsection heading, by striking ``Not of 
        Investment Grade'';
            (B) in paragraph (1), by striking ``not of investment 
        grade'' and inserting ``that does not meet standards of credit-
        worthiness as established by the Corporation''; and
            (C) in paragraphs (2) and (3), by striking ``not of 
        investment grade'' each place that it appears and inserting 
        ``that does not meet standards of credit-worthiness established 
        by the Corporation''.
    (b) Federal Housing Enterprises Financial Safety and Soundness Act 
of 1992.--Section 1319 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4519) is amended by 
striking ``that is a nationally recognized statistical rating 
organization, as such term is defined in section 3(a) of the Securities 
Exchange Act of 1934,''.
    (c) Investment Company Act of 1940.--Section 6(a)(5)(A)(iv)(I) 
Investment Company Act of 1940 (15 U.S.C. 80a-6(a)(5)(A)(iv)(I)) is 
amended by striking ``is rated investment grade by not less than 1 
nationally recognized statistical rating organization'' and inserting 
``meets such standards of credit-worthiness as the Commission shall 
adopt''.
    (d) Revised Statutes.--Section 5136A of title LXII of the Revised 
Statutes of the United States (12 U.S.C. 24a) is amended--
        (1) in subsection (a)(2)(E), by striking ``any applicable 
    rating'' and inserting ``standards of credit-worthiness established 
    by the Comptroller of the Currency'';
        (2) in the heading for subsection (a)(3) by striking ``Rating 
    or Comparable Requirement'' and inserting ``Requirement'';
        (3) subsection (a)(3), by amending subparagraph (A) to read as 
    follows:
            ``(A) In general.--A national bank meets the requirements 
        of this paragraph if the bank is one of the 100 largest insured 
        banks and has not fewer than 1 issue of outstanding debt that 
        meets standards of credit-worthiness or other criteria as the 
        Secretary of the Treasury and the Board of Governors of the 
        Federal Reserve System may jointly establish.''.
        (4) in the heading for subsection (f), by striking ``Maintain 
    Public Rating or'' and inserting ``Meet Standards of Credit-
    worthiness''; and
        (5) in subsection (f)(1), by striking ``any applicable rating'' 
    and inserting ``standards of credit-worthiness established by the 
    Comptroller of the Currency''.
    (e) Securities Exchange Act of 1934.--Section 3(a) Securities 
Exchange Act of 1934 (15 U.S.C. 78a(3)(a)) is amended--
        (1) in paragraph (41), by striking ``is rated in one of the two 
    highest rating categories by at least one nationally recognized 
    statistical rating organization'' and inserting ``meets standards 
    of credit-worthiness as established by the Commission''; and
        (2) in paragraph (53)(A), by striking ``is rated in 1 of the 4 
    highest rating categories by at least 1 nationally recognized 
    statistical rating organization'' and inserting ``meets standards 
    of credit-worthiness as established by the Commission''.
    (f) World Bank Discussions.--Section 3(a)(6) of the amendment in 
the nature of a substitute to the text of H.R. 4645, as ordered 
reported from the Committee on Banking, Finance and Urban Affairs on 
September 22, 1988, as enacted into law by section 555 of Public Law 
100-461, (22 U.S.C. 286hh(a)(6)), is amended by striking ``credit 
rating'' and inserting ``credit-worthiness''.
    (g) Effective Date.--The amendments made by this section shall take 
effect 2 years after the date of enactment of this Act.
    (h) Study and Report.--
        (1) In general.--Commission shall undertake a study on the 
    feasability and desirability of--
            (A) standardizing credit ratings terminology, so that all 
        credit rating agencies issue credit ratings using identical 
        terms;
            (B) standardizing the market stress conditions under which 
        ratings are evaluated;
            (C) requiring a quantitative correspondence between credit 
        ratings and a range of default probabilities and loss 
        expectations under standardized conditions of economic stress; 
        and
            (D) standardizing credit rating terminology across asset 
        classes, so that named ratings correspond to a standard range 
        of default probabilities and expected losses independent of 
        asset class and issuing entity.
        (2) Report.--Not later than 1 year after the date of enactment 
    of this Act, the Commission shall submit to Congress a report 
    containing the findings of the study under paragraph (1) and the 
    recommendations, if any, of the Commission with respect to the 
    study.
SEC. 939A. REVIEW OF RELIANCE ON RATINGS.
    (a) Agency Review.--Not later than 1 year after the date of the 
enactment of this subtitle, each Federal agency shall, to the extent 
applicable, review--
        (1) any regulation issued by such agency that requires the use 
    of an assessment of the credit-worthiness of a security or money 
    market instrument; and
        (2) any references to or requirements in such regulations 
    regarding credit ratings.
    (b) Modifications Required.--Each such agency shall modify any such 
regulations identified by the review conducted under subsection (a) to 
remove any reference to or requirement of reliance on credit ratings 
and to substitute in such regulations such standard of credit-
worthiness as each respective agency shall determine as appropriate for 
such regulations. In making such determination, such agencies shall 
seek to establish, to the extent feasible, uniform standards of credit-
worthiness for use by each such agency, taking into account the 
entities regulated by each such agency and the purposes for which such 
entities would rely on such standards of credit-worthiness.
    (c) Report.--Upon conclusion of the review required under 
subsection (a), each Federal agency shall transmit a report to Congress 
containing a description of any modification of any regulation such 
agency made pursuant to subsection (b).
SEC. 939B. ELIMINATION OF EXEMPTION FROM FAIR DISCLOSURE RULE.
    Not later than 90 days after the date of enactment of this 
subtitle, the Securities Exchange Commission shall revise Regulation FD 
(17 C.F.R. 243.100) to remove from such regulation the exemption for 
entities whose primary business is the issuance of credit ratings (17 
C.F.R. 243.100(b)(2)(iii)).
SEC. 939C. SECURITIES AND EXCHANGE COMMISSION STUDY ON STRENGTHENING 
CREDIT RATING AGENCY INDEPENDENCE.
    (a) Study.--The Commission shall conduct a study of--
        (1) the independence of nationally recognized statistical 
    rating organizations; and
        (2) how the independence of nationally recognized statistical 
    rating organizations affects the ratings issued by the nationally 
    recognized statistical rating organizations.
    (b) Subjects for Evaluation.--In conducting the study under 
subsection (a), the Commission shall evaluate--
        (1) the management of conflicts of interest raised by a 
    nationally recognized statistical rating organization providing 
    other services, including risk management advisory services, 
    ancillary assistance, or consulting services;
        (2) the potential impact of rules prohibiting a nationally 
    recognized statistical rating organization that provides a rating 
    to an issuer from providing other services to the issuer; and
        (3) any other issue relating to nationally recognized 
    statistical rating organizations, as the Chairman of the Commission 
    determines is appropriate.
    (c) Report.--Not later than 3 years after the date of enactment of 
this Act, the Chairman of the Commission shall submit to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives a report on the 
results of the study conducted under subsection (a), including 
recommendations, if any, for improving the integrity of ratings issued 
by nationally recognized statistical rating organizations.
SEC. 939D. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON ALTERNATIVE 
BUSINESS MODELS.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study on alternative means for compensating nationally 
recognized statistical rating organizations in order to create 
incentives for nationally recognized statistical rating organizations 
to provide more accurate credit ratings, including any statutory 
changes that would be required to facilitate the use of an alternative 
means of compensation.
    (b) Report.--Not later than 18 months after the date of enactment 
of this Act, the Comptroller General shall submit to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives a report on the 
results of the study conducted under subsection (a), including 
recommendations, if any, for providing incentives to credit rating 
agencies to improve the credit rating process.
SEC. 939E. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON THE CREATION OF AN 
INDEPENDENT PROFESSIONAL ANALYST ORGANIZATION.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study on the feasibility and merits of creating an 
independent professional organization for rating analysts employed by 
nationally recognized statistical rating organizations that would be 
responsible for--
        (1) establishing independent standards for governing the 
    profession of rating analysts;
        (2) establishing a code of ethical conduct; and
        (3) overseeing the profession of rating analysts.
    (b) Report.--Not later than 1 year after the date of publication of 
the rules issued by the Commission pursuant to section 936, the 
Comptroller General shall submit to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives a report on the results of the study 
conducted under subsection (a).
SEC. 939F. STUDY AND RULEMAKING ON ASSIGNED CREDIT RATINGS.
    (a) Definition.--In this section, the term ``structured finance 
product'' means an asset-backed security, as defined in section 
3(a)(77) of the Securities Exchange Act of 1934, as added by section 
941, and any structured product based on an asset-backed security, as 
determined by the Commission, by rule.
    (b) Study.--The Commission shall carry out a study of--
        (1) the credit rating process for structured finance products 
    and the conflicts of interest associated with the issuer-pay and 
    the subscriber-pay models;
        (2) the feasibility of establishing a system in which a public 
    or private utility or a self-regulatory organization assigns 
    nationally recognized statistical rating organizations to determine 
    the credit ratings of structured finance products, including--
            (A) an assessment of potential mechanisms for determining 
        fees for the nationally recognized statistical rating 
        organizations;
            (B) appropriate methods for paying fees to the nationally 
        recognized statistical rating organizations;
            (C) the extent to which the creation of such a system would 
        be viewed as the creation of moral hazard by the Federal 
        Government; and
            (D) any constitutional or other issues concerning the 
        establishment of such a system;
        (3) the range of metrics that could be used to determine the 
    accuracy of credit ratings; and
        (4) alternative means for compensating nationally recognized 
    statistical rating organizations that would create incentives for 
    accurate credit ratings.
    (c) Report and Recommendation.--Not later than 24 months after the 
date of enactment of this Act, the Commission shall submit to the 
Committee on Banking, Housing, and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of Representatives a 
report that contains--
        (1) the findings of the study required under subsection (b); 
    and
        (2) any recommendations for regulatory or statutory changes 
    that the Commission determines should be made to implement the 
    findings of the study required under subsection (b).
    (d) Rulemaking.--
        (1) Rulemaking.--After submission of the report under 
    subsection (c), the Commission shall, by rule, as the Commission 
    determines is necessary or appropriate in the public interest or 
    for the protection of investors, establish a system for the 
    assignment of nationally recognized statistical rating 
    organizations to determine the initial credit ratings of structured 
    finance products, in a manner that prevents the issuer, sponsor, or 
    underwriter of the structured finance product from selecting the 
    nationally recognized statistical rating organization that will 
    determine the initial credit ratings and monitor such credit 
    ratings. In issuing any rule under this paragraph, the Commission 
    shall give thorough consideration to the provisions of section 
    15E(w) of the Securities Exchange Act of 1934, as that provision 
    would have been added by section 939D of H.R. 4173 (111th 
    Congress), as passed by the Senate on May 20, 2010, and shall 
    implement the system described in such section 939D unless the 
    Commission determines that an alternative system would better serve 
    the public interest and the protection of investors.
        (2) Rule of construction.--Nothing in this subsection may be 
    construed to limit or suspend any other rulemaking authority of the 
    Commission.
SEC. 939G. EFFECT OF RULE 436(G).
    Rule 436(g), promulgated by the Securities and Exchange Commission 
under the Securities Act of 1933, shall have no force or effect.
SEC. 939H. SENSE OF CONGRESS.
    It is the sense of Congress that the Securities and Exchange 
Commission should exercise the rulemaking authority of the Commission 
under section 15E(h)(2)(B) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-7(h)(2)(B)) to prevent improper conflicts of interest 
arising from employees of nationally recognized statistical rating 
organizations providing services to issuers of securities that are 
unrelated to the issuance of credit ratings, including consulting, 
advisory, and other services.

  Subtitle D--Improvements to the Asset-Backed Securitization Process

    SEC. 941. REGULATION OF CREDIT RISK RETENTION.
    (a) Definition of Asset-backed Security.--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:
        ``(77) Asset-backed security.--The term `asset-backed 
    security'--
            ``(A) means a fixed-income or other security collateralized 
        by any type of self-liquidating financial asset (including a 
        loan, a lease, a mortgage, or a secured or unsecured 
        receivable) that allows the holder of the security to receive 
        payments that depend primarily on cash flow from the asset, 
        including--
                ``(i) a collateralized mortgage obligation;
                ``(ii) a collateralized debt obligation;
                ``(iii) a collateralized bond obligation;
                ``(iv) a collateralized debt obligation of asset-backed 
            securities;
                ``(v) a collateralized debt obligation of 
            collateralized debt obligations; and
                ``(vi) a security that the Commission, by rule, 
            determines to be an asset-backed security for purposes of 
            this section; and
            ``(B) does not include a security issued by a finance 
        subsidiary held by the parent company or a company controlled 
        by the parent company, if none of the securities issued by the 
        finance subsidiary are held by an entity that is not controlled 
        by the parent company.''.
    (b) Credit Risk Retention.--The Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.) is amended by inserting after section 15F, as added 
by this Act, the following:
    ``SEC. 15G. CREDIT RISK RETENTION.
    ``(a) Definitions.--In this section--
        ``(1) the term `Federal banking agencies' means the Office of 
    the Comptroller of the Currency, the Board of Governors of the 
    Federal Reserve System, and the Federal Deposit Insurance 
    Corporation;
        ``(2) the term `insured depository institution' has the same 
    meaning as in section 3(c) of the Federal Deposit Insurance Act (12 
    U.S.C. 1813(c));
        ``(3) the term `securitizer' means--
            ``(A) an issuer of an asset-backed security; or
            ``(B) a person who organizes and initiates an asset-backed 
        securities transaction by selling or transferring assets, 
        either directly or indirectly, including through an affiliate, 
        to the issuer; and
        ``(4) the term `originator' means a person who--
            ``(A) through the extension of credit or otherwise, creates 
        a financial asset that collateralizes an asset-backed security; 
        and
            ``(B) sells an asset directly or indirectly to a 
        securitizer.
    ``(b) Regulations Required.--
        ``(1) In general.--Not later than 270 days after the date of 
    enactment of this section, the Federal banking agencies and the 
    Commission shall jointly prescribe regulations to require any 
    securitizer to retain an economic interest in a portion of the 
    credit risk for any asset that the securitizer, through the 
    issuance of an asset-backed security, transfers, sells, or conveys 
    to a third party.
        ``(2) Residential mortgages.--Not later than 270 days after the 
    date of the enactment of this section, the Federal banking 
    agencies, the Commission, the Secretary of Housing and Urban 
    Development, and the Federal Housing Finance Agency, shall jointly 
    prescribe regulations to require any securitizer to retain an 
    economic interest in a portion of the credit risk for any 
    residential mortgage asset that the securitizer, through the 
    issuance of an asset-backed security, transfers, sells, or conveys 
    to a third party.
    ``(c) Standards for Regulations.--
        ``(1) Standards.--The regulations prescribed under subsection 
    (b) shall--
            ``(A) prohibit a securitizer from directly or indirectly 
        hedging or otherwise transferring the credit risk that the 
        securitizer is required to retain with respect to an asset;
            ``(B) require a securitizer to retain--
                ``(i) not less than 5 percent of the credit risk for 
            any asset--

                    ``(I) that is not a qualified residential mortgage 
                that is transferred, sold, or conveyed through the 
                issuance of an asset-backed security by the 
                securitizer; or
                    ``(II) that is a qualified residential mortgage 
                that is transferred, sold, or conveyed through the 
                issuance of an asset-backed security by the 
                securitizer, if 1 or more of the assets that 
                collateralize the asset-backed security are not 
                qualified residential mortgages; or

                ``(ii) less than 5 percent of the credit risk for an 
            asset that is not a qualified residential mortgage that is 
            transferred, sold, or conveyed through the issuance of an 
            asset-backed security by the securitizer, if the originator 
            of the asset meets the underwriting standards prescribed 
            under paragraph (2)(B);
            ``(C) specify--
                ``(i) the permissible forms of risk retention for 
            purposes of this section;
                ``(ii) the minimum duration of the risk retention 
            required under this section; and
                ``(iii) that a securitizer is not required to retain 
            any part of the credit risk for an asset that is 
            transferred, sold or conveyed through the issuance of an 
            asset-backed security by the securitizer, if all of the 
            assets that collateralize the asset-backed security are 
            qualified residential mortgages;
            ``(D) apply, regardless of whether the securitizer is an 
        insured depository institution;
            ``(E) with respect to a commercial mortgage, specify the 
        permissible types, forms, and amounts of risk retention that 
        would meet the requirements of subparagraph (B), which in the 
        determination of the Federal banking agencies and the 
        Commission may include--
                ``(i) retention of a specified amount or percentage of 
            the total credit risk of the asset;
                ``(ii) retention of the first-loss position by a third-
            party purchaser that specifically negotiates for the 
            purchase of such first loss position, holds adequate 
            financial resources to back losses, provides due diligence 
            on all individual assets in the pool before the issuance of 
            the asset-backed securities, and meets the same standards 
            for risk retention as the Federal banking agencies and the 
            Commission require of the securitizer;
                ``(iii) a determination by the Federal banking agencies 
            and the Commission that the underwriting standards and 
            controls for the asset are adequate; and
                ``(iv) provision of adequate representations and 
            warranties and related enforcement mechanisms; and
            ``(F) establish appropriate standards for retention of an 
        economic interest with respect to collateralized debt 
        obligations, securities collateralized by collateralized debt 
        obligations, and similar instruments collateralized by other 
        asset-backed securities; and
            ``(G) provide for--
                ``(i) a total or partial exemption of any 
            securitization, as may be appropriate in the public 
            interest and for the protection of investors;
                ``(ii) a total or partial exemption for the 
            securitization of an asset issued or guaranteed by the 
            United States, or an agency of the United States, as the 
            Federal banking agencies and the Commission jointly 
            determine appropriate in the public interest and for the 
            protection of investors, except that, for purposes of this 
            clause, the Federal National Mortgage Association and the 
            Federal Home Loan Mortgage Corporation are not agencies of 
            the United States;
                ``(iii) a total or partial exemption for any asset-
            backed security that is a security issued or guaranteed by 
            any State of the United States, or by any political 
            subdivision of a State or territory, or by any public 
            instrumentality of a State or territory that is exempt from 
            the registration requirements of the Securities Act of 1933 
            by reason of section 3(a)(2) of that Act (15 U.S.C. 
            77c(a)(2)), or a security defined as a qualified 
            scholarship funding bond in section 150(d)(2) of the 
            Internal Revenue Code of 1986, as may be appropriate in the 
            public interest and for the protection of investors; and
                ``(iv) the allocation of risk retention obligations 
            between a securitizer and an originator in the case of a 
            securitizer that purchases assets from an originator, as 
            the Federal banking agencies and the Commission jointly 
            determine appropriate.
        ``(2) Asset classes.--
            ``(A) Asset classes.--The regulations prescribed under 
        subsection (b) shall establish asset classes with separate 
        rules for securitizers of different classes of assets, 
        including residential mortgages, commercial mortgages, 
        commercial loans, auto loans, and any other class of assets 
        that the Federal banking agencies and the Commission deem 
        appropriate.
            ``(B) Contents.--For each asset class established under 
        subparagraph (A), the regulations prescribed under subsection 
        (b) shall include underwriting standards established by the 
        Federal banking agencies that specify the terms, conditions, 
        and characteristics of a loan within the asset class that 
        indicate a low credit risk with respect to the loan.
    ``(d) Originators.--In determining how to allocate risk retention 
obligations between a securitizer and an originator under subsection 
(c)(1)(E)(iv), the Federal banking agencies and the Commission shall--
        ``(1) reduce the percentage of risk retention obligations 
    required of the securitizer by the percentage of risk retention 
    obligations required of the originator; and
        ``(2) consider--
            ``(A) whether the assets sold to the securitizer have 
        terms, conditions, and characteristics that reflect low credit 
        risk;
            ``(B) whether the form or volume of transactions in 
        securitization markets creates incentives for imprudent 
        origination of the type of loan or asset to be sold to the 
        securitizer; and
            ``(C) the potential impact of the risk retention 
        obligations on the access of consumers and businesses to credit 
        on reasonable terms, which may not include the transfer of 
        credit risk to a third party.
    ``(e) Exemptions, Exceptions, and Adjustments.--
        ``(1) In general.--The Federal banking agencies and the 
    Commission may jointly adopt or issue exemptions, exceptions, or 
    adjustments to the rules issued under this section, including 
    exemptions, exceptions, or adjustments for classes of institutions 
    or assets relating to the risk retention requirement and the 
    prohibition on hedging under subsection (c)(1).
        ``(2) Applicable standards.--Any exemption, exception, or 
    adjustment adopted or issued by the Federal banking agencies and 
    the Commission under this paragraph shall--
            ``(A) help ensure high quality underwriting standards for 
        the securitizers and originators of assets that are securitized 
        or available for securitization; and
            ``(B) encourage appropriate risk management practices by 
        the securitizers and originators of assets, improve the access 
        of consumers and businesses to credit on reasonable terms, or 
        otherwise be in the public interest and for the protection of 
        investors.
        ``(3) Certain institutions and programs exempt.--
            ``(A) Farm credit system institutions.--Notwithstanding any 
        other provision of this section, the requirements of this 
        section shall not apply to any loan or other financial asset 
        made, insured, guaranteed, or purchased by any institution that 
        is subject to the supervision of the Farm Credit 
        Administration, including the Federal Agricultural Mortgage 
        Corporation.
            ``(B) Other federal programs.--This section shall not apply 
        to any residential, multifamily, or health care facility 
        mortgage loan asset, or securitization based directly or 
        indirectly on such an asset, which is insured or guaranteed by 
        the United States or an agency of the United States. For 
        purposes of this subsection, the Federal National Mortgage 
        Association, the Federal Home Loan Mortgage Corporation, and 
        the Federal home loan banks shall not be considered an agency 
        of the United States.
        ``(4) Exemption for qualified residential mortgages.--
            ``(A) In general.--The Federal banking agencies, the 
        Commission, the Secretary of Housing and Urban Development, and 
        the Director of the Federal Housing Finance Agency shall 
        jointly issue regulations to exempt qualified residential 
        mortgages from the risk retention requirements of this 
        subsection.
            ``(B) Qualified residential mortgage.--The Federal banking 
        agencies, the Commission, the Secretary of Housing and Urban 
        Development, and the Director of the Federal Housing Finance 
        Agency shall jointly define the term `qualified residential 
        mortgage' for purposes of this subsection, taking into 
        consideration underwriting and product features that historical 
        loan performance data indicate result in a lower risk of 
        default, such as--
                ``(i) documentation and verification of the financial 
            resources relied upon to qualify the mortgagor;
                ``(ii) standards with respect to--

                    ``(I) the residual income of the mortgagor after 
                all monthly obligations;
                    ``(II) the ratio of the housing payments of the 
                mortgagor to the monthly income of the mortgagor;
                    ``(III) the ratio of total monthly installment 
                payments of the mortgagor to the income of the 
                mortgagor;

                ``(iii) mitigating the potential for payment shock on 
            adjustable rate mortgages through product features and 
            underwriting standards;
                ``(iv) mortgage guarantee insurance or other types of 
            insurance or credit enhancement obtained at the time of 
            origination, to the extent such insurance or credit 
            enhancement reduces the risk of default; and
                ``(v) prohibiting or restricting the use of balloon 
            payments, negative amortization, prepayment penalties, 
            interest-only payments, and other features that have been 
            demonstrated to exhibit a higher risk of borrower default.
            ``(C) Limitation on definition.--The Federal banking 
        agencies, the Commission, the Secretary of Housing and Urban 
        Development, and the Director of the Federal Housing Finance 
        Agency in defining the term `qualified residential mortgage', 
        as required by subparagraph (B), shall define that term to be 
        no broader than the definition `qualified mortgage' as the term 
        is defined under section 129C(c)(2) of the Truth in Lending 
        Act, as amended by the Consumer Financial Protection Act of 
        2010, and regulations adopted thereunder.
        ``(5) Condition for qualified residential mortgage exemption.--
    The regulations issued under paragraph (4) shall provide that an 
    asset-backed security that is collateralized by tranches of other 
    asset-backed securities shall not be exempt from the risk retention 
    requirements of this subsection.
        ``(6) Certification.--The Commission shall require an issuer to 
    certify, for each issuance of an asset-backed security 
    collateralized exclusively by qualified residential mortgages, that 
    the issuer has evaluated the effectiveness of the internal 
    supervisory controls of the issuer with respect to the process for 
    ensuring that all assets that collateralize the asset-backed 
    security are qualified residential mortgages.
    ``(f) Enforcement.--The regulations issued under this section shall 
be enforced by--
        ``(1) the appropriate Federal banking agency, with respect to 
    any securitizer that is an insured depository institution; and
        ``(2) the Commission, with respect to any securitizer that is 
    not an insured depository institution.
    ``(g) Authority of Commission.--The authority of the Commission 
under this section shall be in addition to the authority of the 
Commission to otherwise enforce the securities laws.
    ``(h) Authority to Coordinate on Rulemaking.--The Chairperson of 
the Financial Stability Oversight Council shall coordinate all joint 
rulemaking required under this section.
    ``(i) Effective Date of Regulations.--The regulations issued under 
this section shall become effective--
        ``(1) with respect to securitizers and originators of asset-
    backed securities backed by residential mortgages, 1 year after the 
    date on which final rules under this section are published in the 
    Federal Register; and
        ``(2) with respect to securitizers and originators of all other 
    classes of asset-backed securities, 2 years after the date on which 
    final rules under this section are published in the Federal 
    Register.''.
    (c) Study on Risk Retention.--
        (1) Study.--The Board of Governors of the Federal Reserve 
    System, in coordination and consultation with the Comptroller of 
    the Currency, the Director of the Office of Thrift Supervision, the 
    Chairperson of the Federal Deposit Insurance Corporation, and the 
    Securities and Exchange Commission shall conduct a study of the 
    combined impact on each individual class of asset-backed security 
    established under section 15G(c)(2) of the Securities Exchange Act 
    of 1934, as added by subsection (b), of--
            (A) the new credit risk retention requirements contained in 
        the amendment made by subsection (b), including the effect 
        credit risk retention requirements have on increasing the 
        market for Federally subsidized loans; and
            (B) the Financial Accounting Statements 166 and 167 issued 
        by the Financial Accounting Standards Board.
        (2) Report.--Not later than 90 days after the date of enactment 
    of this Act, the Board of Governors of the Federal Reserve System 
    shall submit to Congress a report on the study conducted under 
    paragraph (1). Such report shall include statutory and regulatory 
    recommendations for eliminating any negative impacts on the 
    continued viability of the asset-backed securitization markets and 
    on the availability of credit for new lending identified by the 
    study conducted under paragraph (1).
    SEC. 942. DISCLOSURES AND REPORTING FOR ASSET-BACKED SECURITIES.
    (a) Securities Exchange Act of 1934.--Section 15(d) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o(d)) is amended--
        (1) by striking ``(d) Each'' and inserting the following:
    ``(d) Supplementary and Periodic Information.--
        ``(1) In general.--Each'';
        (2) in the third sentence, by inserting after ``securities of 
    each class'' the following: ``, other than any class of asset-
    backed securities,''; and
        (3) by adding at the end the following:
        ``(2) Asset-backed securities.--
            ``(A) Suspension of duty to file.--The Commission may, by 
        rule or regulation, provide for the suspension or termination 
        of the duty to file under this subsection for any class of 
        asset-backed security, on such terms and conditions and for 
        such period or periods as the Commission deems necessary or 
        appropriate in the public interest or for the protection of 
        investors.
            ``(B) Classification of issuers.--The Commission may, for 
        purposes of this subsection, classify issuers and prescribe 
        requirements appropriate for each class of issuers of asset-
        backed securities.''.
    (b) Securities Act of 1933.--Section 7 of the Securities Act of 
1933 (15 U.S.C. 77g) is amended by adding at the end the following:
    ``(c) Disclosure Requirements.--
        ``(1) In general.--The Commission shall adopt regulations under 
    this subsection requiring each issuer of an asset-backed security 
    to disclose, for each tranche or class of security, information 
    regarding the assets backing that security.
        ``(2) Content of regulations.--In adopting regulations under 
    this subsection, the Commission shall--
            ``(A) set standards for the format of the data provided by 
        issuers of an asset-backed security, which shall, to the extent 
        feasible, facilitate comparison of such data across securities 
        in similar types of asset classes; and
            ``(B) require issuers of asset-backed securities, at a 
        minimum, to disclose asset-level or loan-level data, if such 
        data are necessary for investors to independently perform due 
        diligence, including--
                ``(i) data having unique identifiers relating to loan 
            brokers or originators;
                ``(ii) the nature and extent of the compensation of the 
            broker or originator of the assets backing the security; 
            and
                ``(iii) the amount of risk retention by the originator 
            and the securitizer of such assets.''.
    SEC. 943. REPRESENTATIONS AND WARRANTIES IN ASSET-BACKED OFFERINGS.
    Not later than 180 days after the date of enactment of this Act, 
the Securities and Exchange Commission shall prescribe regulations on 
the use of representations and warranties in the market for asset-
backed securities (as that term is defined in section 3(a)(77) of the 
Securities Exchange Act of 1934, as added by this subtitle) that--
        (1) require each national recognized statistical rating 
    organization to include in any report accompanying a credit rating 
    a description of--
            (A) the representations, warranties, and enforcement 
        mechanisms available to investors; and
            (B) how they differ from the representations, warranties, 
        and enforcement mechanisms in issuances of similar securities; 
        and
        (2) require any securitizer (as that term is defined in section 
    15G(a) of the Securities Exchange Act of 1934, as added by this 
    subtitle) to disclose fulfilled and unfulfilled repurchase requests 
    across all trusts aggregated by the securitizer, so that investors 
    may identify asset originators with clear underwriting 
    deficiencies.
    SEC. 944. EXEMPTED TRANSACTIONS UNDER THE SECURITIES ACT OF 1933.
    (a) Exemption Eliminated.--Section 4 of the Securities Act of 1933 
(15 U.S.C. 77d) is amended--
        (1) by striking paragraph (5); and
        (2) by striking ``(6) transactions'' and inserting the 
    following:
        ``(5) transactions''.
    (b) Conforming Amendment.--Section 3(a)(4)(B)(vii)(I) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(4)(B)(vii)(I)) is 
amended by striking ``4(6)'' and inserting ``4(5)''.
    SEC. 945. DUE DILIGENCE ANALYSIS AND DISCLOSURE IN ASSET-BACKED 
      SECURITIES ISSUES.
    Section 7 of the Securities Act of 1933 (15 U.S.C. 77g), as amended 
by this subtitle, is amended by adding at the end the following:
    ``(d) Registration Statement for Asset-backed Securities.--Not 
later than 180 days after the date of enactment of this subsection, the 
Commission shall issue rules relating to the registration statement 
required to be filed by any issuer of an asset-backed security (as that 
term is defined in section 3(a)(77) of the Securities Exchange Act of 
1934) that require any issuer of an asset-backed security--
        ``(1) to perform a review of the assets underlying the asset-
    backed security; and
        ``(2) to disclose the nature of the review under paragraph 
    (1).''.
    SEC. 946. STUDY ON THE MACROECONOMIC EFFECTS OF RISK RETENTION 
      REQUIREMENTS.
    (a) Study Required.--The Chairman of the Financial Services 
Oversight Council shall carry out a study on the macroeconomic effects 
of the risk retention requirements under this subtitle, and the 
amendments made by this subtitle, with emphasis placed on potential 
beneficial effects with respect to stabilizing the real estate market. 
Such study shall include--
        (1) an analysis of the effects of risk retention on real estate 
    asset price bubbles, including a retrospective estimate of what 
    fraction of real estate losses may have been averted had such 
    requirements been in force in recent years;
        (2) an analysis of the feasibility of minimizing real estate 
    price bubbles by proactively adjusting the percentage of risk 
    retention that must be borne by creditors and securitizers of real 
    estate debt, as a function of regional or national market 
    conditions;
        (3) a comparable analysis for proactively adjusting mortgage 
    origination requirements;
        (4) an assessment of whether such proactive adjustments should 
    be made by an independent regulator, or in a formulaic and 
    transparent manner;
        (5) an assessment of whether such adjustments should take place 
    independently or in concert with monetary policy; and
        (6) recommendations for implementation and enabling 
    legislation.
    (b) Report.--Not later than the end of the 180-day period beginning 
on the date of the enactment of this title, the Chairman of the 
Financial Services Oversight Council shall issue a report to the 
Congress containing any findings and determinations made in carrying 
out the study required under subsection (a).

         Subtitle E--Accountability and Executive Compensation

    SEC. 951. SHAREHOLDER VOTE ON EXECUTIVE COMPENSATION DISCLOSURES.
    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 14 (15 U.S.C. 78n) the following:
    ``SEC. 14A. SHAREHOLDER APPROVAL OF EXECUTIVE COMPENSATION.
    ``(a) Separate Resolution Required.--
        ``(1) In general.--Not less frequently than once every 3 years, 
    a proxy or consent or authorization for an annual or other meeting 
    of the shareholders for which the proxy solicitation rules of the 
    Commission require compensation disclosure shall include a separate 
    resolution subject to shareholder vote to approve the compensation 
    of executives, as disclosed pursuant to section 229.402 of title 
    17, Code of Federal Regulations, or any successor thereto.
        ``(2) Frequency of vote.--Not less frequently than once every 6 
    years, a proxy or consent or authorization for an annual or other 
    meeting of the shareholders for which the proxy solicitation rules 
    of the Commission require compensation disclosure shall include a 
    separate resolution subject to shareholder vote to determine 
    whether votes on the resolutions required under paragraph (1) will 
    occur every 1, 2, or 3 years.
        ``(3) Effective date.--The proxy or consent or authorization 
    for the first annual or other meeting of the shareholders occurring 
    after the end of the 6-month period beginning on the date of 
    enactment of this section shall include--
            ``(A) the resolution described in paragraph (1); and
            ``(B) a separate resolution subject to shareholder vote to 
        determine whether votes on the resolutions required under 
        paragraph (1) will occur every 1, 2, or 3 years.
    ``(b) Shareholder Approval of Golden Parachute Compensation.--
        ``(1) Disclosure.--In any proxy or consent solicitation 
    material (the solicitation of which is subject to the rules of the 
    Commission pursuant to subsection (a)) for a meeting of the 
    shareholders occurring after the end of the 6-month period 
    beginning on the date of enactment of this section, at which 
    shareholders are asked to approve an acquisition, merger, 
    consolidation, or proposed sale or other disposition of all or 
    substantially all the assets of an issuer, the person making such 
    solicitation shall disclose in the proxy or consent solicitation 
    material, in a clear and simple form in accordance with regulations 
    to be promulgated by the Commission, any agreements or 
    understandings that such person has with any named executive 
    officers of such issuer (or of the acquiring issuer, if such issuer 
    is not the acquiring issuer) concerning any type of compensation 
    (whether present, deferred, or contingent) that is based on or 
    otherwise relates to the acquisition, merger, consolidation, sale, 
    or other disposition of all or substantially all of the assets of 
    the issuer and the aggregate total of all such compensation that 
    may (and the conditions upon which it may) be paid or become 
    payable to or on behalf of such executive officer.
        ``(2) Shareholder approval.--Any proxy or consent or 
    authorization relating to the proxy or consent solicitation 
    material containing the disclosure required by paragraph (1) shall 
    include a separate resolution subject to shareholder vote to 
    approve such agreements or understandings and compensation as 
    disclosed, unless such agreements or understandings have been 
    subject to a shareholder vote under subsection (a).
    ``(c) Rule of Construction.--The shareholder vote referred to in 
subsections (a) and (b) shall not be binding on the issuer or the board 
of directors of an issuer, and may not be construed--
        ``(1) as overruling a decision by such issuer or board of 
    directors;
        ``(2) to create or imply any change to the fiduciary duties of 
    such issuer or board of directors;
        ``(3) to create or imply any additional fiduciary duties for 
    such issuer or board of directors; or
        ``(4) to restrict or limit the ability of shareholders to make 
    proposals for inclusion in proxy materials related to executive 
    compensation.
    ``(d) Disclosure of Votes.--Every institutional investment manager 
subject to section 13(f) shall report at least annually how it voted on 
any shareholder vote pursuant to subsections (a) and (b), unless such 
vote is otherwise required to be reported publicly by rule or 
regulation of the Commission.
    ``(e) Exemption.--The Commission may, by rule or order, exempt an 
issuer or class of issuers from the requirement under subsection (a) or 
(b). In determining whether to make an exemption under this subsection, 
the Commission shall take into account, among other considerations, 
whether the requirements under subsections (a) and (b) 
disproportionately burdens small issuers.''.
    SEC. 952. COMPENSATION COMMITTEE INDEPENDENCE.
    (a) In General.--The Securities Exchange Act of 1934 (15 U.S.C. 78 
et seq.) is amended by inserting after section 10B, as added by section 
753, the following:
    ``SEC. 10C. COMPENSATION COMMITTEES.
    ``(a) Independence of Compensation Committees.--
        ``(1) Listing standards.--The Commission shall, by rule, direct 
    the national securities exchanges and national securities 
    associations to prohibit the listing of any equity security of an 
    issuer, other than an issuer that is a controlled company, limited 
    partnership, company in bankruptcy proceedings, open-ended 
    management investment company that is registered under the 
    Investment Company Act of 1940, or a foreign private issuer that 
    provides annual disclosures to shareholders of the reasons that the 
    foreign private issuer does not have an independent compensation 
    committee, that does not comply with the requirements of this 
    subsection.
        ``(2) Independence of compensation committees.--The rules of 
    the Commission under paragraph (1) shall require that each member 
    of the compensation committee of the board of directors of an 
    issuer be--
            ``(A) a member of the board of directors of the issuer; and
            ``(B) independent.
        ``(3) Independence.--The rules of the Commission under 
    paragraph (1) shall require that, in determining the definition of 
    the term `independence' for purposes of paragraph (2), the national 
    securities exchanges and the national securities associations shall 
    consider relevant factors, including--
            ``(A) the source of compensation of a member of the board 
        of directors of an issuer, including any consulting, advisory, 
        or other compensatory fee paid by the issuer to such member of 
        the board of directors; and
            ``(B) whether a member of the board of directors of an 
        issuer is affiliated with the issuer, a subsidiary of the 
        issuer, or an affiliate of a subsidiary of the issuer.
        ``(4) Exemption authority.--The rules of the Commission under 
    paragraph (1) shall permit a national securities exchange or a 
    national securities association to exempt a particular relationship 
    from the requirements of paragraph (2), with respect to the members 
    of a compensation committee, as the national securities exchange or 
    national securities association determines is appropriate, taking 
    into consideration the size of an issuer and any other relevant 
    factors.
    ``(b) Independence of Compensation Consultants and Other 
Compensation Committee Advisers.--
        ``(1) In general.--The compensation committee of an issuer may 
    only select a compensation consultant, legal counsel, or other 
    adviser to the compensation committee after taking into 
    consideration the factors identified by the Commission under 
    paragraph (2).
        ``(2) Rules.--The Commission shall identify factors that affect 
    the independence of a compensation consultant, legal counsel, or 
    other adviser to a compensation committee of an issuer. Such 
    factors shall be competitively neutral among categories of 
    consultants, legal counsel, or other advisers and preserve the 
    ability of compensation committees to retain the services of 
    members of any such category, and shall include--
            ``(A) the provision of other services to the issuer by the 
        person that employs the compensation consultant, legal counsel, 
        or other adviser;
            ``(B) the amount of fees received from the issuer by the 
        person that employs the compensation consultant, legal counsel, 
        or other adviser, as a percentage of the total revenue of the 
        person that employs the compensation consultant, legal counsel, 
        or other adviser;
            ``(C) the policies and procedures of the person that 
        employs the compensation consultant, legal counsel, or other 
        adviser that are designed to prevent conflicts of interest;
            ``(D) any business or personal relationship of the 
        compensation consultant, legal counsel, or other adviser with a 
        member of the compensation committee; and
            ``(E) any stock of the issuer owned by the compensation 
        consultant, legal counsel, or other adviser.
    ``(c) Compensation Committee Authority Relating to Compensation 
Consultants.--
        ``(1) Authority to retain compensation consultant.--
            ``(A) In general.--The compensation committee of an issuer, 
        in its capacity as a committee of the board of directors, may, 
        in its sole discretion, retain or obtain the advice of a 
        compensation consultant.
            ``(B) Direct responsibility of compensation committee.--The 
        compensation committee of an issuer shall be directly 
        responsible for the appointment, compensation, and oversight of 
        the work of a compensation consultant.
            ``(C) Rule of construction.--This paragraph may not be 
        construed--
                ``(i) to require the compensation committee to 
            implement or act consistently with the advice or 
            recommendations of the compensation consultant; or
                ``(ii) to affect the ability or obligation of a 
            compensation committee to exercise its own judgment in 
            fulfillment of the duties of the compensation committee.
        ``(2) Disclosure.--In any proxy or consent solicitation 
    material for an annual meeting of the shareholders (or a special 
    meeting in lieu of the annual meeting) occurring on or after the 
    date that is 1 year after the date of enactment of this section, 
    each issuer shall disclose in the proxy or consent material, in 
    accordance with regulations of the Commission, whether--
            ``(A) the compensation committee of the issuer retained or 
        obtained the advice of a compensation consultant; and
            ``(B) the work of the compensation consultant has raised 
        any conflict of interest and, if so, the nature of the conflict 
        and how the conflict is being addressed.
    ``(d) Authority To Engage Independent Legal Counsel and Other 
Advisers.--
        ``(1) In general.--The compensation committee of an issuer, in 
    its capacity as a committee of the board of directors, may, in its 
    sole discretion, retain and obtain the advice of independent legal 
    counsel and other advisers.
        ``(2) Direct responsibility of compensation committee.--The 
    compensation committee of an issuer shall be directly responsible 
    for the appointment, compensation, and oversight of the work of 
    independent legal counsel and other advisers.
        ``(3) Rule of construction.--This subsection may not be 
    construed--
            ``(A) to require a compensation committee to implement or 
        act consistently with the advice or recommendations of 
        independent legal counsel or other advisers under this 
        subsection; or
            ``(B) to affect the ability or obligation of a compensation 
        committee to exercise its own judgment in fulfillment of the 
        duties of the compensation committee.
    ``(e) Compensation of Compensation Consultants, Independent Legal 
Counsel, and Other Advisers.--Each issuer shall provide for appropriate 
funding, as determined by the compensation committee in its capacity as 
a committee of the board of directors, for payment of reasonable 
compensation--
        ``(1) to a compensation consultant; and
        ``(2) to independent legal counsel or any other adviser to the 
    compensation committee.
    ``(f) Commission Rules.--
        ``(1) In general.--Not later than 360 days after the date of 
    enactment of this section, the Commission shall, by rule, direct 
    the national securities exchanges and national securities 
    associations to prohibit the listing of any security of an issuer 
    that is not in compliance with the requirements of this section.
        ``(2) Opportunity to cure defects.--The rules of the Commission 
    under paragraph (1) shall provide for appropriate procedures for an 
    issuer to have a reasonable opportunity to cure any defects that 
    would be the basis for the prohibition under paragraph (1), before 
    the imposition of such prohibition.
        ``(3) Exemption authority.--
            ``(A) In general.--The rules of the Commission under 
        paragraph (1) shall permit a national securities exchange or a 
        national securities association to exempt a category of issuers 
        from the requirements under this section, as the national 
        securities exchange or the national securities association 
        determines is appropriate.
            ``(B) Considerations.--In determining appropriate 
        exemptions under subparagraph (A), the national securities 
        exchange or the national securities association shall take into 
        account the potential impact of the requirements of this 
        section on smaller reporting issuers.
    ``(g) Controlled Company Exemption.--
        ``(1) In general.--This section shall not apply to any 
    controlled company.
        ``(2) Definition.--For purposes of this section, the term 
    `controlled company' means an issuer--
            ``(A) that is listed on a national securities exchange or 
        by a national securities association; and
            ``(B) that holds an election for the board of directors of 
        the issuer in which more than 50 percent of the voting power is 
        held by an individual, a group, or another issuer.''.
    (b) Study and Report.--
        (1) Study.--The Securities and Exchange Commission shall 
    conduct a study and review of the use of compensation consultants 
    and the effects of such use.
        (2) Report.--Not later than 2 years after the date of the 
    enactment of this Act, the Commission shall submit a report to 
    Congress on the results of the study and review required by this 
    subsection.
    SEC. 953. EXECUTIVE COMPENSATION DISCLOSURES.
    (a) Disclosure of Pay Versus Performance.--Section 14 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78n), as amended by this 
title, is amended by adding at the end the following:
    ``(i) Disclosure of Pay Versus Performance.--The Commission shall, 
by rule, require each issuer to disclose in any proxy or consent 
solicitation material for an annual meeting of the shareholders of the 
issuer a clear description of any compensation required to be disclosed 
by the issuer under section 229.402 of title 17, Code of Federal 
Regulations (or any successor thereto), including information that 
shows the relationship between executive compensation actually paid and 
the financial performance of the issuer, taking into account any change 
in the value of the shares of stock and dividends of the issuer and any 
distributions. The disclosure under this subsection may include a 
graphic representation of the information required to be disclosed.''.
    (b) Additional Disclosure Requirements.--
        (1) In general.--The Commission shall amend section 229.402 of 
    title 17, Code of Federal Regulations, to require each issuer to 
    disclose in any filing of the issuer described in section 229.10(a) 
    of title 17, Code of Federal Regulations (or any successor 
    thereto)--
            (A) the median of the annual total compensation of all 
        employees of the issuer, except the chief executive officer (or 
        any equivalent position) of the issuer;
            (B) the annual total compensation of the chief executive 
        officer (or any equivalent position) of the issuer; and
            (C) the ratio of the amount described in subparagraph (A) 
        to the amount described in subparagraph (B).
        (2) Total compensation.--For purposes of this subsection, the 
    total compensation of an employee of an issuer shall be determined 
    in accordance with section 229.402(c)(2)(x) of title 17, Code of 
    Federal Regulations, as in effect on the day before the date of 
    enactment of this Act.
    SEC. 954. RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.
    The Securities Exchange Act of 1934 is amended by inserting after 
section 10C, as added by section 952, the following:
    ``SEC. 10D. RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION POLICY.
    ``(a) Listing Standards.--The Commission shall, by rule, direct the 
national securities exchanges and national securities associations to 
prohibit the listing of any security of an issuer that does not comply 
with the requirements of this section.
    ``(b) Recovery of Funds.--The rules of the Commission under 
subsection (a) shall require each issuer to develop and implement a 
policy providing--
        ``(1) for disclosure of the policy of the issuer on incentive-
    based compensation that is based on financial information required 
    to be reported under the securities laws; and
        ``(2) that, in the event that the issuer is required to prepare 
    an accounting restatement due to the material noncompliance of the 
    issuer with any financial reporting requirement under the 
    securities laws, the issuer will recover from any current or former 
    executive officer of the issuer who received incentive-based 
    compensation (including stock options awarded as compensation) 
    during the 3-year period preceding the date on which the issuer is 
    required to prepare an accounting restatement, based on the 
    erroneous data, in excess of what would have been paid to the 
    executive officer under the accounting restatement.''.
    SEC. 955. DISCLOSURE REGARDING EMPLOYEE AND DIRECTOR HEDGING.
    Section 14 of the Securities Exchange Act of 1934 (15 U.S.C. 78n), 
as amended by this title, is amended by adding at the end the 
following:
    ``(j) Disclosure of Hedging by Employees and Directors.--The 
Commission shall, by rule, require each issuer to disclose in any proxy 
or consent solicitation material for an annual meeting of the 
shareholders of the issuer whether any employee or member of the board 
of directors of the issuer, or any designee of such employee or member, 
is permitted to purchase financial instruments (including prepaid 
variable forward contracts, equity swaps, collars, and exchange funds) 
that are designed to hedge or offset any decrease in the market value 
of equity securities--
        ``(1) granted to the employee or member of the board of 
    directors by the issuer as part of the compensation of the employee 
    or member of the board of directors; or
        ``(2) held, directly or indirectly, by the employee or member 
    of the board of directors.''.
    SEC. 956. ENHANCED COMPENSATION STRUCTURE REPORTING.
    (a) Enhanced Disclosure and Reporting of Compensation 
Arrangements.--
        (1) In general.--Not later than 9 months after the date of 
    enactment of this title, the appropriate Federal regulators jointly 
    shall prescribe regulations or guidelines to require each covered 
    financial institution to disclose to the appropriate Federal 
    regulator the structures of all incentive-based compensation 
    arrangements offered by such covered financial institutions 
    sufficient to determine whether the compensation structure--
            (A) provides an executive officer, employee, director, or 
        principal shareholder of the covered financial institution with 
        excessive compensation, fees, or benefits; or
            (B) could lead to material financial loss to the covered 
        financial institution.
        (2) Rules of construction.--Nothing in this section shall be 
    construed as requiring the reporting of the actual compensation of 
    particular individuals. Nothing in this section shall be construed 
    to require a covered financial institution that does not have an 
    incentive-based payment arrangement to make the disclosures 
    required under this subsection.
    (b) Prohibition on Certain Compensation Arrangements.--Not later 
than 9 months after the date of enactment of this title, the 
appropriate Federal regulators shall jointly prescribe regulations or 
guidelines that prohibit any types of incentive-based payment 
arrangement, or any feature of any such arrangement, that the 
regulators determine encourages inappropriate risks by covered 
financial institutions--
        (1) by providing an executive officer, employee, director, or 
    principal shareholder of the covered financial institution with 
    excessive compensation, fees, or benefits; or
        (2) that could lead to material financial loss to the covered 
    financial institution.
    (c) Standards.--The appropriate Federal regulators shall--
        (1) ensure that any standards for compensation established 
    under subsections (a) or (b) are comparable to the standards 
    established under section of the Federal Deposit Insurance Act (12 
    U.S.C. 2 1831p-1) for insured depository institutions; and
        (2) in establishing such standards under such subsections, take 
    into consideration the compensation standards described in section 
    39(c) of the Federal Deposit Insurance Act (12 U.S.C. 1831p- 9 
    1(c)).
    (d) Enforcement.--The provisions of this section and the 
regulations issued under this section shall be enforced under section 
505 of the Gramm-Leach-Bliley Act and, for purposes of such section, a 
violation of this section or such regulations shall be treated as a 
violation of subtitle A of title V of such Act.
    (e) Definitions.--As used in this section--
        (1) the term ``appropriate Federal regulator'' means the Board 
    of Governors of the Federal Reserve System, the Office of the 
    Comptroller of the Currency, the Board of Directors of the Federal 
    Deposit Insurance Corporation, the Director of the Office of Thrift 
    Supervision, the National Credit Union Administration Board, the 
    Securities and Exchange Commission, the Federal Housing Finance 
    Agency; and
        (2) the term ``covered financial institution'' means--
            (A) a depository institution or depository institution 
        holding company, as such terms are defined in section 3 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1813);
            (B) a broker-dealer registered under section 15 of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78o);
            (C) a credit union, as described in section 19(b)(1)(A)(iv) 
        of the Federal Reserve Act;
            (D) an investment advisor, as such term is defined in 
        section 202(a)(11) of the Investment Advisers Act of 1940 (15 
        U.S.C. 80b-2(a)(11));
            (E) the Federal National Mortgage Association;
            (F) the Federal Home Loan Mortgage Corporation; and
            (G) any other financial institution that the appropriate 
        Federal regulators, jointly, by rule, determine should be 
        treated as a covered financial institution for purposes of this 
        section.
    (f) Exemption for Certain Financial Institutions.--The requirements 
of this section shall not apply to covered financial institutions with 
assets of less than $1,000,000,000.
    SEC. 957. VOTING BY BROKERS.
    Section 6(b) of the Securities Exchange Act of 1934 (15 U.S.C. 
78f(b)) is amended--
        (1) in paragraph (9)--
            (A) in subparagraph (A), by redesignating clauses (i) 
        through (v) as subclauses (I) through (V), respectively, and 
        adjusting the margins accordingly;
            (B) by redesignating subparagraphs (A) through (D) as 
        clauses (i) through (iv), respectively, and adjusting the 
        margins accordingly;
            (C) by inserting ``(A)'' after ``(9)''; and
            (D) in the matter immediately following clause (iv), as so 
        redesignated, by striking ``As used'' and inserting the 
        following:
        ``(B) As used''.
        (2) by adding at the end the following:
        ``(10)(A) The rules of the exchange prohibit any member that is 
    not the beneficial owner of a security registered under section 12 
    from granting a proxy to vote the security in connection with a 
    shareholder vote described in subparagraph (B), unless the 
    beneficial owner of the security has instructed the member to vote 
    the proxy in accordance with the voting instructions of the 
    beneficial owner.
        ``(B) A shareholder vote described in this subparagraph is a 
    shareholder vote with respect to the election of a member of the 
    board of directors of an issuer, executive compensation, or any 
    other significant matter, as determined by the Commission, by rule, 
    and does not include a vote with respect to the uncontested 
    election of a member of the board of directors of any investment 
    company registered under the Investment Company Act of 1940 (15 
    U.S.C. 80b-1 et seq.).
        ``(C) Nothing in this paragraph shall be construed to prohibit 
    a national securities exchange from prohibiting a member that is 
    not the beneficial owner of a security registered under section 12 
    from granting a proxy to vote the security in connection with a 
    shareholder vote not described in subparagraph (A).''.

   Subtitle F--Improvements to the Management of the Securities and 
                          Exchange Commission

    SEC. 961. REPORT AND CERTIFICATION OF INTERNAL SUPERVISORY 
      CONTROLS.
    (a) Annual Reports and Certification.--Not later than 90 days after 
the end of each fiscal year, the Commission shall submit a report to 
the Committee on Banking, Housing, and Urban Affairs of the Senate and 
the Committee on Financial Services of the House of Representatives on 
the conduct by the Commission of examinations of registered entities, 
enforcement investigations, and review of corporate financial 
securities filings.
    (b) Contents of Reports.--Each report under subsection (a) shall 
contain--
        (1) an assessment, as of the end of the most recent fiscal 
    year, of the effectiveness of--
            (A) the internal supervisory controls of the Commission; 
        and
            (B) the procedures of the Commission applicable to the 
        staff of the Commission who perform examinations of registered 
        entities, enforcement investigations, and reviews of corporate 
        financial securities filings;
        (2) a certification that the Commission has adequate internal 
    supervisory controls to carry out the duties of the Commission 
    described in paragraph (1)(B); and
        (3) a summary by the Comptroller General of the United States 
    of the review carried out under subsection (d).
    (c) Certification.--
        (1) Signature.--The certification under subsection (b)(2) shall 
    be signed by the Director of the Division of Enforcement, the 
    Director of the Division of Corporation Finance, and the Director 
    of the Office of Compliance Inspections and Examinations (or the 
    head of any successor division or office).
        (2) Content of certification.--Each individual described in 
    paragraph (1) shall certify that the individual--
            (A) is directly responsible for establishing and 
        maintaining the internal supervisory controls of the Division 
        or Office of which the individual is the head;
            (B) is knowledgeable about the internal supervisory 
        controls of the Division or Office of which the individual is 
        the head;
            (C) has evaluated the effectiveness of the internal 
        supervisory controls during the 90-day period ending on the 
        final day of the fiscal year to which the report relates; and
            (D) has disclosed to the Commission any significant 
        deficiencies in the design or operation of internal supervisory 
        controls that could adversely affect the ability of the 
        Division or Office to consistently conduct inspections, or 
        investigations, or reviews of filings with professional 
        competence and integrity.
    (d) New Director or Acting Director.--Notwithstanding subsection 
(a), if the Director of the Division of Enforcement, the Director of 
the Division of Corporate Finance, or the Director of the Office of 
Compliance Inspections and Examinations has served as Director of the 
Division or Office for less than 90 days on the date on which a report 
is required to be submitted under subsection (a), the Commission may 
submit the report on the date on which the Director has served as 
Director for 90 days. If there is no Director of the Division of 
Enforcement, the Division of Corporate Finance, or the Office of 
Compliance Inspections and Examinations, on the date on which a report 
is required to be submitted under subsection (a), the Acting Director 
of the Division or Office may make the certification required under 
subsection (c).
    (e) Review by the Comptroller General.--
        (1) Report.--The Comptroller General of the United States shall 
    submit to the Committee on Banking, Housing, and Urban Affairs of 
    the Senate and the Committee on Financial Services of the House of 
    Representatives a report that contains a review of the adequacy and 
    effectiveness of the internal supervisory control structure and 
    procedures described in subsection (b)(1), not less frequently than 
    once every 3 years, at a time to coincide with the publication of 
    the reports of the Commission under this section.
        (2) Authority to hire experts.--The Comptroller General of the 
    United States may hire independent consultants with specialized 
    expertise in any area relevant to the duties of the Comptroller 
    General described in this section, in order to assist the 
    Comptroller General in carrying out such duties.
    SEC. 962. TRIENNIAL REPORT ON PERSONNEL MANAGEMENT.
    (a) Triennial Report Required.--Once every 3 years, the Comptroller 
General of the United States shall submit a report to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives on the quality of 
personnel management by the Commission.
    (b) Contents of Report.--Each report under subsection (a) shall 
include--
        (1) an evaluation of--
            (A) the effectiveness of supervisors in using the skills, 
        talents, and motivation of the employees of the Commission to 
        achieve the goals of the Commission;
            (B) the criteria for promoting employees of the Commission 
        to supervisory positions;
            (C) the fairness of the application of the promotion 
        criteria to the decisions of the Commission;
            (D) the competence of the professional staff of the 
        Commission;
            (E) the efficiency of communication between the units of 
        the Commission regarding the work of the Commission (including 
        communication between divisions and between subunits of a 
        division) and the efforts by the Commission to promote such 
        communication;
            (F) the turnover within subunits of the Commission, 
        including the consideration of supervisors whose subordinates 
        have an unusually high rate of turnover;
            (G) whether there are excessive numbers of low-level, mid-
        level, or senior-level managers;
            (H) any initiatives of the Commission that increase the 
        competence of the staff of the Commission;
            (I) the actions taken by the Commission regarding employees 
        of the Commission who have failed to perform their duties and 
        circumstances under which the Commission has issued to 
        employees a notice of termination; and
            (J) such other factors relating to the management of the 
        Commission as the Comptroller General determines are 
        appropriate;
        (2) an evaluation of any improvements made with respect to the 
    areas described in paragraph (1) since the date of submission of 
    the previous report; and
        (3) recommendations for how the Commission can use the human 
    resources of the Commission more effectively and efficiently to 
    carry out the mission of the Commission.
    (c) Consultation.--In preparing the report under subsection (a), 
the Comptroller General shall consult with current employees of the 
Commission, retired employees and other former employees of the 
Commission, the Inspector General of the Commission, persons that have 
business before the Commission, any union representing the employees of 
the Commission, private management consultants, academics, and any 
other source that the Comptroller General deems appropriate.
    (d) Report by Commission.--Not later than 90 days after the date on 
which the Comptroller General submits each report under subsection (a), 
the Commission shall submit to the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Financial Services of 
the House of Representatives a report describing the actions taken by 
the Commission in response to the recommendations contained in the 
report under subsection (a).
    (e) Reimbursements for Cost of Reports.--
        (1) Reimbursements required.--The Commission shall reimburse 
    the Government Accountability Office for the full cost of making 
    the reports under this section, as billed therefor by the 
    Comptroller General.
        (2) Crediting and use of reimbursements.--Such reimbursements 
    shall--
            (A) be credited to the appropriation account ``Salaries and 
        Expenses, Government Accountability Office'' current when the 
        payment is received; and
            (B) remain available until expended.
    (f) Authority to Hire Experts.--The Comptroller General of the 
United States may hire independent consultants with specialized 
expertise in any area relevant to the duties of the Comptroller General 
described in this section, in order to assist the Comptroller General 
in carrying out such duties.
    SEC. 963. ANNUAL FINANCIAL CONTROLS AUDIT.
    (a) Reports of Commission.--
        (1) Annual reports required.--Not later than 6 months after the 
    end of each fiscal year, the Commission shall publish and submit to 
    Congress a report that--
            (A) describes the responsibility of the management of the 
        Commission for establishing and maintaining an adequate 
        internal control structure and procedures for financial 
        reporting; and
            (B) contains an assessment of the effectiveness of the 
        internal control structure and procedures for financial 
        reporting of the Commission during that fiscal year.
        (2) Attestation.--The reports required under paragraph (1) 
    shall be attested to by the Chairman and chief financial officer of 
    the Commission.
    (b) Report by Comptroller General.--
        (1) Report required.--Not later than 6 months after the end of 
    the first fiscal year after the date of enactment of this Act, the 
    Comptroller General of the United States shall submit a report to 
    Congress that assesses--
            (A) the effectiveness of the internal control structure and 
        procedures of the Commission for financial reporting; and
            (B) the assessment of the Commission under subsection 
        (a)(1)(B).
        (2) Attestation.--The Comptroller General shall attest to, and 
    report on, the assessment made by the Commission under subsection 
    (a).
    (c) Reimbursements for Cost of Reports.--
        (1) Reimbursements required.--The Commission shall reimburse 
    the Government Accountability Office for the full cost of making 
    the reports under subsection (b), as billed therefor by the 
    Comptroller General.
        (2) Crediting and use of reimbursements.--Such reimbursements 
    shall--
            (A) be credited to the appropriation account ``Salaries and 
        Expenses, Government Accountability Office'' current when the 
        payment is received; and
            (B) remain available until expended.
    SEC. 964. REPORT ON OVERSIGHT OF NATIONAL SECURITIES ASSOCIATIONS.
    (a) Report Required.--Not later than 2 years after the date of 
enactment of this Act, and every 3 years thereafter, the Comptroller 
General of the United States shall submit to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the Committee on Financial 
Services of the House of Representatives a report that includes an 
evaluation of the oversight by the Commission of national securities 
associations registered under section 15A of the Securities Exchange 
Act of 1934 (15 U.S.C. 78o-3) with respect to--
        (1) the governance of such national securities associations, 
    including the identification and management of conflicts of 
    interest by such national securities associations, together with an 
    analysis of the impact of any conflicts of interest on the 
    regulatory enforcement or rulemaking by such national securities 
    associations;
        (2) the examinations carried out by the national securities 
    associations, including the expertise of the examiners;
        (3) the executive compensation practices of such national 
    securities associations;
        (4) the arbitration services provided by the national 
    securities associations;
        (5) the review performed by national securities associations of 
    advertising by the members of the national securities associations;
        (6) the cooperation with and assistance to State securities 
    administrators by the national securities associations to promote 
    investor protection;
        (7) how the funding of national securities associations is used 
    to support the mission of the national securities associations, 
    including--
            (A) the methods of funding;
            (B) the sufficiency of funds;
            (C) how funds are invested by the national securities 
        association pending use; and
            (D) the impact of the methods, sufficiency, and investment 
        of funds on regulatory enforcement by the national securities 
        associations;
        (8) the policies regarding the employment of former employees 
    of national securities associations by regulated entities;
        (9) the ongoing effectiveness of the rules of the national 
    securities associations in achieving the goals of the rules;
        (10) the transparency of governance and activities of the 
    national securities associations; and
        (11) any other issue that has an impact, as determined by the 
    Comptroller General, on the effectiveness of such national 
    securities associations in performing their mission and in dealing 
    fairly with investors and members;
    (b) Reimbursements for Cost of Reports.--
        (1) Reimbursements required.--The Commission shall reimburse 
    the Government Accountability Office for the full cost of making 
    the reports under subsection (a), as billed therefor by the 
    Comptroller General.
        (2) Crediting and use of reimbursements.--Such reimbursements 
    shall--
            (A) be credited to the appropriation account ``Salaries and 
        Expenses, Government Accountability Office'' current when the 
        payment is received; and
            (B) remain available until expended.
    SEC. 965. COMPLIANCE EXAMINERS.
    Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d) is 
amended by adding at the end the following:
    ``(h) Examiners.--
        ``(1) Division of trading and markets.--The Division of Trading 
    and Markets of the Commission, or any successor organizational 
    unit, shall have a staff of examiners who shall--
            ``(A) perform compliance inspections and examinations of 
        entities under the jurisdiction of that Division; and
            ``(B) report to the Director of that Division.
        ``(2) Division of investment management.--The Division of 
    Investment Management of the Commission, or any successor 
    organizational unit, shall have a staff of examiners who shall--
            ``(A) perform compliance inspections and examinations of 
        entities under the jurisdiction of that Division; and
            ``(B) report to the Director of that Division.''.
    SEC. 966. SUGGESTION PROGRAM FOR EMPLOYEES OF THE COMMISSION.
    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 4C (15 U.S.C. 78d-3) the following:
  ``SEC. 4D. ADDITIONAL DUTIES OF INSPECTOR GENERAL.
    ``(a) Suggestion Submissions by Commission Employees.--
        ``(1) Hotline established.--The Inspector General of the 
    Commission shall establish and maintain a telephone hotline or 
    other electronic means for the receipt of--
            ``(A) suggestions by employees of the Commission for 
        improvements in the work efficiency, effectiveness, and 
        productivity, and the use of the resources, of the Commission; 
        and
            ``(B) allegations by employees of the Commission of waste, 
        abuse, misconduct, or mismanagement within the Commission.
        ``(2) Confidentiality.--The Inspector General shall maintain as 
    confidential--
            ``(A) the identity of any individual who provides 
        information by the means established under paragraph (1), 
        unless the individual requests otherwise, in writing; and
            ``(B) at the request of any such individual, any specific 
        information provided by the individual.
    ``(b) Consideration of Reports.--The Inspector General shall 
consider any suggestions or allegations received by the means 
established under subsection (a)(1), and shall recommend appropriate 
action in relation to such suggestions or allegations.
    ``(c) Recognition.--The Inspector General may recognize any 
employee who makes a suggestion under subsection (a)(1) (or by other 
means) that would or does--
        ``(1) increase the work efficiency, effectiveness, or 
    productivity of the Commission; or
        ``(2) reduce waste, abuse, misconduct, or mismanagement within 
    the Commission.
    ``(d) Report.--The Inspector General of the Commission shall submit 
to Congress an annual report containing a description of--
        ``(1) the nature, number, and potential benefits of any 
    suggestions received under subsection (a);
        ``(2) the nature, number, and seriousness of any allegations 
    received under subsection (a);
        ``(3) any recommendations made or actions taken by the 
    Inspector General in response to substantiated allegations received 
    under subsection (a); and
        ``(4) any action the Commission has taken in response to 
    suggestions or allegations received under subsection (a).
    ``(e) Funding.--The activities of the Inspector General under this 
subsection shall be funded by the Securities and Exchange Commission 
Investor Protection Fund established under section 21F.''.
    SEC. 967. COMMISSION ORGANIZATIONAL STUDY AND REFORM.
    (a) Study Required.--
        (1) In general.--Not later than the end of the 90-day period 
    beginning on the date of the enactment of this subtitle, the 
    Securities and Exchange Commission (hereinafter in this section 
    referred to as the ``SEC'') shall hire an independent consultant of 
    high caliber and with expertise in organizational restructuring and 
    the operations of capital markets to examine the internal 
    operations, structure, funding, and the need for comprehensive 
    reform of the SEC, as well as the SEC's relationship with and the 
    reliance on self-regulatory organizations and other entities 
    relevant to the regulation of securities and the protection of 
    securities investors that are under the SEC's oversight.
        (2) Specific areas for study.--The study required under 
    paragraph (1) shall, at a minimum, include the study of--
            (A) the possible elimination of unnecessary or redundant 
        units at the SEC;
            (B) improving communications between SEC offices and 
        divisions;
            (C) the need to put in place a clear chain-of-command 
        structure, particularly for enforcement examinations and 
        compliance inspections;
            (D) the effect of high-frequency trading and other 
        technological advances on the market and what the SEC requires 
        to monitor the effect of such trading and advances on the 
        market;
            (E) the SEC's hiring authorities, workplace policies, and 
        personal practices, including--
                (i) whether there is a need to further streamline 
            hiring authorities for those who are not lawyers, 
            accountants, compliance examiners, or economists;
                (ii) whether there is a need for further pay reforms;
                (iii) the diversity of skill sets of SEC employees and 
            whether the present skill set diversity efficiently and 
            effectively fosters the SEC's mission of investor 
            protection; and
                (iv) the application of civil service laws by the SEC;
            (F) whether the SEC's oversight and reliance on self-
        regulatory organizations promotes efficient and effective 
        governance for the securities markets; and
            (G) whether adjusting the SEC's reliance on self-regulatory 
        organizations is necessary to promote more efficient and 
        effective governance for the securities markets.
    (b) Consultant Report.--Not later than the end of the 150-day 
period after being retained, the independent consultant hired pursuant 
to subsection (a)(1) shall issue a report to the SEC and the Congress 
containing--
        (1) a detailed description of any findings and conclusions made 
    while carrying out the study required under subsection (a)(1); and
        (2) recommendations for legislative, regulatory, or 
    administrative action that the consultant determines appropriate to 
    enable the SEC and other entities on which the consultant reports 
    to perform their statutorily or otherwise mandated missions.
    (c) SEC Report.--Not later than the end of the 6-month period 
beginning on the date the consultant issues the report under subsection 
(b), and every 6-months thereafter during the 2-year period following 
the date on which the consultant issues such report, the SEC shall 
issue 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 describing the SEC's implementation of the 
regulatory and administrative recommendations contained in the 
consultant's report.
    SEC. 968. STUDY ON SEC REVOLVING DOOR.
    (a) Government Accountability Office Study.--The Comptroller 
General of the United States shall conduct a study that will--
        (1) review the number of employees who leave the Securities and 
    Exchange Commission to work for financial institutions regulated by 
    such Commission;
        (2) determine how many employees who leave the Securities and 
    Exchange Commission worked on cases that involved financial 
    institutions regulated by such Commission;
        (3) review the length of time employees work for the Securities 
    and Exchange Commission before leaving to be employed by financial 
    institutions regulated by such Commission;
        (4) review existing internal controls and make recommendations 
    on strengthening such controls to ensure that employees of the 
    Securities and Exchange Commission who are later employed by 
    financial institutions did not assist such institutions in 
    violating any rules or regulations of the Commission during the 
    course of their employment with such Commission;
        (5) determine if greater post-employment restrictions are 
    necessary to prevent employees of the Securities and Exchange 
    Commission from being employed by financial institutions after 
    employment with such Commission;
        (6) determine if the volume of employees of the Securities and 
    Exchange Commission who are later employed by financial 
    institutions has led to inefficiencies in enforcement;
        (7) determine if employees of the Securities and Exchange 
    Commission who are later employed by financial institutions 
    assisted such institutions in circumventing Federal rules and 
    regulations while employed by such Commission;
        (8) review any information that may address the volume of 
    employees of the Securities and Exchange Commission who are later 
    employed by financial institutions, and make recommendations to 
    Congress; and
        (9) review other additional issues as may be raised during the 
    course of the study conducted under this subsection.
    (b) Report.--Not later than 1 year after the date of the enactment 
of this subtitle, 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 results of the study required by 
subsection (a).

             Subtitle G--Strengthening Corporate Governance

    SEC. 971. PROXY ACCESS.
    (a) Proxy Access.--Section 14(a) of the Securities Exchange Act of 
1934 (15 U.S.C. 78n(a)) is amended--
        (1) by inserting ``(1)'' after ``(a)''; and
        (2) by adding at the end the following:
    ``(2) The rules and regulations prescribed by the Commission under 
paragraph (1) may include--
        ``(A) a requirement that a solicitation of proxy, consent, or 
    authorization by (or on behalf of) an issuer include a nominee 
    submitted by a shareholder to serve on the board of directors of 
    the issuer; and
        ``(B) a requirement that an issuer follow a certain procedure 
    in relation to a solicitation described in subparagraph (A).''.
    (b) Regulations.--The Commission may issue rules permitting the use 
by a shareholder of proxy solicitation materials supplied by an issuer 
of securities for the purpose of nominating individuals to membership 
on the board of directors of the issuer, under such terms and 
conditions as the Commission determines are in the interests of 
shareholders and for the protection of investors.
    (c) Exemptions.--The Commission may, by rule or order, exempt an 
issuer or class of issuers from the requirement made by this section or 
an amendment made by this section. In determining whether to make an 
exemption under this subsection, the Commission shall take into 
account, among other considerations, whether the requirement in the 
amendment made by subsection (a) disproportionately burdens small 
issuers.
    SEC. 972. DISCLOSURES REGARDING CHAIRMAN AND CEO STRUCTURES.
    The Securities Exchange Act of 1934 (15 U.S. C. 78a et seq.) is 
amended by inserting after section 14A, as added by this title, the 
following:
    ``SEC. 14B. CORPORATE GOVERNANCE.
    ``Not later than 180 days after the date of enactment of this 
subsection, the Commission shall issue rules that require an issuer to 
disclose in the annual proxy sent to investors the reasons why the 
issuer has chosen--
        ``(1) the same person to serve as chairman of the board of 
    directors and chief executive officer (or in equivalent positions); 
    or
        ``(2) different individuals to serve as chairman of the board 
    of directors and chief executive officer (or in equivalent 
    positions of the issuer).''.

                    Subtitle H--Municipal Securities

    SEC. 975. REGULATION OF MUNICIPAL SECURITIES AND CHANGES TO THE 
      BOARD OF THE MSRB.
    (a) Registration of Municipal Securities Dealers and Municipal 
Advisors.--Section 15B(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-4(a)) is amended--
        (1) in paragraph (1)--
            (A) by inserting ``(A)'' after ``(1)''; and
            (B) by adding at the end the following:
            ``(B) It shall be unlawful for a municipal advisor to 
        provide advice to or on behalf of a municipal entity or 
        obligated person with respect to municipal financial products 
        or the issuance of municipal securities, or to undertake a 
        solicitation of a municipal entity or obligated person, unless 
        the municipal advisor is registered in accordance with this 
        subsection.'';
        (2) in paragraph (2), by inserting ``or municipal advisor'' 
    after ``municipal securities dealer'' each place that term appears;
        (3) in paragraph (3), by inserting ``or municipal advisor'' 
    after ``municipal securities dealer'' each place that term appears;
        (4) in paragraph (4), by striking ``dealer, or municipal 
    securities dealer or class of brokers, dealers, or municipal 
    securities dealers'' and inserting ``dealer, municipal securities 
    dealer, or municipal advisor, or class of brokers, dealers, 
    municipal securities dealers, or municipal advisors''; and
        (5) by adding at the end the following:
        ``(5) No municipal advisor shall make use of the mails or any 
    means or instrumentality of interstate commerce to provide advice 
    to or on behalf of a municipal entity or obligated person with 
    respect to municipal financial products, the issuance of municipal 
    securities, or to undertake a solicitation of a municipal entity or 
    obligated person, in connection with which such municipal advisor 
    engages in any fraudulent, deceptive, or manipulative act or 
    practice.''.
    (b) Municipal Securities Rulemaking Board.--Section 15B(b) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o-4(b)) is amended--
        (1) in paragraph (1)--
            (A) in the first sentence, by striking ``Not later than'' 
        and all that follows through ``appointed by the Commission'' 
        and inserting ``The Municipal Securities Rulemaking Board shall 
        be composed of 15 members, or such other number of members as 
        specified by rules of the Board pursuant to paragraph 
        (2)(B),'';
            (B) by striking the second sentence and inserting the 
        following: ``The members of the Board shall serve as members 
        for a term of 3 years or for such other terms as specified by 
        rules of the Board pursuant to paragraph (2)(B), and shall 
        consist of (A) 8 individuals who are independent of any 
        municipal securities broker, municipal securities dealer, or 
        municipal advisor, at least 1 of whom shall be representative 
        of institutional or retail investors in municipal securities, 
        at least 1 of whom shall be representative of municipal 
        entities, and at least 1 of whom shall be a member of the 
        public with knowledge of or experience in the municipal 
        industry (which members are hereinafter referred to as `public 
        representatives'); and (B) 7 individuals who are associated 
        with a broker, dealer, municipal securities dealer, or 
        municipal advisor, including at least 1 individual who is 
        associated with and representative of brokers, dealers, or 
        municipal securities dealers that are not banks or subsidiaries 
        or departments or divisions of banks (which members are 
        hereinafter referred to as `broker-dealer representatives'), at 
        least 1 individual who is associated with and representative of 
        municipal securities dealers which are banks or subsidiaries or 
        departments or divisions of banks (which members are 
        hereinafter referred to as `bank representatives'), and at 
        least 1 individual who is associated with a municipal advisor 
        (which members are hereinafter referred to as `advisor 
        representatives' and, together with the broker-dealer 
        representatives and the bank representatives, are referred to 
        as `regulated representatives'). Each member of the board shall 
        be knowledgeable of matters related to the municipal securities 
        markets.''; and
            (C) in the third sentence, by striking ``initial'';
        (2) in paragraph (2)--
            (A) in the matter preceding subparagraph (A)--
                (i) by inserting before the period at the end of the 
            first sentence the following: ``and advice provided to or 
            on behalf of municipal entities or obligated persons by 
            brokers, dealers, municipal securities dealers, and 
            municipal advisors with respect to municipal financial 
            products, the issuance of municipal securities, and 
            solicitations of municipal entities or obligated persons 
            undertaken by brokers, dealers, municipal securities 
            dealers, and municipal advisors''; and
                (ii) by striking the second sentence;
            (B) in subparagraph (A)--
                (i) in the matter preceding clause (i)--

                    (I) by inserting ``, and no broker, dealer, 
                municipal securities dealer, or municipal advisor shall 
                provide advice to or on behalf of a municipal entity or 
                obligated person with respect to municipal financial 
                products or the issuance of municipal securities,'' 
                after ``sale of, any municipal security''; and
                    (II) by inserting ``and municipal entities or 
                obligated persons'' after ``protection of investors'';

                (ii) in clause (i), by striking ``municipal securities 
            brokers and municipal securities dealers'' each place that 
            term appears and inserting ``municipal securities brokers, 
            municipal securities dealers, and municipal advisors'';
                (iii) in clause (ii), by adding ``and'' at the end;
                (iv) in clause (iii), by striking ``; and'' and 
            inserting a period; and
                (v) by striking clause (iv);
            (C) by amending subparagraph (B) to read as follows:
        ``(B) establish fair procedures for the nomination and election 
    of members of the Board and assure fair representation in such 
    nominations and elections of public representatives, broker dealer 
    representatives, bank representatives, and advisor representatives. 
    Such rules--
            ``(i) shall provide that the number of public 
        representatives of the Board shall at all times exceed the 
        total number of regulated representatives and that the 
        membership shall at all times be as evenly divided in number as 
        possible between public representatives and regulated 
        representatives;
            ``(ii) shall specify the length or lengths of terms members 
        shall serve;
            ``(iii) may increase the number of members which shall 
        constitute the whole Board, provided that such number is an odd 
        number; and
            ``(iv) shall establish requirements regarding the 
        independence of public representatives.''.
            (D) in subparagraph (C)--
                (i) by inserting ``and municipal financial products'' 
            after ``municipal securities'' the first two times that 
            term appears;
                (ii) by inserting ``, municipal entities, obligated 
            persons,'' before ``and the public interest'';
                (iii) by striking ``between'' and inserting ``among'';
                (iv) by striking ``issuers, municipal securities 
            brokers, or municipal securities dealers, to fix'' and 
            inserting ``municipal entities, obligated persons, 
            municipal securities brokers, municipal securities dealers, 
            or municipal advisors, to fix''; and
                (v) by striking ``brokers or municipal securities 
            dealers, to regulate'' and inserting ``brokers, municipal 
            securities dealers, or municipal advisors, to regulate'';
            (E) in subparagraph (D)--
                (i) by inserting ``and advice concerning municipal 
            financial products'' after ``transactions in municipal 
            securities'';
                (ii) by striking ``That no'' and inserting ``that no'';
                (iii) by inserting ``municipal advisor,'' before ``or 
            person associated''; and
                (iv) by striking ``a municipal securities broker or 
            municipal securities dealer may be compelled'' and 
            inserting ``a municipal securities broker, municipal 
            securities dealer, or municipal advisor may be compelled'';
            (F) in subparagraph (E)--
                (i) by striking ``municipal securities brokers and 
            municipal securities dealers'' and inserting ``municipal 
            securities brokers, municipal securities dealers, and 
            municipal advisors''; and
                (ii) by striking ``municipal securities broker or 
            municipal securities dealer'' and inserting ``municipal 
            securities broker, municipal securities dealer, or 
            municipal advisor'';
            (G) in subparagraph (G), by striking ``municipal securities 
        brokers and municipal securities dealers'' and inserting 
        ``municipal securities brokers, municipal securities dealers, 
        and municipal advisors'';
            (H) in subparagraph (J)--
                (i) by striking ``municipal securities broker and each 
            municipal securities dealer'' and inserting ``municipal 
            securities broker, municipal securities dealer, and 
            municipal advisor''; and
                (ii) by striking the period at the end of the second 
            sentence and inserting ``, which may include charges for 
            failure to submit to the Board, or to any information 
            system operated by the Board, within the prescribed 
            timeframes, any items of information or documents required 
            to be submitted under any rule issued by the Board.'';
            (I) in subparagraph (K)--
                (i) by inserting ``broker, dealer, or'' before 
            ``municipal securities dealer'' each place that term 
            appears; and
                (ii) by striking ``municipal securities investment 
            portfolio'' and inserting ``related account of a broker, 
            dealer, or municipal securities dealer''; and
            (J) by adding at the end the following:
            ``(L) with respect to municipal advisors--
                ``(i) prescribe means reasonably designed to prevent 
            acts, practices, and courses of business as are not 
            consistent with a municipal advisor's fiduciary duty to its 
            clients;
                ``(ii) provide continuing education requirements for 
            municipal advisors;
                ``(iii) provide professional standards; and
                ``(iv) not impose a regulatory burden on small 
            municipal advisors that is not necessary or appropriate in 
            the public interest and for the protection of investors, 
            municipal entities, and obligated persons, provided that 
            there is robust protection of investors against fraud.'';
        (3) by redesignating paragraph (3) as paragraph (7); and
        (4) by inserting after paragraph (2) the following:
        ``(3) The Board, in conjunction with or on behalf of any 
    Federal financial regulator or self-regulatory organization, may--
            ``(A) establish information systems; and
            ``(B) assess such reasonable fees and charges for the 
        submission of information to, or the receipt of information 
        from, such systems from any persons which systems may be 
        developed for the purposes of serving as a repository of 
        information from municipal market participants or otherwise in 
        furtherance of the purposes of the Board, a Federal financial 
        regulator, or a self-regulatory organization, except that the 
        Board--
                ``(i) may not charge a fee to municipal entities or 
            obligated persons to submit documents or other information 
            to the Board or charge a fee to any person to obtain, 
            directly from the Internet site of the Board, documents or 
            information submitted by municipal entities, obligated 
            persons, brokers, dealers, municipal securities dealers, or 
            municipal advisors, including documents submitted under the 
            rules of the Board or the Commission; and
                ``(ii) shall not be prohibited from charging 
            commercially reasonable fees for automated subscription-
            based feeds or similar services, or for charging for other 
            data or document-based services customized upon request of 
            any person, made available to commercial enterprises, 
            municipal securities market professionals, or the general 
            public, whether delivered through the Internet or any other 
            means, that contain all or part of the documents or 
            information, subject to approval of the fees by the 
            Commission under section 19(b).
        ``(4) The Board may provide guidance and assistance in the 
    enforcement of, and examination for, compliance with the rules of 
    the Board to the Commission, a registered securities association 
    under section 15A, or any other appropriate regulatory agency, as 
    applicable.
        ``(5) The Board, the Commission, and a registered securities 
    association under section 15A, or the designees of the Board, the 
    Commission, or such association, shall meet not less frequently 
    than 2 times a year--
            ``(A) to describe the work of the Board, the Commission, 
        and the registered securities association involving the 
        regulation of municipal securities; and
            ``(B) to share information about--
                ``(i) the interpretation of the Board, the Commission, 
            and the registered securities association of Board rules; 
            and
                ``(ii) examination and enforcement of compliance with 
            Board rules.''.
    (c) Discipline of Brokers, Dealers, Municipal Securities Dealers 
and Municipal Advisors; Fiduciary Duty of Municipal Advisors.--Section 
15B(c) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-4(c)) is 
amended--
        (1) in paragraph (1), by inserting ``, and no broker, dealer, 
    municipal securities dealer, or municipal advisor shall make use of 
    the mails or any means or instrumentality of interstate commerce to 
    provide advice to or on behalf of a municipal entity or obligated 
    person with respect to municipal financial products, the issuance 
    of municipal securities, or to undertake a solicitation of a 
    municipal entity or obligated person,'' after ``any municipal 
    security'';
        (2) by adding at the end of paragraph (1) the following: ``A 
    municipal advisor and any person associated with such municipal 
    advisor shall be deemed to have a fiduciary duty to any municipal 
    entity for whom such municipal advisor acts as a municipal advisor, 
    and no municipal advisor may engage in any act, practice, or course 
    of business which is not consistent with a municipal advisor's 
    fiduciary duty or that is in contravention of any rule of the 
    Board.''.
        (3) in paragraph (2), by inserting ``or municipal advisor'' 
    after ``municipal securities dealer'' each place that term appears;
        (4) in paragraph (3)--
            (A) by inserting ``or municipal entities or obligated 
        person'' after ``protection of investors'' each place that term 
        appears; and
            (B) by inserting ``or municipal advisor'' after ``municipal 
        securities dealer'' each place that term appears;
        (5) in paragraph (4), by inserting ``or municipal advisor'' 
    after ``municipal securities dealer or obligated person'' each 
    place that term appears;
        (6) in paragraph (6)(B), by inserting ``or municipal entities 
    or obligated person'' after ``protection of investors'';
        (7) in paragraph (7)--
            (A) in subparagraph (A)--
                (i) in clause (i), by striking ``; and'' and inserting 
            a semicolon;
                (ii) in clause (ii), by striking the period and 
            inserting ``; and''; and
                (iii) by adding at the end the following:
                ``(iii) the Commission, or its designee, in the case of 
            municipal advisors.''.
            (B) in subparagraph (B), by inserting ``or municipal 
        entities or obligated person'' after ``protection of 
        investors''; and
        (8) by adding at the end the following:
        ``(9)(A) Fines collected by the Commission for violations of 
    the rules of the Board shall be equally divided between the 
    Commission and the Board.
        ``(B) Fines collected by a registered securities association 
    under section 15A(7) with respect to violations of the rules of the 
    Board shall be accounted for by such registered securities 
    association separately from other fines collected under section 
    15A(7) and shall be allocated between such registered securities 
    association and the Board, and such allocation shall require the 
    registered securities association to pay to the Board \1/3\ of all 
    fines collected by the registered securities association reasonably 
    allocable to violations of the rules of the Board, or such other 
    portion of such fines as may be directed by the Commission upon 
    agreement between the registered securities association and the 
    Board.''.
    (d) Issuance of Municipal Securities.--Section 15B(d)(2) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o-4(d)) is amended--
        (1) by striking ``through a municipal securities broker or 
    municipal securities dealer or otherwise'' and inserting ``through 
    a municipal securities broker, municipal securities dealer, 
    municipal advisor, or otherwise''; and
        (2) by inserting ``or municipal advisors'' before ``to 
    furnish''.
    (e) Definitions.--Section 15B of the Securities Exchange Act of 
1934 (15 U.S.C. 78o-4) is amended by adding at the end the following:
    ``(e) Definitions.--For purposes of this section--
        ``(1) the term `Board' means the Municipal Securities 
    Rulemaking Board established under subsection (b)(1);
        ``(2) the term `guaranteed investment contract' includes any 
    investment that has specified withdrawal or reinvestment provisions 
    and a specifically negotiated or bid interest rate, and also 
    includes any agreement to supply investments on 2 or more future 
    dates, such as a forward supply contract;
        ``(3) the term `investment strategies' includes plans or 
    programs for the investment of the proceeds of municipal securities 
    that are not municipal derivatives, guaranteed investment 
    contracts, and the recommendation of and brokerage of municipal 
    escrow investments;
        ``(4) the term `municipal advisor'--
            ``(A) means a person (who is not a municipal entity or an 
        employee of a municipal entity) that--
                ``(i) provides advice to or on behalf of a municipal 
            entity or obligated person with respect to municipal 
            financial products or the issuance of municipal securities, 
            including advice with respect to the structure, timing, 
            terms, and other similar matters concerning such financial 
            products or issues; or
                ``(ii) undertakes a solicitation of a municipal entity;
            ``(B) includes financial advisors, guaranteed investment 
        contract brokers, third-party marketers, placement agents, 
        solicitors, finders, and swap advisors, if such persons are 
        described in any of clauses (i) through (iii) of subparagraph 
        (A); and
            ``(C) does not include a broker, dealer, or municipal 
        securities dealer serving as an underwriter (as defined in 
        section 2(a)(11) of the Securities Act of 1933) (15 U.S.C. 
        77b(a)(11)), any investment adviser registered under the 
        Investment Advisers Act of 1940, or persons associated with 
        such investment advisers who are providing investment advice, 
        any commodity trading advisor registered under the Commodity 
        Exchange Act or persons associated with a commodity trading 
        advisor who are providing advice related to swaps, attorneys 
        offering legal advice or providing services that are of a 
        traditional legal nature, or engineers providing engineering 
        advice;
        ``(5) the term `municipal financial product' means municipal 
    derivatives, guaranteed investment contracts, and investment 
    strategies;
        ``(6) the term `rules of the Board' means the rules proposed 
    and adopted by the Board under subsection (b)(2);
        ``(7) the term `person associated with a municipal advisor' or 
    `associated person of an advisor' means--
            ``(A) any partner, officer, director, or branch manager of 
        such municipal advisor (or any person occupying a similar 
        status or performing similar functions);
            ``(B) any other employee of such municipal advisor who is 
        engaged in the management, direction, supervision, or 
        performance of any activities relating to the provision of 
        advice to or on behalf of a municipal entity or obligated 
        person with respect to municipal financial products or the 
        issuance of municipal securities; and
            ``(C) any person directly or indirectly controlling, 
        controlled by, or under common control with such municipal 
        advisor;
        ``(8) the term `municipal entity' means any State, political 
    subdivision of a State, or municipal corporate instrumentality of a 
    State, including--
            ``(A) any agency, authority, or instrumentality of the 
        State, political subdivision, or municipal corporate 
        instrumentality;
            ``(B) any plan, program, or pool of assets sponsored or 
        established by the State, political subdivision, or municipal 
        corporate instrumentality or any agency, authority, or 
        instrumentality thereof; and
            ``(C) any other issuer of municipal securities;
        ``(9) the term `solicitation of a municipal entity or obligated 
    person' means a direct or indirect communication with a municipal 
    entity or obligated person made by a person, for direct or indirect 
    compensation, on behalf of a broker, dealer, municipal securities 
    dealer, municipal advisor, or investment adviser (as defined in 
    section 202 of the Investment Advisers Act of 1940) that does not 
    control, is not controlled by, or is not under common control with 
    the person undertaking such solicitation for the purpose of 
    obtaining or retaining an engagement by a municipal entity or 
    obligated person of a broker, dealer, municipal securities dealer, 
    or municipal advisor for or in connection with municipal financial 
    products, the issuance of municipal securities, or of an investment 
    adviser to provide investment advisory services to or on behalf of 
    a municipal entity; and
        ``(10) the term `obligated person' means any person, including 
    an issuer of municipal securities, who is either generally or 
    through an enterprise, fund, or account of such person, committed 
    by contract or other arrangement to support the payment of all or 
    part of the obligations on the municipal securities to be sold in 
    an offering of municipal securities.''.
    (f) Registered Securities Association.--Section 15A(b) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o-3(b)) is amended by 
adding at the end the following:
        ``(15) The rules of the association provide that the 
    association shall--
            ``(A) request guidance from the Municipal Securities 
        Rulemaking Board in interpretation of the rules of the 
        Municipal Securities Rulemaking Board; and
            ``(B) provide information to the Municipal Securities 
        Rulemaking Board about the enforcement actions and examinations 
        of the association under section 15B(b)(2)(E), so that the 
        Municipal Securities Rulemaking Board may--
                ``(i) assist in such enforcement actions and 
            examinations; and
                ``(ii) evaluate the ongoing effectiveness of the rules 
            of the Board.''.
    (g) Registration and Regulation of Brokers and Dealers.--Section 15 
of the Securities Exchange Act of 1934 is amended--
        (1) in subsection (b)(4), by inserting ``municipal advisor,'' 
    after ``municipal securities dealer'' each place that term appears; 
    and
        (2) in subsection (c), by inserting ``broker, dealer, or'' 
    before ``municipal securities dealer'' each place that term 
    appears.
    (h) Accounts and Records, Reports, Examinations of Exchanges, 
Members, and Others.--Section 17(a)(1) of the Securities Exchange Act 
of 1934 is amended by inserting ``municipal advisor,'' after 
``municipal securities dealer''.
    (i) Effective Date.--This section, and the amendments made by this 
section, shall take effect on October 1, 2010.
    SEC. 976. GOVERNMENT ACCOUNTABILITY OFFICE STUDY OF INCREASED 
      DISCLOSURE TO INVESTORS.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study and review of the disclosure required to be made by 
issuers of municipal securities.
    (b) Subjects for Evaluation.--In conducting the study under 
subsection (a), the Comptroller General of the United States shall--
        (1) broadly describe--
            (A) the size of the municipal securities markets and the 
        issuers and investors; and
            (B) the disclosures provided by issuers to investors;
        (2) compare the amount, frequency, and quality of disclosures 
    that issuers of municipal securities are required by law to provide 
    for the benefit of municipal securities holders, including the 
    amount of and frequency of disclosures actually provided by issuers 
    of municipal securities, with the amount of and frequency of 
    disclosures that issuers of corporate securities provide for the 
    benefit of corporate securities holders, taking into account the 
    differences between issuers of municipal securities and issuers of 
    corporate securities;
        (3) evaluate the costs and benefits to various types of issuers 
    of municipal securities of requiring issuers of municipal bonds to 
    provide additional financial disclosures for the benefit of 
    investors;
        (4) evaluate the potential benefit to investors from additional 
    financial disclosures by issuers of municipal bonds; and
        (5) make recommendations relating to disclosure requirements 
    for municipal issuers, including the advisability of the repeal or 
    retention of section 15B(d) of the Securities Exchange Act of 1934 
    (15 U.S.C. 78o-4(d)) (commonly known as the ``Tower Amendment'').
    (c) Report.--Not later than 24 months after the date of enactment 
of this Act, the Comptroller General of the United States shall submit 
a report to Congress on the results of the study conducted under 
subsection (a), including recommendations for how to improve disclosure 
by issuers of municipal securities.
    SEC. 977. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON THE MUNICIPAL 
      SECURITIES MARKETS.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study of the municipal securities markets.
    (b) Report.--Not later than 18 months after the date of enactment 
of this Act, the Comptroller General of the United States shall submit 
a report to the Committee on Banking, Housing, and Urban Affairs of the 
Senate, and the Committee on Financial Services of the House of 
Representatives, with copies to the Special Committee on Aging of the 
Senate and the Commission, on the results of the study conducted under 
subsection (a), including--
        (1) an analysis of the mechanisms for trading, quality of trade 
    executions, market transparency, trade reporting, price discovery, 
    settlement clearing, and credit enhancements;
        (2) the needs of the markets and investors and the impact of 
    recent innovations;
        (3) recommendations for how to improve the transparency, 
    efficiency, fairness, and liquidity of trading in the municipal 
    securities markets, including with reference to items listed in 
    paragraph (1); and
        (4) potential uses of derivatives in the municipal securities 
    markets.
    (c) Responses.--Not later than 180 days after receipt of the report 
required under subsection (b), the Commission shall submit a response 
to the Committee on Banking, Housing, and Urban Affairs of the Senate, 
and the Committee on Financial Services of the House of 
Representatives, with a copy to the Special Committee on Aging of the 
Senate, stating the actions the Commission has taken in response to the 
recommendations contained in such report.
    SEC. 978. FUNDING FOR GOVERNMENTAL ACCOUNTING STANDARDS BOARD.
    (a) Amendment to the Securities Act of 1933.--Section 19 of the 
Securities Act of 1933 (15 U.S.C. 77s), as amended by section 912, is 
further amended by adding at the end the following:
    ``(g) Funding for the GASB.--
        ``(1) In general.--The Commission may, subject to the 
    limitations imposed by section 15B of the Securities Exchange Act 
    of 1934 (15 U.S.C. 78o-4), require a national securities 
    association registered under the Securities Exchange Act of 1934 to 
    establish--
            ``(A) a reasonable annual accounting support fee to 
        adequately fund the annual budget of the Governmental 
        Accounting Standards Board (referred to in this subsection as 
        the `GASB'); and
            ``(B) rules and procedures, in consultation with the 
        principal organizations representing State governors, 
        legislators, local elected officials, and State and local 
        finance officers, to provide for the equitable allocation, 
        assessment, and collection of the accounting support fee 
        established under subparagraph (A) from the members of the 
        association, and the remittance of all such accounting support 
        fees to the Financial Accounting Foundation.
        ``(2) Annual budget.--For purposes of this subsection, the 
    annual budget of the GASB is the annual budget reviewed and 
    approved according to the internal procedures of the Financial 
    Accounting Foundation.
        ``(3) Use of funds.--Any fees or funds collected under this 
    subsection shall be used to support the efforts of the GASB to 
    establish standards of financial accounting and reporting 
    recognized as generally accepted accounting principles applicable 
    to State and local governments of the United States.
        ``(4) Limitation on fee.--The annual accounting support fees 
    collected under this subsection for a fiscal year shall not exceed 
    the recoverable annual budgeted expenses of the GASB (which may 
    include operating expenses, capital, and accrued items).
        ``(5) Rules of construction.--
            ``(A) Fees not public monies.--Accounting support fees 
        collected under this subsection and other receipts of the GASB 
        shall not be considered public monies of the United States.
            ``(B) Limitation on authority of the commission.--Nothing 
        in this subsection shall be construed to--
                ``(i) provide the Commission or any national securities 
            association direct or indirect oversight of the budget or 
            technical agenda of the GASB; or
                ``(ii) affect the setting of generally accepted 
            accounting principles by the GASB.
            ``(C) Noninterference with states.--Nothing in this 
        subsection shall be construed to impair or limit the authority 
        of a State or local government to establish accounting and 
        financial reporting standards.''.
    (b) Study of Funding for Governmental Accounting Standards Board.--
        (1) Study.--The Comptroller General of the United States shall 
    conduct a study that evaluates--
            (A) the role and importance of the Governmental Accounting 
        Standards Board in the municipal securities markets; and
            (B) the manner and the level at which the Governmental 
        Accounting Standards Board has been funded.
        (2) Consultation.--In conducting the study required under 
    paragraph (1), the Comptroller General shall consult with the 
    principal organizations representing State governors, legislators, 
    local elected officials, and State and local finance officers.
        (3) Report.--Not later than 180 days after the date of 
    enactment of this Act, the Comptroller General shall submit to the 
    Committee on Banking, Housing, and Urban Affairs of the Senate and 
    the Committee on Financial Services of the House of Representatives 
    a report on the study required under paragraph (1).
    SEC. 979. COMMISSION OFFICE OF MUNICIPAL SECURITIES.
    (a) In General.--There shall be in the Commission an Office of 
Municipal Securities, which shall--
        (1) administer the rules of the Commission with respect to the 
    practices of municipal securities brokers and dealers, municipal 
    securities advisors, municipal securities investors, and municipal 
    securities issuers; and
        (2) coordinate with the Municipal Securities Rulemaking Board 
    for rulemaking and enforcement actions as required by law.
    (b) Director of the Office.--The head of the Office of Municipal 
Securities shall be the Director, who shall report to the Chairman.
    (c) Staffing.--
        (1) In general.--The Office of Municipal Securities shall be 
    staffed sufficiently to carry out the requirements of this section.
        (2) Requirement.--The staff of the Office of Municipal 
    Securities shall include individuals with knowledge of and 
    expertise in municipal finance.

   Subtitle I--Public Company Accounting Oversight Board, Portfolio 
                      Margining, and Other Matters

    SEC. 981. AUTHORITY TO SHARE CERTAIN INFORMATION WITH FOREIGN 
      AUTHORITIES.
    (a) Definition.--Section 2(a) of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7201(a)) is amended by adding at the end the following:
        ``(17) Foreign auditor oversight authority.--The term `foreign 
    auditor oversight authority' means any governmental body or other 
    entity empowered by a foreign government to conduct inspections of 
    public accounting firms or otherwise to administer or enforce laws 
    related to the regulation of public accounting firms.''.
    (b) Availability to Share Information.--Section 105(b)(5) of the 
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(b)(5)) is amended by adding 
at the end the following:
            ``(C) Availability to foreign oversight authorities.--
        Without the loss of its status as confidential and privileged 
        in the hands of the Board, all information referred to in 
        subparagraph (A) that relates to a public accounting firm that 
        a foreign government has empowered a foreign auditor oversight 
        authority to inspect or otherwise enforce laws with respect to, 
        may, at the discretion of the Board, be made available to the 
        foreign auditor oversight authority, if--
                ``(i) the Board finds that it is necessary to 
            accomplish the purposes of this Act or to protect 
            investors;
                ``(ii) the foreign auditor oversight authority 
            provides--

                    ``(I) such assurances of confidentiality as the 
                Board may request;
                    ``(II) a description of the applicable information 
                systems and controls of the foreign auditor oversight 
                authority; and
                    ``(III) a description of the laws and regulations 
                of the foreign government of the foreign auditor 
                oversight authority that are relevant to information 
                access; and

                ``(iii) the Board determines that it is appropriate to 
            share such information.''.
    (c) Conforming Amendment.--Section 105(b)(5)(A) of the Sarbanes-
Oxley Act of 2002 (15 U.S.C. 7215(b)(5)(A)) is amended by striking 
``subparagraph (B)'' and inserting ``subparagraphs (B) and (C)''.
    SEC. 982. OVERSIGHT OF BROKERS AND DEALERS.
    (a) Definitions.--
        (1) Definitions amended.--Title I of the Sarbanes-Oxley Act of 
    2002 (15 U.S.C. 7201 et seq.) is amended by adding at the end the 
    following new section:
    ``SEC. 110. DEFINITIONS.
    ``For the purposes of this title, the following definitions shall 
apply:
        ``(1) Audit.--The term `audit' means an examination of the 
    financial statements, reports, documents, procedures, controls, or 
    notices of any issuer, broker, or dealer by an independent public 
    accounting firm in accordance with the rules of the Board or the 
    Commission, for the purpose of expressing an opinion on the 
    financial statements or providing an audit report.
        ``(2) Audit report.--The term `audit report' means a document, 
    report, notice, or other record--
            ``(A) prepared following an audit performed for purposes of 
        compliance by an issuer, broker, or dealer with the 
        requirements of the securities laws; and
            ``(B) in which a public accounting firm either--
                ``(i) sets forth the opinion of that firm regarding a 
            financial statement, report, notice, or other document, 
            procedures, or controls; or
                ``(ii) asserts that no such opinion can be expressed.
        ``(3) Broker.--The term `broker' means a broker (as such term 
    is defined in section 3(a)(4) of the Securities Exchange Act of 
    1934 (15 U.S.C. 78c(a)(4))) that is required to file a balance 
    sheet, income statement, or other financial statement under section 
    17(e)(1)(A) of such Act (15 U.S.C. 78q(e)(1)(A)), where such 
    balance sheet, income statement, or financial statement is required 
    to be certified by a registered public accounting firm.
        ``(4) Dealer.--The term `dealer' means a dealer (as such term 
    is defined in section 3(a)(5) of the Securities Exchange Act of 
    1934 (15 U.S.C. 78c(a)(5))) that is required to file a balance 
    sheet, income statement, or other financial statement under section 
    17(e)(1)(A) of such Act (15 U.S.C. 78q(e)(1)(A)), where such 
    balance sheet, income statement, or financial statement is required 
    to be certified by a registered public accounting firm.
        ``(5) Professional standards.--The term `professional 
    standards' means--
            ``(A) accounting principles that are--
                ``(i) established by the standard setting body 
            described in section 19(b) of the Securities Act of 1933, 
            as amended by this Act, or prescribed by the Commission 
            under section 19(a) of that Act (15 U.S.C. 17a(s)) or 
            section 13(b) of the Securities Exchange Act of 1934 (15 
            U.S.C. 78a(m)); and
                ``(ii) relevant to audit reports for particular 
            issuers, brokers, or dealers, or dealt with in the quality 
            control system of a particular registered public accounting 
            firm; and
            ``(B) auditing standards, standards for attestation 
        engagements, quality control policies and procedures, ethical 
        and competency standards, and independence standards (including 
        rules implementing title II) that the Board or the Commission 
        determines--
                ``(i) relate to the preparation or issuance of audit 
            reports for issuers, brokers, or dealers; and
                ``(ii) are established or adopted by the Board under 
            section 103(a), or are promulgated as rules of the 
            Commission.
        ``(6) Self-regulatory organization.--The term `self-regulatory 
    organization' has the same meaning as in section 3(a) of the 
    Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).''.
        (2) Conforming amendment.--Section 2(a) of the Sarbanes-Oxley 
    Act of 2002 (15 U.S.C. 7201(a)) is amended in the matter preceding 
    paragraph (1), by striking ``In this'' and inserting ``Except as 
    otherwise specifically provided in this Act, in this''.
    (b) Establishment and Administration of the Public Company 
Accounting Oversight Board.--Section 101 of the Sarbanes-Oxley Act of 
2002 (15 U.S.C. 7211) is amended--
        (1) by striking ``issuers'' each place that term appears and 
    inserting ``issuers, brokers, and dealers''; and
        (2) in subsection (a)--
            (A) by striking ``public companies'' and inserting 
        ``companies''; and
            (B) by striking ``for companies the securities of which are 
        sold to, and held by and for, public investors''.
    (c) Registration With the Board.--Section 102 of the Sarbanes-Oxley 
Act of 2002 (15 U.S.C. 7212) is amended--
        (1) in subsection (a)--
            (A) by striking ``Beginning 180'' and all that follows 
        through ``101(d), it'' and inserting ``It''; and
            (B) by striking ``issuer'' and inserting ``issuer, broker, 
        or dealer'';
        (2) in subsection (b)--
            (A) in paragraph (2)(A), by striking ``issuers'' and 
        inserting ``issuers, brokers, and dealers''; and
            (B) by striking ``issuer'' each place that term appears and 
        inserting ``issuer, broker, or dealer''.
    (d) Auditing and Independence.--Section 103(a) of the Sarbanes-
Oxley Act of 2002 (15 U.S.C. 7213(a)) is amended--
        (1) in paragraph (1), by striking ``and such ethics standards'' 
    and inserting ``such ethics standards, and such independence 
    standards'';
        (2) in paragraph (2)(A)(iii), by striking ``describe in each 
    audit report'' and inserting ``in each audit report for an issuer, 
    describe''; and
        (3) in paragraph (2)(B)(i), by striking ``issuers'' and 
    inserting ``issuers, brokers, and dealers''.
    (e) Inspections of Registered Public Accounting Firms.--
        (1) Amendments.--Section 104(a) of the Sarbanes-Oxley Act of 
    2002 (15 U.S.C. 7214(a)) is amended--
            (A) by striking ``The Board shall'' and inserting the 
        following:
        ``(1) Inspections generally.--The Board shall''; and
            (B) by adding at the end the following:
        ``(2) Inspections of audit reports for brokers and dealers.--
            ``(A) The Board may, by rule, conduct and require a program 
        of inspection in accordance with paragraph (1), on a basis to 
        be determined by the Board, of registered public accounting 
        firms that provide one or more audit reports for a broker or 
        dealer. The Board, in establishing such a program, may allow 
        for differentiation among classes of brokers and dealers, as 
        appropriate.
            ``(B) If the Board determines to establish a program of 
        inspection pursuant to subparagraph (A), the Board shall 
        consider in establishing any inspection schedules whether 
        differing schedules would be appropriate with respect to 
        registered public accounting firms that issue audit reports 
        only for one or more brokers or dealers that do not receive, 
        handle, or hold customer securities or cash or are not a member 
        of the Securities Investor Protection Corporation.
            ``(C) Any rules of the Board pursuant to this paragraph 
        shall be subject to prior approval by the Commission pursuant 
        to section 107(b) before the rules become effective, including 
        an opportunity for public notice and comment.
            ``(D) Notwithstanding anything to the contrary in section 
        102 of this Act, a public accounting firm shall not be required 
        to register with the Board if the public accounting firm is 
        exempt from the inspection program which may be established by 
        the Board under subparagraph (A).''.
        (2) Conforming amendment.--Section 17(e)(1)(A) of the 
    Securities Exchange Act of 1934 (15 U.S.C. 78q(e)(1)(A)) is amended 
    by striking ``registered public accounting firm'' and inserting 
    ``independent public accounting firm, or by a registered public 
    accounting firm if the firm is required to be registered under the 
    Sarbanes-Oxley Act of 2002,''.
    (f) Investigations and Disciplinary Proceedings.--Section 
105(c)(7)(B) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7215(c)(7)(B)) is amended--
        (1) in the subparagraph heading, by inserting ``, broker, or 
    dealer'' after ``issuer'';
        (2) by striking ``any issuer'' each place that term appears and 
    inserting ``any issuer, broker, or dealer''; and
        (3) by striking ``an issuer under this subsection'' and 
    inserting ``a registered public accounting firm under this 
    subsection''.
    (g) Foreign Public Accounting Firms.--Section 106(a) of the 
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7216(a)) is amended--
        (1) in paragraph (1), by striking ``issuer'' and inserting 
    ``issuer, broker, or dealer''; and
        (2) in paragraph (2), by striking ``issuers'' and inserting 
    ``issuers, brokers, or dealers''.
    (h) Funding.--Section 109 of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7219) is amended--
        (1) in subsection (c)(2), by striking ``subsection (i)'' and 
    inserting ``subsection (j)'';
        (2) in subsection (d)--
            (A) in paragraph (2), by striking ``allowing for 
        differentiation among classes of issuers, as appropriate'' and 
        inserting ``and among brokers and dealers, in accordance with 
        subsection (h), and allowing for differentiation among classes 
        of issuers, brokers and dealers, as appropriate''; and
            (B) by adding at the end the following:
        ``(3) Brokers and dealers.--The Board shall begin the 
    allocation, assessment, and collection of fees under paragraph (2) 
    with respect to brokers and dealers with the payment of support 
    fees to fund the first full fiscal year beginning after the date of 
    enactment of the Investor Protection and Securities Reform Act of 
    2010.'';
        (3) by redesignating subsections (h), (i), and (j) as 
    subsections (i), (j), and (k), respectively; and
        (4) by inserting after subsection (g) the following:
    ``(h) Allocation of Accounting Support Fees Among Brokers and 
Dealers.--
        ``(1) Obligation to pay.--Each broker or dealer shall pay to 
    the Board the annual accounting support fee allocated to such 
    broker or dealer under this section.
        ``(2) Allocation.--Any amount due from a broker or dealer (or 
    from a particular class of brokers and dealers) under this section 
    shall be allocated among brokers and dealers and payable by the 
    broker or dealer (or the brokers and dealers in the particular 
    class, as applicable).
        ``(3) Proportionality.--The amount due from a broker or dealer 
    shall be in proportion to the net capital of the broker or dealer 
    (before or after any adjustments), compared to the total net 
    capital of all brokers and dealers (before or after any 
    adjustments), in accordance with rules issued by the Board.''.
    (i) Referral of Investigations to a Self-regulatory Organization.--
Section 105(b)(4)(B) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7215(b)(4)(B)) is amended--
        (1) by redesignating clauses (ii) and (iii) as clauses (iii) 
    and (iv), respectively; and
        (2) by inserting after clause (i) the following:
                ``(ii) to a self-regulatory organization, in the case 
            of an investigation that concerns an audit report for a 
            broker or dealer that is under the jurisdiction of such 
            self-regulatory organization;''.
    (j) Use of Documents Related to an Inspection or Investigation.--
Section 105(b)(5)(B)(ii) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7215(b)(5)(B)(ii)) is amended--
        (1) in subclause (III), by striking ``and'' at the end;
        (2) in subclause (IV), by striking the comma and inserting ``; 
    and''; and
        (3) by inserting after subclause (IV) the following:

                    ``(V) a self-regulatory organization, with respect 
                to an audit report for a broker or dealer that is under 
                the jurisdiction of such self-regulatory 
                organization,''.

    SEC. 983. PORTFOLIO MARGINING.
    (a) Advances.--Section 9(a)(1) of the Securities Investor 
Protection Act of 1970 (15 U.S.C. 78fff3(a)(1)) is amended by inserting 
``or options on commodity futures contracts'' after ``claim for 
securities''.
    (b) Definitions.--Section 16 of the Securities Investor Protection 
Act of 1970 (15 U.S.C. 78lll) is amended--
        (1) by striking paragraph (2) and inserting the following:
        ``(2) Customer.--
            ``(A) In general.--The term `customer' of a debtor means 
        any person (including any person with whom the debtor deals as 
        principal or agent) who has a claim on account of securities 
        received, acquired, or held by the debtor in the ordinary 
        course of its business as a broker or dealer from or for the 
        securities accounts of such person for safekeeping, with a view 
        to sale, to cover consummated sales, pursuant to purchases, as 
        collateral, security, or for purposes of effecting transfer.
            ``(B) Included persons.--The term `customer' includes--
                ``(i) any person who has deposited cash with the debtor 
            for the purpose of purchasing securities;
                ``(ii) any person who has a claim against the debtor 
            for cash, securities, futures contracts, or options on 
            futures contracts received, acquired, or held in a 
            portfolio margining account carried as a securities account 
            pursuant to a portfolio margining program approved by the 
            Commission; and
                ``(iii) any person who has a claim against the debtor 
            arising out of sales or conversions of such securities.
            ``(C) Excluded persons.--The term `customer' does not 
        include any person, to the extent that--
                ``(i) the claim of such person arises out of 
            transactions with a foreign subsidiary of a member of SIPC; 
            or
                ``(ii) such person has a claim for cash or securities 
            which by contract, agreement, or understanding, or by 
            operation of law, is part of the capital of the debtor, or 
            is subordinated to the claims of any or all creditors of 
            the debtor, notwithstanding that some ground exists for 
            declaring such contract, agreement, or understanding void 
            or voidable in a suit between the claimant and the 
            debtor.'';
        (2) in paragraph (4)--
            (A) in subparagraph (C), by striking ``and'' at the end;
            (B) by redesignating subparagraph (D) as subparagraph (E); 
        and
            (C) by inserting after subparagraph (C) the following:
            ``(D) in the case of a portfolio margining account of a 
        customer that is carried as a securities account pursuant to a 
        portfolio margining program approved by the Commission, a 
        futures contract or an option on a futures contract received, 
        acquired, or held by or for the account of a debtor from or for 
        such portfolio margining account, and the proceeds thereof; 
        and'';
        (3) in paragraph (9), in the matter following subparagraph (L), 
    by inserting after ``Such term'' the following: ``includes revenues 
    earned by a broker or dealer in connection with a transaction in 
    the portfolio margining account of a customer carried as securities 
    accounts pursuant to a portfolio margining program approved by the 
    Commission. Such term''; and
        (4) in paragraph (11)--
            (A) in subparagraph (A)--
                (i) by striking ``filing date, all'' and all that 
            follows through the end of the subparagraph and inserting 
            the following: ``filing date--
                ``(i) all securities positions of such customer (other 
            than customer name securities reclaimed by such customer); 
            and
                ``(ii) all positions in futures contracts and options 
            on futures contracts held in a portfolio margining account 
            carried as a securities account pursuant to a portfolio 
            margining program approved by the Commission, including all 
            property collateralizing such positions, to the extent that 
            such property is not otherwise included herein; minus''; 
            and
            (B) in the matter following subparagraph (C), by striking 
        ``In determining'' and inserting the following: ``A claim for a 
        commodity futures contract received, acquired, or held in a 
        portfolio margining account pursuant to a portfolio margining 
        program approved by the Commission or a claim for a security 
        futures contract, shall be deemed to be a claim with respect to 
        such contract as of the filing date, and such claim shall be 
        treated as a claim for cash. In determining''.
    SEC. 984. LOAN OR BORROWING OF SECURITIES.
    (a) Rulemaking Authority.--Section 10 of the Securities Exchange 
Act of 1934 (15 U.S.C. 78j) is amended by adding at the end the 
following:
        ``(c)(1) To effect, accept, or facilitate a transaction 
    involving the loan or borrowing of securities in contravention of 
    such rules and regulations as the Commission may prescribe as 
    necessary or appropriate in the public interest or for the 
    protection of investors.
        ``(2) Nothing in paragraph (1) may be construed to limit the 
    authority of the appropriate Federal banking agency (as defined in 
    section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
    1813(q))), the National Credit Union Administration, or any other 
    Federal department or agency having a responsibility under Federal 
    law to prescribe rules or regulations restricting transactions 
    involving the loan or borrowing of securities in order to protect 
    the safety and soundness of a financial institution or to protect 
    the financial system from systemic risk.''.
    (b) Rulemaking Required.--Not later than 2 years after the date of 
enactment of this Act, the Commission shall promulgate rules that are 
designed to increase the transparency of information available to 
brokers, dealers, and investors, with respect to the loan or borrowing 
of securities.
    SEC. 985. TECHNICAL CORRECTIONS TO FEDERAL SECURITIES LAWS.
    (a) Securities Act of 1933.--The Securities Act of 1933 (15 U.S.C. 
77a et seq.) is amended--
        (1) in section 3(a)(4) (15 U.S.C. 77c(a)(4)), by striking 
    ``individual;'' and inserting ``individual,'';
        (2) in section 18 (15 U.S.C. 77r)--
            (A) in subsection (b)(1)(C), by striking ``is a security'' 
        and inserting ``a security''; and
            (B) in subsection (c)(2)(B)(i), by striking ``State, or'' 
        and inserting ``State or'';
        (3) in section 19(d)(6)(A) (15 U.S.C. 77s(d)(6)(A)), by 
    striking ``in paragraph (1) of (3)'' and inserting ``in paragraph 
    (1) or (3)''; and
        (4) in section 27A(c)(1)(B)(ii) (15 U.S.C. 77z-2(c)(1)(B)(ii)), 
    by striking ``business entity;'' and inserting ``business 
    entity,''.
    (b) Securities Exchange Act of 1934.--The Securities Exchange Act 
of 1934 (15 U.S.C. 78a et seq.) is amended--
        (1) in section 2 (15 U.S.C. 78b), by striking ``affected'' and 
    inserting ``effected'';
        (2) in section 3 (15 U.S.C. 78c)--
            (A) in subsection (a)(55)(A), by striking ``section 
        3(a)(12) of the Securities Exchange Act of 1934'' and inserting 
        ``section 3(a)(12) of this title''; and
            (B) in subsection (g), by striking ``company, account 
        person, or entity'' and inserting ``company, account, person, 
        or entity'';
        (3) in section 10A(i)(1)(B) (15 U.S.C. 78j-1(i)(1)(B))--
            (A) in the subparagraph heading, by striking ``minimus'' 
        and inserting ``minimis''; and
            (B) in clause (i), by striking ``nonaudit'' and inserting 
        ``non-audit'';
        (4) in section 13(b)(1) (15 U.S.C. 78m(b)(1)), by striking 
    ``earning statement'' and inserting ``earnings statement'';
        (5) in section 15 (15 U.S.C. 78o)--
            (A) in subsection (b)(1)--
                (i) in subparagraph (B), by striking ``The order 
            granting'' and all that follows through ``from such 
            membership.''; and
                (ii) in the undesignated matter immediately following 
            subparagraph (B), by inserting after the first sentence the 
            following: ``The order granting registration shall not be 
            effective until such broker or dealer has become a member 
            of a registered securities association, or until such 
            broker or dealer has become a member of a national 
            securities exchange, if such broker or dealer effects 
            transactions solely on that exchange, unless the Commission 
            has exempted such broker or dealer, by rule or order, from 
            such membership.'';
        (6) in section 15C(a)(2) (15 U.S.C. 78o-5(a)(2))--
            (A) by redesignating clauses (i) and (ii) as subparagraphs 
        (A) and (B), respectively, and adjusting the subparagraph 
        margins accordingly;
            (B) in subparagraph (B), as so redesignated, by striking 
        ``The order granting'' and all that follows through ``from such 
        membership.''; and
            (C) in the matter following subparagraph (B), as so 
        redesignated, by inserting after the first sentence the 
        following: ``The order granting registration shall not be 
        effective until such government securities broker or government 
        securities dealer has become a member of a national securities 
        exchange registered under section 6 of this title, or a 
        securities association registered under section 15A of this 
        title, unless the Commission has exempted such government 
        securities broker or government securities dealer, by rule or 
        order, from such membership.'';
        (7) in section 17(b)(1)(B) (15 U.S.C. 78q(b)(1)(B)), by 
    striking ``15A(k) gives'' and inserting ``15A(k), give''; and
        (8) in section 21C(c)(2) (15 U.S.C. 78u-3(c)(2)), by striking 
    ``paragraph (1) subsection'' and inserting ``Paragraph (1)''.
    (c) Trust Indenture Act of 1939.--The Trust Indenture Act of 1939 
(15 U.S.C. 77aaa et seq.) is amended--
        (1) in section 304(b) (15 U.S.C. 77ddd(b)), by striking 
    ``section 2 of such Act'' and inserting ``section 2(a) of such 
    Act''; and
        (2) in section 317(a)(1) (15 U.S.C. 77qqq(a)(1)), by striking 
    ``, in the'' and inserting ``in the''.
    (d) Investment Company Act of 1940.--The Investment Company Act of 
1940 (15 U.S.C. 80a-1 et seq.) is amended--
        (1) in section 2(a)(19) (15 U.S.C. 80a-2(a)(19)), in the matter 
    following subparagraph (B)(vii)--
            (A) by striking ``clause (vi)'' each place that term 
        appears and inserting ``clause (vii)''; and
            (B) in each of subparagraphs (A)(vi) and (B)(vi), by adding 
        ``and'' at the end of subclause (III);
        (2) in section 9(b)(4)(B) (15 U.S.C. 80a-9(b)(4)(B)), by adding 
    ``or'' after the semicolon at the end;
        (3) in section 12(d)(1)(J) (15 U.S.C. 80a-12(d)(1)(J)), by 
    striking ``any provision of this subsection'' and inserting ``any 
    provision of this paragraph'';
        (4) in section 17(f) (15 U.S.C. 80a-17(f))--
            (A) in paragraph (4), by striking ``No such member'' and 
        inserting ``No member of a national securities exchange''; and
            (B) in paragraph (6), by striking ``company may serve'' and 
        inserting ``company, may serve''; and
        (5) in section 61(a)(3)(B)(iii) (15 U.S.C. 80a-
    60(a)(3)(B)(iii))--
            (A) by striking ``paragraph (1) of section 205'' and 
        inserting ``section 205(a)(1)''; and
            (B) by striking ``clause (A) or (B) of that section'' and 
        inserting ``paragraph (1) or (2) of section 205(b)''.
    (e) Investment Advisers Act of 1940.--The Investment Advisers Act 
of 1940 (15 U.S.C. 80b-1 et seq.) is amended--
        (1) in section 203 (15 U.S.C. 80b-3)--
            (A) in subsection (c)(1)(A), by striking ``principal 
        business office and'' and inserting ``principal office, 
        principal place of business, and''; and
            (B) in subsection (k)(4)(B), in the matter following clause 
        (ii), by striking ``principal place of business'' and inserting 
        ``principal office or place of business'';
        (2) in section 206(3) (15 U.S.C. 80b-6(3)), by adding ``or'' 
    after the semicolon at the end;
        (3) in section 213(a) (15 U.S.C. 80b-13(a)), by striking 
    ``principal place of business'' and inserting ``principal office or 
    place of business''; and
        (4) in section 222 (15 U.S.C. 80b-18a), by striking ``principal 
    place of business'' each place that term appears and inserting 
    ``principal office and place of business''.
    SEC. 986. CONFORMING AMENDMENTS RELATING TO REPEAL OF THE PUBLIC 
      UTILITY HOLDING COMPANY ACT OF 1935.
    (a) Securities Exchange Act of 1934.--The Securities Exchange Act 
of 1934 (15 U.S.C. 78 et seq.) is amended--
        (1) in section 3(a)(47) (15 U.S.C. 78c(a)(47)), by striking 
    ``the Public Utility Holding Company Act of 1935 (15 U.S.C. 79a et 
    seq.),'';
        (2) in section 12(k) (15 U.S.C. 78l(k)), by amending paragraph 
    (7) to read as follows:  
        ``(7) Definition.--For purposes of this subsection, the term 
    `emergency' means--
            ``(A) a major market disturbance characterized by or 
        constituting--
                ``(i) sudden and excessive fluctuations of securities 
            prices generally, or a substantial threat thereof, that 
            threaten fair and orderly markets; or
                ``(ii) a substantial disruption of the safe or 
            efficient operation of the national system for clearance 
            and settlement of transactions in securities, or a 
            substantial threat thereof; or
            ``(B) a major disturbance that substantially disrupts, or 
        threatens to substantially disrupt--
                ``(i) the functioning of securities markets, investment 
            companies, or any other significant portion or segment of 
            the securities markets; or
                ``(ii) the transmission or processing of securities 
            transactions.''; and
        (3) in section 21(h)(2) (15 U.S.C. 78u(h)(2)), by striking 
    ``section 18(c) of the Public Utility Holding Company Act of 
    1935,''.
    (b) Trust Indenture Act of 1939.--The Trust Indenture Act of 1939 
(15 U.S.C. 77aaa et seq.) is amended--
        (1) in section 303 (15 U.S.C. 77ccc), by striking paragraph 
    (17) and inserting the following:
        ``(17) The terms `Securities Act of 1933' and `Securities 
    Exchange Act of 1934' shall be deemed to refer, respectively, to 
    such Acts, as amended, whether amended prior to or after the 
    enactment of this title.'';
        (2) in section 308 (15 U.S.C. 77hhh), by striking ``Securities 
    Act of 1933, the Securities Exchange Act of 1934, or the Public 
    Utility Holding Company Act of 1935'' each place that term appears 
    and inserting ``Securities Act of 1933 or the Securities Exchange 
    Act of 1934'';
        (3) in section 310 (15 U.S.C. 77jjj), by striking subsection 
    (c);
        (4) in section 311 (15 U.S.C. 77kkk), by striking subsection 
    (c);
        (5) in section 323(b) (15 U.S.C. 77www(b)), by striking 
    ``Securities Act of 1933, or the Securities Exchange Act of 1934, 
    or the Public Utility Holding Company Act of 1935'' and inserting 
    ``Securities Act of 1933 or the Securities Exchange Act of 1934''; 
    and
        (6) in section 326 (15 U.S.C. 77zzz), by striking ``Securities 
    Act of 1933, or the Securities Exchange Act of 1934, or the Public 
    Utility Holding Company Act of 1935,'' and inserting ``Securities 
    Act of 1933 or the Securities Exchange Act of 1934''.
    (c) Investment Company Act of 1940.--The Investment Company Act of 
1940 (15 U.S.C. 80a-1 et seq.) is amended--
        (1) in section 2(a)(44) (15 U.S.C. 80a-2(a)(44)), by striking 
    ```Public Utility Holding Company Act of 1935','';
        (2) in section 3(c) (15 U.S.C. 80a-3(c)), by striking paragraph 
    (8) and inserting the following:
        ``(8) [Repealed]'';
        (3) in section 38(b) (15 U.S.C. 80a-37(b)), by striking ``the 
    Public Utility Holding Company Act of 1935,''; and
        (4) in section 50 (15 U.S.C. 80a-49), by striking ``the Public 
    Utility Holding Company Act of 1935,''.
    (d) Investment Advisers Act of 1940.--Section 202(a)(21) of the 
Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(21)) is amended by 
striking ```Public Utility Holding Company Act of 1935',''.
    SEC. 987. AMENDMENT TO DEFINITION OF MATERIAL LOSS AND NONMATERIAL 
      LOSSES TO THE DEPOSIT INSURANCE FUND FOR PURPOSES OF INSPECTOR 
      GENERAL REVIEWS.
    (a) In General.--Section 38(k) of the Federal Deposit Insurance Act 
(U.S.C. 1831o(k)) is amended--
        (1) in paragraph (2), by striking subparagraph (B) and 
    inserting the following:
            ``(B) Material loss defined.--The term `material loss' 
        means any estimated loss in excess of--
                ``(i) $200,000,000, if the loss occurs during the 
            period beginning on January 1, 2010, and ending on December 
            31, 2011;
                ``(ii) $150,000,000, if the loss occurs during the 
            period beginning on January 1, 2012, and ending on December 
            31, 2013; and
                ``(iii) $50,000,000, if the loss occurs on or after 
            January 1, 2014, provided that if the inspector general of 
            a Federal banking agency certifies to the Committee on 
            Banking, Housing, and Urban Affairs of the Senate and the 
            Committee on Financial Services of the House of 
            Representatives that the number of projected failures of 
            depository institutions that would require material loss 
            reviews for the following 12 months will be greater than 30 
            and would hinder the effectiveness of its oversight 
            functions, then the definition of `material loss' shall be 
            $75,000,000 for a duration of 1 year from the date of the 
            certification.'';
        (2) in paragraph (4)(A) by striking ``the report'' and 
    inserting ``any report on losses required under this subsection,'';
        (3) by striking paragraph (6);
        (4) by redesignating paragraph (5) as paragraph (6); and
        (5) by inserting after paragraph (4) the following:
        ``(5) Losses that are not material.--
            ``(A) Semiannual report.--For the 6-month period ending on 
        March 31, 2010, and each 6-month period thereafter, the 
        Inspector General of each Federal banking agency shall--
                ``(i) identify losses that the Inspector General 
            estimates have been incurred by the Deposit Insurance Fund 
            during that 6-month period, with respect to the insured 
            depository institutions supervised by the Federal banking 
            agency;
                ``(ii) for each loss incurred by the Deposit Insurance 
            Fund that is not a material loss, determine--

                    ``(I) the grounds identified by the Federal banking 
                agency or State bank supervisor for appointing the 
                Corporation as receiver under section 11(c)(5); and
                    ``(II) whether any unusual circumstances exist that 
                might warrant an in-depth review of the loss; and

                ``(iii) prepare and submit a written report to the 
            appropriate Federal banking agency and to Congress on the 
            results of any determination by the Inspector General, 
            including--

                    ``(I) an identification of any loss that warrants 
                an in-depth review, together with the reasons why such 
                review is warranted, or, if the Inspector General 
                determines that no review is warranted, an explanation 
                of such determination; and
                    ``(II) for each loss identified under subclause (I) 
                that warrants an in-depth review, the date by which 
                such review, and a report on such review prepared in a 
                manner consistent with reports under paragraph (1)(A), 
                will be completed and submitted to the Federal banking 
                agency and Congress.

            ``(B) Deadline for semiannual report.--The Inspector 
        General of each Federal banking agency shall--
                ``(i) submit each report required under paragraph (A) 
            expeditiously, and not later than 90 days after the end of 
            the 6-month period covered by the report; and
                ``(ii) provide a copy of the report required under 
            paragraph (A) to any Member of Congress, upon request.''.
    (b) Technical and Conforming Amendment.--The heading for subsection 
(k) of section 38 of the Federal Deposit Insurance Act (U.S.C. 
1831o(k)) is amended to read as follows:
    ``(k) Reviews Required When Deposit Insurance Fund Incurs Losses.--
''.
    SEC. 988. AMENDMENT TO DEFINITION OF MATERIAL LOSS AND NONMATERIAL 
      LOSSES TO THE NATIONAL CREDIT UNION SHARE INSURANCE FUND FOR 
      PURPOSES OF INSPECTOR GENERAL REVIEWS.
    (a) In General.--Section 216(j) of the Federal Credit Union Act (12 
U.S.C. 1790d(j)) is amended to read as follows:
    ``(j) Reviews Required When Share Insurance Fund Experiences 
Losses.--
        ``(1) In general.--If the Fund incurs a material loss with 
    respect to an insured credit union, the Inspector General of the 
    Board shall--
            ``(A) submit to the Board a written report reviewing the 
        supervision of the credit union by the Administration 
        (including the implementation of this section by the 
        Administration), which shall include--
                ``(i) a description of the reasons why the problems of 
            the credit union resulted in a material loss to the Fund; 
            and
                ``(ii) recommendations for preventing any such loss in 
            the future; and
            ``(B) submit a copy of the report under subparagraph (A) 
        to--
                ``(i) the Comptroller General of the United States;
                ``(ii) the Corporation;
                ``(iii) in the case of a report relating to a State 
            credit union, the appropriate State supervisor; and
                ``(iv) to any Member of Congress, upon request.
        ``(2) Material loss defined.--For purposes of determining 
    whether the Fund has incurred a material loss with respect to an 
    insured credit union, a loss is material if it exceeds the sum of--
            ``(A) $25,000,000; and
            ``(B) an amount equal to 10 percent of the total assets of 
        the credit union on the date on which the Board initiated 
        assistance under section 208 or was appointed liquidating 
        agent.
        ``(3) Public disclosure required.--
            ``(A) In general.--The Board shall disclose a report under 
        this subsection, upon request under section 552 of title 5, 
        United States Code, without excising--
                ``(i) any portion under section 552(b)(5) of title 5, 
            United States Code; or
                ``(ii) any information about the insured credit union 
            (other than trade secrets) under section 552(b)(8) of title 
            5, United States Code.
            ``(B) Rule of construction.--Subparagraph (A) may not be 
        construed as requiring the agency to disclose the name of any 
        customer of the insured credit union (other than an 
        institution-affiliated party), or information from which the 
        identity of such customer could reasonably be ascertained.
        ``(4) Losses that are not material.--
            ``(A) Semiannual report.--For the 6-month period ending on 
        March 31, 2010, and each 6-month period thereafter, the 
        Inspector General of the Board shall--
                ``(i) identify any losses that the Inspector General 
            estimates were incurred by the Fund during such 6-month 
            period, with respect to insured credit unions;
                ``(ii) for each loss to the Fund that is not a material 
            loss, determine--

                    ``(I) the grounds identified by the Board or the 
                State official having jurisdiction over a State credit 
                union for appointing the Board as the liquidating agent 
                for any Federal or State credit union; and
                    ``(II) whether any unusual circumstances exist that 
                might warrant an in-depth review of the loss; and

                ``(iii) prepare and submit a written report to the 
            Board and to Congress on the results of the determinations 
            of the Inspector General that includes--

                    ``(I) an identification of any loss that warrants 
                an in-depth review, and the reasons such review is 
                warranted, or if the Inspector General determines that 
                no review is warranted, an explanation of such 
                determination; and
                    ``(II) for each loss identified in subclause (I) 
                that warrants an in-depth review, the date by which 
                such review, and a report on the review prepared in a 
                manner consistent with reports under paragraph (1)(A), 
                will be completed.

            ``(B) Deadline for semiannual report.--The Inspector 
        General of the Board shall--
                ``(i) submit each report required under subparagraph 
            (A) expeditiously, and not later than 90 days after the end 
            of the 6-month period covered by the report; and
                ``(ii) provide a copy of the report required under 
            subparagraph (A) to any Member of Congress, upon request.
        ``(5) GAO review.--The Comptroller General of the United States 
    shall, under such conditions as the Comptroller General determines 
    to be appropriate--
            ``(A) review each report made under paragraph (1), 
        including the extent to which the Inspector General of the 
        Board complied with the requirements under section 8L of the 
        Inspector General Act of 1978 (5 U.S.C. App.) with respect to 
        each such report; and
            ``(B) recommend improvements to the supervision of insured 
        credit unions (including improvements relating to the 
        implementation of this section).''.
    SEC. 989. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON PROPRIETARY 
      TRADING.
    (a) Definitions.--In this section--
        (1) the term ``covered entity'' means--
            (A) an insured depository institution, an affiliate of an 
        insured depository institution, a bank holding company, a 
        financial holding company, or a subsidiary of a bank holding 
        company or a financial holding company, as those terms are 
        defined in the Bank Holding Company Act of 1956 (12 U.S.C. 1841 
        et seq.); and
            (B) any other entity, as the Comptroller General of the 
        United States may determine; and
        (2) the term ``proprietary trading'' means the act of a covered 
    entity investing as a principal in securities, commodities, 
    derivatives, hedge funds, private equity firms, or such other 
    financial products or entities as the Comptroller General may 
    determine.
    (b) Study.--
        (1) In general.--The Comptroller General of the United States 
    shall conduct a study regarding the risks and conflicts associated 
    with proprietary trading by and within covered entities, including 
    an evaluation of--
            (A) whether proprietary trading presents a material 
        systemic risk to the stability of the United States financial 
        system, and if so, the costs and benefits of options for 
        mitigating such systemic risk;
            (B) whether proprietary trading presents material risks to 
        the safety and soundness of the covered entities that engage in 
        such activities, and if so, the costs and benefits of options 
        for mitigating such risks;
            (C) whether proprietary trading presents material conflicts 
        of interest between covered entities that engage in proprietary 
        trading and the clients of the institutions who use the firm to 
        execute trades or who rely on the firm to manage assets, and if 
        so, the costs and benefits of options for mitigating such 
        conflicts of interest;
            (D) whether adequate disclosure regarding the risks and 
        conflicts of proprietary trading is provided to the depositors, 
        trading and asset management clients, and investors of covered 
        entities that engage in proprietary trading, and if not, the 
        costs and benefits of options for the improvement of such 
        disclosure; and
            (E) whether the banking, securities, and commodities 
        regulators of institutions that engage in proprietary trading 
        have in place adequate systems and controls to monitor and 
        contain any risks and conflicts of interest related to 
        proprietary trading, and if not, the costs and benefits of 
        options for the improvement of such systems and controls.
        (2) Considerations.--In carrying out the study required under 
    paragraph (1), the Comptroller General shall consider--
            (A) current practice relating to proprietary trading;
            (B) the advisability of a complete ban on proprietary 
        trading;
            (C) limitations on the scope of activities that covered 
        entities may engage in with respect to proprietary trading;
            (D) the advisability of additional capital requirements for 
        covered entities that engage in proprietary trading;
            (E) enhanced restrictions on transactions between 
        affiliates related to proprietary trading;
            (F) enhanced accounting disclosures relating to proprietary 
        trading;
            (G) enhanced public disclosure relating to proprietary 
        trading; and
            (H) any other options the Comptroller General deems 
        appropriate.
    (c) Report to Congress.--Not later than 15 months after the date of 
enactment of this Act, the Comptroller General shall submit a report to 
Congress on the results of the study conducted under subsection (b).
    (d) Access by Comptroller General.--For purposes of conducting the 
study required under subsection (b), the Comptroller General shall have 
access, upon request, to any information, data, schedules, books, 
accounts, financial records, reports, files, electronic communications, 
or other papers, things, or property belonging to or in use by a 
covered entity that engages in proprietary trading, and to the 
officers, directors, employees, independent public accountants, 
financial advisors, staff, and agents and representatives of a covered 
entity (as related to the activities of the agent or representative on 
behalf of the covered entity), at such reasonable times as the 
Comptroller General may request. The Comptroller General may make and 
retain copies of books, records, accounts, and other records, as the 
Comptroller General deems appropriate.
    (e) Confidentiality of Reports.--
        (1) In general.--Except as provided in paragraph (2), the 
    Comptroller General may not disclose information regarding--
            (A) any proprietary trading activity of a covered entity, 
        unless such information is disclosed at a level of generality 
        that does not reveal the investment or trading position or 
        strategy of the covered entity for any specific security, 
        commodity, derivative, or other investment or financial 
        product; or
            (B) any individual interviewed by the Comptroller General 
        for purposes of the study under subsection (b), unless such 
        information is disclosed at a level of generality that does not 
        reveal--
                (i) the name of or identifying details relating to such 
            individual; or
                (ii) in the case of an individual who is an employee of 
            a third party that provides professional services to a 
            covered entity believed to be engaged in proprietary 
            trading, the name of or any identifying details relating to 
            such third party.
        (2) Exceptions.--The Comptroller General may disclose the 
    information described in paragraph (1)--
            (A) to a department, agency, or official of the Federal 
        Government, for official use, upon request;
            (B) to a committee of Congress, upon request; and
            (C) to a court, upon an order of such court.
SEC. 989A. SENIOR INVESTOR PROTECTIONS.
    (a) Definitions.--As used in this section--
        (1) the term ``eligible entity'' means--
            (A) a securities commission (or any agency or office 
        performing like functions) of a State that the Office 
        determines has adopted rules on the appropriate use of 
        designations in the offer or sale of securities or the 
        provision of investment advice that meet or exceed the minimum 
        requirements of the NASAA Model Rule on the Use of Senior-
        Specific Certifications and Professional Designations (or any 
        successor thereto);
            (B) the insurance commission (or any agency or office 
        performing like functions) of any State that the Office 
        determines has--
                (i) adopted rules on the appropriate use of 
            designations in the sale of insurance products that, to the 
            extent practicable, conform to the minimum requirements of 
            the National Association of Insurance Commissioners Model 
            Regulation on the Use of Senior-Specific Certifications and 
            Professional Designations in the Sale of Life Insurance and 
            Annuities (or any successor thereto); and
                (ii) adopted rules with respect to fiduciary or 
            suitability requirements in the sale of annuities that meet 
            or exceed the minimum requirements established by the 
            Suitability in Annuity Transactions Model Regulation of the 
            National Association of Insurance Commissioners (or any 
            successor thereto); or
            (C) a consumer protection agency of any State, if--
                (i) the securities commission (or any agency or office 
            performing like functions) of the State is eligible under 
            subparagraph (A); or
                (ii) the insurance commission (or any agency or office 
            performing like functions) of the State is eligible under 
            subparagraph (B);
        (2) the term ``financial product'' means a security, an 
    insurance product (including an insurance product that pays a 
    return, whether fixed or variable), a bank product, and a loan 
    product;
        (3) the term ``misleading designation''--
            (A) means a certification, professional designation, or 
        other purported credential that indicates or implies that a 
        salesperson or adviser has special certification or training in 
        advising or servicing seniors; and
            (B) does not include a certification, professional 
        designation, license, or other credential that--
                (i) was issued by or obtained from an academic 
            institution having regional accreditation;
                (ii) meets the standards for certifications and 
            professional designations outlined by the NASAA Model Rule 
            on the Use of Senior-Specific Certifications and 
            Professional Designations (or any successor thereto) or by 
            the Model Regulations on the Use of Senior-Specific 
            Certifications and Professional Designations in the Sale of 
            Life Insurance and Annuities, adopted by the National 
            Association of Insurance Commissioners (or any successor 
            thereto); or
                (iii) was issued by or obtained from a State;
        (4) the term ``misleading or fraudulent marketing'' means the 
    use of a misleading designation by a person that sells to or 
    advises a senior in connection with the sale of a financial 
    product;
        (5) the term ``NASAA'' means the North American Securities 
    Administrators Association;
        (6) the term ``Office'' means the Office of Financial Literacy 
    of the Bureau;
        (7) the term ``senior'' means any individual who has attained 
    the age of 62 years or older; and
        (8) the term ``State'' has the same meaning as in section 3 of 
    the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).
    (b) Grants to States for Enhanced Protection of Seniors From Being 
Misled by False Designations.--The Office shall establish a program 
under which the Office may make grants to States or eligible entities--
        (1) to hire staff to identify, investigate, and prosecute 
    (through civil, administrative, or criminal enforcement actions) 
    cases involving misleading or fraudulent marketing;
        (2) to fund technology, equipment, and training for regulators, 
    prosecutors, and law enforcement officers, in order to identify 
    salespersons and advisers who target seniors through the use of 
    misleading designations;
        (3) to fund technology, equipment, and training for prosecutors 
    to increase the successful prosecution of salespersons and advisers 
    who target seniors with the use of misleading designations;
        (4) to provide educational materials and training to regulators 
    on the appropriateness of the use of designations by salespersons 
    and advisers in connection with the sale and marketing of financial 
    products;
        (5) to provide educational materials and training to seniors to 
    increase awareness and understanding of misleading or fraudulent 
    marketing;
        (6) to develop comprehensive plans to combat misleading or 
    fraudulent marketing of financial products to seniors; and
        (7) to enhance provisions of State law to provide protection 
    for seniors against misleading or fraudulent marketing.
    (c) Applications.--A State or eligible entity desiring a grant 
under this section shall submit an application to the Office, in such 
form and in such a manner as the Office may determine, that includes--
        (1) a proposal for activities to protect seniors from 
    misleading or fraudulent marketing that are proposed to be funded 
    using a grant under this section, including--
            (A) an identification of the scope of the problem of 
        misleading or fraudulent marketing in the State;
            (B) a description of how the proposed activities would--
                (i) protect seniors from misleading or fraudulent 
            marketing in the sale of financial products, including by 
            proactively identifying victims of misleading and 
            fraudulent marketing who are seniors;
                (ii) assist in the investigation and prosecution of 
            those using misleading or fraudulent marketing; and
                (iii) discourage and reduce cases of misleading or 
            fraudulent marketing; and
            (C) a description of how the proposed activities would be 
        coordinated with other State efforts; and
        (2) any other information, as the Office determines is 
    appropriate.
    (d) Performance Objectives and Reporting Requirements.--The Office 
may establish such performance objectives and reporting requirements 
for States and eligible entities receiving a grant under this section 
as the Office determines are necessary to carry out and assess the 
effectiveness of the program under this section.
    (e) Maximum Amount.--The amount of a grant under this section may 
not exceed--
        (1) $500,000 for each of 3 consecutive fiscal years, if the 
    recipient is a State, or an eligible entity of a State, that has 
    adopted rules--
            (A) on the appropriate use of designations in the offer or 
        sale of securities or investment advice that meet or exceed the 
        minimum requirements of the NASAA Model Rule on the Use of 
        Senior-Specific Certifications and Professional Designations 
        (or any successor thereto);
            (B) on the appropriate use of designations in the sale of 
        insurance products that, to the extent practicable, conform to 
        the minimum requirements of the National Association of 
        Insurance Commissioners Model Regulation on the Use of Senior-
        Specific Certifications and Professional Designations in the 
        Sale of Life Insurance and Annuities (or any successor 
        thereto); and
            (C) with respect to fiduciary or suitability requirements 
        in the sale of annuities that meet or exceed the minimum 
        requirements established by the Suitability in Annuity 
        Transactions Model Regulation of the National Association of 
        Insurance Commissioners (or any successor thereto); and
        (2) $100,000 for each of 3 consecutive fiscal years, if the 
    recipient is a State, or an eligible entity of a State, that has 
    adopted--
            (A) rules on the appropriate use of designations in the 
        offer or sale of securities or investment advice that meet or 
        exceed the minimum requirements of the NASAA Model Rule on the 
        Use of Senior-Specific Certifications and Professional 
        Designations (or any successor thereto); or
            (B) rules--
                (i) on the appropriate use of designations in the sale 
            of insurance products that, to the extent practicable, 
            conform to the minimum requirements of the National 
            Association of Insurance Commissioners Model Regulation on 
            the Use of Senior-Specific Certifications and Professional 
            Designations in the Sale of Life Insurance and Annuities 
            (or any successor thereto); and
                (ii) with respect to fiduciary or suitability 
            requirements in the sale of annuities that meet or exceed 
            the minimum requirements established by the Suitability in 
            Annuity Transactions Model Regulation of the National 
            Association of Insurance Commissioners (or any successor 
            thereto).
    (f) Subgrants.--A State or eligible entity that receives a grant 
under this section may make a subgrant, as the State or eligible entity 
determines is necessary to carry out the activities funded using a 
grant under this section.
    (g) Reapplication.--A State or eligible entity that receives a 
grant under this section may reapply for a grant under this section, 
notwithstanding the limitations on grant amounts under subsection (e).
    (h) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, $8,000,000 for each of fiscal 
years 2011 through 2015.
SEC. 989B. DESIGNATED FEDERAL ENTITY INSPECTORS GENERAL INDEPENDENCE.
    Section 8G of the Inspector General Act of 1978 (5 U.S.C. App.) is 
amended--
        (1) in subsection (a)(4)--
            (A) in the matter preceding subparagraph (A), by inserting 
        ``the board or commission of the designated Federal entity, or 
        in the event the designated Federal entity does not have a 
        board or commission,'' after ``means'';
            (B) in subparagraph (A), by striking ``and'' after the 
        semicolon; and
            (C) by adding after subparagraph (B) the following:
            ``(C) with respect to the Federal Labor Relations 
        Authority, such term means the members of the Authority 
        (described under section 7104 of title 5, United States Code);
            ``(D) with respect to the National Archives and Records 
        Administration, such term means the Archivist of the United 
        States;
            ``(E) with respect to the National Credit Union 
        Administration, such term means the National Credit Union 
        Administration Board (described under section 102 of the 
        Federal Credit Union Act (12 U.S.C. 1752a);
            ``(F) with respect to the National Endowment of the Arts, 
        such term means the National Council on the Arts;
            ``(G) with respect to the National Endowment for the 
        Humanities, such term means the National Council on the 
        Humanities; and
            ``(H) with respect to the Peace Corps, such term means the 
        Director of the Peace Corps;''; and
        (2) in subsection (h), by inserting ``if the designated Federal 
    entity is not a board or commission, include'' after ``designated 
    Federal entities and''.
SEC. 989C. STRENGTHENING INSPECTOR GENERAL ACCOUNTABILITY.
    Section 5(a) of the Inspector General Act of 1978 (5 U.S.C. App.) 
is amended--
        (1) in paragraph (12), by striking ``and'' after the semicolon;
        (2) in paragraph (13), by striking the period and inserting a 
    semicolon; and
        (3) by adding at the end the following:
        ``(14)(A) an appendix containing the results of any peer review 
    conducted by another Office of Inspector General during the 
    reporting period; or
        ``(B) if no peer review was conducted within that reporting 
    period, a statement identifying the date of the last peer review 
    conducted by another Office of Inspector General;
        ``(15) a list of any outstanding recommendations from any peer 
    review conducted by another Office of Inspector General that have 
    not been fully implemented, including a statement describing the 
    status of the implementation and why implementation is not 
    complete; and
        ``(16) a list of any peer reviews conducted by the Inspector 
    General of another Office of the Inspector General during the 
    reporting period, including a list of any outstanding 
    recommendations made from any previous peer review (including any 
    peer review conducted before the reporting period) that remain 
    outstanding or have not been fully implemented.''.
SEC. 989D. REMOVAL OF INSPECTORS GENERAL OF DESIGNATED FEDERAL 
ENTITIES.
    Section 8G(e) of the Inspector General Act of 1978 (5 U.S.C. App.) 
is amended--
        (1) by redesignating the sentences following ``(e)'' as 
    paragraph (2); and
        (2) by striking ``(e)'' and inserting the following:
    ``(e)(1) In the case of a designated Federal entity for which a 
board or commission is the head of the designated Federal entity, a 
removal under this subsection may only be made upon the written 
concurrence of a \2/3\ majority of the board or commission.''.
SEC. 989E. ADDITIONAL OVERSIGHT OF FINANCIAL REGULATORY SYSTEM.
    (a) Council of Inspectors General on Financial Oversight.--
        (1) Establishment and membership.--There is established a 
    Council of Inspectors General on Financial Oversight (in this 
    section referred to as the ``Council of Inspectors General'') 
    chaired by the Inspector General of the Department of the Treasury 
    and composed of the inspectors general of the following:
            (A) The Board of Governors of the Federal Reserve System.
            (B) The Commodity Futures Trading Commission.
            (C) The Department of Housing and Urban Development.
            (D) The Department of the Treasury.
            (E) The Federal Deposit Insurance Corporation.
            (F) The Federal Housing Finance Agency.
            (G) The National Credit Union Administration.
            (H) The Securities and Exchange Commission.
            (I) The Troubled Asset Relief Program (until the 
        termination of the authority of the Special Inspector General 
        for such program under section 121(k) of the Emergency Economic 
        Stabilization Act of 2008 (12 U.S.C. 5231(k))).
        (2) Duties.--
            (A) Meetings.--The Council of Inspectors General shall meet 
        not less than once each quarter, or more frequently if the 
        chair considers it appropriate, to facilitate the sharing of 
        information among inspectors general and to discuss the ongoing 
        work of each inspector general who is a member of the Council 
        of Inspectors General, with a focus on concerns that may apply 
        to the broader financial sector and ways to improve financial 
        oversight.
            (B) Annual report.--Each year the Council of Inspectors 
        General shall submit to the Council and to Congress a report 
        including--
                (i) for each inspector general who is a member of the 
            Council of Inspectors General, a section within the 
            exclusive editorial control of such inspector general that 
            highlights the concerns and recommendations of such 
            inspector general in such inspector general's ongoing and 
            completed work, with a focus on issues that may apply to 
            the broader financial sector; and
                (ii) a summary of the general observations of the 
            Council of Inspectors General based on the views expressed 
            by each inspector general as required by clause (i), with a 
            focus on measures that should be taken to improve financial 
            oversight.
        (3) Working groups to evaluate council.--
            (A) Convening a working group.--The Council of Inspectors 
        General may, by majority vote, convene a Council of Inspectors 
        General Working Group to evaluate the effectiveness and 
        internal operations of the Council.
            (B) Personnel and resources.--The inspectors general who 
        are members of the Council of Inspectors General may detail 
        staff and resources to a Council of Inspectors General Working 
        Group established under this paragraph to enable it to carry 
        out its duties.
            (C) Reports.--A Council of Inspectors General Working Group 
        established under this paragraph shall submit regular reports 
        to the Council and to Congress on its evaluations pursuant to 
        this paragraph.
    (b) Response to Report by Council.--The Council shall respond to 
the concerns raised in the report of the Council of Inspectors General 
under subsection (a)(2)(B) for such year.
SEC. 989F. GAO STUDY OF PERSON TO PERSON LENDING.
    (a) Study.--
        (1) In general.--The Comptroller General of the United States 
    shall conduct a study of person to person lending to determine the 
    optimal Federal regulatory structure.
        (2) Consultation.--In conducting the study required under 
    paragraph (1), the Comptroller General shall consult with Federal 
    banking agencies, the Commission, consumer groups, outside experts, 
    and the person to person lending industry.
        (3) Content of study.--The study required under paragraph (1) 
    shall include an examination of--
            (A) the regulatory structure as it exists on the date of 
        enactment of this Act, as determined by the Commission, with 
        particular attention to--
                (i) the application of the Securities Act of 1933 to 
            person to person lending platforms;
                (ii) the posting of consumer loan information on the 
            EDGAR database of the Commission; and
                (iii) the treatment of privately held person to person 
            lending platforms as public companies;
            (B) the State and other Federal regulators responsible for 
        the oversight and regulation of person to person lending 
        markets;
            (C) any Federal, State, or local government or private 
        studies of person to person lending completed or in progress on 
        the date of enactment of this Act;
            (D) consumer privacy and data protections, minimum credit 
        standards, anti-money laundering and risk management in the 
        regulatory structure as it exists on the date of enactment of 
        this Act, and whether additional or alternative safeguards are 
        needed; and
            (E) the uses of person to person lending.
    (b) Report.--
        (1) In general.--Not later than 1 year after the date of 
    enactment of this Act, the Comptroller General shall submit a 
    report on the study required under 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.
        (2) Content of report.--The report required under paragraph (1) 
    shall include alternative regulatory options, including--
            (A) the involvement of other Federal agencies; and
            (B) alternative approaches by the Commission and 
        recommendations on whether the alternative approaches are 
        effective.
SEC. 989G. EXEMPTION FOR NONACCELERATED FILERS.
    (a) Exemption.--Section 404 of the Sarbanes-Oxley Act of 2002 is 
amended by adding at the end the following:
    ``(c) Exemption for Smaller Issuers.--Subsection (b) shall not 
apply with respect to any audit report prepared for an issuer that is 
neither a `large accelerated filer' nor an `accelerated filer' as those 
terms are defined in Rule 12b-2 of the Commission (17 C.F.R. 240.12b-
2).''.
    (b) Study.--The Securities and Exchange Commission shall conduct a 
study to determine how the Commission could reduce the burden of 
complying with section 404(b) of the Sarbanes-Oxley Act of 2002 for 
companies whose market capitalization is between $75,000,000 and 
$250,000,000 for the relevant reporting period while maintaining 
investor protections for such companies. The study shall also consider 
whether any such methods of reducing the compliance burden or a 
complete exemption for such companies from compliance with such section 
would encourage companies to list on exchanges in the United States in 
their initial public offerings. Not later than 9 months after the date 
of the enactment of this subtitle, the Commission shall transmit a 
report of such study to Congress.
SEC. 989H. CORRECTIVE RESPONSES BY HEADS OF CERTAIN ESTABLISHMENTS TO 
DEFICIENCIES IDENTIFIED BY INSPECTORS GENERAL.
    The Chairman of the Board of Governors of the Federal Reserve 
System, the Chairman of the Commodity Futures Trading Commission, the 
Chairman of the National Credit Union Administration, the Director of 
the Pension Benefit Guaranty Corporation, and the Chairman of the 
Securities and Exchange Commission shall each--
        (1) take action to address deficiencies identified by a report 
    or investigation of the Inspector General of the establishment 
    concerned; or
        (2) certify to both Houses of Congress that no action is 
    necessary or appropriate in connection with a deficiency described 
    in paragraph (1).
SEC. 989I. GAO STUDY REGARDING EXEMPTION FOR SMALLER ISSUERS.
    (a) Study Regarding Exemption for Smaller Issuers.--The Comptroller 
General of the United States shall carry out a study on the impact of 
the amendments made by this Act to section 404(b) of the Sarbanes-Oxley 
Act of 2002 (15 U.S.C. 7262(b)), which shall include an analysis of--
        (1) whether issuers that are exempt from such section 404(b) 
    have fewer or more restatements of published accounting statements 
    than issuers that are required to comply with such section 404(b);
        (2) the cost of capital for issuers that are exempt from such 
    section 404(b) compared to the cost of capital for issuers that are 
    required to comply with such section 404(b);
        (3) whether there is any difference in the confidence of 
    investors in the integrity of financial statements of issuers that 
    comply with such section 404(b) and issuers that are exempt from 
    compliance with such section 404(b);
        (4) whether issuers that do not receive the attestation for 
    internal controls required under such section 404(b) should be 
    required to disclose the lack of such attestation to investors; and
        (5) the costs and benefits to issuers that are exempt from such 
    section 404(b) that voluntarily have obtained the attestation of an 
    independent auditor.
    (b) Report.--Not later than 3 years after the date of enactment of 
this Act, the Comptroller General shall submit to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives a report on the 
results of the study required under subsection (a).
SEC. 989J. FURTHER PROMOTING THE ADOPTION OF THE NAIC MODEL REGULATIONS 
THAT ENHANCE PROTECTION OF SENIORS AND OTHER CONSUMERS.
    (a) In General.--The Commission shall treat as exempt securities 
described under section 3(a)(8) of the Securities Act of 1933 (15 
U.S.C. 77c(a)(8)) any insurance or endowment policy or annuity contract 
or optional annuity contract--
        (1) the value of which does not vary according to the 
    performance of a separate account;
        (2) that--
            (A) satisfies standard nonforfeiture laws or similar 
        requirements of the applicable State at the time of issue; or
            (B) in the absence of applicable standard nonforfeiture 
        laws or requirements, satisfies the Model Standard 
        Nonforfeiture Law for Life Insurance or Model Standard 
        Nonforfeiture Law for Individual Deferred Annuities, or any 
        successor model law, as published by the National Association 
        of Insurance Commissioners; and
        (3) that is issued--
            (A) on and after June 16, 2013, in a State, or issued by an 
        insurance company that is domiciled in a State, that--
                (i) adopts rules that govern suitability requirements 
            in the sale of an insurance or endowment policy or annuity 
            contract or optional annuity contract, which shall 
            substantially meet or exceed the minimum requirements 
            established by the Suitability in Annuity Transactions 
            Model Regulation adopted by the National Association of 
            Insurance Commissioners in March 2010; and
                (ii) adopts rules that substantially meet or exceed the 
            minimum requirements of any successor modifications to the 
            model regulations described in subparagraph (A) within 5 
            years of the adoption by the Association of any further 
            successors thereto; or
            (B) by an insurance company that adopts and implements 
        practices on a nationwide basis for the sale of any insurance 
        or endowment policy or annuity contract or optional annuity 
        contract that meet or exceed the minimum requirements 
        established by the National Association of Insurance 
        Commissioners Suitability in Annuity Transactions Model 
        Regulation (Model 275), and any successor thereto, and is 
        therefore subject to examination by the State of domicile of 
        the insurance company, or by any other State where the 
        insurance company conducts sales of such products, for the 
        purpose of monitoring compliance under this section.
    (b) Rule of Construction.--Nothing in this section shall be 
construed to affect whether any insurance or endowment policy or 
annuity contract or optional annuity contract that is not described in 
this section is or is not an exempt security under section 3(a)(8) of 
the Securities Act of 1933 (15 U.S.C. 77c(a)(8)).

      Subtitle J--Securities and Exchange Commission Match Funding

    SEC. 991. SECURITIES AND EXCHANGE COMMISSION MATCH FUNDING.
    (a) Match Funding Authority.--
        (1) Amendments.--Section 31 of the Securities Exchange Act of 
    1934 (15 U.S.C. 78ee) is amended--
            (A) by striking subsection (a) and inserting the following:
    ``(a) Recovery of Costs of Annual Appropriation.--The Commission 
shall, in accordance with this section, collect transaction fees and 
assessments that are designed to recover the costs to the Government of 
the annual appropriation to the Commission by Congress.'';
            (B) in subsection (e)(2), by striking ``September 30'' and 
        inserting ``September 25'';
            (C) in subsection (g), by striking ``April 30 of the fiscal 
        year preceding the fiscal year to which such rate applies'' and 
        inserting ``30 days after the date on which an Act making a 
        regular appropriation to the Commission for such fiscal year is 
        enacted'';
            (D) by striking subsection (j) and inserting the following:
    ``(j) Adjustments to Fee Rates.--
        ``(1) Annual adjustment.--Subject to subsections (i)(1)(B) and 
    (k), for each fiscal year, the Commission shall by order adjust 
    each of the rates applicable under subsections (b) and (c) for such 
    fiscal year to a uniform adjusted rate that, when applied to the 
    baseline estimate of the aggregate dollar amount of sales for such 
    fiscal year, is reasonably likely to produce aggregate fee 
    collections under this section (including assessments collected 
    under subsection (d) of this section) that are equal to the regular 
    appropriation to the Commission by Congress for such fiscal year.
        ``(2) Mid-year adjustment.--Subject to subsections (i)(1)(B) 
    and (k), for each fiscal year, the Commission shall determine, by 
    March 1 of such fiscal year, whether, based on the actual aggregate 
    dollar volume of sales during the first 5 months of such fiscal 
    year, the baseline estimate of the aggregate dollar volume of sales 
    used under paragraph (1) for such fiscal year is reasonably likely 
    to be 10 percent (or more) greater or less than the actual 
    aggregate dollar volume of sales for such fiscal year. If the 
    Commission so determines, the Commission shall by order, no later 
    than March 1, adjust each of the rates applicable under subsections 
    (b) and (c) for such fiscal year to a uniform adjusted rate that, 
    when applied to the revised estimate of the aggregate dollar amount 
    of sales for the remainder of such fiscal year, is reasonably 
    likely to produce aggregate fee collections under this section 
    (including fees collected during such five-month period and 
    assessments collected under subsection (d) of this section) that 
    are equal to the regular appropriation to the Commission by 
    Congress for such fiscal year. In making such revised estimate, the 
    Commission shall, after consultation with the Congressional Budget 
    Office and the Office of Management and Budget, use the same 
    methodology required by subsection (l).
        ``(3) Review.--In exercising its authority under this 
    subsection, the Commission shall not be required to comply with the 
    provisions of section 553 of title 5, United States Code. An 
    adjusted rate prescribed under paragraph (1) or (2) and published 
    under subsection (g) shall not be subject to judicial review.
        ``(4) Effective date.--
            ``(A) Annual adjustment.--Subject to subsections (i)(1)(B) 
        and (k), an adjusted rate prescribed under paragraph (1) shall 
        take effect on the later of--
                ``(i) the first day of the fiscal year to which such 
            rate applies; or
                ``(ii) 60 days after the date on which an Act making a 
            regular appropriation to the Commission for such fiscal 
            year is enacted.
            ``(B) Mid-year adjustment.--An adjusted rate prescribed 
        under paragraph (2) shall take effect on April 1 of the fiscal 
        year to which such rate applies.'';
            (E) in subsection (k), by striking ``30 days'' and 
        inserting ``60 days''; and
            (F) in subsection (l), by striking ``Definitions.--'' and 
        all that follows through ``sales.--The baseline'' and inserting 
        ``Baseline Estimate of the Aggregate Dollar Amount of Sales.--
        The baseline''.
        (2) Effective date.--The amendments made by this subsection 
    shall take effect on the later of--
            (A) October 1, 2011; or
            (B) the date of enactment of an Act making a regular 
        appropriation to the Commission for fiscal year 2012.
    (b) Amendments to Registration Fee Provisions.--
        (1) 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--
            (A) by striking ``offsetting'' each place that term appears 
        and inserting ``fee'';
            (B) by striking paragraphs (1), (3), (4), (6), (8), and 
        (9);
            (C) by redesignating paragraph (2) as paragraph (1);
            (D) by redesignating paragraph (5) as paragraph (2);
            (E) by redesignating paragraph (7) as paragraph (3);
            (F) by redesignating paragraph (10) as paragraph (5);
            (G) by redesignating paragraph (11) as paragraph (6);
            (H) in paragraph (1), as so redesignated, by striking 
        ``paragraph (5) or (6).'' and inserting ``paragraph (2).'';
            (I) in paragraph (2), as so redesignated--
                (i) by striking ``of the fiscal years 2003 through 
            2011'' and inserting ``fiscal year''; and
                (ii) by striking ``paragraph (2)'' and inserting 
            ``paragraph (1)'';
            (J) by inserting after paragraph (3), as so redesignated, 
        the following:
        ``(4) Review and effective date.--In exercising its authority 
    under this subsection, the Commission shall not be required to 
    comply with the provisions of section 553 of title 5, United States 
    Code. An adjusted rate prescribed under paragraph (2) and published 
    under paragraph (5) shall not be subject to judicial review. An 
    adjusted rate prescribed under paragraph (2) shall take effect on 
    the first day of the fiscal year to which such rate applies.'';
            (K) in paragraph (5), as redesignated, by striking ``April 
        30'' and inserting ``August 31'';
            (L) in paragraph (6), as so redesignated--
                (i) by striking ``of the fiscal years 2002 through 
            2011'' and inserting ``fiscal year''; and
                (ii) by inserting at the end of the table in 
            subparagraph (A) the following:

  ``2012
  $425,000,000
  2013
  $455,000,000
  2014
  $485,000,000
  2015
  $515,000,000
  2016
  $550,000,000
  2017
  $585,000,000
  2018
  $620,000,000
  2019
  $660,000,000
  2020
  $705,000,000
  2021 and each fiscal year thereafter
  An amount that is equal to the target fee collection amount for the 
    prior fiscal year, adjusted by the rate of inflation.''.

        (2) 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--
            (A) in paragraph (3), by striking ``paragraphs (5) and 
        (6)'' and inserting ``paragraph (4)'';
            (B) by striking paragraphs (4), (5), and (6);
            (C) by inserting after paragraph (3) the following:
        ``(4) Annual adjustment.--For each fiscal year, the Commission 
    shall by order adjust the rate required by paragraph (3) for such 
    fiscal year to a rate that is equal to the rate (expressed in 
    dollars per million) that is applicable under section 6(b) of the 
    Securities Act of 1933 for such fiscal year.
        ``(5) Fee collections.--Fees collected pursuant to this 
    subsection for fiscal year 2012 and each fiscal year thereafter 
    shall be deposited and credited as general revenue of the Treasury 
    and shall not be available for obligation.
        ``(6) Effective date; publication.--In exercising its authority 
    under this subsection, the Commission shall not be required to 
    comply with the provisions of section 553 of title 5, United States 
    Code. An adjusted rate prescribed under paragraph (4) shall be 
    published and take effect in accordance with section 6(b) of the 
    Securities Act of 1933 (15 U.S.C. 77f(b)).''; and
            (D) by striking paragraphs (8), (9), and (10).
        (3) 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--
            (A) in paragraph (1), by striking ``paragraphs (5) and 
        (6)'' each time that term appears and inserting ``paragraph 
        (4)'';
            (B) in paragraph (3), by striking ``paragraphs (5) and 
        (6)'' and inserting ``paragraph (4)'';
            (C) by striking paragraphs (4), (5), and (6);
            (D) by inserting after paragraph (3) the following:
        ``(4) Annual adjustment.--For each fiscal year, the Commission 
    shall by order adjust the rate required by paragraphs (1) and (3) 
    for such fiscal year to a rate that is equal to the rate (expressed 
    in dollars per million) that is applicable under section 6(b) of 
    the Securities Act of 1933 (15 U.S.C. 77f(b)) for such fiscal year.
        ``(5) Fee collection.--Fees collected pursuant to this 
    subsection for fiscal year 2012 and each fiscal year thereafter 
    shall be deposited and credited as general revenue of the Treasury 
    and shall not be available for obligation.
        ``(6) Review; effective date; publication.--In exercising its 
    authority under this subsection, the Commission shall not be 
    required to comply with the provisions of section 553 of title 5, 
    United States Code. An adjusted rate prescribed under paragraph (4) 
    shall be published and take effect in accordance with section 6(b) 
    of the Securities Act of 1933 (15 U.S.C. 77f(b)).'';
            (E) by striking paragraphs (8), (9), and (10); and
            (F) by redesignating paragraph (11) as paragraph (8).
        (4) Effective date.--The amendments made by this subsection 
    shall take effect on October 1, 2011, except that for fiscal year 
    2012, the Commission shall publish the rate established under 
    section 6(b) of the Securities Act of 1933 (15 U.S.C. 77f(b)), as 
    amended by this Act, on August 31, 2011.
    (c) Authorization of Appropriations.--Section 35 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78kk) is amended to read as follows:
  ``SEC. 35. AUTHORIZATION OF APPROPRIATIONS.
    ``In addition to any other funds authorized to be appropriated to 
the Commission, there are authorized to be appropriated to carry out 
the functions, powers, and duties of the Commission--
        ``(1) for fiscal year 2011, $1,300,000,000;
        ``(2) for fiscal year 2012, $1,500,000,000;
        ``(3) for fiscal year 2013, $1,750,000,000;
        ``(4) for fiscal year 2014, $2,000,000,000; and
        ``(5) for fiscal year 2015, $2,250,000,000.''.
    (d) Transmittal of Budget Requests.--
        (1) Amendment.--Section 31 of the Securities Exchange Act of 
    1934 (15 U.S.C. 78ee) is amended by adding at the end the 
    following:
    ``(m) Transmittal of Commission Budget Requests.--
        ``(1) Budget required.--For fiscal year 2012, and each fiscal 
    year thereafter, the Commission shall prepare and submit a budget 
    to the President. Whenever the Commission submits a budget estimate 
    or request to the President or the Office of Management and Budget, 
    the Commission shall concurrently transmit copies of the estimate 
    or request to the Committee on Appropriations of the Senate, the 
    Committee on Appropriations of the House of Representatives, the 
    Committee on Banking, Housing, and Urban Affairs of the Senate, and 
    the Committee on Financial Services of the House of 
    Representatives.
        ``(2) Submission to congress.--The President shall submit each 
    budget submitted under paragraph (1) to Congress, in unaltered 
    form, together with the annual budget for the Administration 
    submitted by the President.
        ``(3) Contents.--The Commission shall include in each budget 
    submitted under paragraph (1)--
            ``(A) an itemization of the amount of funds necessary to 
        carry out the functions of the Commission.
            ``(B) an amount to be designated as contingency funding to 
        be used by the Commission to address unanticipated needs; and
            ``(C) a designation of any activities of the Commission for 
        which multi-year budget authority would be suitable.''.
        (2) Budget of the president.--For fiscal year 2012, and each 
    fiscal year thereafter, the annual budget for the Administration 
    submitted by the President to Congress shall reflect the amendments 
    made by this section.
    (e) Securities and Exchange Commission Reserve Fund.--
        (1) Amendment.--Section 4 of the Securities Exchange Act of 
    1934 (15 U.S.C. 78d), as amended by this Act, is amended by adding 
    at the end the following:
    ``(i) Securities and Exchange Commission Reserve Fund.--
        ``(1) Reserve fund established.--There is established in the 
    Treasury of the United States a separate fund, to be known as the 
    `Securities and Exchange Commission Reserve Fund' (referred to in 
    this subsection as the `Reserve Fund').
        ``(2) Reserve fund amounts.--
            ``(A) In general.--Except as provided in subparagraph (B), 
        any registration fees collected by the Commission under section 
        6(b) of the Securities Act of 1933 (15 U.S.C. 77f(b)) or 
        section 24(f) of the Investment Company Act of 1940 (15 U.S.C. 
        80a-24(f)) shall be deposited into the Reserve Fund.
            ``(B) Limitations.--For any 1 fiscal year--
                ``(i) the amount deposited in the Fund may not exceed 
            $50,000,000; and
                ``(ii) the balance in the Fund may not exceed 
            $100,000,000.
            ``(C) Excess fees.--Any amounts in excess of the 
        limitations described in subparagraph (B) that the Commission 
        collects from registration fees under section 6(b) of the 
        Securities Act of 1933 (15 U.S.C. 77f(b)) or section 24(f) of 
        the Investment Company Act of 1940 (15 U.S.C. 80a-24(f)) shall 
        be deposited in the General Fund of the Treasury of the United 
        States and shall not be available for obligation by the 
        Commission.
        ``(3) Use of amounts in reserve fund.--The Commission may 
    obligate amounts in the Reserve Fund, not to exceed a total of 
    $100,000,000 in any 1 fiscal year, as the Commission determines is 
    necessary to carry out the functions of the Commission. Any amounts 
    in the reserve fund shall remain available until expended. Not 
    later than 10 days after the date on which the Commission obligates 
    amounts under this paragraph, the Commission shall notify Congress 
    of the date, amount, and purpose of the obligation.
        ``(4) Rule of construction.--Amounts collected and deposited in 
    the Reserve Fund shall not be construed to be Government funds or 
    appropriated monies and shall not be subject to apportionment for 
    the purpose of chapter 15 of title 31, United States Code, or under 
    any other authority.''.
        (2) Effective date.--The amendment made by this subsection 
    shall take effect on October 1, 2011.

            TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

SEC. 1001. SHORT TITLE.
    This title may be cited as the ``Consumer Financial Protection Act 
of 2010''.
SEC. 1002. DEFINITIONS.
    Except as otherwise provided in this title, for purposes of this 
title, the following definitions shall apply:
        (1) Affiliate.--The term ``affiliate'' means any person that 
    controls, is controlled by, or is under common control with another 
    person.
        (2) Bureau.--The term ``Bureau'' means the Bureau of Consumer 
    Financial Protection.
        (3) Business of insurance.--The term ``business of insurance'' 
    means the writing of insurance or the reinsuring of risks by an 
    insurer, including all acts necessary to such writing or reinsuring 
    and the activities relating to the writing of insurance or the 
    reinsuring of risks conducted by persons who act as, or are, 
    officers, directors, agents, or employees of insurers or who are 
    other persons authorized to act on behalf of such persons.
        (4) Consumer.--The term ``consumer'' means an individual or an 
    agent, trustee, or representative acting on behalf of an 
    individual.
        (5) Consumer financial product or service.--The term ``consumer 
    financial product or service'' means any financial product or 
    service that is described in one or more categories under--
            (A) paragraph (15) and is offered or provided for use by 
        consumers primarily for personal, family, or household 
        purposes; or
            (B) clause (i), (iii), (ix), or (x) of paragraph (15)(A), 
        and is delivered, offered, or provided in connection with a 
        consumer financial product or service referred to in 
        subparagraph (A).
        (6) Covered person.--The term ``covered person'' means--
            (A) any person that engages in offering or providing a 
        consumer financial product or service; and
            (B) any affiliate of a person described in subparagraph (A) 
        if such affiliate acts as a service provider to such person.
        (7) Credit.--The term ``credit'' means the right granted by a 
    person to a consumer to defer payment of a debt, incur debt and 
    defer its payment, or purchase property or services and defer 
    payment for such purchase.
        (8) Deposit-taking activity.--The term ``deposit-taking 
    activity'' means--
            (A) the acceptance of deposits, maintenance of deposit 
        accounts, or the provision of services related to the 
        acceptance of deposits or the maintenance of deposit accounts;
            (B) the acceptance of funds, the provision of other 
        services related to the acceptance of funds, or the maintenance 
        of member share accounts by a credit union; or
            (C) the receipt of funds or the equivalent thereof, as the 
        Bureau may determine by rule or order, received or held by a 
        covered person (or an agent for a covered person) for the 
        purpose of facilitating a payment or transferring funds or 
        value of funds between a consumer and a third party.
        (9) Designated transfer date.--The term ``designated transfer 
    date'' means the date established under section 1062.
        (10) Director.--The term ``Director'' means the Director of the 
    Bureau.
        (11) Electronic conduit services.--The term ``electronic 
    conduit services''--
            (A) means the provision, by a person, of electronic data 
        transmission, routing, intermediate or transient storage, or 
        connections to a telecommunications system or network; and
            (B) does not include a person that provides electronic 
        conduit services if, when providing such services, the person--
                (i) selects or modifies the content of the electronic 
            data;
                (ii) transmits, routes, stores, or provides connections 
            for electronic data, including financial data, in a manner 
            that such financial data is differentiated from other types 
            of data of the same form that such person transmits, 
            routes, or stores, or with respect to which, provides 
            connections; or
                (iii) is a payee, payor, correspondent, or similar 
            party to a payment transaction with a consumer.
        (12) Enumerated consumer laws.--Except as otherwise 
    specifically provided in section 1029, subtitle G or subtitle H, 
    the term ``enumerated consumer laws'' means--
            (A) the Alternative Mortgage Transaction Parity Act of 1982 
        (12 U.S.C. 3801 et seq.);
            (B) the Consumer Leasing Act of 1976 (15 U.S.C. 1667 et 
        seq.);
            (C) the Electronic Fund Transfer Act (15 U.S.C. 1693 et 
        seq.), except with respect to section 920 of that Act;
            (D) the Equal Credit Opportunity Act (15 U.S.C. 1691 et 
        seq.);
            (E) the Fair Credit Billing Act (15 U.S.C. 1666 et seq.);
            (F) the Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), 
        except with respect to sections 615(e) and 628 of that Act (15 
        U.S.C. 1681m(e), 1681w);
            (G) the Home Owners Protection Act of 1998 (12 U.S.C. 4901 
        et seq.);
            (H) the Fair Debt Collection Practices Act (15 U.S.C. 1692 
        et seq.);
            (I) subsections (b) through (f) of section 43 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1831t(c)-(f));
            (J) sections 502 through 509 of the Gramm-Leach-Bliley Act 
        (15 U.S.C. 6802-6809) except for section 505 as it applies to 
        section 501(b);
            (K) the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 
        2801 et seq.);
            (L) the Home Ownership and Equity Protection Act of 1994 
        (15 U.S.C. 1601 note);
            (M) the Real Estate Settlement Procedures Act of 1974 (12 
        U.S.C. 2601 et seq.);
            (N) the S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 
        5101 et seq.);
            (O) the Truth in Lending Act (15 U.S.C. 1601 et seq.);
            (P) the Truth in Savings Act (12 U.S.C. 4301 et seq.);
            (Q) section 626 of the Omnibus Appropriations Act, 2009 
        (Public Law 111-8); and
            (R) the Interstate Land Sales Full Disclosure Act (15 
        U.S.C. 1701).
        (13) Fair lending.--The term ``fair lending'' means fair, 
    equitable, and nondiscriminatory access to credit for consumers.
        (14) Federal consumer financial law.--The term ``Federal 
    consumer financial law'' means the provisions of this title, the 
    enumerated consumer laws, the laws for which authorities are 
    transferred under subtitles F and H, and any rule or order 
    prescribed by the Bureau under this title, an enumerated consumer 
    law, or pursuant to the authorities transferred under subtitles F 
    and H. The term does not include the Federal Trade Commission Act.
        (15) Financial product or service.--
            (A) In general.--The term ``financial product or service'' 
        means--
                (i) extending credit and servicing loans, including 
            acquiring, purchasing, selling, brokering, or other 
            extensions of credit (other than solely extending 
            commercial credit to a person who originates consumer 
            credit transactions);
                (ii) extending or brokering leases of personal or real 
            property that are the functional equivalent of purchase 
            finance arrangements, if--

                    (I) the lease is on a non-operating basis;
                    (II) the initial term of the lease is at least 90 
                days; and
                    (III) in the case of a lease involving real 
                property, at the inception of the initial lease, the 
                transaction is intended to result in ownership of the 
                leased property to be transferred to the lessee, 
                subject to standards prescribed by the Bureau;

                (iii) providing real estate settlement services, except 
            such services excluded under subparagraph (C), or 
            performing appraisals of real estate or personal property;
                (iv) engaging in deposit-taking activities, 
            transmitting or exchanging funds, or otherwise acting as a 
            custodian of funds or any financial instrument for use by 
            or on behalf of a consumer;
                (v) selling, providing, or issuing stored value or 
            payment instruments, except that, in the case of a sale of, 
            or transaction to reload, stored value, only if the seller 
            exercises substantial control over the terms or conditions 
            of the stored value provided to the consumer where, for 
            purposes of this clause--

                    (I) a seller shall not be found to exercise 
                substantial control over the terms or conditions of the 
                stored value if the seller is not a party to the 
                contract with the consumer for the stored value 
                product, and another person is principally responsible 
                for establishing the terms or conditions of the stored 
                value; and
                    (II) advertising the nonfinancial goods or services 
                of the seller on the stored value card or device is not 
                in itself an exercise of substantial control over the 
                terms or conditions;

                (vi) providing check cashing, check collection, or 
            check guaranty services;
                (vii) providing payments or other financial data 
            processing products or services to a consumer by any 
            technological means, including processing or storing 
            financial or banking data for any payment instrument, or 
            through any payments systems or network used for processing 
            payments data, including payments made through an online 
            banking system or mobile telecommunications network, except 
            that a person shall not be deemed to be a covered person 
            with respect to financial data processing solely because 
            the person--

                    (I) is a merchant, retailer, or seller of any 
                nonfinancial good or service who engages in financial 
                data processing by transmitting or storing payments 
                data about a consumer exclusively for purpose of 
                initiating payments instructions by the consumer to pay 
                such person for the purchase of, or to complete a 
                commercial transaction for, such nonfinancial good or 
                service sold directly by such person to the consumer; 
                or
                    (II) provides access to a host server to a person 
                for purposes of enabling that person to establish and 
                maintain a website;

                (viii) providing financial advisory services (other 
            than services relating to securities provided by a person 
            regulated by the Commission or a person regulated by a 
            State securities Commission, but only to the extent that 
            such person acts in a regulated capacity) to consumers on 
            individual financial matters or relating to proprietary 
            financial products or services (other than by publishing 
            any bona fide newspaper, news magazine, or business or 
            financial publication of general and regular circulation, 
            including publishing market data, news, or data analytics 
            or investment information or recommendations that are not 
            tailored to the individual needs of a particular consumer), 
            including--

                    (I) providing credit counseling to any consumer; 
                and
                    (II) providing services to assist a consumer with 
                debt management or debt settlement, modifying the terms 
                of any extension of credit, or avoiding foreclosure;

                (ix) collecting, analyzing, maintaining, or providing 
            consumer report information or other account information, 
            including information relating to the credit history of 
            consumers, used or expected to be used in connection with 
            any decision regarding the offering or provision of a 
            consumer financial product or service, except to the extent 
            that--

                    (I) a person--

                        (aa) collects, analyzes, or maintains 
                    information that relates solely to the transactions 
                    between a consumer and such person;
                        (bb) provides the information described in item 
                    (aa) to an affiliate of such person; or
                        (cc) provides information that is used or 
                    expected to be used solely in any decision 
                    regarding the offering or provision of a product or 
                    service that is not a consumer financial product or 
                    service, including a decision for employment, 
                    government licensing, or a residential lease or 
                    tenancy involving a consumer; and

                    (II) the information described in subclause (I)(aa) 
                is not used by such person or affiliate in connection 
                with any decision regarding the offering or provision 
                of a consumer financial product or service to the 
                consumer, other than credit described in section 
                1027(a)(2)(A);

                (x) collecting debt related to any consumer financial 
            product or service; and
                (xi) such other financial product or service as may be 
            defined by the Bureau, by regulation, for purposes of this 
            title, if the Bureau finds that such financial product or 
            service is--

                    (I) entered into or conducted as a subterfuge or 
                with a purpose to evade any Federal consumer financial 
                law; or
                    (II) permissible for a bank or for a financial 
                holding company to offer or to provide under any 
                provision of a Federal law or regulation applicable to 
                a bank or a financial holding company, and has, or 
                likely will have, a material impact on consumers.

            (B) Rule of construction.--
                (i) In general.--For purposes of subparagraph 
            (A)(xi)(II), and subject to clause (ii) of this 
            subparagraph, the following activities provided to a 
            covered person shall not, for purposes of this title, be 
            considered incidental or complementary to a financial 
            activity permissible for a financial holding company to 
            engage in under any provision of a Federal law or 
            regulation applicable to a financial holding company:

                    (I) Providing information products or services to a 
                covered person for identity authentication.
                    (II) Providing information products or services for 
                fraud or identify theft detection, prevention, or 
                investigation.
                    (III) Providing document retrieval or delivery 
                services.
                    (IV) Providing public records information 
                retrieval.
                    (V) Providing information products or services for 
                anti-money laundering activities.

                (ii) Limitation.--Nothing in clause (i) may be 
            construed as modifying or limiting the authority of the 
            Bureau to exercise any--

                    (I) examination or enforcement powers authority 
                under this title with respect to a covered person or 
                service provider engaging in an activity described in 
                subparagraph (A)(ix); or
                    (II) powers authorized by this title to prescribe 
                rules, issue orders, or take other actions under any 
                enumerated consumer law or law for which the 
                authorities are transferred under subtitle F or H.

            (C) Exclusions.--The term ``financial product or service'' 
        does not include--
                (i) the business of insurance; or
                (ii) electronic conduit services.
        (16) Foreign exchange.--The term ``foreign exchange'' means the 
    exchange, for compensation, of currency of the United States or of 
    a foreign government for currency of another government.
        (17) Insured credit union.--The term ``insured credit union'' 
    has the same meaning as in section 101 of the Federal Credit Union 
    Act (12 U.S.C. 1752).
        (18) Payment instrument.--The term ``payment instrument'' means 
    a check, draft, warrant, money order, traveler's check, electronic 
    instrument, or other instrument, payment of funds, or monetary 
    value (other than currency).
        (19) Person.--The term ``person'' means an individual, 
    partnership, company, corporation, association (incorporated or 
    unincorporated), trust, estate, cooperative organization, or other 
    entity.
        (20) Person regulated by the commodity futures trading 
    commission.--The term ``person regulated by the Commodity Futures 
    Trading Commission'' means any person that is registered, or 
    required by statute or regulation to be registered, with the 
    Commodity Futures Trading Commission, but only to the extent that 
    the activities of such person are subject to the jurisdiction of 
    the Commodity Futures Trading Commission under the Commodity 
    Exchange Act.
        (21) Person regulated by the commission.--The term ``person 
    regulated by the Commission'' means a person who is--
            (A) a broker or dealer that is required to be registered 
        under the Securities Exchange Act of 1934;
            (B) an investment adviser that is registered under the 
        Investment Advisers Act of 1940;
            (C) an investment company that is required to be registered 
        under the Investment Company Act of 1940, and any company that 
        has elected to be regulated as a business development company 
        under that Act;
            (D) a national securities exchange that is required to be 
        registered under the Securities Exchange Act of 1934;
            (E) a transfer agent that is required to be registered 
        under the Securities Exchange Act of 1934;
            (F) a clearing corporation that is required to be 
        registered under the Securities Exchange Act of 1934;
            (G) any self-regulatory organization that is required to be 
        registered with the Commission;
            (H) any nationally recognized statistical rating 
        organization that is required to be registered with the 
        Commission;
            (I) any securities information processor that is required 
        to be registered with the Commission;
            (J) any municipal securities dealer that is required to be 
        registered with the Commission;
            (K) any other person that is required to be registered with 
        the Commission under the Securities Exchange Act of 1934; and
            (L) any employee, agent, or contractor acting on behalf of, 
        registered with, or providing services to, any person described 
        in any of subparagraphs (A) through (K), but only to the extent 
        that any person described in any of subparagraphs (A) through 
        (K), or the employee, agent, or contractor of such person, acts 
        in a regulated capacity.
        (22) Person regulated by a state insurance regulator.--The term 
    ``person regulated by a State insurance regulator'' means any 
    person that is engaged in the business of insurance and subject to 
    regulation by any State insurance regulator, but only to the extent 
    that such person acts in such capacity.
        (23) Person that performs income tax preparation activities for 
    consumers.--The term ``person that performs income tax preparation 
    activities for consumers'' means--
            (A) any tax return preparer (as defined in section 
        7701(a)(36) of the Internal Revenue Code of 1986), regardless 
        of whether compensated, but only to the extent that the person 
        acts in such capacity;
            (B) any person regulated by the Secretary under section 330 
        of title 31, United States Code, but only to the extent that 
        the person acts in such capacity; and
            (C) any authorized IRS e-file Providers (as defined for 
        purposes of section 7216 of the Internal Revenue Code of 1986), 
        but only to the extent that the person acts in such capacity.
        (24) Prudential regulator.--The term ``prudential regulator'' 
    means--
            (A) in the case of an insured depository institution or 
        depository institution holding company (as defined in section 3 
        of the Federal Deposit Insurance Act), or subsidiary of such 
        institution or company, the appropriate Federal banking agency, 
        as that term is defined in section 3 of the Federal Deposit 
        Insurance Act; and
            (B) in the case of an insured credit union, the National 
        Credit Union Administration.
        (25) Related person.--The term ``related person''--
            (A) shall apply only with respect to a covered person that 
        is not a bank holding company (as that term is defined in 
        section 2 of the Bank Holding Company Act of 1956), credit 
        union, or depository institution;
            (B) shall be deemed to mean a covered person for all 
        purposes of any provision of Federal consumer financial law; 
        and
            (C) means--
                (i) any director, officer, or employee charged with 
            managerial responsibility for, or controlling shareholder 
            of, or agent for, such covered person;
                (ii) any shareholder, consultant, joint venture 
            partner, or other person, as determined by the Bureau (by 
            rule or on a case-by-case basis) who materially 
            participates in the conduct of the affairs of such covered 
            person; and
                (iii) any independent contractor (including any 
            attorney, appraiser, or accountant) who knowingly or 
            recklessly participates in any--

                    (I) violation of any provision of law or 
                regulation; or
                    (II) breach of a fiduciary duty.

        (26) Service provider.--
            (A) In general.--The term ``service provider'' means any 
        person that provides a material service to a covered person in 
        connection with the offering or provision by such covered 
        person of a consumer financial product or service, including a 
        person that--
                (i) participates in designing, operating, or 
            maintaining the consumer financial product or service; or
                (ii) processes transactions relating to the consumer 
            financial product or service (other than unknowingly or 
            incidentally transmitting or processing financial data in a 
            manner that such data is undifferentiated from other types 
            of data of the same form as the person transmits or 
            processes).
            (B) Exceptions.--The term ``service provider'' does not 
        include a person solely by virtue of such person offering or 
        providing to a covered person--
                (i) a support service of a type provided to businesses 
            generally or a similar ministerial service; or
                (ii) time or space for an advertisement for a consumer 
            financial product or service through print, newspaper, or 
            electronic media.
            (C) Rule of construction.--A person that is a service 
        provider shall be deemed to be a covered person to the extent 
        that such person engages in the offering or provision of its 
        own consumer financial product or service.
        (27) State.--The term ``State'' means any State, territory, or 
    possession of the United States, the District of Columbia, the 
    Commonwealth of Puerto Rico, the Commonwealth of the Northern 
    Mariana Islands, Guam, American Samoa, or the United States Virgin 
    Islands or any federally recognized Indian tribe, as defined by the 
    Secretary of the Interior under section 104(a) of the Federally 
    Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a-1(a)).
        (28) Stored value.--
            (A) In general.--The term ``stored value'' means funds or 
        monetary value represented in any electronic format, whether or 
        not specially encrypted, and stored or capable of storage on 
        electronic media in such a way as to be retrievable and 
        transferred electronically, and includes a prepaid debit card 
        or product, or any other similar product, regardless of whether 
        the amount of the funds or monetary value may be increased or 
        reloaded.
            (B) Exclusion.--Notwithstanding subparagraph (A), the term 
        ``stored value'' does not include a special purpose card or 
        certificate, which shall be defined for purposes of this 
        paragraph as funds or monetary value represented in any 
        electronic format, whether or not specially encrypted, that 
        is--
                (i) issued by a merchant, retailer, or other seller of 
            nonfinancial goods or services;
                (ii) redeemable only for transactions with the 
            merchant, retailer, or seller of nonfinancial goods or 
            services or with an affiliate of such person, which 
            affiliate itself is a merchant, retailer, or seller of 
            nonfinancial goods or services;
                (iii) issued in a specified amount that, except in the 
            case of a card or product used solely for telephone 
            services, may not be increased or reloaded;
                (iv) purchased on a prepaid basis in exchange for 
            payment; and
                (v) honored upon presentation to such merchant, 
            retailer, or seller of nonfinancial goods or services or an 
            affiliate of such person, which affiliate itself is a 
            merchant, retailer, or seller of nonfinancial goods or 
            services, only for any nonfinancial goods or services.
        (29) Transmitting or exchanging funds.--The term ``transmitting 
    or exchanging funds'' means receiving currency, monetary value, or 
    payment instruments from a consumer for the purpose of exchanging 
    or transmitting the same by any means, including transmission by 
    wire, facsimile, electronic transfer, courier, the Internet, or 
    through bill payment services or through other businesses that 
    facilitate third-party transfers within the United States or to or 
    from the United States.

          Subtitle A--Bureau of Consumer Financial Protection

SEC. 1011. ESTABLISHMENT OF THE BUREAU OF CONSUMER FINANCIAL 
PROTECTION.
    (a) Bureau Established.--There is established in the Federal 
Reserve System, an independent bureau to be known as the ``Bureau of 
Consumer Financial Protection'', which shall regulate the offering and 
provision of consumer financial products or services under the Federal 
consumer financial laws. The Bureau shall be considered an Executive 
agency, as defined in section 105 of title 5, United States Code. 
Except as otherwise provided expressly by law, all Federal laws dealing 
with public or Federal contracts, property, works, officers, employees, 
budgets, or funds, including the provisions of chapters 5 and 7 of 
title 5, shall apply to the exercise of the powers of the Bureau.
    (b) Director and Deputy Director.--
        (1) In general.--There is established the position of the 
    Director, who shall serve as the head of the Bureau.
        (2) Appointment.--Subject to paragraph (3), the Director shall 
    be appointed by the President, by and with the advice and consent 
    of the Senate.
        (3) Qualification.--The President shall nominate the Director 
    from among individuals who are citizens of the United States.
        (4) Compensation.--The Director shall be compensated at the 
    rate prescribed for level II of the Executive Schedule under 
    section 5313 of title 5, United States Code.
        (5) Deputy director.--There is established the position of 
    Deputy Director, who shall--
            (A) be appointed by the Director; and
            (B) serve as acting Director in the absence or 
        unavailability of the Director.
    (c) Term.--
        (1) In general.--The Director shall serve for a term of 5 
    years.
        (2) Expiration of term.--An individual may serve as Director 
    after the expiration of the term for which appointed, until a 
    successor has been appointed and qualified.
        (3) Removal for cause.--The President may remove the Director 
    for inefficiency, neglect of duty, or malfeasance in office.
    (d) Service Restriction.--No Director or Deputy Director may hold 
any office, position, or employment in any Federal reserve bank, 
Federal home loan bank, covered person, or service provider during the 
period of service of such person as Director or Deputy Director.
    (e) Offices.--The principal office of the Bureau shall be in the 
District of Columbia. The Director may establish regional offices of 
the Bureau, including in cities in which the Federal reserve banks, or 
branches of such banks, are located, in order to carry out the 
responsibilities assigned to the Bureau under the Federal consumer 
financial laws.
SEC. 1012. EXECUTIVE AND ADMINISTRATIVE POWERS.
    (a) Powers of the Bureau.--The Bureau is authorized to establish 
the general policies of the Bureau with respect to all executive and 
administrative functions, including--
        (1) the establishment of rules for conducting the general 
    business of the Bureau, in a manner not inconsistent with this 
    title;
        (2) to bind the Bureau and enter into contracts;
        (3) directing the establishment and maintenance of divisions or 
    other offices within the Bureau, in order to carry out the 
    responsibilities under the Federal consumer financial laws, and to 
    satisfy the requirements of other applicable law;
        (4) to coordinate and oversee the operation of all 
    administrative, enforcement, and research activities of the Bureau;
        (5) to adopt and use a seal;
        (6) to determine the character of and the necessity for the 
    obligations and expenditures of the Bureau;
        (7) the appointment and supervision of personnel employed by 
    the Bureau;
        (8) the distribution of business among personnel appointed and 
    supervised by the Director and among administrative units of the 
    Bureau;
        (9) the use and expenditure of funds;
        (10) implementing the Federal consumer financial laws through 
    rules, orders, guidance, interpretations, statements of policy, 
    examinations, and enforcement actions; and
        (11) performing such other functions as may be authorized or 
    required by law.
    (b) Delegation of Authority.--The Director of the Bureau may 
delegate to any duly authorized employee, representative, or agent any 
power vested in the Bureau by law.
    (c) Autonomy of the Bureau.--
        (1) Coordination with the board of governors.--Notwithstanding 
    any other provision of law applicable to the supervision or 
    examination of persons with respect to Federal consumer financial 
    laws, the Board of Governors may delegate to the Bureau the 
    authorities to examine persons subject to the jurisdiction of the 
    Board of Governors for compliance with the Federal consumer 
    financial laws.
        (2) Autonomy.--Notwithstanding the authorities granted to the 
    Board of Governors under the Federal Reserve Act, the Board of 
    Governors may not--
            (A) intervene in any matter or proceeding before the 
        Director, including examinations or enforcement actions, unless 
        otherwise specifically provided by law;
            (B) appoint, direct, or remove any officer or employee of 
        the Bureau; or
            (C) merge or consolidate the Bureau, or any of the 
        functions or responsibilities of the Bureau, with any division 
        or office of the Board of Governors or the Federal reserve 
        banks.
        (3) Rules and orders.--No rule or order of the Bureau shall be 
    subject to approval or review by the Board of Governors. The Board 
    of Governors may not delay or prevent the issuance of any rule or 
    order of the Bureau.
        (4) Recommendations and testimony.--No officer or agency of the 
    United States shall have any authority to require the Director or 
    any other officer of the Bureau to submit legislative 
    recommendations, or testimony or comments on legislation, to any 
    officer or agency of the United States for approval, comments, or 
    review prior to the submission of such recommendations, testimony, 
    or comments to the Congress, if such recommendations, testimony, or 
    comments to the Congress include a statement indicating that the 
    views expressed therein are those of the Director or such officer, 
    and do not necessarily reflect the views of the Board of Governors 
    or the President.
        (5) Clarification of autonomy of the bureau in legal 
    proceedings.--The Bureau shall not be liable under any provision of 
    law for any action or inaction of the Board of Governors, and the 
    Board of Governors shall not be liable under any provision of law 
    for any action or inaction of the Bureau.
SEC. 1013. ADMINISTRATION.
    (a) Personnel.--
        (1) Appointment.--
            (A) In general.--The Director may fix the number of, and 
        appoint and direct, all employees of the Bureau, in accordance 
        with the applicable provisions of title 5, United States Code.
            (B) Employees of the bureau.--The Director is authorized to 
        employ attorneys, compliance examiners, compliance supervision 
        analysts, economists, statisticians, and other employees as may 
        be deemed necessary to conduct the business of the Bureau. 
        Unless otherwise provided expressly by law, any individual 
        appointed under this section 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 an Executive agency.
            (C) Waiver authority.--
                (i) In general.--In making any appointment under 
            subparagraph (A), the Director may waive the requirements 
            of chapter 33 of title 5, United States Code, and the 
            regulations implementing such chapter, to the extent 
            necessary to appoint employees on terms and conditions that 
            are consistent with those set forth in section 11(1) of the 
            Federal Reserve Act (12 U.S.C. 248(1)), while providing 
            for--

                    (I) fair, credible, and transparent methods of 
                establishing qualification requirements for, 
                recruitment for, and appointments to positions;
                    (II) fair and open competition and equitable 
                treatment in the consideration and selection of 
                individuals to positions;
                    (III) fair, credible, and transparent methods of 
                assigning, reassigning, detailing, transferring, and 
                promoting employees.

                (ii) Veterans preferences.--In implementing this 
            subparagraph, the Director shall comply with the provisions 
            of section 2302(b)(11), regarding veterans' preference 
            requirements, in a manner consistent with that in which 
            such provisions are applied under chapter 33 of title 5, 
            United States Code. The authority under this subparagraph 
            to waive the requirements of that chapter 33 shall expire 5 
            years after the date of enactment of this Act.
        (2) Compensation.--Notwithstanding any otherwise applicable 
    provision of title 5, United States Code, concerning compensation, 
    including the provisions of chapter 51 and chapter 53, the 
    following provisions shall apply with respect to employees of the 
    Bureau:
            (A) The rates of basic pay for all employees of the Bureau 
        may be set and adjusted by the Director.
            (B) The Director shall at all times provide compensation 
        (including benefits) to each class of employees that, at a 
        minimum, are comparable to the compensation and benefits then 
        being provided by the Board of Governors for the corresponding 
        class of employees.
            (C) All such employees shall be compensated (including 
        benefits) on terms and conditions that are consistent with the 
        terms and conditions set forth in section 11(l) of the Federal 
        Reserve Act (12 U.S.C. 248(l)).
        (3) Bureau participation in federal reserve system retirement 
    plan and federal reserve system thrift plan.--
            (A) Employee election.--Employees appointed to the Bureau 
        may elect to participate in either--
                (i) both the Federal Reserve System Retirement Plan and 
            the Federal Reserve System Thrift Plan, under the same 
            terms on which such participation is offered to employees 
            of the Board of Governors who participate in such plans and 
            under the terms and conditions specified under section 
            1064(i)(1)(C); or
                (ii) the Civil Service Retirement System under chapter 
            83 of title 5, United States Code, or the Federal Employees 
            Retirement System under chapter 84 of title 5, United 
            States Code, if previously covered under one of those 
            Federal employee retirement systems.
            (B) Election period.--Bureau employees shall make an 
        election under this paragraph not later than 1 year after the 
        date of appointment by, or transfer under subtitle F to, the 
        Bureau. Participation in, and benefit accruals under, any other 
        retirement plan established or maintained by the Federal 
        Government shall end not later than the date on which 
        participation in, and benefit accruals under, the Federal 
        Reserve System Retirement Plan and Federal Reserve System 
        Thrift Plan begin.
            (C) Employer contribution.--The Bureau shall pay an 
        employer contribution to the Federal Reserve System Retirement 
        Plan, in the amount established as an employer contribution 
        under the Federal Employees Retirement System, as established 
        under chapter 84 of title 5, United States Code, for each 
        Bureau employee who elects to participate in the Federal 
        Reserve System Retirement Plan. The Bureau shall pay an 
        employer contribution to the Federal Reserve System Thrift Plan 
        for each Bureau employee who elects to participate in such 
        plan, as required under the terms of such plan.
            (D) Controlled group status.--The Bureau is the same 
        employer as the Federal Reserve System (as comprised of the 
        Board of Governors and each of the 12 Federal reserve banks 
        prior to the date of enactment of this Act) for purposes of 
        subsections (b), (c), (m), and (o) of section 414 of the 
        Internal Revenue Code of 1986, (26 U.S.C. 414).
        (4) Labor-management relations.--Chapter 71 of title 5, United 
    States Code, shall apply to the Bureau and the employees of the 
    Bureau.
        (5) Agency ombudsman.--
            (A) Establishment required.--Not later than 180 days after 
        the designated transfer date, the Bureau shall appoint an 
        ombudsman.
            (B) Duties of ombudsman.--The ombudsman appointed in 
        accordance with subparagraph (A) shall--
                (i) act as a liaison between the Bureau and any 
            affected person with respect to any problem that such party 
            may have in dealing with the Bureau, resulting from the 
            regulatory activities of the Bureau; and
                (ii) assure that safeguards exist to encourage 
            complainants to come forward and preserve confidentiality.
    (b) Specific Functional Units.--
        (1) Research.--The Director shall establish a unit whose 
    functions shall include researching, analyzing, and reporting on--
            (A) developments in markets for consumer financial products 
        or services, including market areas of alternative consumer 
        financial products or services with high growth rates and areas 
        of risk to consumers;
            (B) access to fair and affordable credit for traditionally 
        underserved communities;
            (C) consumer awareness, understanding, and use of 
        disclosures and communications regarding consumer financial 
        products or services;
            (D) consumer awareness and understanding of costs, risks, 
        and benefits of consumer financial products or services;
            (E) consumer behavior with respect to consumer financial 
        products or services, including performance on mortgage loans; 
        and
            (F) experiences of traditionally underserved consumers, 
        including un-banked and under-banked consumers.
        (2) Community affairs.--The Director shall establish a unit 
    whose functions shall include providing information, guidance, and 
    technical assistance regarding the offering and provision of 
    consumer financial products or services to traditionally 
    underserved consumers and communities.
        (3) Collecting and tracking complaints.--
            (A) In general.--The Director shall establish a unit whose 
        functions shall include establishing a single, toll-free 
        telephone number, a website, and a database or utilizing an 
        existing database to facilitate the centralized collection of, 
        monitoring of, and response to consumer complaints regarding 
        consumer financial products or services. The Director shall 
        coordinate with the Federal Trade Commission or other Federal 
        agencies to route complaints to such agencies, where 
        appropriate.
            (B) Routing calls to states.--To the extent practicable, 
        State agencies may receive appropriate complaints from the 
        systems established under subparagraph (A), if--
                (i) the State agency system has the functional capacity 
            to receive calls or electronic reports routed by the Bureau 
            systems;
                (ii) the State agency has satisfied any conditions of 
            participation in the system that the Bureau may establish, 
            including treatment of personally identifiable information 
            and sharing of information on complaint resolution or 
            related compliance procedures and resources; and
                (iii) participation by the State agency includes 
            measures necessary to provide for protection of personally 
            identifiable information that conform to the standards for 
            protection of the confidentiality of personally 
            identifiable information and for data integrity and 
            security that apply to the Federal agencies described in 
            subparagraph (D).
            (C) Reports to the congress.--The Director shall present an 
        annual report to Congress not later than March 31 of each year 
        on the complaints received by the Bureau in the prior year 
        regarding consumer financial products and services. Such report 
        shall include information and analysis about complaint numbers, 
        complaint types, and, where applicable, information about 
        resolution of complaints.
            (D) Data sharing required.--To facilitate preparation of 
        the reports required under subparagraph (C), supervision and 
        enforcement activities, and monitoring of the market for 
        consumer financial products and services, the Bureau shall 
        share consumer complaint information with prudential 
        regulators, the Federal Trade Commission, other Federal 
        agencies, and State agencies, subject to the standards 
        applicable to Federal agencies for protection of the 
        confidentiality of personally identifiable information and for 
        data security and integrity. The prudential regulators, the 
        Federal Trade Commission, and other Federal agencies shall 
        share data relating to consumer complaints regarding consumer 
        financial products and services with the Bureau, subject to the 
        standards applicable to Federal agencies for protection of 
        confidentiality of personally identifiable information and for 
        data security and integrity.
    (c) Office of Fair Lending and Equal Opportunity.--
        (1) Establishment.--The Director shall establish within the 
    Bureau the Office of Fair Lending and Equal Opportunity.
        (2) Functions.--The Office of Fair Lending and Equal 
    Opportunity shall have such powers and duties as the Director may 
    delegate to the Office, including--
            (A) providing oversight and enforcement of Federal laws 
        intended to ensure the fair, equitable, and nondiscriminatory 
        access to credit for both individuals and communities that are 
        enforced by the Bureau, including the Equal Credit Opportunity 
        Act and the Home Mortgage Disclosure Act;
            (B) coordinating fair lending efforts of the Bureau with 
        other Federal agencies and State regulators, as appropriate, to 
        promote consistent, efficient, and effective enforcement of 
        Federal fair lending laws;
            (C) working with private industry, fair lending, civil 
        rights, consumer and community advocates on the promotion of 
        fair lending compliance and education; and
            (D) providing annual reports to Congress on the efforts of 
        the Bureau to fulfill its fair lending mandate.
        (3) Administration of office.--There is established the 
    position of Assistant Director of the Bureau for Fair Lending and 
    Equal Opportunity, who--
            (A) shall be appointed by the Director; and
            (B) shall carry out such duties as the Director may 
        delegate to such Assistant Director.
    (d) Office of Financial Education.--
        (1) Establishment.--The Director shall establish an Office of 
    Financial Education, which shall be responsible for developing and 
    implementing initiatives intended to educate and empower consumers 
    to make better informed financial decisions.
        (2) Other duties.--The Office of Financial Education shall 
    develop and implement a strategy to improve the financial literacy 
    of consumers that includes measurable goals and objectives, in 
    consultation with the Financial Literacy and Education Commission, 
    consistent with the National Strategy for Financial Literacy, 
    through activities including providing opportunities for consumers 
    to access--
            (A) financial counseling, including community-based 
        financial counseling, where practicable;
            (B) information to assist with the evaluation of credit 
        products and the understanding of credit histories and scores;
            (C) savings, borrowing, and other services found at 
        mainstream financial institutions;
            (D) activities intended to--
                (i) prepare the consumer for educational expenses and 
            the submission of financial aid applications, and other 
            major purchases;
                (ii) reduce debt; and
                (iii) improve the financial situation of the consumer;
            (E) assistance in developing long-term savings strategies; 
        and
            (F) wealth building and financial services during the 
        preparation process to claim earned income tax credits and 
        Federal benefits.
        (3) Coordination.--The Office of Financial Education shall 
    coordinate with other units within the Bureau in carrying out its 
    functions, including--
            (A) working with the Community Affairs Office to implement 
        the strategy to improve financial literacy of consumers; and
            (B) working with the research unit established by the 
        Director to conduct research related to consumer financial 
        education and counseling.
        (4) Report.--Not later than 24 months after the designated 
    transfer date, and annually thereafter, the Director shall submit a 
    report on its financial literacy activities and strategy to improve 
    financial literacy of consumers to--
            (A) the Committee on Banking, Housing, and Urban Affairs of 
        the Senate; and
            (B) the Committee on Financial Services of the House of 
        Representatives.
        (5) Membership in financial literacy and education 
    commission.--Section 513(c)(1) of the Financial Literacy and 
    Education Improvement Act (20 U.S.C. 9702(c)(1)) is amended--
            (A) in subparagraph (B), by striking ``and'' at the end;
            (B) by redesignating subparagraph (C) as subparagraph (D); 
        and
            (C) by inserting after subparagraph (B) the following new 
        subparagraph:
            ``(C) the Director of the Bureau of Consumer Financial 
        Protection; and''.
        (6) Conforming amendment.--Section 513(d) of the Financial 
    Literacy and Education Improvement Act (20 U.S.C. 9702(d)) is 
    amended by adding at the end the following: ``The Director of the 
    Bureau of Consumer Financial Protection shall serve as the Vice 
    Chairman.''.
        (7) Study and report on financial literacy program.--
            (A) In general.--The Comptroller General of the United 
        States shall conduct a study to identify--
                (i) the feasibility of certification of persons 
            providing the programs or performing the activities 
            described in paragraph (2), including recognizing 
            outstanding programs, and developing guidelines and 
            resources for community-based practitioners, including--

                    (I) a potential certification process and standards 
                for certification;
                    (II) appropriate certifying entities;
                    (III) resources required for funding such a 
                process; and
                    (IV) a cost-benefit analysis of such certification;

                (ii) technological resources intended to collect, 
            analyze, evaluate, or promote financial literacy and 
            counseling programs;
                (iii) effective methods, tools, and strategies intended 
            to educate and empower consumers about personal finance 
            management; and
                (iv) recommendations intended to encourage the 
            development of programs that effectively improve financial 
            education outcomes and empower consumers to make better 
            informed financial decisions based on findings.
            (B) Report.--Not later than 1 year after the date of 
        enactment of this Act, the Comptroller General of the United 
        States shall submit a report on the results of the study 
        conducted under this paragraph to the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives.
    (e) Office of Service Member Affairs.--
        (1) In general.--The Director shall establish an Office of 
    Service Member Affairs, which shall be responsible for developing 
    and implementing initiatives for service members and their families 
    intended to--
            (A) educate and empower service members and their families 
        to make better informed decisions regarding consumer financial 
        products and services;
            (B) coordinate with the unit of the Bureau established 
        under subsection (b)(3), in order to monitor complaints by 
        service members and their families and responses to those 
        complaints by the Bureau or other appropriate Federal or State 
        agency; and
            (C) coordinate efforts among Federal and State agencies, as 
        appropriate, regarding consumer protection measures relating to 
        consumer financial products and services offered to, or used 
        by, service members and their families.
        (2) Coordination.--
            (A) Regional services.--The Director is authorized to 
        assign employees of the Bureau as may be deemed necessary to 
        conduct the business of the Office of Service Member Affairs, 
        including by establishing and maintaining the functions of the 
        Office in regional offices of the Bureau located near military 
        bases, military treatment facilities, or other similar military 
        facilities.
            (B) Agreements.--The Director is authorized to enter into 
        memoranda of understanding and similar agreements with the 
        Department of Defense, including any branch or agency as 
        authorized by the department, in order to carry out the 
        business of the Office of Service Member Affairs.
        (3) Definition.--As used in this subsection, the term ``service 
    member'' means any member of the United States Armed Forces and any 
    member of the National Guard or Reserves.
    (f) Timing.--The Office of Fair Lending and Equal Opportunity, the 
Office of Financial Education, and the Office of Service Member Affairs 
shall each be established not later than 1 year after the designated 
transfer date.
    (g) Office of Financial Protection for Older Americans.--
        (1) Establishment.--Before the end of the 180-day period 
    beginning on the designated transfer date, the Director shall 
    establish the Office of Financial Protection for Older Americans, 
    the functions of which shall include activities designed to 
    facilitate the financial literacy of individuals who have attained 
    the age of 62 years or more (in this subsection, referred to as 
    ``seniors'') on protection from unfair, deceptive, and abusive 
    practices and on current and future financial choices, including 
    through the dissemination of materials to seniors on such topics.
        (2) Assistant director.--The Office of Financial Protection for 
    Older Americans (in this subsection referred to as the ``Office'') 
    shall be headed by an assistant director.
        (3) Duties.--The Office shall--
            (A) develop goals for programs that provide seniors 
        financial literacy and counseling, including programs that--
                (i) help seniors recognize warning signs of unfair, 
            deceptive, or abusive practices, protect themselves from 
            such practices;
                (ii) provide one-on-one financial counseling on issues 
            including long-term savings and later-life economic 
            security; and
                (iii) provide personal consumer credit advocacy to 
            respond to consumer problems caused by unfair, deceptive, 
            or abusive practices;
            (B) monitor certifications or designations of financial 
        advisors who advise seniors and alert the Commission and State 
        regulators of certifications or designations that are 
        identified as unfair, deceptive, or abusive;
            (C) not later than 18 months after the date of the 
        establishment of the Office, submit to Congress and the 
        Commission any legislative and regulatory recommendations on 
        the best practices for--
                (i) disseminating information regarding the legitimacy 
            of certifications of financial advisers who advise seniors;
                (ii) methods in which a senior can identify the 
            financial advisor most appropriate for the senior's needs; 
            and
                (iii) methods in which a senior can verify a financial 
            advisor's credentials;
            (D) conduct research to identify best practices and 
        effective methods, tools, technology and strategies to educate 
        and counsel seniors about personal finance management with a 
        focus on--
                (i) protecting themselves from unfair, deceptive, and 
            abusive practices;
                (ii) long-term savings; and
                (iii) planning for retirement and long-term care;
            (E) coordinate consumer protection efforts of seniors with 
        other Federal agencies and State regulators, as appropriate, to 
        promote consistent, effective, and efficient enforcement; and
            (F) work with community organizations, non-profit 
        organizations, and other entities that are involved with 
        educating or assisting seniors (including the National 
        Education and Resource Center on Women and Retirement 
        Planning).
SEC. 1014. CONSUMER ADVISORY BOARD.
    (a) Establishment Required.--The Director shall establish a 
Consumer Advisory Board to advise and consult with the Bureau in the 
exercise of its functions under the Federal consumer financial laws, 
and to provide information on emerging practices in the consumer 
financial products or services industry, including regional trends, 
concerns, and other relevant information.
    (b) Membership.--In appointing the members of the Consumer Advisory 
Board, the Director shall seek to assemble experts in consumer 
protection, financial services, community development, fair lending and 
civil rights, and consumer financial products or services and 
representatives of depository institutions that primarily serve 
underserved communities, and representatives of communities that have 
been significantly impacted by higher-priced mortgage loans, and seek 
representation of the interests of covered persons and consumers, 
without regard to party affiliation. Not fewer than 6 members shall be 
appointed upon the recommendation of the regional Federal Reserve Bank 
Presidents, on a rotating basis.
    (c) Meetings.--The Consumer Advisory Board shall meet from time to 
time at the call of the Director, but, at a minimum, shall meet at 
least twice in each year.
    (d) Compensation and Travel Expenses.--Members of the Consumer 
Advisory Board who are not full-time employees of the United States 
shall--
        (1) be entitled to receive compensation at a rate fixed by the 
    Director while attending meetings of the Consumer Advisory Board, 
    including travel time; and
        (2) be allowed travel expenses, including transportation and 
    subsistence, while away from their homes or regular places of 
    business.
SEC. 1015. COORDINATION.
    The Bureau shall coordinate with the Commission, the Commodity 
Futures Trading Commission, the Federal Trade Commission, and other 
Federal agencies and State regulators, as appropriate, to promote 
consistent regulatory treatment of consumer financial and investment 
products and services.
SEC. 1016. APPEARANCES BEFORE AND REPORTS TO CONGRESS.
    (a) Appearances Before Congress.--The Director of the Bureau shall 
appear before the Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services and the Committee on 
Energy and Commerce of the House of Representatives at semi-annual 
hearings regarding the reports required under subsection (b).
    (b) Reports Required.--The Bureau shall, concurrent with each semi-
annual hearing referred to in subsection (a), prepare and submit to the 
President and to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services and the Committee 
on Energy and Commerce of the House of Representatives, a report, 
beginning with the session following the designated transfer date. The 
Bureau may also submit such report to the Committee on Commerce, 
Science, and Transportation of the Senate.
    (c) Contents.--The reports required by subsection (b) shall 
include--
        (1) a discussion of the significant problems faced by consumers 
    in shopping for or obtaining consumer financial products or 
    services;
        (2) a justification of the budget request of the previous year;
        (3) a list of the significant rules and orders adopted by the 
    Bureau, as well as other significant initiatives conducted by the 
    Bureau, during the preceding year and the plan of the Bureau for 
    rules, orders, or other initiatives to be undertaken during the 
    upcoming period;
        (4) an analysis of complaints about consumer financial products 
    or services that the Bureau has received and collected in its 
    central database on complaints during the preceding year;
        (5) a list, with a brief statement of the issues, of the public 
    supervisory and enforcement actions to which the Bureau was a party 
    during the preceding year;
        (6) the actions taken regarding rules, orders, and supervisory 
    actions with respect to covered persons which are not credit unions 
    or depository institutions;
        (7) an assessment of significant actions by State attorneys 
    general or State regulators relating to Federal consumer financial 
    law;
        (8) an analysis of the efforts of the Bureau to fulfill the 
    fair lending mission of the Bureau; and
        (9) an analysis of the efforts of the Bureau to increase 
    workforce and contracting diversity consistent with the procedures 
    established by the Office of Minority and Women Inclusion.
SEC. 1017. FUNDING; PENALTIES AND FINES.
    (a) Transfer of Funds From Board Of Governors.--
        (1) In general.--Each year (or quarter of such year), beginning 
    on the designated transfer date, and each quarter thereafter, the 
    Board of Governors shall transfer to the Bureau from the combined 
    earnings of the Federal Reserve System, the amount determined by 
    the Director to be reasonably necessary to carry out the 
    authorities of the Bureau under Federal consumer financial law, 
    taking into account such other sums made available to the Bureau 
    from the preceding year (or quarter of such year).
        (2) Funding cap.--
            (A) In general.--Notwithstanding paragraph (1), and in 
        accordance with this paragraph, the amount that shall be 
        transferred to the Bureau in each fiscal year shall not exceed 
        a fixed percentage of the total operating expenses of the 
        Federal Reserve System, as reported in the Annual Report, 2009, 
        of the Board of Governors, equal to--
                (i) 10 percent of such expenses in fiscal year 2011;
                (ii) 11 percent of such expenses in fiscal year 2012; 
            and
                (iii) 12 percent of such expenses in fiscal year 2013, 
            and in each year thereafter.
            (B) Adjustment of amount.--The dollar amount referred to in 
        subparagraph (A)(iii) shall be adjusted annually, using the 
        percent increase, if any, in the employment cost index for 
        total compensation for State and local government workers 
        published by the Federal Government, or the successor index 
        thereto, for the 12-month period ending on September 30 of the 
        year preceding the transfer.
            (C) Reviewability.--Notwithstanding any other provision in 
        this title, the funds derived from the Federal Reserve System 
        pursuant to this subsection shall not be subject to review by 
        the Committees on Appropriations of the House of 
        Representatives and the Senate.
        (3) Transition period.--Beginning on the date of enactment of 
    this Act and until the designated transfer date, the Board of 
    Governors shall transfer to the Bureau the amount estimated by the 
    Secretary needed to carry out the authorities granted to the Bureau 
    under Federal consumer financial law, from the date of enactment of 
    this Act until the designated transfer date.
        (4) Budget and financial management.--
            (A) Financial operating plans and forecasts.--The Director 
        shall provide to the Director of the Office of Management and 
        Budget copies of the financial operating plans and forecasts of 
        the Director, as prepared by the Director in the ordinary 
        course of the operations of the Bureau, and copies of the 
        quarterly reports of the financial condition and results of 
        operations of the Bureau, as prepared by the Director in the 
        ordinary course of the operations of the Bureau.
            (B) Financial statements.--The Bureau shall prepare 
        annually a statement of--
                (i) assets and liabilities and surplus or deficit;
                (ii) income and expenses; and
                (iii) sources and application of funds.
            (C) Financial management systems.--The Bureau shall 
        implement and maintain financial management systems that comply 
        substantially with Federal financial management systems 
        requirements and applicable Federal accounting standards.
            (D) Assertion of internal controls.--The Director shall 
        provide to the Comptroller General of the United States an 
        assertion as to the effectiveness of the internal controls that 
        apply to financial reporting by the Bureau, using the standards 
        established in section 3512(c) of title 31, United States Code.
            (E) Rule of construction.--This subsection may not be 
        construed as implying any obligation on the part of the 
        Director to consult with or obtain the consent or approval of 
        the Director of the Office of Management and Budget with 
        respect to any report, plan, forecast, or other information 
        referred to in subparagraph (A) or any jurisdiction or 
        oversight over the affairs or operations of the Bureau.
            (F) Financial statements.--The financial statements of the 
        Bureau shall not be consolidated with the financial statements 
        of either the Board of Governors or the Federal Reserve System.
        (5) Audit of the bureau.--
            (A) In general.--The Comptroller General shall annually 
        audit the financial transactions of the Bureau in accordance 
        with the United States generally accepted government auditing 
        standards, as may be prescribed by the Comptroller General of 
        the United States. The audit shall be conducted at the place or 
        places where accounts of the Bureau are normally kept. The 
        representatives of the Government Accountability Office shall 
        have access to the personnel and to all books, accounts, 
        documents, papers, records (including electronic records), 
        reports, files, and all other papers, automated data, things, 
        or property belonging to or under the control of or used or 
        employed by the Bureau pertaining to its financial transactions 
        and necessary to facilitate the audit, and such representatives 
        shall be afforded full facilities for verifying transactions 
        with the balances or securities held by depositories, fiscal 
        agents, and custodians. All such books, accounts, documents, 
        records, reports, files, papers, and property of the Bureau 
        shall remain in possession and custody of the Bureau. The 
        Comptroller General may obtain and duplicate any such books, 
        accounts, documents, records, working papers, automated data 
        and files, or other information relevant to such audit without 
        cost to the Comptroller General, and the right of access of the 
        Comptroller General to such information shall be enforceable 
        pursuant to section 716(c) of title 31, United States Code.
            (B) Report.--The Comptroller General shall submit to the 
        Congress a report of each annual audit conducted under this 
        subsection. The report to the Congress shall set forth the 
        scope of the audit and shall include the statement of assets 
        and liabilities and surplus or deficit, the statement of income 
        and expenses, the statement of sources and application of 
        funds, and such comments and information as may be deemed 
        necessary to inform Congress of the financial operations and 
        condition of the Bureau, together with such recommendations 
        with respect thereto as the Comptroller General may deem 
        advisable. A copy of each report shall be furnished to the 
        President and to the Bureau at the time submitted to the 
        Congress.
            (C) Assistance and costs.--For the purpose of conducting an 
        audit under this subsection, the Comptroller General may, in 
        the discretion of the Comptroller General, employ by contract, 
        without regard to section 3709 of the Revised Statutes of the 
        United States (41 U.S.C. 5), professional services of firms and 
        organizations of certified public accountants for temporary 
        periods or for special purposes. Upon the request of the 
        Comptroller General, the Director of the Bureau shall transfer 
        to the Government Accountability Office from funds available, 
        the amount requested by the Comptroller General to cover the 
        full costs of any audit and report conducted by the Comptroller 
        General. The Comptroller General shall credit funds transferred 
        to the account established for salaries and expenses of the 
        Government Accountability Office, and such amount shall be 
        available upon receipt and without fiscal year limitation to 
        cover the full costs of the audit and report.
    (b) Consumer Financial Protection Fund.--
        (1) Separate fund in federal reserve established.--There is 
    established in the Federal Reserve a separate fund, to be known as 
    the ``Bureau of Consumer Financial Protection Fund'' (referred to 
    in this section as the ``Bureau Fund''). The Bureau Fund shall be 
    maintained and established at a Federal reserve bank, in accordance 
    with such requirements as the Board of Governors may impose.
        (2) Fund receipts.--All amounts transferred to the Bureau under 
    subsection (a) shall be deposited into the Bureau Fund.
        (3) Investment authority.--
            (A) Amounts in bureau fund may be invested.--The Bureau may 
        request the Board of Governors to direct the investment of the 
        portion of the Bureau Fund that is not, in the judgment of the 
        Bureau, required to meet the current needs of the Bureau.
            (B) Eligible investments.--Investments authorized by this 
        paragraph shall be made in obligations of the United States or 
        obligations that are guaranteed as to principal and interest by 
        the United States, with maturities suitable to the needs of the 
        Bureau Fund, as determined by the Bureau.
            (C) Interest and proceeds credited.--The interest on, and 
        the proceeds from the sale or redemption of, any obligations 
        held in the Bureau Fund shall be credited to the Bureau Fund.
    (c) Use of Funds.--
        (1) In general.--Funds obtained by, transferred to, or credited 
    to the Bureau Fund shall be immediately available to the Bureau and 
    under the control of the Director, and shall remain available until 
    expended, to pay the expenses of the Bureau in carrying out its 
    duties and responsibilities. The compensation of the Director and 
    other employees of the Bureau and all other expenses thereof may be 
    paid from, obtained by, transferred to, or credited to the Bureau 
    Fund under this section.
        (2) Funds that are not government funds.--Funds obtained by or 
    transferred to the Bureau Fund shall not be construed to be 
    Government funds or appropriated monies.
        (3) Amounts not subject to apportionment.--Notwithstanding any 
    other provision of law, amounts in the Bureau Fund and in the Civil 
    Penalty Fund established under subsection (d) shall not be subject 
    to apportionment for purposes of chapter 15 of title 31, United 
    States Code, or under any other authority.
    (d) Penalties and Fines.--
        (1) Establishment of victims relief fund.--There is established 
    in the Federal Reserve a separate fund, to be known as the 
    ``Consumer Financial Civil Penalty Fund'' (referred to in this 
    section as the ``Civil Penalty Fund''). The Civil Penalty Fund 
    shall be maintained and established at a Federal reserve bank, in 
    accordance with such requirements as the Board of Governors may 
    impose. If the Bureau obtains a civil penalty against any person in 
    any judicial or administrative action under Federal consumer 
    financial laws, the Bureau shall deposit into the Civil Penalty 
    Fund, the amount of the penalty collected.
        (2) Payment to victims.--Amounts in the Civil Penalty Fund 
    shall be available to the Bureau, without fiscal year limitation, 
    for payments to the victims of activities for which civil penalties 
    have been imposed under the Federal consumer financial laws. To the 
    extent that such victims cannot be located or such payments are 
    otherwise not practicable, the Bureau may use such funds for the 
    purpose of consumer education and financial literacy programs.
    (e) Authorization of Appropriations; Annual Report.--
        (1) Determination regarding need for appropriated funds.--
            (A) In general.--The Director is authorized to determine 
        that sums available to the Bureau under this section will not 
        be sufficient to carry out the authorities of the Bureau under 
        Federal consumer financial law for the upcoming year.
            (B) Report required.--When making a determination under 
        subparagraph (A), the Director shall prepare a report regarding 
        the funding of the Bureau, including the assets and liabilities 
        of the Bureau, and the extent to which the funding needs of the 
        Bureau are anticipated to exceed the level of the amount set 
        forth in subsection (a)(2). The Director shall submit the 
        report to the President and to the Committee on Appropriations 
        of the Senate and the Committee on Appropriations of the House 
        of Representatives.
        (2) Authorization of appropriations.--If the Director makes the 
    determination and submits the report pursuant to paragraph (1), 
    there are hereby authorized to be appropriated to the Bureau, for 
    the purposes of carrying out the authorities granted in Federal 
    consumer financial law, $200,000,000 for each of fiscal years 2010, 
    2011, 2012, 2013, and 2014.
        (3) Apportionment.--Notwithstanding any other provision of law, 
    the amounts in paragraph (2) shall be subject to apportionment 
    under section 1517 of title 31, United States Code, and 
    restrictions that generally apply to the use of appropriated funds 
    in title 31, United States Code, and other laws.
        (4) Annual report.--The Director shall prepare and submit a 
    report, on an annual basis, to the Committee on Appropriations of 
    the Senate and the Committee on Appropriations of the House of 
    Representatives regarding the financial operating plans and 
    forecasts of the Director, the financial condition and results of 
    operations of the Bureau, and the sources and application of funds 
    of the Bureau, including any funds appropriated in accordance with 
    this subsection.
SEC. 1018. EFFECTIVE DATE.
    This subtitle shall become effective on the date of enactment of 
this Act.

                Subtitle B--General Powers of the Bureau

SEC. 1021. PURPOSE, OBJECTIVES, AND FUNCTIONS.
    (a) Purpose.--The Bureau shall seek to implement and, where 
applicable, enforce Federal consumer financial law consistently for the 
purpose of ensuring that all consumers have access to markets for 
consumer financial products and services and that markets for consumer 
financial products and services are fair, transparent, and competitive.
    (b) Objectives.--The Bureau is authorized to exercise its 
authorities under Federal consumer financial law for the purposes of 
ensuring that, with respect to consumer financial products and 
services--
        (1) consumers are provided with timely and understandable 
    information to make responsible decisions about financial 
    transactions;
        (2) consumers are protected from unfair, deceptive, or abusive 
    acts and practices and from discrimination;
        (3) outdated, unnecessary, or unduly burdensome regulations are 
    regularly identified and addressed in order to reduce unwarranted 
    regulatory burdens;
        (4) Federal consumer financial law is enforced consistently, 
    without regard to the status of a person as a depository 
    institution, in order to promote fair competition; and
        (5) markets for consumer financial products and services 
    operate transparently and efficiently to facilitate access and 
    innovation.
    (c) Functions.--The primary functions of the Bureau are--
        (1) conducting financial education programs;
        (2) collecting, investigating, and responding to consumer 
    complaints;
        (3) collecting, researching, monitoring, and publishing 
    information relevant to the functioning of markets for consumer 
    financial products and services to identify risks to consumers and 
    the proper functioning of such markets;
        (4) subject to sections 1024 through 1026, supervising covered 
    persons for compliance with Federal consumer financial law, and 
    taking appropriate enforcement action to address violations of 
    Federal consumer financial law;
        (5) issuing rules, orders, and guidance implementing Federal 
    consumer financial law; and
        (6) performing such support activities as may be necessary or 
    useful to facilitate the other functions of the Bureau.
SEC. 1022. RULEMAKING AUTHORITY.
    (a) In General.--The Bureau is authorized to exercise its 
authorities under Federal consumer financial law to administer, 
enforce, and otherwise implement the provisions of Federal consumer 
financial law.
    (b) Rulemaking, Orders, and Guidance.--
        (1) General authority.--The Director may prescribe rules and 
    issue orders and guidance, as may be necessary or appropriate to 
    enable the Bureau to administer and carry out the purposes and 
    objectives of the Federal consumer financial laws, and to prevent 
    evasions thereof.
        (2) Standards for rulemaking.--In prescribing a rule under the 
    Federal consumer financial laws--
            (A) the Bureau shall consider--
                (i) the potential benefits and costs to consumers and 
            covered persons, including the potential reduction of 
            access by consumers to consumer financial products or 
            services resulting from such rule; and
                (ii) the impact of proposed rules on covered persons, 
            as described in section 1026, and the impact on consumers 
            in rural areas;
            (B) the Bureau shall consult with the appropriate 
        prudential regulators or other Federal agencies prior to 
        proposing a rule and during the comment process regarding 
        consistency with prudential, market, or systemic objectives 
        administered by such agencies; and
            (C) if, during the consultation process described in 
        subparagraph (B), a prudential regulator provides the Bureau 
        with a written objection to the proposed rule of the Bureau or 
        a portion thereof, the Bureau shall include in the adopting 
        release a description of the objection and the basis for the 
        Bureau decision, if any, regarding such objection, 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) Exemptions.--
            (A) In general.--The Bureau, by rule, may conditionally or 
        unconditionally exempt any class of covered persons, service 
        providers, or consumer financial products or services, from any 
        provision of this title, or from any rule issued under this 
        title, as the Bureau determines necessary or appropriate to 
        carry out the purposes and objectives of this title, taking 
        into consideration the factors in subparagraph (B).
            (B) Factors.--In issuing an exemption, as permitted under 
        subparagraph (A), the Bureau shall, as appropriate, take into 
        consideration--
                (i) the total assets of the class of covered persons;
                (ii) the volume of transactions involving consumer 
            financial products or services in which the class of 
            covered persons engages; and
                (iii) existing provisions of law which are applicable 
            to the consumer financial product or service and the extent 
            to which such provisions provide consumers with adequate 
            protections.
        (4) Exclusive rulemaking authority.--
            (A) In general.--Notwithstanding any other provisions of 
        Federal law and except as provided in section 1061(b)(5), to 
        the extent that a provision of Federal consumer financial law 
        authorizes the Bureau and another Federal agency to issue 
        regulations under that provision of law for purposes of 
        assuring compliance with Federal consumer financial law and any 
        regulations thereunder, the Bureau shall have the exclusive 
        authority to prescribe rules subject to those provisions of 
        law.
            (B) Deference.--Notwithstanding any power granted to any 
        Federal agency or to the Council under this title, and subject 
        to section 1061(b)(5)(E), the deference that a court affords to 
        the Bureau with respect to a determination by the Bureau 
        regarding the meaning or interpretation of any provision of a 
        Federal consumer financial law shall be applied as if the 
        Bureau were the only agency authorized to apply, enforce, 
        interpret, or administer the provisions of such Federal 
        consumer financial law.
    (c) Monitoring.--
        (1) In general.--In order to support its rulemaking and other 
    functions, the Bureau shall monitor for risks to consumers in the 
    offering or provision of consumer financial products or services, 
    including developments in markets for such products or services.
        (2) Considerations.--In allocating its resources to perform the 
    monitoring required by this section, the Bureau may consider, among 
    other factors--
            (A) likely risks and costs to consumers associated with 
        buying or using a type of consumer financial product or 
        service;
            (B) understanding by consumers of the risks of a type of 
        consumer financial product or service;
            (C) the legal protections applicable to the offering or 
        provision of a consumer financial product or service, including 
        the extent to which the law is likely to adequately protect 
        consumers;
            (D) rates of growth in the offering or provision of a 
        consumer financial product or service;
            (E) the extent, if any, to which the risks of a consumer 
        financial product or service may disproportionately affect 
        traditionally underserved consumers; or
            (F) the types, number, and other pertinent characteristics 
        of covered persons that offer or provide the consumer financial 
        product or service.
        (3) Significant findings.--
            (A) In general.--The Bureau shall publish not fewer than 1 
        report of significant findings of its monitoring required by 
        this subsection in each calendar year, beginning with the first 
        calendar year that begins at least 1 year after the designated 
        transfer date.
            (B) Confidential information.--The Bureau may make public 
        such information obtained by the Bureau under this section as 
        is in the public interest, through aggregated reports or other 
        appropriate formats designed to protect confidential 
        information in accordance with paragraphs (4), (6), (8), and 
        (9).
        (4) Collection of information.--
            (A) In general.--In conducting any monitoring or assessment 
        required by this section, the Bureau shall have the authority 
        to gather information from time to time regarding the 
        organization, business conduct, markets, and activities of 
        covered persons and service providers.
            (B) Methodology.--In order to gather information described 
        in subparagraph (A), the Bureau may--
                (i) gather and compile information from a variety of 
            sources, including examination reports concerning covered 
            persons or service providers, consumer complaints, 
            voluntary surveys and voluntary interviews of consumers, 
            surveys and interviews with covered persons and service 
            providers, and review of available databases; and
                (ii) require covered persons and service providers 
            participating in consumer financial services markets to 
            file with the Bureau, under oath or otherwise, in such form 
            and within such reasonable period of time as the Bureau may 
            prescribe by rule or order, annual or special reports, or 
            answers in writing to specific questions, furnishing 
            information described in paragraph (4), as necessary for 
            the Bureau to fulfill the monitoring, assessment, and 
            reporting responsibilities imposed by Congress.
            (C) Limitation.--The Bureau may not use its authorities 
        under this paragraph to obtain records from covered persons and 
        service providers participating in consumer financial services 
        markets for purposes of gathering or analyzing the personally 
        identifiable financial information of consumers.
        (5) Limited information gathering.--In order to assess whether 
    a nondepository is a covered person, as defined in section 1002, 
    the Bureau may require such nondepository to file with the Bureau, 
    under oath or otherwise, in such form and within such reasonable 
    period of time as the Bureau may prescribe by rule or order, annual 
    or special reports, or answers in writing to specific questions.
        (6) Confidentiality rules.--
            (A) Rulemaking.--The Bureau shall prescribe rules regarding 
        the confidential treatment of information obtained from persons 
        in connection with the exercise of its authorities under 
        Federal consumer financial law.
            (B) Access by the bureau to reports of other regulators.--
                (i) Examination and financial condition reports.--Upon 
            providing reasonable assurances of confidentiality, the 
            Bureau shall have access to any report of examination or 
            financial condition made by a prudential regulator or other 
            Federal agency having jurisdiction over a covered person or 
            service provider, and to all revisions made to any such 
            report.
                (ii) Provision of other reports to the bureau.--In 
            addition to the reports described in clause (i), a 
            prudential regulator or other Federal agency having 
            jurisdiction over a covered person or service provider may, 
            in its discretion, furnish to the Bureau any other report 
            or other confidential supervisory information concerning 
            any insured depository institution, credit union, or other 
            entity examined by such agency under authority of any 
            provision of Federal law.
            (C) Access by other regulators to reports of the bureau.--
                (i) Examination reports.--Upon providing reasonable 
            assurances of confidentiality, a prudential regulator, a 
            State regulator, or any other Federal agency having 
            jurisdiction over a covered person or service provider 
            shall have access to any report of examination made by the 
            Bureau with respect to such person, and to all revisions 
            made to any such report.
                (ii) Provision of other reports to other regulators.--
            In addition to the reports described in clause (i), the 
            Bureau may, in its discretion, furnish to a prudential 
            regulator or other agency having jurisdiction over a 
            covered person or service provider any other report or 
            other confidential supervisory information concerning such 
            person examined by the Bureau under the authority of any 
            other provision of Federal law.
        (7) Registration.--
            (A) In general.--The Bureau may prescribe rules regarding 
        registration requirements applicable to a covered person, other 
        than an insured depository institution, insured credit union, 
        or related person.
            (B) Registration information.--Subject to rules prescribed 
        by the Bureau, the Bureau may publicly disclose registration 
        information to facilitate the ability of consumers to identify 
        covered persons that are registered with the Bureau.
            (C) Consultation with state agencies.--In developing and 
        implementing registration requirements under this paragraph, 
        the Bureau shall consult with State agencies regarding 
        requirements or systems (including coordinated or combined 
        systems for registration), where appropriate.
        (8) Privacy considerations.--In collecting information from any 
    person, publicly releasing information held by the Bureau, or 
    requiring covered persons to publicly report information, the 
    Bureau shall take steps to ensure that proprietary, personal, or 
    confidential consumer information that is protected from public 
    disclosure under section 552(b) or 552a of title 5, United States 
    Code, or any other provision of law, is not made public under this 
    title.
        (9) Consumer privacy.--
            (A) In general.--The Bureau may not obtain from a covered 
        person or service provider any personally identifiable 
        financial information about a consumer from the financial 
        records of the covered person or service provider, except--
                (i) if the financial records are reasonably described 
            in a request by the Bureau and the consumer provides 
            written permission for the disclosure of such information 
            by the covered person or service provider to the Bureau; or
                (ii) as may be specifically permitted or required under 
            other applicable provisions of law and in accordance with 
            the Right to Financial Privacy Act of 1978 (12 U.S.C. 3401 
            et seq.).
            (B) Treatment of covered person or service provider.--With 
        respect to the application of any provision of the Right to 
        Financial Privacy Act of 1978, to a disclosure by a covered 
        person or service provider subject to this subsection, the 
        covered person or service provider shall be treated as if it 
        were a ``financial institution'', as defined in section 1101 of 
        that Act (12 U.S.C. 3401).
    (d) Assessment of Significant Rules.--
        (1) In general.--The Bureau shall conduct an assessment of each 
    significant rule or order adopted by the Bureau under Federal 
    consumer financial law. The assessment shall address, among other 
    relevant factors, the effectiveness of the rule or order in meeting 
    the purposes and objectives of this title and the specific goals 
    stated by the Bureau. The assessment shall reflect available 
    evidence and any data that the Bureau reasonably may collect.
        (2) Reports.--The Bureau shall publish a report of its 
    assessment under this subsection not later than 5 years after the 
    effective date of the subject rule or order.
        (3) Public comment required.--Before publishing a report of its 
    assessment, the Bureau shall invite public comment on 
    recommendations for modifying, expanding, or eliminating the newly 
    adopted significant rule or order.
SEC. 1023. REVIEW OF BUREAU REGULATIONS.
    (a) Review of Bureau Regulations.--On the petition of a member 
agency of the Council, the Council may set aside a final regulation 
prescribed by the Bureau, or any provision thereof, if the Council 
decides, in accordance with subsection (c), that the regulation or 
provision would put the safety and soundness of the United States 
banking system or the stability of the financial system of the United 
States at risk.
    (b) Petition.--
        (1) Procedure.--An agency represented by a member of the 
    Council may petition the Council, in writing, and in accordance 
    with rules prescribed pursuant to subsection (f), to stay the 
    effectiveness of, or set aside, a regulation if the member agency 
    filing the petition--
            (A) has in good faith attempted to work with the Bureau to 
        resolve concerns regarding the effect of the rule on the safety 
        and soundness of the United States banking system or the 
        stability of the financial system of the United States; and
            (B) files the petition with the Council not later than 10 
        days after the date on which the regulation has been published 
        in the Federal Register.
        (2) Publication.--Any petition filed with the Council under 
    this section shall be published in the Federal Register and 
    transmitted contemporaneously with filing to the Committee on 
    Banking, Housing, and Urban Affairs of the Senate and the Committee 
    on Financial Services of the House of Representatives.
    (c) Stays and Set Asides.--
        (1) Stay.--
            (A) In general.--Upon the request of any member agency, the 
        Chairperson of the Council may stay the effectiveness of a 
        regulation for the purpose of allowing appropriate 
        consideration of the petition by the Council.
            (B) Expiration.--A stay issued under this paragraph shall 
        expire on the earlier of--
                (i) 90 days after the date of filing of the petition 
            under subsection (b); or
                (ii) the date on which the Council makes a decision 
            under paragraph (3).
        (2) No adverse inference.--After the expiration of any stay 
    imposed under this section, no inference shall be drawn regarding 
    the validity or enforceability of a regulation which was the 
    subject of the petition.
        (3) Vote.--
            (A) In general.--The decision to issue a stay of, or set 
        aside, any regulation under this section shall be made only 
        with the affirmative vote in accordance with subparagraph (B) 
        of \2/3\ of the members of the Council then serving.
            (B) Authorization to vote.--A member of the Council may 
        vote to stay the effectiveness of, or set aside, a final 
        regulation prescribed by the Bureau only if the agency or 
        department represented by that member has--
                (i) considered any relevant information provided by the 
            agency submitting the petition and by the Bureau; and
                (ii) made an official determination, at a public 
            meeting where applicable, that the regulation which is the 
            subject of the petition would put the safety and soundness 
            of the United States banking system or the stability of the 
            financial system of the United States at risk.
        (4) Decisions to set aside.--
            (A) Effect of decision.--A decision by the Council to set 
        aside a regulation prescribed by the Bureau, or provision 
        thereof, shall render such regulation, or provision thereof, 
        unenforceable.
            (B) Timely action required.--The Council may not issue a 
        decision to set aside a regulation, or provision thereof, which 
        is the subject of a petition under this section after the 
        expiration of the later of--
                (i) 45 days following the date of filing of the 
            petition, unless a stay is issued under paragraph (1); or
                (ii) the expiration of a stay issued by the Council 
            under this section.
            (C) Separate authority.--The issuance of a stay under this 
        section does not affect the authority of the Council to set 
        aside a regulation.
        (5) Dismissal due to inaction.--A petition under this section 
    shall be deemed dismissed if the Council has not issued a decision 
    to set aside a regulation, or provision thereof, within the period 
    for timely action under paragraph (4)(B).
        (6) Publication of decision.--Any decision under this 
    subsection to issue a stay of, or set aside, a regulation or 
    provision thereof shall be published by the Council in the Federal 
    Register as soon as practicable after the decision is made, with an 
    explanation of the reasons for the decision.
        (7) Rulemaking procedures inapplicable.--The notice and comment 
    procedures under section 553 of title 5, United States Code, shall 
    not apply to any decision under this section of the Council to 
    issue a stay of, or set aside, a regulation.
        (8) Judicial review of decisions by the council.--A decision by 
    the Council to set aside a regulation prescribed by the Bureau, or 
    provision thereof, shall be subject to review under chapter 7 of 
    title 5, United States Code.
    (d) Application of Other Law.--Nothing in this section shall be 
construed as altering, limiting, or restricting the application of any 
other provision of law, except as otherwise specifically provided in 
this section, including chapter 5 and chapter 7 of title 5, United 
States Code, to a regulation which is the subject of a petition filed 
under this section.
    (e) Savings Clause.--Nothing in this section shall be construed as 
limiting or restricting the Bureau from engaging in a rulemaking in 
accordance with applicable law.
    (f) Implementing Rules.--The Council shall prescribe procedural 
rules to implement this section.
SEC. 1024. SUPERVISION OF NONDEPOSITORY COVERED PERSONS.
    (a) Scope of Coverage.--
        (1) Applicability.--Notwithstanding any other provision of this 
    title, and except as provided in paragraph (3), this section shall 
    apply to any covered person who--
            (A) offers or provides origination, brokerage, or servicing 
        of loans secured by real estate for use by consumers primarily 
        for personal, family, or household purposes, or loan 
        modification or foreclosure relief services in connection with 
        such loans;
            (B) is a larger participant of a market for other consumer 
        financial products or services, as defined by rule in 
        accordance with paragraph (2);
            (C) the Bureau has reasonable cause to determine, by order, 
        after notice to the covered person and a reasonable opportunity 
        for such covered person to respond, based on complaints 
        collected through the system under section 1013(b)(3) or 
        information from other sources, that such covered person is 
        engaging, or has engaged, in conduct that poses risks to 
        consumers with regard to the offering or provision of consumer 
        financial products or services;
            (D) offers or provides to a consumer any private education 
        loan, as defined in section 140 of the Truth in Lending Act (15 
        U.S.C. 1650), notwithstanding section 1027(a)(2)(A) and subject 
        to section 1027(a)(2)(C); or
            (E) offers or provides to a consumer a payday loan.
        (2) Rulemaking to define covered persons subject to this 
    section.--The Bureau shall consult with the Federal Trade 
    Commission prior to issuing a rule, in accordance with paragraph 
    (1)(B), to define covered persons subject to this section. The 
    Bureau shall issue its initial rule not later than 1 year after the 
    designated transfer date.
        (3) Rules of construction.--
            (A) Certain persons excluded.--This section shall not apply 
        to persons described in section 1025(a) or 1026(a).
            (B) Activity levels.--For purposes of computing activity 
        levels under paragraph (1) or rules issued thereunder, 
        activities of affiliated companies (other than insured 
        depository institutions or insured credit unions) shall be 
        aggregated.
    (b) Supervision.--
        (1) In general.--The Bureau shall require reports and conduct 
    examinations on a periodic basis of persons described in subsection 
    (a)(1) for purposes of--
            (A) assessing compliance with the requirements of Federal 
        consumer financial law;
            (B) obtaining information about the activities and 
        compliance systems or procedures of such person; and
            (C) detecting and assessing risks to consumers and to 
        markets for consumer financial products and services.
        (2) Risk-based supervision program.--The Bureau shall exercise 
    its authority under paragraph (1) in a manner designed to ensure 
    that such exercise, with respect to persons described in subsection 
    (a)(1), is based on the assessment by the Bureau of the risks posed 
    to consumers in the relevant product markets and geographic 
    markets, and taking into consideration, as applicable--
            (A) the asset size of the covered person;
            (B) the volume of transactions involving consumer financial 
        products or services in which the covered person engages;
            (C) the risks to consumers created by the provision of such 
        consumer financial products or services;
            (D) the extent to which such institutions are subject to 
        oversight by State authorities for consumer protection; and
            (E) any other factors that the Bureau determines to be 
        relevant to a class of covered persons.
        (3) Coordination.--To minimize regulatory burden, the Bureau 
    shall coordinate its supervisory activities with the supervisory 
    activities conducted by prudential regulators and the State bank 
    regulatory authorities, including establishing their respective 
    schedules for examining persons described in subsection (a)(1) and 
    requirements regarding reports to be submitted by such persons.
        (4) Use of existing reports.--The Bureau shall, to the fullest 
    extent possible, use--
            (A) reports pertaining to persons described in subsection 
        (a)(1) that have been provided or required to have been 
        provided to a Federal or State agency; and
            (B) information that has been reported publicly.
        (5) Preservation of authority.--Nothing in this title may be 
    construed as limiting the authority of the Director to require 
    reports from persons described in subsection (a)(1), as permitted 
    under paragraph (1), regarding information owned or under the 
    control of such person, regardless of whether such information is 
    maintained, stored, or processed by another person.
        (6) Reports of tax law noncompliance.--The Bureau shall provide 
    the Commissioner of Internal Revenue with any report of examination 
    or related information identifying possible tax law noncompliance.
        (7) Registration, recordkeeping and other requirements for 
    certain persons.--
            (A) In general.--The Bureau shall prescribe rules to 
        facilitate supervision of persons described in subsection 
        (a)(1) and assessment and detection of risks to consumers.
            (B) Recordkeeping.--The Bureau may require a person 
        described in subsection (a)(1), to generate, provide, or retain 
        records for the purposes of facilitating supervision of such 
        persons and assessing and detecting risks to consumers.
            (C) Requirements concerning obligations.--The Bureau may 
        prescribe rules regarding a person described in subsection 
        (a)(1), to ensure that such persons are legitimate entities and 
        are able to perform their obligations to consumers. Such 
        requirements may include background checks for principals, 
        officers, directors, or key personnel and bonding or other 
        appropriate financial requirements.
            (D) Consultation with state agencies.--In developing and 
        implementing requirements under this paragraph, the Bureau 
        shall consult with State agencies regarding requirements or 
        systems (including coordinated or combined systems for 
        registration), where appropriate.
    (c) Enforcement Authority.--
        (1) The bureau to have enforcement authority.--Except as 
    provided in paragraph (3) and section 1061, with respect to any 
    person described in subsection (a)(1), to the extent that Federal 
    law authorizes the Bureau and another Federal agency to enforce 
    Federal consumer financial law, the Bureau shall have exclusive 
    authority to enforce that Federal consumer financial law.
        (2) Referral.--Any Federal agency authorized to enforce a 
    Federal consumer financial law described in paragraph (1) may 
    recommend in writing to the Bureau that the Bureau initiate an 
    enforcement proceeding, as the Bureau is authorized by that Federal 
    law or by this title.
        (3) Coordination with the federal trade commission.--
            (A) In general.--The Bureau and the Federal Trade 
        Commission shall negotiate an agreement for coordinating with 
        respect to enforcement actions by each agency regarding the 
        offering or provision of consumer financial products or 
        services by any covered person that is described in subsection 
        (a)(1), or service providers thereto. The agreement shall 
        include procedures for notice to the other agency, where 
        feasible, prior to initiating a civil action to enforce any 
        Federal law regarding the offering or provision of consumer 
        financial products or services.
            (B) Civil actions.--Whenever a civil action has been filed 
        by, or on behalf of, the Bureau or the Federal Trade Commission 
        for any violation of any provision of Federal law described in 
        subparagraph (A), or any regulation prescribed under such 
        provision of law--
                (i) the other agency may not, during the pendency of 
            that action, institute a civil action under such provision 
            of law against any defendant named in the complaint in such 
            pending action for any violation alleged in the complaint; 
            and
                (ii) the Bureau or the Federal Trade Commission may 
            intervene as a party in any such action brought by the 
            other agency, and, upon intervening--

                    (I) be heard on all matters arising in such 
                enforcement action; and
                    (II) file petitions for appeal in such actions.

            (C) Agreement terms.--The terms of any agreement negotiated 
        under subparagraph (A) may modify or supersede the provisions 
        of subparagraph (B).
            (D) Deadline.--The agencies shall reach the agreement 
        required under subparagraph (A) not later than 6 months after 
        the designated transfer date.
    (d) Exclusive Rulemaking and Examination Authority.--
Notwithstanding any other provision of Federal law and except as 
provided in section 1061, to the extent that Federal law authorizes the 
Bureau and another Federal agency to issue regulations or guidance, 
conduct examinations, or require reports from a person described in 
subsection (a)(1) under such law for purposes of assuring compliance 
with Federal consumer financial law and any regulations thereunder, the 
Bureau shall have the exclusive authority to prescribe rules, issue 
guidance, conduct examinations, require reports, or issue exemptions 
with regard to a person described in subsection (a)(1), subject to 
those provisions of law.
    (e) Service Providers.--A service provider to a person described in 
subsection (a)(1) shall be subject to the authority of the Bureau under 
this section, to the same extent as if such service provider were 
engaged in a service relationship with a bank, and the Bureau were an 
appropriate Federal banking agency under section 7(c) of the Bank 
Service Company Act (12 U.S.C. 1867(c)). In conducting any examination 
or requiring any report from a service provider subject to this 
subsection, the Bureau shall coordinate with the appropriate prudential 
regulator, as applicable.
    (f) Preservation of Farm Credit Administration Authority.--No 
provision of this title may be construed as modifying, limiting, or 
otherwise affecting the authority of the Farm Credit Administration.
SEC. 1025. SUPERVISION OF VERY LARGE BANKS, SAVINGS ASSOCIATIONS, AND 
CREDIT UNIONS.
    (a) Scope of Coverage.--This section shall apply to any covered 
person that is--
        (1) an insured depository institution with total assets of more 
    than $10,000,000,000 and any affiliate thereof; or
        (2) an insured credit union with total assets of more than 
    $10,000,000,000 and any affiliate thereof.
    (b) Supervision.--
        (1) In general.--The Bureau shall have exclusive authority to 
    require reports and conduct examinations on a periodic basis of 
    persons described in subsection (a) for purposes of--
            (A) assessing compliance with the requirements of Federal 
        consumer financial laws;
            (B) obtaining information about the activities subject to 
        such laws and the associated compliance systems or procedures 
        of such persons; and
            (C) detecting and assessing associated risks to consumers 
        and to markets for consumer financial products and services.
        (2) Coordination.--To minimize regulatory burden, the Bureau 
    shall coordinate its supervisory activities with the supervisory 
    activities conducted by prudential regulators and the State bank 
    regulatory authorities, including consultation regarding their 
    respective schedules for examining such persons described in 
    subsection (a) and requirements regarding reports to be submitted 
    by such persons.
        (3) Use of existing reports.--The Bureau shall, to the fullest 
    extent possible, use--
            (A) reports pertaining to a person described in subsection 
        (a) that have been provided or required to have been provided 
        to a Federal or State agency; and
            (B) information that has been reported publicly.
        (4) Preservation of authority.--Nothing in this title may be 
    construed as limiting the authority of the Director to require 
    reports from a person described in subsection (a), as permitted 
    under paragraph (1), regarding information owned or under the 
    control of such person, regardless of whether such information is 
    maintained, stored, or processed by another person.
        (5) Reports of tax law noncompliance.--The Bureau shall provide 
    the Commissioner of Internal Revenue with any report of examination 
    or related information identifying possible tax law noncompliance.
    (c) Primary Enforcement Authority.--
        (1) The bureau to have primary enforcement authority.--To the 
    extent that the Bureau and another Federal agency are authorized to 
    enforce a Federal consumer financial law, the Bureau shall have 
    primary authority to enforce that Federal consumer financial law 
    with respect to any person described in subsection (a).
        (2) 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 Bureau that the 
    Bureau initiate an enforcement proceeding with respect to a person 
    described in subsection (a), as the Bureau is authorized to do by 
    that Federal consumer financial law.
        (3) Backup enforcement authority of other federal agency.--If 
    the Bureau does not, before the end of the 120-day period beginning 
    on the date on which the Bureau receives a recommendation under 
    paragraph (2), initiate an enforcement proceeding, the other agency 
    referred to in paragraph (2) may initiate an enforcement 
    proceeding, including performing follow up supervisory and support 
    functions incidental thereto, to assure compliance with such 
    proceeding.
    (d) Service Providers.--A service provider to a person described in 
subsection (a) shall be subject to the authority of the Bureau under 
this section, to the same extent as if the Bureau were an appropriate 
Federal banking agency under section 7(c) of the Bank Service Company 
Act 12 U.S.C. 1867(c). In conducting any examination or requiring any 
report from a service provider subject to this subsection, the Bureau 
shall coordinate with the appropriate prudential regulator.
    (e) Simultaneous and Coordinated Supervisory Action.--
        (1) Examinations.--A prudential regulator and the Bureau shall, 
    with respect to each insured depository institution, insured credit 
    union, or other covered person described in subsection (a) that is 
    supervised by the prudential regulator and the Bureau, 
    respectively--
            (A) coordinate the scheduling of examinations of the 
        insured depository institution, insured credit union, or other 
        covered person described in subsection (a);
            (B) conduct simultaneous examinations of each insured 
        depository institution or insured credit union, unless such 
        institution requests examinations to be conducted separately;
            (C) share each draft report of examination with the other 
        agency and permit the receiving agency a reasonable opportunity 
        (which shall not be less than a period of 30 days after the 
        date of receipt) to comment on the draft report before such 
        report is made final; and
            (D) prior to issuing a final report of examination or 
        taking supervisory action, take into consideration concerns, if 
        any, raised in the comments made by the other agency.
        (2) Coordination with state bank supervisors.--The Bureau shall 
    pursue arrangements and agreements with State bank supervisors to 
    coordinate examinations, consistent with paragraph (1).
        (3) Avoidance of conflict in supervision.--
            (A) Request.--If the proposed supervisory determinations of 
        the Bureau and a prudential regulator (in this section referred 
        to collectively as the ``agencies'') are conflicting, an 
        insured depository institution, insured credit union, or other 
        covered person described in subsection (a) may request the 
        agencies to coordinate and present a joint statement of 
        coordinated supervisory action.
            (B) Joint statement.--The agencies shall provide a joint 
        statement under subparagraph (A), not later than 30 days after 
        the date of receipt of the request of the insured depository 
        institution, credit union, or covered person described in 
        subsection (a).
        (4) Appeals to governing panel.--
            (A) In general.--If the agencies do not resolve the 
        conflict or issue a joint statement required by subparagraph 
        (B), or if either of the agencies takes or attempts to take any 
        supervisory action relating to the request for the joint 
        statement without the consent of the other agency, an insured 
        depository institution, insured credit union, or other covered 
        person described in subsection (a) may institute an appeal to a 
        governing panel, as provided in this subsection, not later than 
        30 days after the expiration of the period during which a joint 
        statement is required to be filed under paragraph (3)(B).
            (B) Composition of governing panel.--The governing panel 
        for an appeal under this paragraph shall be composed of--
                (i) a representative from the Bureau and a 
            representative of the prudential regulator, both of whom--

                    (I) have not participated in the material 
                supervisory determinations under appeal; and
                    (II) do not directly or indirectly report to the 
                person who participated materially in the supervisory 
                determinations under appeal; and

                (ii) one individual representative, to be determined on 
            a rotating basis, from among the Board of Governors, the 
            Corporation, the National Credit Union Administration, and 
            the Office of the Comptroller of the Currency, other than 
            any agency involved in the subject dispute.
            (C) Conduct of appeal.--In an appeal under this paragraph--
                (i) the insured depository institution, insured credit 
            union, or other covered person described in subsection 
            (a)--

                    (I) shall include in its appeal all the facts and 
                legal arguments pertaining to the matter; and
                    (II) may, through counsel, employees, or 
                representatives, appear before the governing panel in 
                person or by telephone; and

                (ii) the governing panel--

                    (I) may request the insured depository institution, 
                insured credit union, or other covered person described 
                in subsection (a), the Bureau, or the prudential 
                regulator to produce additional information relevant to 
                the appeal; and
                    (II) by a majority vote of its members, shall 
                provide a final determination, in writing, not later 
                than 30 days after the date of filing of an 
                informationally complete appeal, or such longer period 
                as the panel and the insured depository institution, 
                insured credit union, or other covered person described 
                in subsection (a) may jointly agree.

            (D) Public availability of determinations.--A governing 
        panel shall publish all information contained in a 
        determination by the governing panel, with appropriate 
        redactions of information that would be subject to an exemption 
        from disclosure under section 552 of title 5, United States 
        Code.
            (E) Prohibition against retaliation.--The Bureau and the 
        prudential regulators shall prescribe rules to provide 
        safeguards from retaliation against the insured depository 
        institution, insured credit union, or other covered person 
        described in subsection (a) instituting an appeal under this 
        paragraph, as well as their officers and employees.
            (F) Limitation.--The process provided in this paragraph 
        shall not apply to a determination by a prudential regulator to 
        appoint a conservator or receiver for an insured depository 
        institution or a liquidating agent for an insured credit union, 
        as the case may be, or a decision to take action pursuant to 
        section 38 of the Federal Deposit Insurance Act (12 U.S.C. 
        1831o) or section 212 of the Federal Credit Union Act (112 
        U.S.C. 1790a), as applicable.
            (G) Effect on other authority.--Nothing in this section 
        shall modify or limit the authority of the Bureau to interpret, 
        or take enforcement action under, any Federal consumer 
        financial law, or the authority of a prudential regulator to 
        interpret or take enforcement action under any other provision 
        of Federal law for safety and soundness purposes.
SEC. 1026. OTHER BANKS, SAVINGS ASSOCIATIONS, AND CREDIT UNIONS.
    (a) Scope of Coverage.--This section shall apply to any covered 
person that is--
        (1) an insured depository institution with total assets of 
    $10,000,000,000 or less; or
        (2) an insured credit union with total assets of 
    $10,000,000,000 or less.
    (b) Reports.--The Director may require reports from a person 
described in subsection (a), as necessary to support the role of the 
Bureau in implementing Federal consumer financial law, to support its 
examination activities under subsection (c), and to assess and detect 
risks to consumers and consumer financial markets.
        (1) Use of existing reports.--The Bureau shall, to the fullest 
    extent possible, use--
            (A) reports pertaining to a person described in subsection 
        (a) that have been provided or required to have been provided 
        to a Federal or State agency; and
            (B) information that has been reported publicly.
        (2) Preservation of authority.--Nothing in this subsection may 
    be construed as limiting the authority of the Director from 
    requiring from a person described in subsection (a), as permitted 
    under paragraph (1), information owned or under the control of such 
    person, regardless of whether such information is maintained, 
    stored, or processed by another person.
        (3) Reports of tax law noncompliance.--The Bureau shall provide 
    the Commissioner of Internal Revenue with any report of examination 
    or related information identifying possible tax law noncompliance.
    (c) Examinations.--
        (1) In general.--The Bureau may, at its discretion, include 
    examiners on a sampling basis of the examinations performed by the 
    prudential regulator to assess compliance with the requirements of 
    Federal consumer financial law of persons described in subsection 
    (a).
        (2) Agency coordination.--The prudential regulator shall--
            (A) provide all reports, records, and documentation related 
        to the examination process for any institution included in the 
        sample referred to in paragraph (1) to the Bureau on a timely 
        and continual basis;
            (B) involve such Bureau examiner in the entire examination 
        process for such person; and
            (C) consider input of the Bureau concerning the scope of an 
        examination, conduct of the examination, the contents of the 
        examination report, the designation of matters requiring 
        attention, and examination ratings.
    (d) Enforcement.--
        (1) In general.--Except for requiring reports under subsection 
    (b), the prudential regulator is authorized to enforce the 
    requirements of Federal consumer financial laws and, with respect 
    to a covered person described in subsection (a), shall have 
    exclusive authority (relative to the Bureau) to enforce such laws .
        (2) Coordination with prudential regulator.--
            (A) Referral.--When the Bureau has reason to believe that a 
        person described in subsection (a) has engaged in a material 
        violation of a Federal consumer financial law, the Bureau shall 
        notify the prudential regulator in writing and recommend 
        appropriate action to respond.
            (B) Response.--Upon receiving a recommendation under 
        subparagraph (A), the prudential regulator shall provide a 
        written response to the Bureau not later than 60 days 
        thereafter.
    (e) Service Providers.--A service provider to a substantial number 
of persons described in subsection (a) shall be subject to the 
authority of the Bureau under section 1025 to the same extent as if the 
Bureau were an appropriate Federal bank agency under section 7(c) of 
the Bank Service Company Act (12 U.S.C. 1867(c)). When conducting any 
examination or requiring any report from a service provider subject to 
this subsection, the Bureau shall coordinate with the appropriate 
prudential regulator.
SEC. 1027. LIMITATIONS ON AUTHORITIES OF THE BUREAU; PRESERVATION OF 
AUTHORITIES.
    (a) Exclusion for Merchants, Retailers, and Other Sellers of 
Nonfinancial Goods or Services.--
        (1) Sale or brokerage of nonfinancial good or service.--The 
    Bureau may not exercise any rulemaking, supervisory, enforcement or 
    other authority under this title with respect to a person who is a 
    merchant, retailer, or seller of any nonfinancial good or service 
    and is engaged in the sale or brokerage of such nonfinancial good 
    or service, except to the extent that such person is engaged in 
    offering or providing any consumer financial product or service, or 
    is otherwise subject to any enumerated consumer law or any law for 
    which authorities are transferred under subtitle F or H.
        (2) Offering or provision of certain consumer financial 
    products or services in connection with the sale or brokerage of 
    nonfinancial good or service.--
            (A) In general.--Except as provided in subparagraph (B), 
        and subject to subparagraph (C), the Bureau may not exercise 
        any rulemaking, supervisory, enforcement, or other authority 
        under this title with respect to a merchant, retailer, or 
        seller of nonfinancial goods or services, but only to the 
        extent that such person--
                (i) extends credit directly to a consumer, in a case in 
            which the good or service being provided is not itself a 
            consumer financial product or service (other than credit 
            described in this subparagraph), exclusively for the 
            purpose of enabling that consumer to purchase such 
            nonfinancial good or service directly from the merchant, 
            retailer, or seller;
                (ii) directly, or through an agreement with another 
            person, collects debt arising from credit extended as 
            described in clause (i); or
                (iii) sells or conveys debt described in clause (i) 
            that is delinquent or otherwise in default.
            (B) Applicability.--Subparagraph (A) does not apply to any 
        credit transaction or collection of debt, other than as 
        described in subparagraph (C)(i), arising from a transaction 
        described in subparagraph (A)--
                (i) in which the merchant, retailer, or seller of 
            nonfinancial goods or services assigns, sells or otherwise 
            conveys to another person such debt owed by the consumer 
            (except for a sale of debt that is delinquent or otherwise 
            in default, as described in subparagraph (A)(iii));
                (ii) in which the credit extended significantly exceeds 
            the market value of the nonfinancial good or service 
            provided, or the Bureau otherwise finds that the sale of 
            the nonfinancial good or service is done as a subterfuge, 
            so as to evade or circumvent the provisions of this title; 
            or
                (iii) in which the merchant, retailer, or seller of 
            nonfinancial goods or services regularly extends credit and 
            the credit is subject to a finance charge.
            (C) Limitations.--
                (i) In general.--Notwithstanding subparagraph (B), 
            subparagraph (A) shall apply with respect to a merchant, 
            retailer, or seller of nonfinancial goods or services that 
            is not engaged significantly in offering or providing 
            consumer financial products or services.
                (ii) Exception.--Subparagraph (A) and clause (i) of 
            this subparagraph do not apply to any merchant, retailer, 
            or seller of nonfinancial goods or services--

                    (I) if such merchant, retailer, or seller of 
                nonfinancial goods or services is engaged in a 
                transaction described in subparagraph (B)(i) or 
                (B)(ii); or
                    (II) to the extent that such merchant, retailer, or 
                seller is subject to any enumerated consumer law or any 
                law for which authorities are transferred under 
                subtitle F or H, but the Bureau may exercise such 
                authority only with respect to that law.

            (D) Rules.--
                (i) Authority of other agencies.--No provision of this 
            title shall be construed as modifying, limiting, or 
            superseding the supervisory or enforcement authority of the 
            Federal Trade Commission or any other agency (other than 
            the Bureau) with respect to credit extended, or the 
            collection of debt arising from such extension, directly by 
            a merchant or retailer to a consumer exclusively for the 
            purpose of enabling that consumer to purchase nonfinancial 
            goods or services directly from the merchant or retailer.
                (ii) Small businesses.--A merchant, retailer, or seller 
            of nonfinancial goods or services that would otherwise be 
            subject to the authority of the Bureau solely by virtue of 
            the application of subparagraph (B)(iii) shall be deemed 
            not to be engaged significantly in offering or providing 
            consumer financial products or services under subparagraph 
            (C)(i), if such person--

                    (I) only extends credit for the sale of 
                nonfinancial goods or services, as described in 
                subparagraph (A)(i);
                    (II) retains such credit on its own accounts 
                (except to sell or convey such debt that is delinquent 
                or otherwise in default); and
                    (III) meets the relevant industry size threshold to 
                be a small business concern, based on annual receipts, 
                pursuant to section 3 of the Small Business Act (15 
                U.S.C. 632) and the implementing rules thereunder.

                (iii) Initial year.--A merchant, retailer, or seller of 
            nonfinancial goods or services shall be deemed to meet the 
            relevant industry size threshold described in clause 
            (ii)(III) during the first year of operations of that 
            business concern if, during that year, the receipts of that 
            business concern reasonably are expected to meet that size 
            threshold.
                (iv) Other standards for small business.--With respect 
            to a merchant, retailer, or seller of nonfinancial goods or 
            services that is a classified on a basis other than annual 
            receipts for the purposes of section 3 of the Small 
            Business Act (15 U.S.C. 632) and the implementing rules 
            thereunder, such merchant, retailer, or seller shall be 
            deemed to meet the relevant industry size threshold 
            described in clause (ii)(III) if such merchant, retailer, 
            or seller meets the relevant industry size threshold to be 
            a small business concern based on the number of employees, 
            or other such applicable measure, established under that 
            Act.
            (E) Exception from state enforcement.--To the extent that 
        the Bureau may not exercise authority under this subsection 
        with respect to a merchant, retailer, or seller of nonfinancial 
        goods or services, no action by a State attorney general or 
        State regulator with respect to a claim made under this title 
        may be brought under subsection 1042(a), with respect to an 
        activity described in any of clauses (i) through (iii) of 
        subparagraph (A) by such merchant, retailer, or seller of 
        nonfinancial goods or services.
    (b) Exclusion for Real Estate Brokerage Activities.--
        (1) Real estate brokerage activities excluded.--Without 
    limiting subsection (a), and except as permitted in paragraph (2), 
    the Bureau may not exercise any rulemaking, supervisory, 
    enforcement, or other authority under this title with respect to a 
    person that is licensed or registered as a real estate broker or 
    real estate agent, in accordance with State law, to the extent that 
    such person--
            (A) acts as a real estate agent or broker for a buyer, 
        seller, lessor, or lessee of real property;
            (B) brings together parties interested in the sale, 
        purchase, lease, rental, or exchange of real property;
            (C) negotiates, on behalf of any party, any portion of a 
        contract relating to the sale, purchase, lease, rental, or 
        exchange of real property (other than in connection with the 
        provision of financing with respect to any such transaction); 
        or
            (D) offers to engage in any activity, or act in any 
        capacity, described in subparagraph (A), (B), or (C).
        (2) Description of activities.--The Bureau may exercise 
    rulemaking, supervisory, enforcement, or other authority under this 
    title with respect to a person described in paragraph (1) when such 
    person is--
            (A) engaged in an activity of offering or providing any 
        consumer financial product or service, except that the Bureau 
        may exercise such authority only with respect to that activity; 
        or
            (B) otherwise subject to any enumerated consumer law or any 
        law for which authorities are transferred under subtitle F or 
        H, but the Bureau may exercise such authority only with respect 
        to that law.
    (c) Exclusion for Manufactured Home Retailers and Modular Home 
Retailers.--
        (1) In general.--The Director may not exercise any rulemaking, 
    supervisory, enforcement, or other authority over a person to the 
    extent that--
            (A) such person is not described in paragraph (2); and
            (B) such person--
                (i) acts as an agent or broker for a buyer or seller of 
            a manufactured home or a modular home;
                (ii) facilitates the purchase by a consumer of a 
            manufactured home or modular home, by negotiating the 
            purchase price or terms of the sales contract (other than 
            providing financing with respect to such transaction); or
                (iii) offers to engage in any activity described in 
            clause (i) or (ii).
        (2) Description of activities.--A person is described in this 
    paragraph to the extent that such person is engaged in the offering 
    or provision of any consumer financial product or service or is 
    otherwise subject to any enumerated consumer law or any law for 
    which authorities are transferred under subtitle F or H.
        (3) Definitions.--For purposes of this subsection, the 
    following definitions shall apply:
            (A) Manufactured home.--The term ``manufactured home'' has 
        the same meaning as in section 603 of the National Manufactured 
        Housing Construction and Safety Standards Act of 1974 (42 
        U.S.C. 5402).
            (B) Modular home.--The term ``modular home'' means a house 
        built in a factory in 2 or more modules that meet the State or 
        local building codes where the house will be located, and where 
        such modules are transported to the building site, installed on 
        foundations, and completed.
    (d) Exclusion for Accountants and Tax Preparers.--
        (1) In general.--Except as permitted in paragraph (2), the 
    Bureau may not exercise any rulemaking, supervisory, enforcement, 
    or other authority over--
            (A) any person that is a certified public accountant, 
        permitted to practice as a certified public accounting firm, or 
        certified or licensed for such purpose by a State, or any 
        individual who is employed by or holds an ownership interest 
        with respect to a person described in this subparagraph, when 
        such person is performing or offering to perform--
                (i) customary and usual accounting activities, 
            including the provision of accounting, tax, advisory, or 
            other services that are subject to the regulatory authority 
            of a State board of accountancy or a Federal authority; or
                (ii) other services that are incidental to such 
            customary and usual accounting activities, to the extent 
            that such incidental services are not offered or provided--

                    (I) by the person separate and apart from such 
                customary and usual accounting activities; or
                    (II) to consumers who are not receiving such 
                customary and usual accounting activities; or

            (B) any person, other than a person described in 
        subparagraph (A) that performs income tax preparation 
        activities for consumers.
        (2) Description of activities.--
            (A) In general.--Paragraph (1) shall not apply to any 
        person described in paragraph (1)(A) or (1)(B) to the extent 
        that such person is engaged in any activity which is not a 
        customary and usual accounting activity described in paragraph 
        (1)(A) or incidental thereto but which is the offering or 
        provision of any consumer financial product or service, except 
        to the extent that a person described in paragraph (1)(A) is 
        engaged in an activity which is a customary and usual 
        accounting activity described in paragraph (1)(A), or 
        incidental thereto.
            (B) Not a customary and usual accounting activity.--For 
        purposes of this subsection, extending or brokering credit is 
        not a customary and usual accounting activity, or incidental 
        thereto.
            (C) Rule of construction.--For purposes of subparagraphs 
        (A) and (B), a person described in paragraph (1)(A) shall not 
        be deemed to be extending credit, if such person is only 
        extending credit directly to a consumer, exclusively for the 
        purpose of enabling such consumer to purchase services 
        described in clause (i) or (ii) of paragraph (1)(A) directly 
        from such person, and such credit is--
                (i) not subject to a finance charge; and
                (ii) not payable by written agreement in more than 4 
            installments.
            (D) Other limitations.--Paragraph (1) does not apply to any 
        person described in paragraph (1)(A) or (1)(B) that is 
        otherwise subject to any enumerated consumer law or any law for 
        which authorities are transferred under subtitle F or H.
    (e) Exclusion for Practice of Law.--
        (1)  In general.--Except as provided under paragraph (2), the 
    Bureau may not exercise any supervisory or enforcement authority 
    with respect to an activity engaged in by an attorney as part of 
    the practice of law under the laws of a State in which the attorney 
    is licensed to practice law.
        (2)  Rule of construction.--Paragraph (1) shall not be 
    construed so as to limit the exercise by the Bureau of any 
    supervisory, enforcement, or other authority regarding the offering 
    or provision of a consumer financial product or service described 
    in any subparagraph of section 1002(5)--
            (A) that is not offered or provided as part of, or 
        incidental to, the practice of law, occurring exclusively 
        within the scope of the attorney-client relationship; or
            (B) that is otherwise offered or provided by the attorney 
        in question with respect to any consumer who is not receiving 
        legal advice or services from the attorney in connection with 
        such financial product or service.
        (3)  Existing authority.--Paragraph (1) shall not be construed 
    so as to limit the authority of the Bureau with respect to any 
    attorney, to the extent that such attorney is otherwise subject to 
    any of the enumerated consumer laws or the authorities transferred 
    under subtitle F or H.
    (f) Exclusion for Persons Regulated by a State Insurance 
Regulator.--
        (1) In general.--No provision of this title shall be construed 
    as altering, amending, or affecting the authority of any State 
    insurance regulator to adopt rules, initiate enforcement 
    proceedings, or take any other action with respect to a person 
    regulated by a State insurance regulator. Except as provided in 
    paragraph (2), the Bureau shall have no authority to exercise any 
    power to enforce this title with respect to a person regulated by a 
    State insurance regulator.
        (2) Description of activities.--Paragraph (1) does not apply to 
    any person described in such paragraph to the extent that such 
    person is engaged in the offering or provision of any consumer 
    financial product or service or is otherwise subject to any 
    enumerated consumer law or any law for which authorities are 
    transferred under subtitle F or H.
        (3) State insurance authority under gramm-leach-bliley.--
    Notwithstanding paragraph (2), the Bureau shall not exercise any 
    authorities that are granted a State insurance authority under 
    section 505(a)(6) of the Gramm-Leach-Bliley Act with respect to a 
    person regulated by a State insurance authority.
    (g) Exclusion for Employee Benefit and Compensation Plans and 
Certain Other Arrangements Under the Internal Revenue Code of 1986.--
        (1) Preservation of authority of other agencies.--No provision 
    of this title shall be construed as altering, amending, or 
    affecting the authority of the Secretary of the Treasury, the 
    Secretary of Labor, or the Commissioner of Internal Revenue to 
    adopt regulations, initiate enforcement proceedings, or take any 
    actions with respect to any specified plan or arrangement.
        (2) Activities not constituting the offering or provision of 
    any consumer financial product or service.--For purposes of this 
    title, a person shall not be treated as having engaged in the 
    offering or provision of any consumer financial product or service 
    solely because such person is--
            (A) a specified plan or arrangement;
            (B) engaged in the activity of establishing or maintaining, 
        for the benefit of employees of such person (or for members of 
        an employee organization), any specified plan or arrangement; 
        or
            (C) engaged in the activity of establishing or maintaining 
        a qualified tuition program under section 529(b)(1) of the 
        Internal Revenue Code of 1986 offered by a State or other 
        prepaid tuition program offered by a State.
        (3) Limitation on bureau authority.--
            (A) In general.--Except as provided under subparagraphs (B) 
        and (C), the Bureau may not exercise any rulemaking or 
        enforcement authority with respect to products or services that 
        relate to any specified plan or arrangement.
            (B) Bureau action pursuant to agency request.--
                (i) Agency request.--The Secretary and the Secretary of 
            Labor may jointly issue a written request to the Bureau 
            regarding implementation of appropriate consumer protection 
            standards under this title with respect to the provision of 
            services relating to any specified plan or arrangement.
                (ii) Agency response.--In response to a request by the 
            Bureau, the Secretary and the Secretary of Labor shall 
            jointly issue a written response, not later than 90 days 
            after receipt of such request, to grant or deny the request 
            of the Bureau regarding implementation of appropriate 
            consumer protection standards under this title with respect 
            to the provision of services relating to any specified plan 
            or arrangement.
                (iii) Scope of bureau action.--Subject to a request or 
            response pursuant to clause (i) or clause (ii) by the 
            agencies made under this subparagraph, the Bureau may 
            exercise rulemaking authority, and may act to enforce a 
            rule prescribed pursuant to such request or response, in 
            accordance with the provisions of this title. A request or 
            response made by the Secretary and the Secretary of Labor 
            under this subparagraph shall describe the basis for, and 
            scope of, appropriate consumer protection standards to be 
            implemented under this title with respect to the provision 
            of services relating to any specified plan or arrangement.
            (C) Description of products or services.--To the extent 
        that a person engaged in providing products or services 
        relating to any specified plan or arrangement is subject to any 
        enumerated consumer law or any law for which authorities are 
        transferred under subtitle F or H, subparagraph (A) shall not 
        apply with respect to that law.
        (4) Specified plan or arrangement.--For purposes of this 
    subsection, the term ``specified plan or arrangement'' means any 
    plan, account, or arrangement described in section 220, 223, 
    401(a), 403(a), 403(b), 408, 408A, 529, or 530 of the Internal 
    Revenue Code of 1986, or any employee benefit or compensation plan 
    or arrangement, including a plan that is subject to title I of the 
    Employee Retirement Income Security Act of 1974, or any prepaid 
    tuition program offered by a State.
    (h) Persons Regulated by a State Securities Commission.--
        (1) In general.--No provision of this title shall be construed 
    as altering, amending, or affecting the authority of any securities 
    commission (or any agency or office performing like functions) of 
    any State to adopt rules, initiate enforcement proceedings, or take 
    any other action with respect to a person regulated by any 
    securities commission (or any agency or office performing like 
    functions) of any State. Except as permitted in paragraph (2) and 
    subsection (f), the Bureau shall have no authority to exercise any 
    power to enforce this title with respect to a person regulated by 
    any securities commission (or any agency or office performing like 
    functions) of any State, but only to the extent that the person 
    acts in such regulated capacity.
        (2) Description of activities.--Paragraph (1) shall not apply 
    to any person to the extent such person is engaged in the offering 
    or provision of any consumer financial product or service, or is 
    otherwise subject to any enumerated consumer law or any law for 
    which authorities are transferred under subtitle F or H.
    (i) Exclusion for Persons Regulated by the Commission.--
        (1) In general.--No provision of this title may be construed as 
    altering, amending, or affecting the authority of the Commission to 
    adopt rules, initiate enforcement proceedings, or take any other 
    action with respect to a person regulated by the Commission. The 
    Bureau shall have no authority to exercise any power to enforce 
    this title with respect to a person regulated by the Commission.
        (2) Consultation and coordination.--Notwithstanding paragraph 
    (1), the Commission shall consult and coordinate, where feasible, 
    with the Bureau with respect to any rule (including any advance 
    notice of proposed rulemaking) regarding an investment product or 
    service that is the same type of product as, or that competes 
    directly with, a consumer financial product or service that is 
    subject to the jurisdiction of the Bureau under this title or under 
    any other law. In carrying out this paragraph, the agencies shall 
    negotiate an agreement to establish procedures for such 
    coordination, including procedures for providing advance notice to 
    the Bureau when the Commission is initiating a rulemaking.
    (j) Exclusion for Persons Regulated by the Commodity Futures 
Trading Commission.--
        (1) In general.--No provision of this title shall be construed 
    as altering, amending, or affecting the authority of the Commodity 
    Futures Trading Commission to adopt rules, initiate enforcement 
    proceedings, or take any other action with respect to a person 
    regulated by the Commodity Futures Trading Commission. The Bureau 
    shall have no authority to exercise any power to enforce this title 
    with respect to a person regulated by the Commodity Futures Trading 
    Commission.
        (2) Consultation and coordination.--Notwithstanding paragraph 
    (1), the Commodity Futures Trading Commission shall consult and 
    coordinate with the Bureau with respect to any rule (including any 
    advance notice of proposed rulemaking) regarding a product or 
    service that is the same type of product as, or that competes 
    directly with, a consumer financial product or service that is 
    subject to the jurisdiction of the Bureau under this title or under 
    any other law.
    (k) Exclusion for Persons Regulated by the Farm Credit 
Administration.--
        (1) In general.--No provision of this title shall be construed 
    as altering, amending, or affecting the authority of the Farm 
    Credit Administration to adopt rules, initiate enforcement 
    proceedings, or take any other action with respect to a person 
    regulated by the Farm Credit Administration. The Bureau shall have 
    no authority to exercise any power to enforce this title with 
    respect to a person regulated by the Farm Credit Administration.
        (2) Definition.--For purposes of this subsection, the term 
    ``person regulated by the Farm Credit Administration'' means any 
    Farm Credit System institution that is chartered and subject to the 
    provisions of the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.).
    (l) Exclusion for Activities Relating to Charitable 
Contributions.--
        (1) In general.--The Director and the Bureau may not exercise 
    any rulemaking, supervisory, enforcement, or other authority, 
    including authority to order penalties, over any activities related 
    to the solicitation or making of voluntary contributions to a tax-
    exempt organization as recognized by the Internal Revenue Service, 
    by any agent, volunteer, or representative of such organizations to 
    the extent the organization, agent, volunteer, or representative 
    thereof is soliciting or providing advice, information, education, 
    or instruction to any donor or potential donor relating to a 
    contribution to the organization.
        (2) Limitation.--The exclusion in paragraph (1) does not apply 
    to other activities not described in paragraph (1) that are the 
    offering or provision of any consumer financial product or service, 
    or are otherwise subject to any enumerated consumer law or any law 
    for which authorities are transferred under subtitle F or H.
    (m) Insurance.--The Bureau may not define as a financial product or 
service, by regulation or otherwise, engaging in the business of 
insurance.
    (n) Limited Authority of the Bureau.--Notwithstanding subsections 
(a) through (h) and (l), a person subject to or described in one or 
more of such provisions--
        (1) may be a service provider; and
        (2) may be subject to requests from, or requirements imposed 
    by, the Bureau regarding information in order to carry out the 
    responsibilities and functions of the Bureau and in accordance with 
    section 1022, 1052, or 1053.
    (o) No Authority To Impose Usury Limit.--No provision of this title 
shall be construed as conferring authority on the Bureau to establish a 
usury limit applicable to an extension of credit offered or made by a 
covered person to a consumer, unless explicitly authorized by law.
    (p) Attorney General.--No provision of this title, including 
section 1024(c)(1), shall affect the authorities of the Attorney 
General under otherwise applicable provisions of law.
    (q) Secretary of the Treasury.--No provision of this title shall 
affect the authorities of the Secretary, including with respect to 
prescribing rules, initiating enforcement proceedings, or taking other 
actions with respect to a person that performs income tax preparation 
activities for consumers.
    (r) Deposit Insurance and Share Insurance.--Nothing in this title 
shall affect the authority of the Corporation under the Federal Deposit 
Insurance Act or the National Credit Union Administration Board under 
the Federal Credit Union Act as to matters related to deposit insurance 
and share insurance, respectively.
    (s) Fair Housing Act.--No provision of this title shall be 
construed as affecting any authority arising under the Fair Housing 
Act.
SEC. 1028. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE ARBITRATION.
    (a) Study and Report.--The Bureau shall conduct a study of, and 
shall provide a report to Congress concerning, the use of agreements 
providing for arbitration of any future dispute between covered persons 
and consumers in connection with the offering or providing of consumer 
financial products or services.
    (b) Further Authority.--The Bureau, by regulation, may prohibit or 
impose conditions or limitations on the use of an agreement between a 
covered person and a consumer for a consumer financial product or 
service providing for arbitration of any future dispute between the 
parties, if the Bureau finds that such a prohibition or imposition of 
conditions or limitations is in the public interest and for the 
protection of consumers. The findings in such rule shall be consistent 
with the study conducted under subsection (a).
    (c) Limitation.--The authority described in subsection (b) may not 
be construed to prohibit or restrict a consumer from entering into a 
voluntary arbitration agreement with a covered person after a dispute 
has arisen.
    (d) Effective Date.--Notwithstanding any other provision of law, 
any regulation prescribed by the Bureau under subsection (b) shall 
apply, consistent with the terms of the regulation, to any agreement 
between a consumer and a covered person entered into after the end of 
the 180-day period beginning on the effective date of the regulation, 
as established by the Bureau.
SEC. 1029. EXCLUSION FOR AUTO DEALERS.
    (a) Sale, Servicing, and Leasing of Motor Vehicles Excluded.--
Except as permitted in subsection (b), the Bureau may not exercise any 
rulemaking, supervisory, enforcement or any other authority, including 
any authority to order assessments, over a motor vehicle dealer that is 
predominantly engaged in the sale and servicing of motor vehicles, the 
leasing and servicing of motor vehicles, or both.
    (b) Certain Functions Excepted.--Subsection (a) shall not apply to 
any person, to the extent that such person--
        (1) provides consumers with any services related to residential 
    or commercial mortgages or self-financing transactions involving 
    real property;
        (2) operates a line of business--
            (A) that involves the extension of retail credit or retail 
        leases involving motor vehicles; and
            (B) in which--
                (i) the extension of retail credit or retail leases are 
            provided directly to consumers; and
                (ii) the contract governing such extension of retail 
            credit or retail leases is not routinely assigned to an 
            unaffiliated third party finance or leasing source; or
        (3) offers or provides a consumer financial product or service 
    not involving or related to the sale, financing, leasing, rental, 
    repair, refurbishment, maintenance, or other servicing of motor 
    vehicles, motor vehicle parts, or any related or ancillary product 
    or service.
    (c) Preservation of Authorities of Other Agencies.--Except as 
provided in subsections (b) and (d), nothing in this title, including 
subtitle F, shall be construed as modifying, limiting, or superseding 
the operation of any provision of Federal law, or otherwise affecting 
the authority of the Board of Governors, the Federal Trade Commission, 
or any other Federal agency, with respect to a person described in 
subsection (a).
    (d) Federal Trade Commission Authority.--Notwithstanding section 18 
of the Federal Trade Commission Act, the Federal Trade Commission is 
authorized to prescribe rules under sections 5 and 18(a)(1)(B) of the 
Federal Trade Commission Act. in accordance with section 553 of title 
5, United States Code, with respect to a person described in subsection 
(a).
    (e) Coordination With Office Of Service Member Affairs.--The Board 
of Governors and the Federal Trade Commission shall coordinate with the 
Office of Service Member Affairs, to ensure that--
        (1) service members and their families are educated and 
    empowered to make better informed decisions regarding consumer 
    financial products and services offered by motor vehicle dealers, 
    with a focus on motor vehicle dealers in the proximity of military 
    installations; and
        (2) complaints by service members and their families concerning 
    such motor vehicle dealers are effectively monitored and responded 
    to, and where appropriate, enforcement action is pursued by the 
    authorized agencies.
    (f) Definitions.--For purposes of this section, the following 
definitions shall apply:
        (1) Motor vehicle.--The term ``motor vehicle'' means--
            (A) any self-propelled vehicle designed for transporting 
        persons or property on a street, highway, or other road;
            (B) recreational boats and marine equipment;
            (C) motorcycles;
            (D) motor homes, recreational vehicle trailers, and slide-
        in campers, as those terms are defined in sections 571.3 and 
        575.103 (d) of title 49, Code of Federal Regulations, or any 
        successor thereto; and
            (E) other vehicles that are titled and sold through 
        dealers.
        (2) Motor vehicle dealer.--The term ``motor vehicle dealer'' 
    means any person or resident in the United States, or any territory 
    of the United States, who--
            (A) is licensed by a State, a territory of the United 
        States, or the District of Columbia to engage in the sale of 
        motor vehicles; and
            (B) takes title to, holds an ownership in, or takes 
        physical custody of motor vehicles.
SEC. 1029A. EFFECTIVE DATE.
    This subtitle shall become effective on the designated transfer 
date, except that sections 1022, 1024, and 1025(e) shall become 
effective on the date of enactment of this Act.

                Subtitle C--Specific Bureau Authorities

SEC. 1031. PROHIBITING UNFAIR, DECEPTIVE, OR ABUSIVE ACTS OR PRACTICES.
    (a) In General.--The Bureau may take any action authorized under 
subtitle E to prevent a covered person or service provider from 
committing or engaging in an unfair, deceptive, or abusive act or 
practice under Federal law in connection with any transaction with a 
consumer for a consumer financial product or service, or the offering 
of a consumer financial product or service.
    (b) Rulemaking.--The Bureau may prescribe rules applicable to a 
covered person or service provider identifying as unlawful unfair, 
deceptive, or abusive acts or practices in connection with any 
transaction with a consumer for a consumer financial product or 
service, or the offering of a consumer financial product or service. 
Rules under this section may include requirements for the purpose of 
preventing such acts or practices.
    (c) Unfairness.--
        (1) In general.--The Bureau shall have no authority under this 
    section to declare an act or practice in connection with a 
    transaction with a consumer for a consumer financial product or 
    service, or the offering of a consumer financial product or 
    service, to be unlawful on the grounds that such act or practice is 
    unfair, unless the Bureau has a reasonable basis to conclude that--
            (A) the act or practice causes or is likely to cause 
        substantial injury to consumers which is not reasonably 
        avoidable by consumers; and
            (B) such substantial injury is not outweighed by 
        countervailing benefits to consumers or to competition.
        (2) Consideration of public policies.--In determining whether 
    an act or practice is unfair, the Bureau may consider established 
    public policies as evidence to be considered with all other 
    evidence. Such public policy considerations may not serve as a 
    primary basis for such determination.
    (d) Abusive.--The Bureau shall have no authority under this section 
to declare an act or practice abusive in connection with the provision 
of a consumer financial product or service, unless the act or 
practice--
        (1) materially interferes with the ability of a consumer to 
    understand a term or condition of a consumer financial product or 
    service; or
        (2) takes unreasonable advantage of--
            (A) a lack of understanding on the part of the consumer of 
        the material risks, costs, or conditions of the product or 
        service;
            (B) the inability of the consumer to protect the interests 
        of the consumer in selecting or using a consumer financial 
        product or service; or
            (C) the reasonable reliance by the consumer on a covered 
        person to act in the interests of the consumer.
    (e) Consultation.--In prescribing rules under this section, the 
Bureau shall consult with the Federal banking agencies, or other 
Federal agencies, as appropriate, concerning the consistency of the 
proposed rule with prudential, market, or systemic objectives 
administered by such agencies.
    (f) Consideration of Seasonal Income.--The rules of the Bureau 
under this section shall provide, with respect to an extension of 
credit secured by residential real estate or a dwelling, if documented 
income of the borrower, including income from a small business, is a 
repayment source for an extension of credit secured by residential real 
estate or a dwelling, the creditor may consider the seasonality and 
irregularity of such income in the underwriting of and scheduling of 
payments for such credit.
SEC. 1032. DISCLOSURES.
    (a) In General.--The Bureau may prescribe rules to ensure that the 
features of any consumer financial product or service, both initially 
and over the term of the product or service, are fully, accurately, and 
effectively disclosed to consumers in a manner that permits consumers 
to understand the costs, benefits, and risks associated with the 
product or service, in light of the facts and circumstances.
    (b) Model Disclosures.--
        (1) In general.--Any final rule prescribed by the Bureau under 
    this section requiring disclosures may include a model form that 
    may be used at the option of the covered person for provision of 
    the required disclosures.
        (2) Format.--A model form issued pursuant to paragraph (1) 
    shall contain a clear and conspicuous disclosure that, at a 
    minimum--
            (A) uses plain language comprehensible to consumers;
            (B) contains a clear format and design, such as an easily 
        readable type font; and
            (C) succinctly explains the information that must be 
        communicated to the consumer.
        (3) Consumer testing.--Any model form issued pursuant to this 
    subsection shall be validated through consumer testing.
    (c) Basis for Rulemaking.--In prescribing rules under this section, 
the Bureau shall consider available evidence about consumer awareness, 
understanding of, and responses to disclosures or communications about 
the risks, costs, and benefits of consumer financial products or 
services.
    (d) Safe Harbor.--Any covered person that uses a model form 
included with a rule issued under this section shall be deemed to be in 
compliance with the disclosure requirements of this section with 
respect to such model form.
    (e) Trial Disclosure Programs.--
        (1) In general.--The Bureau may permit a covered person to 
    conduct a trial program that is limited in time and scope, subject 
    to specified standards and procedures, for the purpose of providing 
    trial disclosures to consumers that are designed to improve upon 
    any model form issued pursuant to subsection (b)(1), or any other 
    model form issued to implement an enumerated statute, as 
    applicable.
        (2) Safe harbor.--The standards and procedures issued by the 
    Bureau shall be designed to encourage covered persons to conduct 
    trial disclosure programs. For the purposes of administering this 
    subsection, the Bureau may establish a limited period during which 
    a covered person conducting a trial disclosure program shall be 
    deemed to be in compliance with, or may be exempted from, a 
    requirement of a rule or an enumerated consumer law.
        (3) Public disclosure.--The rules of the Bureau shall provide 
    for public disclosure of trial disclosure programs, which public 
    disclosure may be limited, to the extent necessary to encourage 
    covered persons to conduct effective trials.
    (f) Combined Mortgage Loan Disclosure.--Not later than 1 year after 
the designated transfer date, the Bureau shall propose for public 
comment rules and model disclosures that combine the disclosures 
required under the Truth in Lending Act and sections 4 and 5 of the 
Real Estate Settlement Procedures Act of 1974, into a single, 
integrated disclosure for mortgage loan transactions covered by those 
laws, unless the Bureau determines that any proposal issued by the 
Board of Governors and the Secretary of Housing and Urban Development 
carries out the same purpose.
SEC. 1033. CONSUMER RIGHTS TO ACCESS INFORMATION.
    (a) In General.--Subject to rules prescribed by the Bureau, a 
covered person shall make available to a consumer, upon request, 
information in the control or possession of the covered person 
concerning the consumer financial product or service that the consumer 
obtained from such covered person, including information relating to 
any transaction, series of transactions, or to the account including 
costs, charges and usage data. The information shall be made available 
in an electronic form usable by consumers.
    (b) Exceptions.--A covered person may not be required by this 
section to make available to the consumer--
        (1) any confidential commercial information, including an 
    algorithm used to derive credit scores or other risk scores or 
    predictors;
        (2) any information collected by the covered person for the 
    purpose of preventing fraud or money laundering, or detecting, or 
    making any report regarding other unlawful or potentially unlawful 
    conduct;
        (3) any information required to be kept confidential by any 
    other provision of law; or
        (4) any information that the covered person cannot retrieve in 
    the ordinary course of its business with respect to that 
    information.
    (c) No Duty To Maintain Records.--Nothing in this section shall be 
construed to impose any duty on a covered person to maintain or keep 
any information about a consumer.
    (d) Standardized Formats for Data.--The Bureau, by rule, shall 
prescribe standards applicable to covered persons to promote the 
development and use of standardized formats for information, including 
through the use of machine readable files, to be made available to 
consumers under this section.
    (e) Consultation.--The Bureau shall, when prescribing any rule 
under this section, consult with the Federal banking agencies and the 
Federal Trade Commission to ensure, to the extent appropriate, that the 
rules--
        (1) impose substantively similar requirements on covered 
    persons;
        (2) take into account conditions under which covered persons do 
    business both in the United States and in other countries; and
        (3) do not require or promote the use of any particular 
    technology in order to develop systems for compliance.
SEC. 1034. RESPONSE TO CONSUMER COMPLAINTS AND INQUIRIES.
    (a) Timely Regulator Response to Consumers.--The Bureau shall 
establish, in consultation with the appropriate Federal regulatory 
agencies, reasonable procedures to provide a timely response to 
consumers, in writing where appropriate, to complaints against, or 
inquiries concerning, a covered person, including--
        (1) steps that have been taken by the regulator in response to 
    the complaint or inquiry of the consumer;
        (2) any responses received by the regulator from the covered 
    person; and
        (3) any follow-up actions or planned follow-up actions by the 
    regulator in response to the complaint or inquiry of the consumer.
    (b) Timely Response to Regulator by Covered Person.--A covered 
person subject to supervision and primary enforcement by the Bureau 
pursuant to section 1025 shall provide a timely response, in writing 
where appropriate, to the Bureau, the prudential regulators, and any 
other agency having jurisdiction over such covered person concerning a 
consumer complaint or inquiry, including--
        (1) steps that have been taken by the covered person to respond 
    to the complaint or inquiry of the consumer;
        (2) responses received by the covered person from the consumer; 
    and
        (3) follow-up actions or planned follow-up actions by the 
    covered person to respond to the complaint or inquiry of the 
    consumer.
    (c) Provision of Information to Consumers.--
        (1) In general.--A covered person subject to supervision and 
    primary enforcement by the Bureau pursuant to section 1025 shall, 
    in a timely manner, comply with a consumer request for information 
    in the control or possession of such covered person concerning the 
    consumer financial product or service that the consumer obtained 
    from such covered person, including supporting written 
    documentation, concerning the account of the consumer.
        (2) Exceptions.--A covered person subject to supervision and 
    primary enforcement by the Bureau pursuant to section 1025, a 
    prudential regulator, and any other agency having jurisdiction over 
    a covered person subject to supervision and primary enforcement by 
    the Bureau pursuant to section 1025 may not be required by this 
    section to make available to the consumer--
            (A) any confidential commercial information, including an 
        algorithm used to derive credit scores or other risk scores or 
        predictors;
            (B) any information collected by the covered person for the 
        purpose of preventing fraud or money laundering, or detecting 
        or making any report regarding other unlawful or potentially 
        unlawful conduct;
            (C) any information required to be kept confidential by any 
        other provision of law; or
            (D) any nonpublic or confidential information, including 
        confidential supervisory information.
    (d) Agreements With Other Agencies.--The Bureau shall enter into a 
memorandum of understanding with any affected Federal regulatory agency 
regarding procedures by which any covered person, and the prudential 
regulators, and any other agency having jurisdiction over a covered 
person, including the Secretary of the Department of Housing and Urban 
Development and the Secretary of Education, shall comply with this 
section.
SEC. 1035. PRIVATE EDUCATION LOAN OMBUDSMAN.
    (a) Establishment.--The Secretary, in consultation with the 
Director, shall designate a Private Education Loan Ombudsman (in this 
section referred to as the ``Ombudsman'') within the Bureau, to provide 
timely assistance to borrowers of private education loans.
    (b) Public Information.--The Secretary and the Director shall 
disseminate information about the availability and functions of the 
Ombudsman to borrowers and potential borrowers, as well as institutions 
of higher education, lenders, guaranty agencies, loan servicers, and 
other participants in private education student loan programs.
    (c) Functions of Ombudsman.--The Ombudsman designated under this 
subsection shall--
        (1) in accordance with regulations of the Director, receive, 
    review, and attempt to resolve informally complaints from borrowers 
    of loans described in subsection (a), including, as appropriate, 
    attempts to resolve such complaints in collaboration with the 
    Department of Education and with institutions of higher education, 
    lenders, guaranty agencies, loan servicers, and other participants 
    in private education loan programs;
        (2) not later than 90 days after the designated transfer date, 
    establish a memorandum of understanding with the student loan 
    ombudsman established under section 141(f) of the Higher Education 
    Act of 1965 (20 U.S.C. 1018(f)), to ensure coordination in 
    providing assistance to and serving borrowers seeking to resolve 
    complaints related to their private education or Federal student 
    loans;
        (3) compile and analyze data on borrower complaints regarding 
    private education loans; and
        (4) make appropriate recommendations to the Director, the 
    Secretary, the Secretary of Education, the Committee on Banking, 
    Housing, and Urban Affairs and the Committee on Health, Education, 
    Labor, and Pensions of the Senate and the Committee on Financial 
    Services and the Committee on Education and Labor of the House of 
    Representatives.
    (d) Annual Reports.--
        (1) In general.--The Ombudsman shall prepare an annual report 
    that describes the activities, and evaluates the effectiveness of 
    the Ombudsman during the preceding year.
        (2) Submission.--The report required by paragraph (1) shall be 
    submitted on the same date annually to the Secretary, the Secretary 
    of Education, the Committee on Banking, Housing, and Urban Affairs 
    and the Committee on Health, Education, Labor, and Pensions of the 
    Senate and the Committee on Financial Services and the Committee on 
    Education and Labor of the House of Representatives.
    (e) Definitions.--For purposes of this section, the terms ``private 
education loan'' and ``institution of higher education'' have the same 
meanings as in section 140 of the Truth in Lending Act (15 U.S.C. 
1650).
SEC. 1036. PROHIBITED ACTS.
    (a) In General.--It shall be unlawful for--
        (1) any covered person or service provider--
            (A) to offer or provide to a consumer any financial product 
        or service not in conformity with Federal consumer financial 
        law, or otherwise commit any act or omission in violation of a 
        Federal consumer financial law; or
            (B) to engage in any unfair, deceptive, or abusive act or 
        practice;
        (2) any covered person or service provider to fail or refuse, 
    as required by Federal consumer financial law, or any rule or order 
    issued by the Bureau thereunder--
            (A) to permit access to or copying of records;
            (B) to establish or maintain records; or
            (C) to make reports or provide information to the Bureau; 
        or
        (3) any person to knowingly or recklessly provide substantial 
    assistance to a covered person or service provider in violation of 
    the provisions of section 1031, or any rule or order issued 
    thereunder, and notwithstanding any provision of this title, the 
    provider of such substantial assistance shall be deemed to be in 
    violation of that section to the same extent as the person to whom 
    such assistance is provided.
    (b) Exception.--No person shall be held to have violated subsection 
(a)(1) solely by virtue of providing or selling time or space to a 
covered person or service provider placing an advertisement.
SEC. 1037. EFFECTIVE DATE.
    This subtitle shall take effect on the designated transfer date.

                 Subtitle D--Preservation of State Law

SEC. 1041. RELATION TO STATE LAW.
    (a) In General.--
        (1) Rule of construction.--This title, other than sections 1044 
    through 1048, may not be construed as annulling, altering, or 
    affecting, or exempting any person subject to the provisions of 
    this title from complying with, the statutes, regulations, orders, 
    or interpretations in effect in any State, except to the extent 
    that any such provision of law is inconsistent with the provisions 
    of this title, and then only to the extent of the inconsistency.
        (2) Greater protection under state law.--For purposes of this 
    subsection, a statute, regulation, order, or interpretation in 
    effect in any State is not inconsistent with the provisions of this 
    title if the protection that such statute, regulation, order, or 
    interpretation affords to consumers is greater than the protection 
    provided under this title. A determination regarding whether a 
    statute, regulation, order, or interpretation in effect in any 
    State is inconsistent with the provisions of this title may be made 
    by the Bureau on its own motion or in response to a nonfrivolous 
    petition initiated by any interested person.
    (b) Relation to Other Provisions of Enumerated Consumer Laws That 
Relate to State Law.--No provision of this title, except as provided in 
section 1083, shall be construed as modifying, limiting, or superseding 
the operation of any provision of an enumerated consumer law that 
relates to the application of a law in effect in any State with respect 
to such Federal law.
    (c) Additional Consumer Protection Regulations in Response to State 
Action.--
        (1) Notice of proposed rule required.--The Bureau shall issue a 
    notice of proposed rulemaking whenever a majority of the States has 
    enacted a resolution in support of the establishment or 
    modification of a consumer protection regulation by the Bureau.
        (2) Bureau considerations required for issuance of final 
    regulation.--Before prescribing a final regulation based upon a 
    notice issued pursuant to paragraph (1), the Bureau shall take into 
    account whether--
            (A) the proposed regulation would afford greater protection 
        to consumers than any existing regulation;
            (B) the intended benefits of the proposed regulation for 
        consumers would outweigh any increased costs or inconveniences 
        for consumers, and would not discriminate unfairly against any 
        category or class of consumers; and
            (C) a Federal banking agency has advised that the proposed 
        regulation is likely to present an unacceptable safety and 
        soundness risk to insured depository institutions.
        (3) Explanation of considerations.--The Bureau--
            (A) shall include a discussion of the considerations 
        required in paragraph (2) in the Federal Register notice of a 
        final regulation prescribed pursuant to this subsection; and
            (B) whenever the Bureau determines not to prescribe a final 
        regulation, shall publish an explanation of such determination 
        in the Federal Register, and provide a copy of such explanation 
        to each State that enacted a resolution in support of the 
        proposed regulation, the Committee on Banking, Housing, and 
        Urban Affairs of the Senate, and the Committee on Financial 
        Services of the House of Representatives.
        (4) Reservation of authority.--No provision of this subsection 
    shall be construed as limiting or restricting the authority of the 
    Bureau to enhance consumer protection standards established 
    pursuant to this title in response to its own motion or in response 
    to a request by any other interested person.
        (5) Rule of construction.--No provision of this subsection 
    shall be construed as exempting the Bureau from complying with 
    subchapter II of chapter 5 of title 5, United States Code.
        (6) Definition.--For purposes of this subsection, the term 
    ``consumer protection regulation'' means a regulation that the 
    Bureau is authorized to prescribe under the Federal consumer 
    financial laws.
SEC. 1042. PRESERVATION OF ENFORCEMENT POWERS OF STATES.
    (a) In General.--
        (1) Action by state.--Except as provided in paragraph (2), the 
    attorney general (or the equivalent thereof) of any State may bring 
    a civil action in the name of such State in any district court of 
    the United States in that State or in State court that is located 
    in that State and that has jurisdiction over the defendant, to 
    enforce provisions of this title or regulations issued under this 
    title, and to secure remedies under provisions of this title or 
    remedies otherwise provided under other law. A State regulator may 
    bring a civil action or other appropriate proceeding to enforce the 
    provisions of this title or regulations issued under this title 
    with respect to any entity that is State-chartered, incorporated, 
    licensed, or otherwise authorized to do business under State law 
    (except as provided in paragraph (2)), and to secure remedies under 
    provisions of this title or remedies otherwise provided under other 
    provisions of law with respect to such an entity.
        (2) Action by state against national bank or federal savings 
    association to enforce rules.--
            (A) In general.--Except as permitted under subparagraph 
        (B), the attorney general (or equivalent thereof) of any State 
        may not bring a civil action in the name of such State against 
        a national bank or Federal savings association to enforce a 
        provision of this title.
            (B) Enforcement of rules permitted.--The attorney general 
        (or the equivalent thereof) of any State may bring a civil 
        action in the name of such State against a national bank or 
        Federal savings association in any district court of the United 
        States in the State or in State court that is located in that 
        State and that has jurisdiction over the defendant to enforce a 
        regulation prescribed by the Bureau under a provision of this 
        title and to secure remedies under provisions of this title or 
        remedies otherwise provided under other law.
        (3) Rule of construction.--No provision of this title shall be 
    construed as modifying, limiting, or superseding the operation of 
    any provision of an enumerated consumer law that relates to the 
    authority of a State attorney general or State regulator to enforce 
    such Federal law.
    (b) Consultation Required.--
        (1) Notice.--
            (A) In general.--Before initiating any action in a court or 
        other administrative or regulatory proceeding against any 
        covered person as authorized by subsection (a) to enforce any 
        provision of this title, including any regulation prescribed by 
        the Bureau under this title, a State attorney general or State 
        regulator shall timely provide a copy of the complete complaint 
        to be filed and written notice describing such action or 
        proceeding to the Bureau and the prudential regulator, if any, 
        or the designee thereof.
            (B) Emergency action.--If prior notice is not practicable, 
        the State attorney general or State regulator shall provide a 
        copy of the complete complaint and the notice to the Bureau and 
        the prudential regulator, if any, immediately upon instituting 
        the action or proceeding.
            (C) Contents of notice.--The notification required under 
        this paragraph shall, at a minimum, describe--
                (i) the identity of the parties;
                (ii) the alleged facts underlying the proceeding; and
                (iii) whether there may be a need to coordinate the 
            prosecution of the proceeding so as not to interfere with 
            any action, including any rulemaking, undertaken by the 
            Bureau, a prudential regulator, or another Federal agency.
        (2) Bureau response.--In any action described in paragraph (1), 
    the Bureau may--
            (A) intervene in the action as a party;
            (B) upon intervening--
                (i) remove the action to the appropriate United States 
            district court, if the action was not originally brought 
            there; and
                (ii) be heard on all matters arising in the action; and
            (C) appeal any order or judgment, to the same extent as any 
        other party in the proceeding may.
    (c) Regulations.--The Bureau shall prescribe regulations to 
implement the requirements of this section and, from time to time, 
provide guidance in order to further coordinate actions with the State 
attorneys general and other regulators.
    (d) Preservation of State Authority.--
        (1) State claims.--No provision of this section shall be 
    construed as altering, limiting, or affecting the authority of a 
    State attorney general or any other regulatory or enforcement 
    agency or authority to bring an action or other regulatory 
    proceeding arising solely under the law in effect in that State.
        (2) State securities regulators.--No provision of this title 
    shall be construed as altering, limiting, or affecting the 
    authority of a State securities commission (or any agency or office 
    performing like functions) under State law to adopt rules, initiate 
    enforcement proceedings, or take any other action with respect to a 
    person regulated by such commission or authority.
        (3) State insurance regulators.--No provision of this title 
    shall be construed as altering, limiting, or affecting the 
    authority of a State insurance commission or State insurance 
    regulator under State law to adopt rules, initiate enforcement 
    proceedings, or take any other action with respect to a person 
    regulated by such commission or regulator.
SEC. 1043. PRESERVATION OF EXISTING CONTRACTS.
    This title, and regulations, orders, guidance, and interpretations 
prescribed, issued, or established by the Bureau, shall not be 
construed to alter or affect the applicability of any regulation, 
order, guidance, or interpretation prescribed, issued, and established 
by the Comptroller of the Currency or the Director of the Office of 
Thrift Supervision regarding the applicability of State law under 
Federal banking law to any contract entered into on or before the date 
of enactment of this Act, by national banks, Federal savings 
associations, or subsidiaries thereof that are regulated and supervised 
by the Comptroller of the Currency or the Director of the Office of 
Thrift Supervision, respectively.
SEC. 1044. STATE LAW PREEMPTION STANDARDS FOR NATIONAL BANKS AND 
SUBSIDIARIES CLARIFIED.
    (a) In General.--Chapter one of title LXII of the Revised Statutes 
of the United States (12 U.S.C. 21 et seq.) is amended by inserting 
after section 5136B the following new section:
``SEC. 5136C. STATE LAW PREEMPTION STANDARDS FOR NATIONAL BANKS AND 
SUBSIDIARIES CLARIFIED.
    ``(a) Definitions.--For purposes of this section, the following 
definitions shall apply:
        ``(1) National bank.--The term `national bank' includes--
            ``(A) any bank organized under the laws of the United 
        States; and
            ``(B) any Federal branch established in accordance with the 
        International Banking Act of 1978.
        ``(2) State consumer financial laws.--The term `State consumer 
    financial law' means a State law that does not directly or 
    indirectly discriminate against national banks and that directly 
    and specifically regulates the manner, content, or terms and 
    conditions of any financial transaction (as may be authorized for 
    national banks to engage in), or any account related thereto, with 
    respect to a consumer.
        ``(3) Other definitions.--The terms `affiliate', `subsidiary', 
    `includes', and `including' have the same meanings as in section 3 
    of the Federal Deposit Insurance Act.
    ``(b) Preemption Standard.--
        ``(1) In general.--State consumer financial laws are preempted, 
    only if--
            ``(A) application of a State consumer financial law would 
        have a discriminatory effect on national banks, in comparison 
        with the effect of the law on a bank chartered by that State;
            ``(B) in accordance with the legal standard for preemption 
        in the decision of the Supreme Court of the United States in 
        Barnett Bank of Marion County, N. A. v. Nelson, Florida 
        Insurance Commissioner, et al., 517 U.S. 25 (1996), the State 
        consumer financial law prevents or significantly interferes 
        with the exercise by the national bank of its powers; and any 
        preemption determination under this subparagraph may be made by 
        a court, or by regulation or order of the Comptroller of the 
        Currency on a case-by-case basis, in accordance with applicable 
        law; or
            ``(C) the State consumer financial law is preempted by a 
        provision of Federal law other than this title.
        ``(2) Savings clause.--This title and section 24 of the Federal 
    Reserve Act (12 U.S.C. 371) do not preempt, annul, or affect the 
    applicability of any State law to any subsidiary or affiliate of a 
    national bank (other than a subsidiary or affiliate that is 
    chartered as a national bank).
        ``(3) Case-by-case basis.--
            ``(A) Definition.--As used in this section the term `case-
        by-case basis' refers to a determination pursuant to this 
        section made by the Comptroller concerning the impact of a 
        particular State consumer financial law on any national bank 
        that is subject to that law, or the law of any other State with 
        substantively equivalent terms.
            ``(B) Consultation.--When making a determination on a case-
        by-case basis that a State consumer financial law of another 
        State has substantively equivalent terms as one that the 
        Comptroller is preempting, the Comptroller shall first consult 
        with the Bureau of Consumer Financial Protection and shall take 
        the views of the Bureau into account when making the 
        determination.
        ``(4) Rule of construction.--This title does not occupy the 
    field in any area of State law.
        ``(5) Standards of review.--
            ``(A) Preemption.--A court reviewing any determinations 
        made by the Comptroller regarding preemption of a State law by 
        this title or section 24 of the Federal Reserve Act (12 U.S.C. 
        371) shall assess the validity of such determinations, 
        depending upon the thoroughness evident in the consideration of 
        the agency, the validity of the reasoning of the agency, the 
        consistency with other valid determinations made by the agency, 
        and other factors which the court finds persuasive and relevant 
        to its decision.
            ``(B) Savings clause.--Except as provided in subparagraph 
        (A), nothing in this section shall affect the deference that a 
        court may afford to the Comptroller in making determinations 
        regarding the meaning or interpretation of title LXII of the 
        Revised Statutes of the United States or other Federal laws.
        ``(6) Comptroller determination not delegable.--Any regulation, 
    order, or determination made by the Comptroller of the Currency 
    under paragraph (1)(B) shall be made by the Comptroller, and shall 
    not be delegable to another officer or employee of the Comptroller 
    of the Currency.
    ``(c) Substantial Evidence.--No regulation or order of the 
Comptroller of the Currency prescribed under subsection (b)(1)(B), 
shall be interpreted or applied so as to invalidate, or otherwise 
declare inapplicable to a national bank, the provision of the State 
consumer financial law, unless substantial evidence, made on the record 
of the proceeding, supports the specific finding regarding the 
preemption of such provision in accordance with the legal standard of 
the decision of the Supreme Court of the United States in Barnett Bank 
of Marion County, N.A. v. Nelson, Florida Insurance Commissioner, et 
al., 517 U.S. 25 (1996).
    ``(d) Periodic Review of Preemption Determinations.--
        ``(1) In general.--The Comptroller of the Currency shall 
    periodically conduct a review, through notice and public comment, 
    of each determination that a provision of Federal law preempts a 
    State consumer financial law. The agency shall conduct such review 
    within the 5-year period after prescribing or otherwise issuing 
    such determination, and at least once during each 5-year period 
    thereafter. After conducting the review of, and inspecting the 
    comments made on, the determination, the agency shall publish a 
    notice in the Federal Register announcing the decision to continue 
    or rescind the determination or a proposal to amend the 
    determination. Any such notice of a proposal to amend a 
    determination and the subsequent resolution of such proposal shall 
    comply with the procedures set forth in subsections (a) and (b) of 
    section 5244 of the Revised Statutes of the United States (12 
    U.S.C. 43 (a), (b)).
        ``(2) Reports to congress.--At the time of issuing a review 
    conducted under paragraph (1), the Comptroller of the Currency 
    shall submit a report regarding such review to the Committee on 
    Financial Services of the House of Representatives and the 
    Committee on Banking, Housing, and Urban Affairs of the Senate. The 
    report submitted to the respective committees shall address whether 
    the agency intends to continue, rescind, or propose to amend any 
    determination that a provision of Federal law preempts a State 
    consumer financial law, and the reasons therefor.
    ``(e) Application of State Consumer Financial Law to Subsidiaries 
and Affiliates.--Notwithstanding any provision of this title or section 
24 of Federal Reserve Act (12 U.S.C. 371), a State consumer financial 
law shall apply to a subsidiary or affiliate of a national bank (other 
than a subsidiary or affiliate that is chartered as a national bank) to 
the same extent that the State consumer financial law applies to any 
person, corporation, or other entity subject to such State law.
    ``(f) Preservation of Powers Related to Charging Interest.--No 
provision of this title shall be construed as altering or otherwise 
affecting the authority conferred by section 5197 of the Revised 
Statutes of the United States (12 U.S.C. 85) for the charging of 
interest by a national bank at the rate allowed by the laws of the 
State, territory, or district where the bank is located, including with 
respect to the meaning of `interest' under such provision.
    ``(g) Transparency of OCC Preemption Determinations.--The 
Comptroller of the Currency shall publish and update no less frequently 
than quarterly, a list of preemption determinations by the Comptroller 
of the Currency then in effect that identifies the activities and 
practices covered by each determination and the requirements and 
constraints determined to be preempted.''.
    (b) Clerical Amendment.--The table of sections for chapter one of 
title LXII of the Revised Statutes of the United States is amended by 
inserting after the item relating to section 5136B the following new 
item:

``Sec. 5136C. State law preemption standards for national banks and 
          subsidiaries clarified.''.
SEC. 1045. CLARIFICATION OF LAW APPLICABLE TO NONDEPOSITORY INSTITUTION 
SUBSIDIARIES.
    Section 5136C of the Revised Statutes of the United States (as 
added by this subtitle) is amended by adding at the end the following:
    ``(h) Clarification of Law Applicable to Nondepository Institution 
Subsidiaries and Affiliates of National Banks.--
        ``(1) Definitions.--For purposes of this subsection, the terms 
    `depository institution', `subsidiary', and `affiliate' have the 
    same meanings as in section 3 of the Federal Deposit Insurance Act.
        ``(2) Rule of construction.--No provision of this title or 
    section 24 of the Federal Reserve Act (12 U.S.C. 371) shall be 
    construed as preempting, annulling, or affecting the applicability 
    of State law to any subsidiary, affiliate, or agent of a national 
    bank (other than a subsidiary, affiliate, or agent that is 
    chartered as a national bank).''.
SEC. 1046. STATE LAW PREEMPTION STANDARDS FOR FEDERAL SAVINGS 
ASSOCIATIONS AND SUBSIDIARIES CLARIFIED.
    (a) In General.--The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) 
is amended by inserting after section 5 the following new section:
``SEC. 6. STATE LAW PREEMPTION STANDARDS FOR FEDERAL SAVINGS 
ASSOCIATIONS CLARIFIED.
    ``(a) In General.--Any determination by a court or by the Director 
or any successor officer or agency regarding the relation of State law 
to a provision of this Act or any regulation or order prescribed under 
this Act shall be made in accordance with the laws and legal standards 
applicable to national banks regarding the preemption of State law.
    ``(b) Principles of Conflict Preemption Applicable.--
Notwithstanding the authorities granted under sections 4 and 5, this 
Act does not occupy the field in any area of State law.''.
    (b) Clerical Amendment.--The table of sections for the Home Owners' 
Loan Act (12 U.S.C. 1461 et seq.) is amended by striking the item 
relating to section 6 and inserting the following new item:

    ``Sec. 6. State law preemption standards for Federal savings 
              associations and subsidiaries clarified.''.
SEC. 1047. VISITORIAL STANDARDS FOR NATIONAL BANKS AND SAVINGS 
ASSOCIATIONS.
    (a) National Banks.--Section 5136C of the Revised Statutes of the 
United States (as added by this subtitle) is amended by adding at the 
end the following:
    ``(i) Visitorial Powers.--
        ``(1) In general.--In accordance with the decision of the 
    Supreme Court of the United States in Cuomo v. Clearing House 
    Assn., L. L. C. (129 S. Ct. 2710 (2009)), no provision of this 
    title which relates to visitorial powers or otherwise limits or 
    restricts the visitorial authority to which any national bank is 
    subject shall be construed as limiting or restricting the authority 
    of any attorney general (or other chief law enforcement officer) of 
    any State to bring an action against a national bank in a court of 
    appropriate jurisdiction to enforce an applicable law and to seek 
    relief as authorized by such law.
    ``(j) Enforcement Actions.--The ability of the Comptroller of the 
Currency to bring an enforcement action under this title or section 5 
of the Federal Trade Commission Act does not preclude any private party 
from enforcing rights granted under Federal or State law in the 
courts.''.
    (b) Savings Associations.--Section 6 of the Home Owners' Loan Act 
(as added by this title) is amended by adding at the end the following:
    ``(c) Visitorial Powers.--The provisions of sections 5136C(i) of 
the Revised Statutes of the United States shall apply to Federal 
savings associations, and any subsidiary thereof, to the same extent 
and in the same manner as if such savings associations, or subsidiaries 
thereof, were national banks or subsidiaries of national banks, 
respectively.''
    ``(d) Enforcement Actions.--The ability of the Comptroller of the 
Currency to bring an enforcement action under this Act or section 5 of 
the Federal Trade Commission Act does not preclude any private party 
from enforcing rights granted under Federal or State law in the 
courts.''.
SEC. 1048. EFFECTIVE DATE.
    This subtitle shall become effective on the designated transfer 
date.

                     Subtitle E--Enforcement Powers

SEC. 1051. DEFINITIONS.
    For purposes of this subtitle, the following definitions shall 
apply:
        (1) Bureau investigation.--The term ``Bureau investigation'' 
    means any inquiry conducted by a Bureau investigator for the 
    purpose of ascertaining whether any person is or has been engaged 
    in any conduct that is a violation, as defined in this section.
        (2) Bureau investigator.--The term ``Bureau investigator'' 
    means any attorney or investigator employed by the Bureau who is 
    charged with the duty of enforcing or carrying into effect any 
    Federal consumer financial law.
        (3) Custodian.--The term ``custodian'' means the custodian or 
    any deputy custodian designated by the Bureau.
        (4) Documentary material.--The term ``documentary material'' 
    includes the original or any copy of any book, document, record, 
    report, memorandum, paper, communication, tabulation, chart, logs, 
    electronic files, or other data or data compilations stored in any 
    medium.
        (5) Violation.--The term ``violation'' means any act or 
    omission that, if proved, would constitute a violation of any 
    provision of Federal consumer financial law.
SEC. 1052. INVESTIGATIONS AND ADMINISTRATIVE DISCOVERY.
    (a) Joint Investigations.--
        (1) In general.--The Bureau or, where appropriate, a Bureau 
    investigator, may engage in joint investigations and requests for 
    information, as authorized under this title.
        (2) Fair lending.--The authority under paragraph (1) includes 
    matters relating to fair lending, and where appropriate, joint 
    investigations with, and requests for information from, the 
    Secretary of Housing and Urban Development, the Attorney General of 
    the United States, or both.
    (b) Subpoenas.--
        (1) In general.--The Bureau or a Bureau investigator may issue 
    subpoenas for the attendance and testimony of witnesses and the 
    production of relevant papers, books, documents, or other material 
    in connection with hearings under this title.
        (2) Failure to obey.--In the case of contumacy or refusal to 
    obey a subpoena issued pursuant to this paragraph and served upon 
    any person, the district court of the United States for any 
    district in which such person is found, resides, or transacts 
    business, upon application by the Bureau or a Bureau investigator 
    and after notice to such person, may issue an order requiring such 
    person to appear and give testimony or to appear and produce 
    documents or other material.
        (3) Contempt.--Any failure to obey an order of the court under 
    this subsection may be punished by the court as a contempt thereof.
    (c) Demands.--
        (1) In general.--Whenever the Bureau has reason to believe that 
    any person may be in possession, custody, or control of any 
    documentary material or tangible things, or may have any 
    information, relevant to a violation, the Bureau may, before the 
    institution of any proceedings under the Federal consumer financial 
    law, issue in writing, and cause to be served upon such person, a 
    civil investigative demand requiring such person to--
            (A) produce such documentary material for inspection and 
        copying or reproduction in the form or medium requested by the 
        Bureau;
            (B) submit such tangible things;
            (C) file written reports or answers to questions;
            (D) give oral testimony concerning documentary material, 
        tangible things, or other information; or
            (E) furnish any combination of such material, answers, or 
        testimony.
        (2) Requirements.--Each civil investigative demand shall state 
    the nature of the conduct constituting the alleged violation which 
    is under investigation and the provision of law applicable to such 
    violation.
        (3) Production of documents.--Each civil investigative demand 
    for the production of documentary material shall--
            (A) describe each class of documentary material to be 
        produced under the demand with such definiteness and certainty 
        as to permit such material to be fairly identified;
            (B) prescribe a return date or dates which will provide a 
        reasonable period of time within which the material so demanded 
        may be assembled and made available for inspection and copying 
        or reproduction; and
            (C) identify the custodian to whom such material shall be 
        made available.
        (4) Production of things.--Each civil investigative demand for 
    the submission of tangible things shall--
            (A) describe each class of tangible things to be submitted 
        under the demand with such definiteness and certainty as to 
        permit such things to be fairly identified;
            (B) prescribe a return date or dates which will provide a 
        reasonable period of time within which the things so demanded 
        may be assembled and submitted; and
            (C) identify the custodian to whom such things shall be 
        submitted.
        (5) Demand for written reports or answers.--Each civil 
    investigative demand for written reports or answers to questions 
    shall--
            (A) propound with definiteness and certainty the reports to 
        be produced or the questions to be answered;
            (B) prescribe a date or dates at which time written reports 
        or answers to questions shall be submitted; and
            (C) identify the custodian to whom such reports or answers 
        shall be submitted.
        (6) Oral testimony.--Each civil investigative demand for the 
    giving of oral testimony shall--
            (A) prescribe a date, time, and place at which oral 
        testimony shall be commenced; and
            (B) identify a Bureau investigator who shall conduct the 
        investigation and the custodian to whom the transcript of such 
        investigation shall be submitted.
        (7) Service.--Any civil investigative demand issued, and any 
    enforcement petition filed, under this section may be served--
            (A) by any Bureau investigator at any place within the 
        territorial jurisdiction of any court of the United States; and
            (B) upon any person who is not found within the territorial 
        jurisdiction of any court of the United States--
                (i) in such manner as the Federal Rules of Civil 
            Procedure prescribe for service in a foreign nation; and
                (ii) to the extent that the courts of the United States 
            have authority to assert jurisdiction over such person, 
            consistent with due process, the United States District 
            Court for the District of Columbia shall have the same 
            jurisdiction to take any action respecting compliance with 
            this section by such person that such district court would 
            have if such person were personally within the jurisdiction 
            of such district court.
        (8) Method of service.--Service of any civil investigative 
    demand or any enforcement petition filed under this section may be 
    made upon a person, including any legal entity, by--
            (A) delivering a duly executed copy of such demand or 
        petition to the individual or to any partner, executive 
        officer, managing agent, or general agent of such person, or to 
        any agent of such person authorized by appointment or by law to 
        receive service of process on behalf of such person;
            (B) delivering a duly executed copy of such demand or 
        petition to the principal office or place of business of the 
        person to be served; or
            (C) depositing a duly executed copy in the United States 
        mails, by registered or certified mail, return receipt 
        requested, duly addressed to such person at the principal 
        office or place of business of such person.
        (9) Proof of service.--
            (A) In general.--A verified return by the individual 
        serving any civil investigative demand or any enforcement 
        petition filed under this section setting forth the manner of 
        such service shall be proof of such service.
            (B) Return receipts.--In the case of service by registered 
        or certified mail, such return shall be accompanied by the 
        return post office receipt of delivery of such demand or 
        enforcement petition.
        (10) Production of documentary material.--The production of 
    documentary material in response to a civil investigative demand 
    shall be made under a sworn certificate, in such form as the demand 
    designates, by the person, if a natural person, to whom the demand 
    is directed or, if not a natural person, by any person having 
    knowledge of the facts and circumstances relating to such 
    production, to the effect that all of the documentary material 
    required by the demand and in the possession, custody, or control 
    of the person to whom the demand is directed has been produced and 
    made available to the custodian.
        (11) Submission of tangible things.--The submission of tangible 
    things in response to a civil investigative demand shall be made 
    under a sworn certificate, in such form as the demand designates, 
    by the person to whom the demand is directed or, if not a natural 
    person, by any person having knowledge of the facts and 
    circumstances relating to such production, to the effect that all 
    of the tangible things required by the demand and in the 
    possession, custody, or control of the person to whom the demand is 
    directed have been submitted to the custodian.
        (12) Separate answers.--Each reporting requirement or question 
    in a civil investigative demand shall be answered separately and 
    fully in writing under oath, unless it is objected to, in which 
    event the reasons for the objection shall be stated in lieu of an 
    answer, and it shall be submitted under a sworn certificate, in 
    such form as the demand designates, by the person, if a natural 
    person, to whom the demand is directed or, if not a natural person, 
    by any person responsible for answering each reporting requirement 
    or question, to the effect that all information required by the 
    demand and in the possession, custody, control, or knowledge of the 
    person to whom the demand is directed has been submitted.
        (13) Testimony.--
            (A) In general.--
                (i) Oath and recordation.--The examination of any 
            person pursuant to a demand for oral testimony served under 
            this subsection shall be taken before an officer authorized 
            to administer oaths and affirmations by the laws of the 
            United States or of the place at which the examination is 
            held. The officer before whom oral testimony is to be taken 
            shall put the witness on oath or affirmation and shall 
            personally, or by any individual acting under the direction 
            of and in the presence of the officer, record the testimony 
            of the witness.
                (ii) Transcription.--The testimony shall be taken 
            stenographically and transcribed.
                (iii) Transmission to custodian.--After the testimony 
            is fully transcribed, the officer investigator before whom 
            the testimony is taken shall promptly transmit a copy of 
            the transcript of the testimony to the custodian.
            (B) Parties present.--Any Bureau investigator before whom 
        oral testimony is to be taken shall exclude from the place 
        where the testimony is to be taken all other persons, except 
        the person giving the testimony, the attorney for that person, 
        the officer before whom the testimony is to be taken, an 
        investigator or representative of an agency with which the 
        Bureau is engaged in a joint investigation, and any 
        stenographer taking such testimony.
            (C) Location.--The oral testimony of any person taken 
        pursuant to a civil investigative demand shall be taken in the 
        judicial district of the United States in which such person 
        resides, is found, or transacts business, or in such other 
        place as may be agreed upon by the Bureau investigator before 
        whom the oral testimony of such person is to be taken and such 
        person.
            (D) Attorney representation.--
                (i) In general.--Any person compelled to appear under a 
            civil investigative demand for oral testimony pursuant to 
            this section may be accompanied, represented, and advised 
            by an attorney.
                (ii) Authority.--The attorney may advise a person 
            described in clause (i), in confidence, either upon the 
            request of such person or upon the initiative of the 
            attorney, with respect to any question asked of such 
            person.
                (iii) Objections.--A person described in clause (i), or 
            the attorney for that person, may object on the record to 
            any question, in whole or in part, and such person shall 
            briefly state for the record the reason for the objection. 
            An objection may properly be made, received, and entered 
            upon the record when it is claimed that such person is 
            entitled to refuse to answer the question on grounds of any 
            constitutional or other legal right or privilege, including 
            the privilege against self-incrimination, but such person 
            shall not otherwise object to or refuse to answer any 
            question, and such person or attorney shall not otherwise 
            interrupt the oral examination.
                (iv) Refusal to answer.--If a person described in 
            clause (i) refuses to answer any question--

                    (I) the Bureau may petition the district court of 
                the United States pursuant to this section for an order 
                compelling such person to answer such question; and
                    (II) if the refusal is on grounds of the privilege 
                against self-incrimination, the testimony of such 
                person may be compelled in accordance with the 
                provisions of section 6004 of title 18, United States 
                Code.

            (E) Transcripts.--For purposes of this subsection--
                (i) after the testimony of any witness is fully 
            transcribed, the Bureau investigator shall afford the 
            witness (who may be accompanied by an attorney) a 
            reasonable opportunity to examine the transcript;
                (ii) the transcript shall be read to or by the witness, 
            unless such examination and reading are waived by the 
            witness;
                (iii) any changes in form or substance which the 
            witness desires to make shall be entered and identified 
            upon the transcript by the Bureau investigator, with a 
            statement of the reasons given by the witness for making 
            such changes;
                (iv) the transcript shall be signed by the witness, 
            unless the witness in writing waives the signing, is ill, 
            cannot be found, or refuses to sign; and
                (v) if the transcript is not signed by the witness 
            during the 30-day period following the date on which the 
            witness is first afforded a reasonable opportunity to 
            examine the transcript, the Bureau investigator shall sign 
            the transcript and state on the record the fact of the 
            waiver, illness, absence of the witness, or the refusal to 
            sign, together with any reasons given for the failure to 
            sign.
            (F) Certification by investigator.--The Bureau investigator 
        shall certify on the transcript that the witness was duly sworn 
        by him or her and that the transcript is a true record of the 
        testimony given by the witness, and the Bureau investigator 
        shall promptly deliver the transcript or send it by registered 
        or certified mail to the custodian.
            (G) Copy of transcript.--The Bureau investigator shall 
        furnish a copy of the transcript (upon payment of reasonable 
        charges for the transcript) to the witness only, except that 
        the Bureau may for good cause limit such witness to inspection 
        of the official transcript of his testimony.
            (H) Witness fees.--Any witness appearing for the taking of 
        oral testimony pursuant to a civil investigative demand shall 
        be entitled to the same fees and mileage which are paid to 
        witnesses in the district courts of the United States.
    (d) Confidential Treatment of Demand Material.--
        (1) In general.--Documentary materials and tangible things 
    received as a result of a civil investigative demand shall be 
    subject to requirements and procedures regarding confidentiality, 
    in accordance with rules established by the Bureau.
        (2) Disclosure to congress.--No rule established by the Bureau 
    regarding the confidentiality of materials submitted to, or 
    otherwise obtained by, the Bureau shall be intended to prevent 
    disclosure to either House of Congress or to an appropriate 
    committee of the Congress, except that the Bureau is permitted to 
    adopt rules allowing prior notice to any party that owns or 
    otherwise provided the material to the Bureau and had designated 
    such material as confidential.
    (e) Petition for Enforcement.--
        (1) In general.--Whenever any person fails to comply with any 
    civil investigative demand duly served upon him under this section, 
    or whenever satisfactory copying or reproduction of material 
    requested pursuant to the demand cannot be accomplished and such 
    person refuses to surrender such material, the Bureau, through such 
    officers or attorneys as it may designate, may file, in the 
    district court of the United States for any judicial district in 
    which such person resides, is found, or transacts business, and 
    serve upon such person, a petition for an order of such court for 
    the enforcement of this section.
        (2) Service of process.--All process of any court to which 
    application may be made as provided in this subsection may be 
    served in any judicial district.
    (f) Petition for Order Modifying or Setting Aside Demand.--
        (1) In general.--Not later than 20 days after the service of 
    any civil investigative demand upon any person under subsection 
    (b), or at any time before the return date specified in the demand, 
    whichever period is shorter, or within such period exceeding 20 
    days after service or in excess of such return date as may be 
    prescribed in writing, subsequent to service, by any Bureau 
    investigator named in the demand, such person may file with the 
    Bureau a petition for an order by the Bureau modifying or setting 
    aside the demand.
        (2) Compliance during pendency.--The time permitted for 
    compliance with the demand in whole or in part, as determined 
    proper and ordered by the Bureau, shall not run during the pendency 
    of a petition under paragraph (1) at the Bureau, except that such 
    person shall comply with any portions of the demand not sought to 
    be modified or set aside.
        (3) Specific grounds.--A petition under paragraph (1) shall 
    specify each ground upon which the petitioner relies in seeking 
    relief, and may be based upon any failure of the demand to comply 
    with the provisions of this section, or upon any constitutional or 
    other legal right or privilege of such person.
    (g) Custodial Control.--At any time during which any custodian is 
in custody or control of any documentary material, tangible things, 
reports, answers to questions, or transcripts of oral testimony given 
by any person in compliance with any civil investigative demand, such 
person may file, in the district court of the United States for the 
judicial district within which the office of such custodian is 
situated, and serve upon such custodian, a petition for an order of 
such court requiring the performance by such custodian of any duty 
imposed upon him by this section or rule promulgated by the Bureau.
    (h) Jurisdiction of Court.--
        (1) In general.--Whenever any petition is filed in any district 
    court of the United States under this section, such court shall 
    have jurisdiction to hear and determine the matter so presented, 
    and to enter such order or orders as may be required to carry out 
    the provisions of this section.
        (2) Appeal.--Any final order entered as described in paragraph 
    (1) shall be subject to appeal pursuant to section 1291 of title 
    28, United States Code.
SEC. 1053. HEARINGS AND ADJUDICATION PROCEEDINGS.
    (a) In General.--The Bureau is authorized to conduct hearings and 
adjudication proceedings with respect to any person in the manner 
prescribed by chapter 5 of title 5, United States Code in order to 
ensure or enforce compliance with--
        (1) the provisions of this title, including any rules 
    prescribed by the Bureau under this title; and
        (2) any other Federal law that the Bureau is authorized to 
    enforce, including an enumerated consumer law, and any regulations 
    or order prescribed thereunder, unless such Federal law 
    specifically limits the Bureau from conducting a hearing or 
    adjudication proceeding and only to the extent of such limitation.
    (b) Special Rules for Cease-and-desist Proceedings.--
        (1) Orders authorized.--
            (A) In general.--If, in the opinion of the Bureau, any 
        covered person or service provider is engaging or has engaged 
        in an activity that violates a law, rule, or any condition 
        imposed in writing on the person by the Bureau, the Bureau may, 
        subject to sections 1024, 1025, and 1026, issue and serve upon 
        the covered person or service provider a notice of charges in 
        respect thereof.
            (B) Content of notice.--The notice under subparagraph (A) 
        shall contain a statement of the facts constituting the alleged 
        violation or violations, and shall fix a time and place at 
        which a hearing will be held to determine whether an order to 
        cease and desist should issue against the covered person or 
        service provider, such hearing to be held not earlier than 30 
        days nor later than 60 days after the date of service of such 
        notice, unless an earlier or a later date is set by the Bureau, 
        at the request of any party so served.
            (C) Consent.--Unless the party or parties served under 
        subparagraph (B) appear at the hearing personally or by a duly 
        authorized representative, such person shall be deemed to have 
        consented to the issuance of the cease-and-desist order.
            (D) Procedure.--In the event of consent under subparagraph 
        (C), or if, upon the record, made at any such hearing, the 
        Bureau finds that any violation specified in the notice of 
        charges has been established, the Bureau may issue and serve 
        upon the covered person or service provider an order to cease 
        and desist from the violation or practice. Such order may, by 
        provisions which may be mandatory or otherwise, require the 
        covered person or service provider to cease and desist from the 
        subject activity, and to take affirmative action to correct the 
        conditions resulting from any such violation.
        (2) Effectiveness of order.--A cease-and-desist order shall 
    become effective at the expiration of 30 days after the date of 
    service of an order under paragraph (1) upon the covered person or 
    service provider concerned (except in the case of a cease-and-
    desist order issued upon consent, which shall become effective at 
    the time specified therein), and shall remain effective and 
    enforceable as provided therein, except to such extent as the order 
    is stayed, modified, terminated, or set aside by action of the 
    Bureau or a reviewing court.
        (3) Decision and appeal.--Any hearing provided for in this 
    subsection shall be held in the Federal judicial district or in the 
    territory in which the residence or principal office or place of 
    business of the person is located unless the person consents to 
    another place, and shall be conducted in accordance with the 
    provisions of chapter 5 of title 5 of the United States Code. After 
    such hearing, and within 90 days after the Bureau has notified the 
    parties that the case has been submitted to the Bureau for final 
    decision, the Bureau shall render its decision (which shall include 
    findings of fact upon which its decision is predicated) and shall 
    issue and serve upon each party to the proceeding an order or 
    orders consistent with the provisions of this section. Judicial 
    review of any such order shall be exclusively as provided in this 
    subsection. Unless a petition for review is timely filed in a court 
    of appeals of the United States, as provided in paragraph (4), and 
    thereafter until the record in the proceeding has been filed as 
    provided in paragraph (4), the Bureau may at any time, upon such 
    notice and in such manner as the Bureau shall determine proper, 
    modify, terminate, or set aside any such order. Upon filing of the 
    record as provided, the Bureau may modify, terminate, or set aside 
    any such order with permission of the court.
        (4) Appeal to court of appeals.--Any party to any proceeding 
    under this subsection may obtain a review of any order served 
    pursuant to this subsection (other than an order issued with the 
    consent of the person concerned) by the filing in the court of 
    appeals of the United States for the circuit in which the principal 
    office of the covered person is located, or in the United States 
    Court of Appeals for the District of Columbia Circuit, within 30 
    days after the date of service of such order, a written petition 
    praying that the order of the Bureau be modified, terminated, or 
    set aside. A copy of such petition shall be forthwith transmitted 
    by the clerk of the court to the Bureau, and thereupon the Bureau 
    shall file in the court the record in the proceeding, as provided 
    in section 2112 of title 28 of the United States Code. Upon the 
    filing of such petition, such court shall have jurisdiction, which 
    upon the filing of the record shall except as provided in the last 
    sentence of paragraph (3) be exclusive, to affirm, modify, 
    terminate, or set aside, in whole or in part, the order of the 
    Bureau. Review of such proceedings shall be had as provided in 
    chapter 7 of title 5 of the United States Code. The judgment and 
    decree of the court shall be final, except that the same shall be 
    subject to review by the Supreme Court of the United States, upon 
    certiorari, as provided in section 1254 of title 28 of the United 
    States Code.
        (5) No stay.--The commencement of proceedings for judicial 
    review under paragraph (4) shall not, unless specifically ordered 
    by the court, operate as a stay of any order issued by the Bureau.
    (c) Special Rules for Temporary Cease-and-desist Proceedings.--
        (1) In general.--Whenever the Bureau determines that the 
    violation specified in the notice of charges served upon a person, 
    including a service provider, pursuant to subsection (b), or the 
    continuation thereof, is likely to cause the person to be insolvent 
    or otherwise prejudice the interests of consumers before the 
    completion of the proceedings conducted pursuant to subsection (b), 
    the Bureau may issue a temporary order requiring the person to 
    cease and desist from any such violation or practice and to take 
    affirmative action to prevent or remedy such insolvency or other 
    condition pending completion of such proceedings. Such order may 
    include any requirement authorized under this subtitle. Such order 
    shall become effective upon service upon the person and, unless set 
    aside, limited, or suspended by a court in proceedings authorized 
    by paragraph (2), shall remain effective and enforceable pending 
    the completion of the administrative proceedings pursuant to such 
    notice and until such time as the Bureau shall dismiss the charges 
    specified in such notice, or if a cease-and-desist order is issued 
    against the person, until the effective date of such order.
        (2) Appeal.--Not later than 10 days after the covered person or 
    service provider concerned has been served with a temporary cease-
    and-desist order, the person may apply to the United States 
    district court for the judicial district in which the residence or 
    principal office or place of business of the person is located, or 
    the United States District Court for the District of Columbia, for 
    an injunction setting aside, limiting, or suspending the 
    enforcement, operation, or effectiveness of such order pending the 
    completion of the administrative proceedings pursuant to the notice 
    of charges served upon the person under subsection (b), and such 
    court shall have jurisdiction to issue such injunction.
        (3) Incomplete or inaccurate records.--
            (A) Temporary order.--If a notice of charges served under 
        subsection (b) specifies, on the basis of particular facts and 
        circumstances, that the books and records of a covered person 
        or service provider are so incomplete or inaccurate that the 
        Bureau is unable to determine the financial condition of that 
        person or the details or purpose of any transaction or 
        transactions that may have a material effect on the financial 
        condition of that person, the Bureau may issue a temporary 
        order requiring--
                (i) the cessation of any activity or practice which 
            gave rise, whether in whole or in part, to the incomplete 
            or inaccurate state of the books or records; or
                (ii) affirmative action to restore such books or 
            records to a complete and accurate state, until the 
            completion of the proceedings under subsection (b)(1).
            (B) Effective period.--Any temporary order issued under 
        subparagraph (A)--
                (i) shall become effective upon service; and
                (ii) unless set aside, limited, or suspended by a court 
            in proceedings under paragraph (2), shall remain in effect 
            and enforceable until the earlier of--

                    (I) the completion of the proceeding initiated 
                under subsection (b) in connection with the notice of 
                charges; or
                    (II) the date the Bureau determines, by examination 
                or otherwise, that the books and records of the covered 
                person or service provider are accurate and reflect the 
                financial condition thereof.

    (d) Special Rules for Enforcement of Orders.--
        (1) In general.--The Bureau may in its discretion apply to the 
    United States district court within the jurisdiction of which the 
    principal office or place of business of the person is located, for 
    the enforcement of any effective and outstanding notice or order 
    issued under this section, and such court shall have jurisdiction 
    and power to order and require compliance herewith.
        (2) Exception.--Except as otherwise provided in this 
    subsection, no court shall have jurisdiction to affect by 
    injunction or otherwise the issuance or enforcement of any notice 
    or order or to review, modify, suspend, terminate, or set aside any 
    such notice or order.
    (e) Rules.--The Bureau shall prescribe rules establishing such 
procedures as may be necessary to carry out this section.
SEC. 1054. LITIGATION AUTHORITY.
    (a) In General.--If any person violates a Federal consumer 
financial law, the Bureau may, subject to sections 1024, 1025, and 
1026, commence a civil action against such person to impose a civil 
penalty or to seek all appropriate legal and equitable relief including 
a permanent or temporary injunction as permitted by law.
    (b) Representation.--The Bureau may act in its own name and through 
its own attorneys in enforcing any provision of this title, rules 
thereunder, or any other law or regulation, or in any action, suit, or 
proceeding to which the Bureau is a party.
    (c) Compromise of Actions.--The Bureau may compromise or settle any 
action if such compromise is approved by the court.
    (d) Notice to the Attorney General.--
        (1) In general.--When commencing a civil action under Federal 
    consumer financial law, or any rule thereunder, the Bureau shall 
    notify the Attorney General and, with respect to a civil action 
    against an insured depository institution or insured credit union, 
    the appropriate prudential regulator.
        (2) Notice and coordination.--
            (A) Notice of other actions.--In addition to any notice 
        required under paragraph (1), the Bureau shall notify the 
        Attorney General concerning any action, suit, or proceeding to 
        which the Bureau is a party, except an action, suit, or 
        proceeding that involves the offering or provision of consumer 
        financial products or services.
            (B) Coordination.--In order to avoid conflicts and promote 
        consistency regarding litigation of matters under Federal law, 
        the Attorney General and the Bureau shall consult regarding the 
        coordination of investigations and proceedings, including by 
        negotiating an agreement for coordination by not later than 180 
        days after the designated transfer date. The agreement under 
        this subparagraph shall include provisions to ensure that 
        parallel investigations and proceedings involving the Federal 
        consumer financial laws are conducted in a manner that avoids 
        conflicts and does not impede the ability of the Attorney 
        General to prosecute violations of Federal criminal laws.
            (C) Rule of construction.--Nothing in this paragraph shall 
        be construed to limit the authority of the Bureau under this 
        title, including the authority to interpret Federal consumer 
        financial law.
    (e) Appearance Before the Supreme Court.--The Bureau may represent 
itself in its own name before the Supreme Court of the United States, 
provided that the Bureau makes a written request to the Attorney 
General within the 10-day period which begins on the date of entry of 
the judgment which would permit any party to file a petition for writ 
of certiorari, and the Attorney General concurs with such request or 
fails to take action within 60 days of the request of the Bureau.
    (f) Forum.--Any civil action brought under this title may be 
brought in a United States district court or in any court of competent 
jurisdiction of a state in a district in which the defendant is located 
or resides or is doing business, and such court shall have jurisdiction 
to enjoin such person and to require compliance with any Federal 
consumer financial law.
    (g) Time for Bringing Action.--
        (1) In general.--Except as otherwise permitted by law or 
    equity, no action may be brought under this title more than 3 years 
    after the date of discovery of the violation to which an action 
    relates.
        (2) Limitations under other federal laws.--
            (A) In general.--An action arising under this title does 
        not include claims arising solely under enumerated consumer 
        laws.
            (B) Bureau authority.--In any action arising solely under 
        an enumerated consumer law, the Bureau may commence, defend, or 
        intervene in the action in accordance with the requirements of 
        that provision of law, as applicable.
            (C) Transferred authority.--In any action arising solely 
        under laws for which authorities were transferred under 
        subtitles F and H, the Bureau may commence, defend, or 
        intervene in the action in accordance with the requirements of 
        that provision of law, as applicable.
SEC. 1055. RELIEF AVAILABLE.
    (a) Administrative Proceedings or Court Actions.--
        (1) Jurisdiction.--The court (or the Bureau, as the case may 
    be) in an action or adjudication proceeding brought under Federal 
    consumer financial law, shall have jurisdiction to grant any 
    appropriate legal or equitable relief with respect to a violation 
    of Federal consumer financial law, including a violation of a rule 
    or order prescribed under a Federal consumer financial law.
        (2) Relief.--Relief under this section may include, without 
    limitation--
            (A) rescission or reformation of contracts;
            (B) refund of moneys or return of real property;
            (C) restitution;
            (D) disgorgement or compensation for unjust enrichment;
            (E) payment of damages or other monetary relief;
            (F) public notification regarding the violation, including 
        the costs of notification;
            (G) limits on the activities or functions of the person; 
        and
            (H) civil money penalties, as set forth more fully in 
        subsection (c).
        (3) No exemplary or punitive damages.--Nothing in this 
    subsection shall be construed as authorizing the imposition of 
    exemplary or punitive damages.
    (b) Recovery of Costs.--In any action brought by the Bureau, a 
State attorney general, or any State regulator to enforce any Federal 
consumer financial law, the Bureau, the State attorney general, or the 
State regulator may recover its costs in connection with prosecuting 
such action if the Bureau, the State attorney general, or the State 
regulator is the prevailing party in the action.
    (c) Civil Money Penalty in Court and Administrative Actions.--
        (1) In general.--Any person that violates, through any act or 
    omission, any provision of Federal consumer financial law shall 
    forfeit and pay a civil penalty pursuant to this subsection.
        (2) Penalty amounts.--
            (A) First tier.--For any violation of a law, rule, or final 
        order or condition imposed in writing by the Bureau, a civil 
        penalty may not exceed $5,000 for each day during which such 
        violation or failure to pay continues.
            (B) Second tier.--Notwithstanding paragraph (A), for any 
        person that recklessly engages in a violation of a Federal 
        consumer financial law, a civil penalty may not exceed $25,000 
        for each day during which such violation continues.
            (C) Third tier.--Notwithstanding subparagraphs (A) and (B), 
        for any person that knowingly violates a Federal consumer 
        financial law, a civil penalty may not exceed $1,000,000 for 
        each day during which such violation continues.
        (3) Mitigating factors.--In determining the amount of any 
    penalty assessed under paragraph (2), the Bureau or the court shall 
    take into account the appropriateness of the penalty with respect 
    to--
            (A) the size of financial resources and good faith of the 
        person charged;
            (B) the gravity of the violation or failure to pay;
            (C) the severity of the risks to or losses of the consumer, 
        which may take into account the number of products or services 
        sold or provided;
            (D) the history of previous violations; and
            (E) such other matters as justice may require.
        (4) Authority to modify or remit penalty.--The Bureau may 
    compromise, modify, or remit any penalty which may be assessed or 
    had already been assessed under paragraph (2). The amount of such 
    penalty, when finally determined, shall be exclusive of any sums 
    owed by the person to the United States in connection with the 
    costs of the proceeding, and may be deducted from any sums owing by 
    the United States to the person charged.
        (5) Notice and hearing.--No civil penalty may be assessed under 
    this subsection with respect to a violation of any Federal consumer 
    financial law, unless--
            (A) the Bureau gives notice and an opportunity for a 
        hearing to the person accused of the violation; or
            (B) the appropriate court has ordered such assessment and 
        entered judgment in favor of the Bureau.
SEC. 1056. REFERRALS FOR CRIMINAL PROCEEDINGS.
    If the Bureau obtains evidence that any person, domestic or 
foreign, has engaged in conduct that may constitute a violation of 
Federal criminal law, the Bureau shall transmit such evidence to the 
Attorney General of the United States, who may institute criminal 
proceedings under appropriate law. Nothing in this section affects any 
other authority of the Bureau to disclose information.
SEC. 1057. EMPLOYEE PROTECTION.
    (a) In General.--No covered person or service provider shall 
terminate or in any other way discriminate against, or cause to be 
terminated or discriminated against, any covered employee or any 
authorized representative of covered employees by reason of the fact 
that such employee or representative, whether at the initiative of the 
employee or in the ordinary course of the duties of the employee (or 
any person acting pursuant to a request of the employee), has--
        (1) provided, caused to be provided, or is about to provide or 
    cause to be provided, information to the employer, the Bureau, or 
    any other State, local, or Federal, government authority or law 
    enforcement agency relating to any violation of, or any act or 
    omission that the employee reasonably believes to be a violation 
    of, any provision of this title or any other provision of law that 
    is subject to the jurisdiction of the Bureau, or any rule, order, 
    standard, or prohibition prescribed by the Bureau;
        (2) testified or will testify in any proceeding resulting from 
    the administration or enforcement of any provision of this title or 
    any other provision of law that is subject to the jurisdiction of 
    the Bureau, or any rule, order, standard, or prohibition prescribed 
    by the Bureau;
        (3) filed, instituted, or caused to be filed or instituted any 
    proceeding under any Federal consumer financial law; or
        (4) objected to, or refused to participate in, any activity, 
    policy, practice, or assigned task that the employee (or other such 
    person) reasonably believed to be in violation of any law, rule, 
    order, standard, or prohibition, subject to the jurisdiction of, or 
    enforceable by, the Bureau.
    (b) Definition of Covered Employee.--For the purposes of this 
section, the term ``covered employee'' means any individual performing 
tasks related to the offering or provision of a consumer financial 
product or service.
    (c) Procedures and Timetables.--
        (1) Complaint.--
            (A) In general.--A person who believes that he or she has 
        been discharged or otherwise discriminated against by any 
        person in violation of subsection (a) may, not later than 180 
        days after the date on which such alleged violation occurs, 
        file (or have any person file on his or her behalf) a complaint 
        with the Secretary of Labor alleging such discharge or 
        discrimination and identifying the person responsible for such 
        act.
            (B) Actions of secretary of labor.--Upon receipt of such a 
        complaint, the Secretary of Labor shall notify, in writing, the 
        person named in the complaint who is alleged to have committed 
        the violation, of--
                (i) the filing of the complaint;
                (ii) the allegations contained in the complaint;
                (iii) the substance of evidence supporting the 
            complaint; and
                (iv) opportunities that will be afforded to such person 
            under paragraph (2).
        (2) Investigation by secretary of labor.--
            (A) In general.--Not later than 60 days after the date of 
        receipt of a complaint filed under paragraph (1), and after 
        affording the complainant and the person named in the complaint 
        who is alleged to have committed the violation that is the 
        basis for the complaint an opportunity to submit to the 
        Secretary of Labor a written response to the complaint and an 
        opportunity to meet with a representative of the Secretary of 
        Labor to present statements from witnesses, the Secretary of 
        Labor shall--
                (i) initiate an investigation and determine whether 
            there is reasonable cause to believe that the complaint has 
            merit; and
                (ii) notify the complainant and the person alleged to 
            have committed the violation of subsection (a), in writing, 
            of such determination.
            (B) Notice of relief available.--If the Secretary of Labor 
        concludes that there is reasonable cause to believe that a 
        violation of subsection (a) has occurred, the Secretary of 
        Labor shall, together with the notice under subparagraph 
        (A)(ii), issue a preliminary order providing the relief 
        prescribed by paragraph (4)(B).
            (C) Request for hearing.--Not later than 30 days after the 
        date of receipt of notification of a determination of the 
        Secretary of Labor under this paragraph, either the person 
        alleged to have committed the violation or the complainant may 
        file objections to the findings or preliminary order, or both, 
        and request a hearing on the record. The filing of such 
        objections shall not operate to stay any reinstatement remedy 
        contained in the preliminary order. Any such hearing shall be 
        conducted expeditiously, and if a hearing is not requested in 
        such 30-day period, the preliminary order shall be deemed a 
        final order that is not subject to judicial review.
        (3) Grounds for determination of complaints.--
            (A) In general.--The Secretary of Labor shall dismiss a 
        complaint filed under this subsection, and shall not conduct an 
        investigation otherwise required under paragraph (2), unless 
        the complainant makes a prima facie showing that any behavior 
        described in paragraphs (1) through (4) of subsection (a) was a 
        contributing factor in the unfavorable personnel action alleged 
        in the complaint.
            (B) Rebuttal evidence.--Notwithstanding a finding by the 
        Secretary of Labor that the complainant has made the showing 
        required under subparagraph (A), no investigation otherwise 
        required under paragraph (2) shall be conducted, if the 
        employer demonstrates, by clear and convincing evidence, that 
        the employer would have taken the same unfavorable personnel 
        action in the absence of that behavior.
            (C) Evidentiary standards.--The Secretary of Labor may 
        determine that a violation of subsection (a) has occurred only 
        if the complainant demonstrates that any behavior described in 
        paragraphs (1) through (4) of subsection (a) was a contributing 
        factor in the unfavorable personnel action alleged in the 
        complaint. Relief may not be ordered under subparagraph (A) if 
        the employer demonstrates by clear and convincing evidence that 
        the employer would have taken the same unfavorable personnel 
        action in the absence of that behavior.
        (4) Issuance of final orders; review procedures.--
            (A) Timing.--Not later than 120 days after the date of 
        conclusion of any hearing under paragraph (2), the Secretary of 
        Labor shall issue a final order providing the relief prescribed 
        by this paragraph or denying the complaint. At any time before 
        issuance of a final order, a proceeding under this subsection 
        may be terminated on the basis of a settlement agreement 
        entered into by the Secretary of Labor, the complainant, and 
        the person alleged to have committed the violation.
            (B) Penalties.--
                (i) Order of secretary of labor.--If, in response to a 
            complaint filed under paragraph (1), the Secretary of Labor 
            determines that a violation of subsection (a) has occurred, 
            the Secretary of Labor shall order the person who committed 
            such violation--

                    (I) to take affirmative action to abate the 
                violation;
                    (II) to reinstate the complainant to his or her 
                former position, together with compensation (including 
                back pay) and restore the terms, conditions, and 
                privileges associated with his or her employment; and
                    (III) to provide compensatory damages to the 
                complainant.

                (ii) Penalty.--If an order is issued under clause (i), 
            the Secretary of Labor, at the request of the complainant, 
            shall assess against the person against whom the order is 
            issued, a sum equal to the aggregate amount of all costs 
            and expenses (including attorney fees and expert witness 
            fees) reasonably incurred, as determined by the Secretary 
            of Labor, by the complainant for, or in connection with, 
            the bringing of the complaint upon which the order was 
            issued.
            (C) Penalty for frivolous claims.--If the Secretary of 
        Labor finds that a complaint under paragraph (1) is frivolous 
        or has been brought in bad faith, the Secretary of Labor may 
        award to the prevailing employer a reasonable attorney fee, not 
        exceeding $1,000, to be paid by the complainant.
            (D) De novo review.--
                (i) Failure of the secretary to act.--If the Secretary 
            of Labor has not issued a final order within 210 days after 
            the date of filing of a complaint under this subsection, or 
            within 90 days after the date of receipt of a written 
            determination, the complainant may bring an action at law 
            or equity for de novo review in the appropriate district 
            court of the United States having jurisdiction, which shall 
            have jurisdiction over such an action without regard to the 
            amount in controversy, and which action shall, at the 
            request of either party to such action, be tried by the 
            court with a jury.
                (ii) Procedures.--A proceeding under clause (i) shall 
            be governed by the same legal burdens of proof specified in 
            paragraph (3). The court shall have jurisdiction to grant 
            all relief necessary to make the employee whole, including 
            injunctive relief and compensatory damages, including--

                    (I) reinstatement with the same seniority status 
                that the employee would have had, but for the discharge 
                or discrimination;
                    (II) the amount of back pay, with interest; and
                    (III) compensation for any special damages 
                sustained as a result of the discharge or 
                discrimination, including litigation costs, expert 
                witness fees, and reasonable attorney fees.

            (E) Other appeals.--Unless the complainant brings an action 
        under subparagraph (D), any person adversely affected or 
        aggrieved by a final order issued under subparagraph (A) may 
        file a petition for review of the order in the United States 
        Court of Appeals for the circuit in which the violation with 
        respect to which the order was issued, allegedly occurred or 
        the circuit in which the complainant resided on the date of 
        such violation, not later than 60 days after the date of the 
        issuance of the final order of the Secretary of Labor under 
        subparagraph (A). Review shall conform to chapter 7 of title 5, 
        United States Code. The commencement of proceedings under this 
        subparagraph shall not, unless ordered by the court, operate as 
        a stay of the order. An order of the Secretary of Labor with 
        respect to which review could have been obtained under this 
        subparagraph shall not be subject to judicial review in any 
        criminal or other civil proceeding.
        (5) Failure to comply with order.--
            (A) Actions by the secretary.--If any person has failed to 
        comply with a final order issued under paragraph (4), the 
        Secretary of Labor may file a civil action in the United States 
        district court for the district in which the violation was 
        found to have occurred, or in the United States district court 
        for the District of Columbia, to enforce such order. In actions 
        brought under this paragraph, the district courts shall have 
        jurisdiction to grant all appropriate relief including 
        injunctive relief and compensatory damages.
            (B) Civil actions to compel compliance.--A person on whose 
        behalf an order was issued under paragraph (4) may commence a 
        civil action against the person to whom such order was issued 
        to require compliance with such order. The appropriate United 
        States district court shall have jurisdiction, without regard 
        to the amount in controversy or the citizenship of the parties, 
        to enforce such order.
            (C) Award of costs authorized.--The court, in issuing any 
        final order under this paragraph, may award costs of litigation 
        (including reasonable attorney and expert witness fees) to any 
        party, whenever the court determines such award is appropriate.
            (D) Mandamus proceedings.--Any nondiscretionary duty 
        imposed by this section shall be enforceable in a mandamus 
        proceeding brought under section 1361 of title 28, United 
        States Code.
    (d) Unenforceability of Certain Agreements.--
        (1) No waiver of rights and remedies.--Except as provided under 
    paragraph (3), and notwithstanding any other provision of law, the 
    rights and remedies provided for in this section may not be waived 
    by any agreement, policy, form, or condition of employment, 
    including by any predispute arbitration agreement.
        (2) No predispute arbitration agreements.--Except as provided 
    under paragraph (3), and notwithstanding any other provision of 
    law, no predispute arbitration agreement shall be valid or 
    enforceable to the extent that it requires arbitration of a dispute 
    arising under this section.
        (3) Exception.--Notwithstanding paragraphs (1) and (2), an 
    arbitration provision in a collective bargaining agreement shall be 
    enforceable as to disputes arising under subsection (a)(4), unless 
    the Bureau determines, by rule, that such provision is inconsistent 
    with the purposes of this title.
SEC. 1058. EFFECTIVE DATE.
    This subtitle shall become effective on the designated transfer 
date.

     Subtitle F--Transfer of Functions and Personnel; Transitional 
                               Provisions

SEC. 1061. TRANSFER OF CONSUMER FINANCIAL PROTECTION FUNCTIONS.
    (a) Defined Terms.--For purposes of this subtitle--
        (1) the term ``consumer financial protection functions'' 
    means--
            (A) all authority to prescribe rules or issue orders or 
        guidelines pursuant to any Federal consumer financial law, 
        including performing appropriate functions to promulgate and 
        review such rules, orders, and guidelines; and
            (B) the examination authority described in subsection 
        (c)(1), with respect to a person described in subsection 
        1025(a); and
        (2) the terms ``transferor agency'' and ``transferor agencies'' 
    mean, respectively--
            (A) the Board of Governors (and any Federal reserve bank, 
        as the context requires), the Federal Deposit Insurance 
        Corporation, the Federal Trade Commission, the National Credit 
        Union Administration, the Office of the Comptroller of the 
        Currency, the Office of Thrift Supervision, and the Department 
        of Housing and Urban Development, and the heads of those 
        agencies; and
            (B) the agencies listed in subparagraph (A), collectively.
    (b) In General.--Except as provided in subsection (c), consumer 
financial protection functions are transferred as follows:
        (1) Board of governors.--
            (A) Transfer of functions.--All consumer financial 
        protection functions of the Board of Governors are transferred 
        to the Bureau.
            (B) Board of governors authority.--The Bureau shall have 
        all powers and duties that were vested in the Board of 
        Governors, relating to consumer financial protection functions, 
        on the day before the designated transfer date.
        (2) Comptroller of the currency.--
            (A) Transfer of functions.--All consumer financial 
        protection functions of the Comptroller of the Currency are 
        transferred to the Bureau.
            (B) Comptroller authority.--The Bureau shall have all 
        powers and duties that were vested in the Comptroller of the 
        Currency, relating to consumer financial protection functions, 
        on the day before the designated transfer date.
        (3) Director of the office of thrift supervision.--
            (A) Transfer of functions.--All consumer financial 
        protection functions of the Director of the Office of Thrift 
        Supervision are transferred to the Bureau.
            (B) Director authority.--The Bureau shall have all powers 
        and duties that were vested in the Director of the Office of 
        Thrift Supervision, relating to consumer financial protection 
        functions, on the day before the designated transfer date.
        (4) Federal deposit insurance corporation.--
            (A) Transfer of functions.--All consumer financial 
        protection functions of the Federal Deposit Insurance 
        Corporation are transferred to the Bureau.
            (B) Corporation authority.--The Bureau shall have all 
        powers and duties that were vested in the Federal Deposit 
        Insurance Corporation, relating to consumer financial 
        protection functions, on the day before the designated transfer 
        date.
        (5) Federal trade commission.--
            (A) Transfer of functions.--The authority of the Federal 
        Trade Commission under an enumerated consumer law to prescribe 
        rules, issue guidelines, or conduct a study or issue a report 
        mandated under such law shall be transferred to the Bureau on 
        the designated transfer date. Nothing in this title shall be 
        construed to require a mandatory transfer of any employee of 
        the Federal Trade Commission.
            (B) Bureau authority.--
                (i) In general.--The Bureau shall have all powers and 
            duties under the enumerated consumer laws to prescribe 
            rules, issue guidelines, or to conduct studies or issue 
            reports mandated by such laws, that were vested in the 
            Federal Trade Commission on the day before the designated 
            transfer date.
                (ii) Federal trade commission act.--Subject to subtitle 
            B, the Bureau may enforce a rule prescribed under the 
            Federal Trade Commission Act by the Federal Trade 
            Commission with respect to an unfair or deceptive act or 
            practice to the extent that such rule applies to a covered 
            person or service provider with respect to the offering or 
            provision of a consumer financial product or service as if 
            it were a rule prescribed under section 1031 of this title.
            (C) Authority of the federal trade commission.--
                (i) In general.--No provision of this title shall be 
            construed as modifying, limiting, or otherwise affecting 
            the authority of the Federal Trade Commission (including 
            its authority with respect to affiliates described in 
            section 1025(a)(1)) under the Federal Trade Commission Act 
            or any other law, other than the authority under an 
            enumerated consumer law to prescribe rules, issue official 
            guidelines, or conduct a study or issue a report mandated 
            under such law.
                (ii) Commission authority relating to rules prescribed 
            by the bureau.--Subject to subtitle B, the Federal Trade 
            Commission shall have authority to enforce under the 
            Federal Trade Commission Act (15 U.S.C. 41 et seq.) a rule 
            prescribed by the Bureau under this title with respect to a 
            covered person subject to the jurisdiction of the Federal 
            Trade Commission under that Act, and a violation of such a 
            rule by such a person shall be treated as a violation of a 
            rule issued under section 18 of that Act (15 U.S.C. 57a) 
            with respect to unfair or deceptive acts or practices.
            (D) Coordination.--To avoid duplication of or conflict 
        between rules prescribed by the Bureau under section 1031 of 
        this title and the Federal Trade Commission under section 
        18(a)(1)(B) of the Federal Trade Commission Act that apply to a 
        covered person or service provider with respect to the offering 
        or provision of consumer financial products or services, the 
        agencies shall negotiate an agreement with respect to 
        rulemaking by each agency, including consultation with the 
        other agency prior to proposing a rule and during the comment 
        period.
            (E) Deference.--No provision of this title shall be 
        construed as altering, limiting, expanding, or otherwise 
        affecting the deference that a court affords to the--
                (i) Federal Trade Commission in making determinations 
            regarding the meaning or interpretation of any provision of 
            the Federal Trade Commission Act, or of any other Federal 
            law for which the Commission has authority to prescribe 
            rules; or
                (ii) Bureau in making determinations regarding the 
            meaning or interpretation of any provision of a Federal 
            consumer financial law (other than any law described in 
            clause (i)).
        (6) National credit union administration.--
            (A) Transfer of functions.--All consumer financial 
        protection functions of the National Credit Union 
        Administration are transferred to the Bureau.
            (B) National credit union administration authority.--The 
        Bureau shall have all powers and duties that were vested in the 
        National Credit Union Administration, relating to consumer 
        financial protection functions, on the day before the 
        designated transfer date.
        (7) Department of housing and urban development.--
            (A) Transfer of functions.--All consumer protection 
        functions of the Secretary of the Department of Housing and 
        Urban Development relating to the Real Estate Settlement 
        Procedures Act of 1974 (12 U.S.C. 2601 et seq.), the Secure and 
        Fair Enforcement for Mortgage Licensing Act of 2008 (12 U.S.C. 
        5102 et seq.), and the Interstate Land Sales Full Disclosure 
        Act (15 U.S.C. 1701 et seq.) are transferred to the Bureau.
            (B) Authority of the department of housing and urban 
        development.--The Bureau shall have all powers and duties that 
        were vested in the Secretary of the Department of Housing and 
        Urban Development relating to the Real Estate Settlement 
        Procedures Act of 1974 (12 U.S.C. 2601 et seq.), the Secure and 
        Fair Enforcement for Mortgage Licensing Act of 2008 (12 U.S.C. 
        5101 et seq.), and the Interstate Land Sales Full Disclosure 
        Act (15 U.S.C. 1701 et seq.), on the day before the designated 
        transfer date.
    (c) Authorities of the Prudential Regulators.--
        (1) Examination.--A transferor agency that is a prudential 
    regulator shall have--
            (A) authority to require reports from and conduct 
        examinations for compliance with Federal consumer financial 
        laws with respect to a person described in section 1025(a), 
        that is incidental to the backup and enforcement procedures 
        provided to the regulator under section 1025(c); and
            (B) 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), except as provided to the Bureau 
        under subsections (b) and (c) of section 1026.
        (2) Enforcement.--
            (A) Limitation.--The authority of a transferor agency that 
        is a prudential regulator to enforce compliance with Federal 
        consumer financial laws with respect to a person described in 
        section 1025(a), shall be limited to the backup and enforcement 
        procedures in described in section 1025(c).
            (B) Exclusive authority.--A transferor agency that is a 
        prudential regulator shall have exclusive authority (relative 
        to the Bureau) to enforce compliance with Federal consumer 
        financial laws with respect to a person described in section 
        1026(a), except as provided to the Bureau under subsections (b) 
        and (c) of section 1026.
            (C) Statutory enforcement.--For purposes of carrying out 
        the authorities under, and subject to the limitations of, 
        subtitle B, each prudential regulator may enforce compliance 
        with the requirements imposed under this title, and any rule or 
        order prescribed by the Bureau under this title, under--
                (i) the Federal Credit Union Act (12 U.S.C. 1751 et 
            seq.), by the National Credit Union Administration Board 
            with respect to any covered person or service provider that 
            is an insured credit union, or service provider thereto, or 
            any affiliate of an insured credit union, who is subject to 
            the jurisdiction of the Board under that Act; and
                (ii) section 8 of the Federal Deposit Insurance Act (12 
            U.S.C. 1818), by the appropriate Federal banking agency, as 
            defined in section 3(q) of the Federal Deposit Insurance 
            Act (12 U.S.C. 1813(q)), with respect to a covered person 
            or service provider that is a person described in section 
            3(q) of that Act and who is subject to the jurisdiction of 
            that agency, as set forth in sections 3(q) and 8 of the 
            Federal Deposit Insurance Act; or
                (iii) the Bank Service Company Act (12 U.S.C. 1861 et 
            seq.).
    (d) Effective Date.--Subsections (b) and (c) shall become effective 
on the designated transfer date.
SEC. 1062. DESIGNATED TRANSFER DATE.
    (a) In General.--Not later than 60 days after the date of enactment 
of this Act, the Secretary shall--
        (1) in consultation with the Chairman of the Board of 
    Governors, the Chairperson of the Corporation, the Chairman of the 
    Federal Trade Commission, the Chairman of the National Credit Union 
    Administration Board, the Comptroller of the Currency, the Director 
    of the Office of Thrift Supervision, the Secretary of the 
    Department of Housing and Urban Development, and the Director of 
    the Office of Management and Budget, designate a single calendar 
    date for the transfer of functions to the Bureau under section 
    1061; and
        (2) publish notice of that designated date in the Federal 
    Register.
    (b) Changing Designation.--The Secretary--
        (1) may, in consultation with the Chairman of the Board of 
    Governors, the Chairperson of the Federal Deposit Insurance 
    Corporation, the Chairman of the Federal Trade Commission, the 
    Chairman of the National Credit Union Administration Board, the 
    Comptroller of the Currency, the Director of the Office of Thrift 
    Supervision, the Secretary of the Department of Housing and Urban 
    Development, and the Director of the Office of Management and 
    Budget, change the date designated under subsection (a); and
        (2) shall publish notice of any changed designated date in the 
    Federal Register.
    (c) Permissible Dates.--
        (1) In general.--Except as provided in paragraph (2), any date 
    designated under this section shall be not earlier than 180 days, 
    nor later than 12 months, after the date of enactment of this Act.
        (2) Extension of time.--The Secretary may designate a date that 
    is later than 12 months after the date of enactment of this Act if 
    the Secretary transmits to appropriate committees of Congress--
            (A) a written determination that orderly implementation of 
        this title is not feasible before the date that is 12 months 
        after the date of enactment of this Act;
            (B) an explanation of why an extension is necessary for the 
        orderly implementation of this title; and
            (C) a description of the steps that will be taken to effect 
        an orderly and timely implementation of this title within the 
        extended time period.
        (3) Extension limited.--In no case may any date designated 
    under this section be later than 18 months after the date of 
    enactment of this Act.
SEC. 1063. SAVINGS PROVISIONS.
    (a) Board of Governors.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(1) does not affect the validity of any right, duty, 
    or obligation of the United States, the Board of Governors (or any 
    Federal reserve bank), or any other person that--
            (A) arises under any provision of law relating to any 
        consumer financial protection function of the Board of 
        Governors transferred to the Bureau by this title; and
            (B) existed on the day before the designated transfer date.
        (2) Continuation of suits.--No provision of this Act shall 
    abate any proceeding commenced by or against the Board of Governors 
    (or any Federal reserve bank) before the designated transfer date 
    with respect to any consumer financial protection function of the 
    Board of Governors (or any Federal reserve bank) transferred to the 
    Bureau by this title, except that the Bureau, subject to sections 
    1024, 1025, and 1026, shall be substituted for the Board of 
    Governors (or Federal reserve bank) as a party to any such 
    proceeding as of the designated transfer date.
    (b) Federal Deposit Insurance Corporation.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(4) does not affect the validity of any right, duty, 
    or obligation of the United States, the Federal Deposit Insurance 
    Corporation, the Board of Directors of that Corporation, or any 
    other person, that--
            (A) arises under any provision of law relating to any 
        consumer financial protection function of the Federal Deposit 
        Insurance Corporation transferred to the Bureau by this title; 
        and
            (B) existed on the day before the designated transfer date.
        (2) Continuation of suits.--No provision of this Act shall 
    abate any proceeding commenced by or against the Federal Deposit 
    Insurance Corporation (or the Board of Directors of that 
    Corporation) before the designated transfer date with respect to 
    any consumer financial protection function of the Federal Deposit 
    Insurance Corporation transferred to the Bureau by this title, 
    except that the Bureau, subject to sections 1024, 1025, and 1026, 
    shall be substituted for the Federal Deposit Insurance Corporation 
    (or Board of Directors) as a party to any such proceeding as of the 
    designated transfer date.
    (c) Federal Trade Commission.--Section 1061(b)(5) does not affect 
the validity of any right, duty, or obligation of the United States, 
the Federal Trade Commission, or any other person, that--
        (1) arises under any provision of law relating to any consumer 
    financial protection function of the Federal Trade Commission 
    transferred to the Bureau by this title; and
        (2) existed on the day before the designated transfer date.
    (d) National Credit Union Administration.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(6) does not affect the validity of any right, duty, 
    or obligation of the United States, the National Credit Union 
    Administration, the National Credit Union Administration Board, or 
    any other person, that--
            (A) arises under any provision of law relating to any 
        consumer financial protection function of the National Credit 
        Union Administration transferred to the Bureau by this title; 
        and
            (B) existed on the day before the designated transfer date.
        (2) Continuation of suits.--No provision of this Act shall 
    abate any proceeding commenced by or against the National Credit 
    Union Administration (or the National Credit Union Administration 
    Board) before the designated transfer date with respect to any 
    consumer financial protection function of the National Credit Union 
    Administration transferred to the Bureau by this title, except that 
    the Bureau, subject to sections 1024, 1025, and 1026, shall be 
    substituted for the National Credit Union Administration (or 
    National Credit Union Administration Board) as a party to any such 
    proceeding as of the designated transfer date.
    (e) Office of the Comptroller of the Currency.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(2) does not affect the validity of any right, duty, 
    or obligation of the United States, the Comptroller of the 
    Currency, the Office of the Comptroller of the Currency, or any 
    other person, that--
            (A) arises under any provision of law relating to any 
        consumer financial protection function of the Comptroller of 
        the Currency transferred to the Bureau by this title; and
            (B) existed on the day before the designated transfer date.
        (2) Continuation of suits.--No provision of this Act shall 
    abate any proceeding commenced by or against the Comptroller of the 
    Currency (or the Office of the Comptroller of the Currency) with 
    respect to any consumer financial protection function of the 
    Comptroller of the Currency transferred to the Bureau by this title 
    before the designated transfer date, except that the Bureau, 
    subject to sections 1024, 1025, and 1026, shall be substituted for 
    the Comptroller of the Currency (or the Office of the Comptroller 
    of the Currency) as a party to any such proceeding as of the 
    designated transfer date.
    (f) Office of Thrift Supervision.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(3) does not affect the validity of any right, duty, 
    or obligation of the United States, the Director of the Office of 
    Thrift Supervision, the Office of Thrift Supervision, or any other 
    person, that--
            (A) arises under any provision of law relating to any 
        consumer financial protection function of the Director of the 
        Office of Thrift Supervision transferred to the Bureau by this 
        title; and
            (B) that existed on the day before the designated transfer 
        date.
        (2) Continuation of suits.--No provision of this Act shall 
    abate any proceeding commenced by or against the Director of the 
    Office of Thrift Supervision (or the Office of Thrift Supervision) 
    with respect to any consumer financial protection function of the 
    Director of the Office of Thrift Supervision transferred to the 
    Bureau by this title before the designated transfer date, except 
    that the Bureau, subject to sections 1024, 1025, and 1026, shall be 
    substituted for the Director (or the Office of Thrift Supervision) 
    as a party to any such proceeding as of the designated transfer 
    date.
    (g) Department of Housing and Urban Development.--
        (1) Existing rights, duties, and obligations not affected.--
    Section 1061(b)(7) shall not affect the validity of any right, 
    duty, or obligation of the United States, the Secretary of the 
    Department of Housing and Urban Development (or the Department of 
    Housing and Urban Development), or any other person, that--
            (A) arises under any provision of law relating to any 
        function of the Secretary of the Department of Housing and 
        Urban Development with respect to the Real Estate Settlement 
        Procedures Act of 1974 (12 U.S.C. 2601 et seq.), the Secure and 
        Fair Enforcement for Mortgage Licensing Act of 2008 (12 U.S.C. 
        5102 et seq.), or the Interstate Land Sales Full Disclosure Act 
        (15 U.S.C. 1701 et seq) transferred to the Bureau by this 
        title; and
            (B) existed on the day before the designated transfer date.
        (2) Continuation of suits.--This title shall not abate any 
    proceeding commenced by or against the Secretary of the Department 
    of Housing and Urban Development (or the Department of Housing and 
    Urban Development) with respect to any consumer financial 
    protection function of the Secretary of the Department of Housing 
    and Urban Development transferred to the Bureau by this title 
    before the designated transfer date, except that the Bureau, 
    subject to sections 1024, 1025, and 1026, shall be substituted for 
    the Secretary of the Department of Housing and Urban Development 
    (or the Department of Housing and Urban Development) as a party to 
    any such proceeding as of the designated transfer date.
    (h) Continuation of Existing Orders, Rulings, Determinations, 
Agreements, and Resolutions.--
        (1) In general.--Except as provided in paragraph (2) and under 
    subsection (i), all orders, resolutions, determinations, 
    agreements, and rulings that have been issued, made, prescribed, or 
    allowed to become effective by any transferor agency or by a court 
    of competent jurisdiction, in the performance of consumer financial 
    protection functions that are transferred by this title and that 
    are in effect on the day before the designated transfer date, shall 
    continue in effect, and shall continue to be enforceable by the 
    appropriate transferor agency, according to the terms of those 
    orders, resolutions, determinations, agreements, and rulings, and 
    shall not be enforceable by or against the Bureau.
        (2) Exception for orders applicable to persons described in 
    section 1025(a).--All orders, resolutions, determinations, 
    agreements, and rulings that have been issued, made, prescribed, or 
    allowed to become effective by any transferor agency or by a court 
    of competent jurisdiction, in the performance of consumer financial 
    protection functions that are transferred by this title and that 
    are in effect on the day before the designated transfer date with 
    respect to any person described in section 1025(a), shall continue 
    in effect, according to the terms of those orders, resolutions, 
    determinations, agreements, and rulings, and shall be enforceable 
    by or against the Bureau or transferor agency.
    (i) Identification of Rules and Orders Continued.--Not later than 
the designated transfer date, the Bureau--
        (1) shall, after consultation with the head of each transferor 
    agency, identify the rules and orders that will be enforced by the 
    Bureau; and
        (2) shall publish a list of such rules and orders in the 
    Federal Register.
    (j) Status of Rules Proposed or Not Yet Effective.--
        (1) Proposed rules.--Any proposed rule of a transferor agency 
    which that agency, in performing consumer financial protection 
    functions transferred by this title, has proposed before the 
    designated transfer date, but has not been published as a final 
    rule before that date, shall be deemed to be a proposed rule of the 
    Bureau.
        (2) Rules not yet effective.--Any interim or final rule of a 
    transferor agency which that agency, in performing consumer 
    financial protection functions transferred by this title, has 
    published before the designated transfer date, but which has not 
    become effective before that date, shall become effective as a rule 
    of the Bureau according to its terms.
SEC. 1064. TRANSFER OF CERTAIN PERSONNEL.
    (a) In General.--
        (1) Certain federal reserve system employees transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        Board of Governors shall--
                (i) jointly determine the number of employees of the 
            Board of Governors necessary to perform or support the 
            consumer financial protection functions of the Board of 
            Governors that are transferred to the Bureau by this title; 
            and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the Board of Governors 
            for transfer to the Bureau, in a manner that the Bureau and 
            the Board of Governors, in their sole discretion, determine 
            equitable.
            (B) Identified employees transferred.--All employees of the 
        Board of Governors identified under subparagraph (A)(ii) shall 
        be transferred to the Bureau for employment.
            (C) Federal reserve bank employees.--Employees of any 
        Federal reserve bank who are performing consumer financial 
        protection functions on behalf of the Board of Governors shall 
        be treated as employees of the Board of Governors for purposes 
        of subparagraphs (A) and (B).
        (2) Certain fdic employees transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        Board of Directors of the Federal Deposit Insurance Corporation 
        shall--
                (i) jointly determine the number of employees of that 
            Corporation necessary to perform or support the consumer 
            financial protection functions of the Corporation that are 
            transferred to the Bureau by this title; and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the Corporation for 
            transfer to the Bureau, in a manner that the Bureau and the 
            Board of Directors of the Corporation, in their sole 
            discretion, determine equitable.
            (B) Identified employees transferred.--All employees of the 
        Corporation identified under subparagraph (A)(ii) shall be 
        transferred to the Bureau for employment.
        (3) Certain ncua employees transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        National Credit Union Administration Board shall--
                (i) jointly determine the number of employees of the 
            National Credit Union Administration necessary to perform 
            or support the consumer financial protection functions of 
            the National Credit Union Administration that are 
            transferred to the Bureau by this title; and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the National Credit 
            Union Administration for transfer to the Bureau, in a 
            manner that the Bureau and the National Credit Union 
            Administration Board, in their sole discretion, determine 
            equitable.
            (B) Identified employees transferred.--All employees of the 
        National Credit Union Administration identified under 
        subparagraph (A)(ii) shall be transferred to the Bureau for 
        employment.
        (4) Certain office of the comptroller of the currency employees 
    transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        Comptroller of the Currency shall--
                (i) jointly determine the number of employees of the 
            Office of the Comptroller of the Currency necessary to 
            perform or support the consumer financial protection 
            functions of the Office of the Comptroller of the Currency 
            that are transferred to the Bureau by this title; and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the Office of the 
            Comptroller of the Currency for transfer to the Bureau, in 
            a manner that the Bureau and the Office of the Comptroller 
            of the Currency, in their sole discretion, determine 
            equitable.
            (B) Identified employees transferred.--All employees of the 
        Office of the Comptroller of the Currency identified under 
        subparagraph (A)(ii) shall be transferred to the Bureau for 
        employment.
        (5) Certain office of thrift supervision employees 
    transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        Director of the Office of Thrift Supervision shall--
                (i) jointly determine the number of employees of the 
            Office of Thrift Supervision necessary to perform or 
            support the consumer financial protection functions of the 
            Office of Thrift Supervision that are transferred to the 
            Bureau by this title; and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the Office of Thrift 
            Supervision for transfer to the Bureau, in a manner that 
            the Bureau and the Office of Thrift Supervision, in their 
            sole discretion, determine equitable.
            (B) Identified employees transferred.--All employees of the 
        Office of Thrift Supervision identified under subparagraph 
        (A)(ii) shall be transferred to the Bureau for employment.
        (6) Certain employees of department of housing and urban 
    development transferred.--
            (A) Identifying employees for transfer.--The Bureau and the 
        Secretary of the Department of Housing and Urban Development 
        shall--
                (i) jointly determine the number of employees of the 
            Department of Housing and Urban Development necessary to 
            perform or support the consumer protection functions of the 
            Department that are transferred to the Bureau by this 
            title; and
                (ii) consistent with the number determined under clause 
            (i), jointly identify employees of the Department of 
            Housing and Urban Development for transfer to the Bureau in 
            a manner that the Bureau and the Secretary of the 
            Department of Housing and Urban Development, in their sole 
            discretion, deem equitable.
            (B) Identified employees transferred.--All employees of the 
        Department of Housing and Urban Development identified under 
        subparagraph (A)(ii) shall be transferred to the Bureau for 
        employment.
        (7) Consumer education, financial literacy, consumer 
    complaints, and research functions.--The Bureau and each of the 
    transferor agencies (except the Federal Trade Commission) shall 
    jointly determine the number of employees and the types and grades 
    of employees necessary to perform the functions of the Bureau under 
    subtitle A, including consumer education, financial literacy, 
    policy analysis, responses to consumer complaints and inquiries, 
    research, and similar functions. All employees jointly identified 
    under this paragraph shall be transferred to the Bureau for 
    employment.
        (8) Authority of the president to resolve disputes.--
            (A) Action authorized.--In the event that the Bureau and a 
        transferor agency are unable to reach an agreement under 
        paragraphs (1) through (7) by the designated transfer date, the 
        President, or the designee thereof, may issue an order or 
        directive to the transferor agency to effect the transfer of 
        personnel and property under this subtitle.
            (B) Transmittal to congress required.--If an order or 
        directive is issued under subparagraph (A), the President shall 
        transmit a copy of the written determination made with respect 
        to such order or directive, including an explanation for the 
        need for the order or directive, to the Committee on Banking, 
        Housing, and Urban Affairs and the Committee on Appropriations 
        of the Senate and the Committee on Financial Services and the 
        Committee on Appropriations of the House of Representatives.
            (C) Sunset.--The authority provided in this paragraph shall 
        terminate 3 years after the designated transfer date.
        (9) Appointment authority for excepted service and senior 
    executive service transferred.--
            (A) In general.--In the case of an employee occupying a 
        position in the excepted service or the Senior Executive 
        Service, any appointment authority established pursuant to law 
        or regulations of the Office of Personnel Management for 
        filling such positions shall be transferred, subject to 
        subparagraph (B).
            (B) Declining transfers allowed.--An agency or entity may 
        decline to make a transfer of authority under subparagraph (A) 
        (and the employees appointed pursuant thereto) to the extent 
        that such authority relates to positions excepted from the 
        competitive service because of their confidential, policy-
        making, policy-determining, or policy-advocating character, and 
        non-career positions in the Senior Executive Service (within 
        the meaning of section 3132(a)(7) of title 5, United States 
        Code).
    (b) Timing of Transfers and Position Assignments.--Each employee to 
be transferred under this section shall--
        (1) be transferred not later than 90 days after the designated 
    transfer date; and
        (2) receive notice of a position assignment not later than 120 
    days after the effective date of his or her transfer.
    (c) Transfer of Function.--
        (1) In general.--Notwithstanding any other provision of law, 
    the transfer of employees shall be deemed a transfer of functions 
    for the purpose of section 3503 of title 5, United States Code.
        (2) Priority of this title.--If any provisions of this title 
    conflict with any protection provided to transferred employees 
    under section 3503 of title 5, United States Code, the provisions 
    of this title shall control.
    (d) Equal Status and Tenure Positions.--
        (1) Employees transferred from the federal reserve system, 
    fdic, hud, ncua, occ, and ots.--Each employee transferred to the 
    Bureau from the Board of Governors, a Federal reserve bank, the 
    Federal Deposit Insurance Corporation, the Department of Housing 
    and Urban Development, the National Credit Union Administration, 
    the Office of the Comptroller of the Currency, or the Office of 
    Thrift Supervision shall be placed in a position at the Bureau with 
    the same status and tenure as that employee held on the day before 
    the designated transfer date.
        (2) Employees transferred from the federal reserve system.--For 
    purposes of determining the status and position placement of a 
    transferred employee, any period of service with the Board of 
    Governors or a Federal reserve bank shall be credited as a period 
    of service with a Federal agency.
    (e) Additional Certification Requirements Limited.--Examiners 
transferred to the Bureau are not subject to any additional 
certification requirements before being placed in a comparable examiner 
position at the Bureau examining the same types of institutions as they 
examined before they were transferred.
    (f) Personnel Actions Limited.--
        (1) 2-year protection.--Except as provided in paragraph (2), 
    each transferred employee holding a permanent position on the day 
    before the designated transfer date may not, during the 2-year 
    period beginning on the designated transfer date, be involuntarily 
    separated, or involuntarily reassigned outside his or her locality 
    pay area.
        (2) Exceptions.--Paragraph (1) does not limit the right of the 
    Bureau--
            (A) to separate an employee for cause or for unacceptable 
        performance;
            (B) to terminate an appointment to a position excepted from 
        the competitive service because of its confidential policy-
        making, policy-determining, or policy-advocating character; or
            (C) to reassign a supervisory employee outside of his or 
        her locality pay area when the Bureau determines that the 
        reassignment is necessary for the efficient operation of the 
        Bureau.
    (g) Pay.--
        (1) 2-year protection.--
            (A) In general.--Except as provided in paragraph (2), each 
        transferred employee shall, during the 2-year period beginning 
        on the designated transfer date, receive pay at a rate equal to 
        not less than the basic rate of pay (including any geographic 
        differential) that the employee received during the pay period 
        immediately preceding the date of transfer.
            (B) Limitation.--Notwithstanding subparagraph (A), if the 
        employee was receiving a higher rate of basic pay on a 
        temporary basis (because of a temporary assignment, temporary 
        promotion, or other temporary action) immediately before the 
        date of transfer, the Bureau may reduce the rate of basic pay 
        on the date on which the rate would have been reduced but for 
        the transfer, and the protected rate for the remainder of the 
        2-year period shall be the reduced rate that would have 
        applied, but for the transfer.
        (2) Exceptions.--Paragraph (1) does not limit the right of the 
    Bureau to reduce the rate of basic pay of a transferred employee--
            (A) for cause;
            (B) for unacceptable performance; or
            (C) with the consent of the employee.
        (3) Protection only while employed.--Paragraph (1) applies to a 
    transferred employee only while that employee remains employed by 
    the Bureau.
        (4) Pay increases permitted.--Paragraph (1) does not limit the 
    authority of the Bureau to increase the pay of a transferred 
    employee.
    (h) Reorganization.--
        (1) Between 1st and 3rd year.--
            (A) In general.--If the Bureau determines, during the 2-
        year period beginning 1 year after the designated transfer 
        date, that a reorganization of the staff of the Bureau is 
        required--
                (i) that reorganization shall be deemed a ``substantial 
            reorganization'' for purposes of affording affected 
            employees retirement under section 8336(d)(2) or 
            8414(b)(1)(B) of title 5, United States Code;
                (ii) before the reorganization occurs, all employees in 
            the same locality pay area as defined by the Office of 
            Personnel Management shall be placed in a uniform position 
            classification system; and
                (iii) any resulting reduction in force shall be 
            governed by the provisions of chapter 35 of title 5, United 
            States Code, except that the Bureau shall--

                    (I) establish competitive areas (as that term is 
                defined in regulations issued by the Office of 
                Personnel Management) to include at a minimum all 
                employees in the same locality pay area as defined by 
                the Office of Personnel Management;
                    (II) establish competitive levels (as that term is 
                defined in regulations issued by the Office of 
                Personnel Management) without regard to whether the 
                particular employees have been appointed to positions 
                in the competitive service or the excepted service; and
                    (III) afford employees appointed to positions in 
                the excepted service (other than to a position excepted 
                from the competitive service because of its 
                confidential policy-making, policy-determining, or 
                policy-advocating character) the same assignment rights 
                to positions within the Bureau as employees appointed 
                to positions in the competitive service.

            (B) Service credit for reductions in force.--For purposes 
        of this paragraph, periods of service with a Federal home loan 
        bank, a joint office of the Federal home loan banks, the Board 
        of Governors, a Federal reserve bank, the Federal Deposit 
        Insurance Corporation, or the National Credit Union 
        Administration shall be credited as periods of service with a 
        Federal agency.
        (2) After 3rd year.--
            (A) In general.--If the Bureau determines, at any time 
        after the 3-year period beginning on the designated transfer 
        date, that a reorganization of the staff of the Bureau is 
        required, any resulting reduction in force shall be governed by 
        the provisions of chapter 35 of title 5, United States Code, 
        except that the Bureau shall establish competitive levels (as 
        that term is defined in regulations issued by the Office of 
        Personnel Management) without regard to types of appointment 
        held by particular employees transferred under this section.
            (B) Service credit for reductions in force.--For purposes 
        of this paragraph, periods of service with a Federal home loan 
        bank, a joint office of the Federal home loan banks, the Board 
        of Governors, a Federal reserve bank, the Federal Deposit 
        Insurance Corporation, or the National Credit Union 
        Administration shall be credited as periods of service with a 
        Federal agency.
    (i) Benefits.--
        (1) Retirement benefits for transferred employees.--
            (A) In general.--
                (i) Continuation of existing retirement plan.--Unless 
            an election is made under clause (iii) or subparagraph (B), 
            each employee transferred pursuant to this subtitle shall 
            remain enrolled in the existing retirement plan of that 
            employee as of the date of transfer, through any period of 
            continuous employment with the Bureau.
                (ii) Employer contribution.--The Bureau shall pay any 
            employer contributions to the existing retirement plan of 
            each transferred employee, as required under that plan.
                (iii) Option to elect into the federal reserve system 
            retirement plan and federal reserve system thrift plan.--
            Any employee transferred pursuant to this subtitle may, 
            during the 1-year period beginning 6 months after the 
            designated transfer date, elect to end their participation 
            and benefit accruals under their existing retirement plan 
            or plans and elect to participate in both the Federal 
            Reserve System Retirement Plan and the Federal Reserve 
            System Thrift Plan, through any period of continuous 
            employment with the Bureau, under the same terms as are 
            applicable to Federal Reserve System transferred employees, 
            as provided in subparagraph (C). An election of coverage by 
            the Federal Reserve System Retirement Plan and the Federal 
            Reserve System Thrift Plan shall begin on the day following 
            the end of the 18-month period beginning on the designated 
            transfer date, and benefit accruals under the existing 
            retirement plan of the transferred employee shall end on 
            the last day of the 18-month period beginning on the 
            designated transfer date If an employee elects to 
            participate in the Federal Reserve System Retirement Plan 
            and the Federal Reserve System Thrift Plan, all of the 
            service of the employee that was creditable under their 
            existing retirement plan shall be transferred to the 
            Federal Reserve System Retirement Plan on the day following 
            the end of the 18-month period beginning on the designated 
            transfer date.
                (iv) Bureau contribution.--The Bureau shall pay an 
            employer contribution to the Federal Reserve System 
            Retirement Plan, in the amount established as an employer 
            contribution under the Federal Employees Retirement System, 
            as established under chapter 84 of title 5, United States 
            Code, for each Bureau employee who elects to participate in 
            the Federal Reserve System Retirement Plan under this 
            subparagraph. The Bureau shall pay an employer contribution 
            to the Federal Reserve System Thrift Plan for each Bureau 
            employee who elects to participate in such plan, as 
            required under the terms of the Federal Reserve System 
            Thrift Plan.
                (v) Additional funding.--The Bureau shall transfer to 
            the Federal Reserve System Retirement Plan an amount 
            determined by the Board of Governors, in consultation with 
            the Bureau, to be necessary to reimburse the Federal 
            Reserve System Retirement Plan for the costs to such plan 
            of providing benefits to employees electing coverage under 
            the Federal Reserve System Retirement Plan under 
            subparagraph (iii), and who were transferred to the Bureau 
            from outside of the Federal Reserve System.
                (vi) Option to elect into thrift plan created by the 
            bureau.--If the Bureau chooses to establish a thrift plan, 
            the employees transferred pursuant to this subtitle shall 
            have the option to elect, under such terms and conditions 
            as the Bureau may establish, coverage under such a thrift 
            plan established by the Bureau. Transferred employees may 
            not remain in the thrift plan of the agency from which the 
            employee transferred under this subtitle, if the employee 
            elects to participate in a thrift plan established by the 
            Bureau.
            (B) Option for employees transferred from federal reserve 
        system to be subject to the federal employee retirement 
        program.--
                (i) Election.--Any Federal Reserve System transferred 
            employee who was enrolled in the Federal Reserve System 
            Retirement Plan on the day before the date of his or her 
            transfer to the Bureau may, during the 1-year period 
            beginning 6 months after the designated transfer date, 
            elect to be subject to the Federal Employee Retirement 
            Program.
                (ii) Effective date of coverage.--An election of 
            coverage by the Federal Employee Retirement Program under 
            this subparagraph shall begin on the day following the end 
            of the 18-month period beginning on the designated transfer 
            date, and benefit accruals under the existing retirement 
            plan of the Federal Reserve System transferred employee 
            shall end on the last day of the 18-month period beginning 
            on the designated transfer date.
            (C) Bureau participation in federal reserve system 
        retirement plan.--
                (i) Benefits provided.--Federal Reserve System 
            employees transferred pursuant to this subtitle shall 
            continue to be eligible to participate in the Federal 
            Reserve System Retirement Plan and Federal Reserve System 
            Thrift Plan through any period of continuous employment 
            with the Bureau, unless the employee makes an election 
            under subparagraph (A)(vi) or (B). The retirement benefits, 
            formulas, and features offered to the Federal Reserve 
            System transferred employees shall be the same as those 
            offered to employees of the Board of Governors who 
            participate in the Federal Reserve System Retirement Plan 
            and the Federal Reserve System Thrift Plan, as amended from 
            time to time.
                (ii) Limitation.--The Bureau shall not have 
            responsibility or authority--

                    (I) to amend an existing retirement plan (including 
                the Federal Reserve System Retirement Plan or Federal 
                Reserve System Thrift Plan);
                    (II) for administering an existing retirement plan 
                (including the Federal Reserve System Retirement Plan 
                or Federal Reserve System Thrift Plan); or
                    (III) for ensuring the plans comply with applicable 
                laws, fiduciary rules, and related responsibilities.

                (iii) Tax qualified status.--Notwithstanding any other 
            provision of law, providing benefits to Federal Reserve 
            System employees transferred to the Bureau pursuant to this 
            subtitle, and to employees who elect coverage pursuant to 
            subparagraph (A)(iii) or under section 1013(a)(2)(B), shall 
            not cause any existing retirement plan (including the 
            Federal Reserve System Retirement Plan and the Federal 
            Reserve System Thrift Plan) to lose its tax-qualified 
            status under sections 401(a) and 501(a) of the Internal 
            Revenue Code of 1986.
                (iv) Bureau contribution.--The Bureau shall pay any 
            employer contributions to the existing retirement plan 
            (including the Federal Reserve System Retirement Plan and 
            the Federal Reserve System Thrift Plan) for each Federal 
            Reserve System transferred employee participating in those 
            plans, as required under the plan, after the designated 
            transfer date.
                (v) Controlled group status.--The Bureau is the same 
            employer as the Federal Reserve System (as comprised of the 
            Board of Governors and each of the 12 Federal reserve banks 
            prior to the date of enactment of this Act) for purposes of 
            subsections (b), (c), (m), and (o) of section 414 of the 
            Internal Revenue Code of 1986 (26 U.S.C. 414).
            (D) Definitions.--For purposes of this paragraph--
                (i) the term ``existing retirement plan'' means, with 
            respect to an employee transferred pursuant to this 
            subtitle, the retirement plan (including the Financial 
            Institutions Retirement Fund) and any associated thrift 
            savings plan, of the agency from which the employee was 
            transferred under this subtitle, in which the employee was 
            enrolled on the day before the date on which the employee 
            was transferred;
                (ii) the term ``Federal Employee Retirement Program'' 
            means either the Civil Service Retirement System 
            established under chapter 83 of title 5, United States 
            Code, or the Federal Employees Retirement System 
            established under chapter 84 of title 5, United States 
            Code, depending upon the service history of the individual;
                (iii) the term ``Federal Reserve System transferred 
            employee'' means a transferred employee who is an employee 
            of the Board of Governors or a Federal reserve bank on the 
            day before the designated transfer date, and who is 
            transferred to the Bureau on the designated transfer date 
            pursuant to this subtitle;
                (iv) the term ``Federal Reserve System Retirement 
            Plan'' means the Retirement Plan for Employees of the 
            Federal Reserve System; and
                (v) the term ``Federal Reserve System Thrift Plan'' 
            means the Thrift Plan for Employees of the Federal Reserve 
            System.
        (2) Benefits other than retirement benefits for transferred 
    employees.--
            (A) During 1st year.--
                (i) Existing plans continue.--Each employee transferred 
            pursuant to this subtitle may, for 1 year after the 
            designated transfer date, retain membership in any other 
            employee benefit program of the agency or bank from which 
            the employee transferred, including a medical, dental, 
            vision, long term care, or life insurance program, to which 
            the employee belonged on the day before the designated 
            transfer date.
                (ii) Employer contribution.--The Bureau shall reimburse 
            the agency or bank from which an employee was transferred 
            for any cost incurred by that agency or bank in continuing 
            to extend coverage in the benefit program to the employee, 
            as required under that program or negotiated agreements.
            (B) Medical, dental, vision, or life insurance after first 
        year.--If, at the end of the 1-year period beginning on the 
        designated transfer date, the Bureau has not established its 
        own, or arranged for participation in another entity's, 
        medical, dental, vision, or life insurance program, an employee 
        transferred pursuant to this subtitle who was a member of such 
        a program at the agency or Federal reserve bank from which the 
        employee transferred may, before the coverage of that employee 
        ends under subparagraph (A)(i), elect to enroll, without regard 
        to any regularly scheduled open season, in--
                (i) the enhanced dental benefits program established 
            under chapter 89A of title 5, United States Code;
                (ii) the enhanced vision benefits established under 
            chapter 89B of title 5, United States Code;
                (iii) the Federal Employees Group Life Insurance 
            Program established under chapter 87 of title 5, United 
            States Code, without regard to any requirement of 
            insurability; and
                (iv) the Federal Employees Health Benefits Program 
            established under chapter 89 of title 5, United States 
            Code.
            (C) Long term care insurance after 1st year.--If, at the 
        end of the 1-year period beginning on the designated transfer 
        date, the Bureau has not established its own, or arranged for 
        participation in another entity's, long term care insurance 
        program, an employee transferred pursuant to this subtitle who 
        was a member of such a program at the agency or Federal reserve 
        bank from which the employee transferred may, before the 
        coverage of that employee ends under subparagraph (A)(i), elect 
        to apply for coverage under the Federal Long Term Care 
        Insurance Program established under chapter 90 of title 5, 
        United States Code, under the underwriting requirements 
        applicable to a new active workforce member (as defined in part 
        875 of title 5, Code of Federal Regulations).
            (D) Employee contribution.--An individual enrolled in the 
        Federal Employees Health Benefits program shall pay any 
        employee contribution required by the plan.
            (E) Additional funding.--The Bureau shall transfer to the 
        Federal Employees Health Benefits Fund established under 
        section 8909 of title 5, United States Code, an amount 
        determined by the Director of the Office of Personnel 
        Management, after consultation with the Bureau and the Office 
        of Management and Budget, to be necessary to reimburse the Fund 
        for the cost to the Fund of providing benefits under this 
        paragraph.
            (F) Credit for time enrolled in other plans.--For employees 
        transferred under this title, enrollment in a health benefits 
        plan administered by a transferor agency or a Federal reserve 
        bank, as the case may be, immediately before enrollment in a 
        health benefits plan under chapter 89 of title 5, United States 
        Code, shall be considered as enrollment in a health benefits 
        plan under that chapter for purposes of section 8905(b)(1)(A) 
        of title 5, United States Code.
            (G) Special provisions to ensure continuation of life 
        insurance benefits.--
                (i) In general.--An annuitant (as defined in section 
            8901(3) of title 5, United States Code) who is enrolled in 
            a life insurance plan administered by a transferor agency 
            on the day before the designated transfer date shall be 
            eligible for coverage by a life insurance plan under 
            sections 8706(b), 8714a, 8714b, and 8714c of title 5, 
            United States Code, or in a life insurance plan established 
            by the Bureau, without regard to any regularly scheduled 
            open season and requirement of insurability.
                (ii) Employee contribution.--An individual enrolled in 
            a life insurance plan under this subparagraph shall pay any 
            employee contribution required by the plan.
                (iii) Additional funding.--The Bureau shall transfer to 
            the Employees' Life Insurance Fund established under 
            section 8714 of title 5, United States Code, an amount 
            determined by the Director of the Office of Personnel 
            Management, after consultation with the Bureau and the 
            Office of Management and Budget, to be necessary to 
            reimburse the Fund for the cost to the Fund of providing 
            benefits under this subparagraph not otherwise paid for by 
            the employee under clause (ii).
                (iv) Credit for time enrolled in other plans.--For 
            employees transferred under this title, enrollment in a 
            life insurance plan administered by a transferor agency 
            immediately before enrollment in a life insurance plan 
            under chapter 87 of title 5, United States Code, shall be 
            considered as enrollment in a life insurance plan under 
            that chapter for purposes of section 8706(b)(1)(A) of title 
            5, United States Code.
        (3) OPM rules.--The Office of Personnel Management shall issue 
    such rules as are necessary to carry out this subsection.
    (j) Implementation of Uniform Pay and Classification System.--Not 
later than 2 years after the designated transfer date, the Bureau shall 
implement a uniform pay and classification system for all employees 
transferred under this title.
    (k) Equitable Treatment.--In administering the provisions of this 
section, the Bureau--
        (1) shall take no action that would unfairly disadvantage 
    transferred employees relative to each other based on their prior 
    employment by the Board of Governors, the Federal Deposit Insurance 
    Corporation, the Department of Housing and Urban Development, the 
    National Credit Union Administration, the Office of the Comptroller 
    of the Currency, the Office of Thrift Supervision, a Federal 
    reserve bank, a Federal home loan bank, or a joint office of the 
    Federal home loan banks; and
        (2) may take such action as is appropriate in individual cases 
    so that employees transferred under this section receive equitable 
    treatment, with respect to the status, tenure, pay, benefits (other 
    than benefits under programs administered by the Office of 
    Personnel Management), and accrued leave or vacation time of those 
    employees, for prior periods of service with any Federal agency, 
    including the Board of Governors, the Corporation, the Department 
    of Housing and Urban Development, the National Credit Union 
    Administration, the Office of the Comptroller of the Currency, the 
    Office of Thrift Supervision, a Federal reserve bank, a Federal 
    home loan bank, or a joint office of the Federal home loan banks.
    (l) Implementation.--In implementing the provisions of this 
section, the Bureau shall coordinate with the Office of Personnel 
Management and other entities having expertise in matters related to 
employment to ensure a fair and orderly transition for affected 
employees.
SEC. 1065. INCIDENTAL TRANSFERS.
    (a) Incidental Transfers Authorized.--The Director of the Office of 
Management and Budget, in consultation with the Secretary, shall make 
such additional incidental transfers and dispositions of assets and 
liabilities held, used, arising from, available, or to be made 
available, in connection with the functions transferred by this title, 
as the Director may determine necessary to accomplish the purposes of 
this title.
    (b) Sunset.--The authority provided in this section shall terminate 
5 years after the date of enactment of this Act.
SEC. 1066. INTERIM AUTHORITY OF THE SECRETARY.
    (a) In General.--The Secretary is authorized to perform the 
functions of the Bureau under this subtitle until the Director of the 
Bureau is confirmed by the Senate in accordance with section 1011.
    (b) Interim Administrative Services by the Department of the 
Treasury.--The Department of the Treasury may provide administrative 
services necessary to support the Bureau before the designated transfer 
date.
SEC. 1067. TRANSITION OVERSIGHT.
    (a) Purpose.--The purpose of this section is to ensure that the 
Bureau--
        (1) has an orderly and organized startup;
        (2) attracts and retains a qualified workforce; and
        (3) establishes comprehensive employee training and benefits 
    programs.
    (b) Reporting Requirement.--
        (1) In general.--The Bureau shall submit an annual report to 
    the Committee on Banking, Housing, and Urban Affairs of the Senate 
    and the Committee on Financial Services of the House of 
    Representatives that includes the plans described in paragraph (2).
        (2) Plans.--The plans described in this paragraph are as 
    follows:
            (A) Training and workforce development plan.--The Bureau 
        shall submit a training and workforce development plan that 
        includes, to the extent practicable--
                (i) identification of skill and technical expertise 
            needs and actions taken to meet those requirements;
                (ii) steps taken to foster innovation and creativity;
                (iii) leadership development and succession planning; 
            and
                (iv) effective use of technology by employees.
            (B) Workplace flexibilities plan.--The Bureau shall submit 
        a workforce flexibility plan that includes, to the extent 
        practicable--
                (i) telework;
                (ii) flexible work schedules;
                (iii) phased retirement;
                (iv) reemployed annuitants;
                (v) part-time work;
                (vi) job sharing;
                (vii) parental leave benefits and childcare assistance;
                (viii) domestic partner benefits;
                (ix) other workplace flexibilities; or
                (x) any combination of the items described in clauses 
            (i) through (ix).
            (C) Recruitment and retention plan.--The Bureau shall 
        submit a recruitment and retention plan that includes, to the 
        extent practicable, provisions relating to--
                (i) the steps necessary to target highly qualified 
            applicant pools with diverse backgrounds;
                (ii) streamlined employment application processes;
                (iii) the provision of timely notification of the 
            status of employment applications to applicants; and
                (iv) the collection of information to measure 
            indicators of hiring effectiveness.
    (c) Expiration.--The reporting requirement under subsection (b) 
shall terminate 5 years after the date of enactment of this Act.
    (d) Rule of Construction.--Nothing in this section may be construed 
to affect--
        (1) a collective bargaining agreement, as that term is defined 
    in section 7103(a)(8) of title 5, United States Code, that is in 
    effect on the date of enactment of this Act; or
        (2) the rights of employees under chapter 71 of title 5, United 
    States Code.
    (e) Participation in Examinations.--In order to prepare the Bureau 
to conduct examinations under section 1025 upon the designated transfer 
date, the Bureau and the applicable prudential regulator may agree to 
include, on a sampling basis, examiners on examinations of the 
compliance with Federal consumer financial law of institutions 
described in section 1025(a) conducted by the prudential regulators 
prior to the designated transfer date.

                  Subtitle G--Regulatory Improvements

SEC. 1071. SMALL BUSINESS DATA COLLECTION.
    (a) In General.--The Equal Credit Opportunity Act (15 U.S.C. 1691 
et seq.) is amended by inserting after section 704A the following:
``SEC. 704B. SMALL BUSINESS LOAN DATA COLLECTION.
    ``(a) Purpose.--The purpose of this section is to facilitate 
enforcement of fair lending laws and enable communities, governmental 
entities, and creditors to identify business and community development 
needs and opportunities of women-owned, minority-owned, and small 
businesses.
    ``(b) Information Gathering.--Subject to the requirements of this 
section, in the case of any application to a financial institution for 
credit for women-owned, minority-owned, or small business, the 
financial institution shall--
        ``(1) inquire whether the business is a women-owned, minority-
    owned, or small business, without regard to whether such 
    application is received in person, by mail, by telephone, by 
    electronic mail or other form of electronic transmission, or by any 
    other means, and whether or not such application is in response to 
    a solicitation by the financial institution; and
        ``(2) maintain a record of the responses to such inquiry, 
    separate from the application and accompanying information.
    ``(c) Right To Refuse.--Any applicant for credit may refuse to 
provide any information requested pursuant to subsection (b) in 
connection with any application for credit.
    ``(d) No Access by Underwriters.--
        ``(1) Limitation.--Where feasible, no loan underwriter or other 
    officer or employee of a financial institution, or any affiliate of 
    a financial institution, involved in making any determination 
    concerning an application for credit shall have access to any 
    information provided by the applicant pursuant to a request under 
    subsection (b) in connection with such application.
        ``(2) Limited access.--If a financial institution determines 
    that a loan underwriter or other officer or employee of a financial 
    institution, or any affiliate of a financial institution, involved 
    in making any determination concerning an application for credit 
    should have access to any information provided by the applicant 
    pursuant to a request under subsection (b), the financial 
    institution shall provide notice to the applicant of the access of 
    the underwriter to such information, along with notice that the 
    financial institution may not discriminate on the basis of such 
    information.
    ``(e) Form and Manner of Information.--
        ``(1) In general.--Each financial institution shall compile and 
    maintain, in accordance with regulations of the Bureau, a record of 
    the information provided by any loan applicant pursuant to a 
    request under subsection (b).
        ``(2) Itemization.--Information compiled and maintained under 
    paragraph (1) shall be itemized in order to clearly and 
    conspicuously disclose--
            ``(A) the number of the application and the date on which 
        the application was received;
            ``(B) the type and purpose of the loan or other credit 
        being applied for;
            ``(C) the amount of the credit or credit limit applied for, 
        and the amount of the credit transaction or the credit limit 
        approved for such applicant;
            ``(D) the type of action taken with respect to such 
        application, and the date of such action;
            ``(E) the census tract in which is located the principal 
        place of business of the women-owned, minority-owned, or small 
        business loan applicant;
            ``(F) the gross annual revenue of the business in the last 
        fiscal year of the women-owned, minority-owned, or small 
        business loan applicant preceding the date of the application;
            ``(G) the race, sex, and ethnicity of the principal owners 
        of the business; and
            ``(H) any additional data that the Bureau determines would 
        aid in fulfilling the purposes of this section.
        ``(3) No personally identifiable information.--In compiling and 
    maintaining any record of information under this section, a 
    financial institution may not include in such record the name, 
    specific address (other than the census tract required under 
    paragraph (1)(E)), telephone number, electronic mail address, or 
    any other personally identifiable information concerning any 
    individual who is, or is connected with, the women-owned, minority-
    owned, or small business loan applicant.
        ``(4) Discretion to delete or modify publicly available data.--
    The Bureau may, at its discretion, delete or modify data collected 
    under this section which is or will be available to the public, if 
    the Bureau determines that the deletion or modification of the data 
    would advance a privacy interest.
    ``(f) Availability of Information.--
        ``(1) Submission to bureau.--The data required to be compiled 
    and maintained under this section by any financial institution 
    shall be submitted annually to the Bureau.
        ``(2) Availability of information.--Information compiled and 
    maintained under this section shall be--
            ``(A) retained for not less than 3 years after the date of 
        preparation;
            ``(B) made available to any member of the public, upon 
        request, in the form required under regulations prescribed by 
        the Bureau;
            ``(C) annually made available to the public generally by 
        the Bureau, in such form and in such manner as is determined by 
        the Bureau, by regulation.
        ``(3) Compilation of aggregate data.--The Bureau may, at its 
    discretion--
            ``(A) compile and aggregate data collected under this 
        section for its own use; and
            ``(B) make public such compilations of aggregate data.
    ``(g) Bureau Action.--
        ``(1) In general.--The Bureau shall prescribe such rules and 
    issue such guidance as may be necessary to carry out, enforce, and 
    compile data pursuant to this section.
        ``(2) Exceptions.--The Bureau, by rule or order, may adopt 
    exceptions to any requirement of this section and may, 
    conditionally or unconditionally, exempt any financial institution 
    or class of financial institutions from the requirements of this 
    section, as the Bureau deems necessary or appropriate to carry out 
    the purposes of this section.
        ``(3) Guidance.--The Bureau shall issue guidance designed to 
    facilitate compliance with the requirements of this section, 
    including assisting financial institutions in working with 
    applicants to determine whether the applicants are women-owned, 
    minority-owned, or small businesses for purposes of this section.
    ``(h) Definitions.--For purposes of this section, the following 
definitions shall apply:
        ``(1) Financial institution.--The term `financial institution' 
    means any partnership, company, corporation, association 
    (incorporated or unincorporated), trust, estate, cooperative 
    organization, or other entity that engages in any financial 
    activity.
        ``(2) Small business.--The term `small business' has the same 
    meaning as the term `small business concern' in section 3 of the 
    Small Business Act (15 U.S.C. 632).
        ``(3) Small business loan.--The term `small business loan' 
    means a loan made to a small business.
        ``(4) Minority.--The term `minority' has the same meaning as in 
    section 1204(c)(3) of the Financial Institutions Reform, Recovery, 
    and Enforcement Act of 1989.
        ``(5) Minority-owned business.--The term `minority-owned 
    business' means a business--
            ``(A) more than 50 percent of the ownership or control of 
        which is held by 1 or more minority individuals; and
            ``(B) more than 50 percent of the net profit or loss of 
        which accrues to 1 or more minority individuals.
        ``(6) Women-owned business.--The term `women-owned business' 
    means a business--
            ``(A) more than 50 percent of the ownership or control of 
        which is held by 1 or more women; and
            ``(B) more than 50 percent of the net profit or loss of 
        which accrues to 1 or more women.''.
    (b) Technical and Conforming Amendments.--Section 701(b) of the 
Equal Credit Opportunity Act (15 U.S.C. 1691(b)) is amended--
        (1) in paragraph (3), by striking ``or'' at the end;
        (2) in paragraph (4), by striking the period at the end and 
    inserting ``; or''; and
        (3) by inserting after paragraph (4), the following:
        ``(5) to make an inquiry under section 704B, in accordance with 
    the requirements of that section.''.
    (c) Clerical Amendment.--The table of sections for title VII of the 
Consumer Credit Protection Act is amended by inserting after the item 
relating to section 704A the following new item:

``704B. Small business loan data collection.''.

    (d) Effective Date.--This section shall become effective on the 
designated transfer date.
SEC. 1072. ASSISTANCE FOR ECONOMICALLY VULNERABLE INDIVIDUALS AND 
FAMILIES.
    (a) HERA Amendments.--Section 1132 of the Housing and Economic 
Recovery Act of 2008 (12 U.S.C. 1701x note) is amended--
        (1) in subsection (a), by inserting in each of paragraphs (1), 
    (2), (3), and (4) ``or economically vulnerable individuals and 
    families'' after ``homebuyers'' each place that term appears;
        (2) in subsection (b)(1), by inserting ``or economically 
    vulnerable individuals and families'' after ``homebuyers'';
        (3) in subsection (c)(1)--
            (A) in subparagraph (A), by striking ``or'' at the end;
            (B) in subparagraph (B), by striking the period at the end 
        and inserting ``; or''; and
            (C) by adding at the end the following:
            ``(C) a nonprofit corporation that--
                ``(i) is exempt from taxation under section 501(c)(3) 
            of the Internal Revenue Code of 1986; and
                ``(ii) specializes or has expertise in working with 
            economically vulnerable individuals and families, but whose 
            primary purpose is not provision of credit counseling 
            services.''; and
        (4) in subsection (d)(1), by striking ``not more than 5''.
    (b) Applicability.--Amendments made by subsection (a) shall not 
apply to programs authorized by section 1132 of the Housing and 
Economic Recovery Act of 2008 (12 U.S.C. 1701x note) that are funded 
with appropriations prior to fiscal year 2011.
SEC. 1073. REMITTANCE TRANSFERS.
    (a) Treatment of Remittance Transfers.--The Electronic Fund 
Transfer Act (15 U.S.C. 1693 et seq.) is amended--
        (1) in section 902(b) (15 U.S.C. 1693(b)), by inserting ``and 
    remittance'' after ``electronic fund'';
        (2) in section 904(c) (15 U.S.C. 1693b(c)), in the first 
    sentence, by inserting ``or remittance transfers'' after 
    ``electronic fund transfers'';
        (3) by redesignating sections 919, 920, 921, and 922 as 
    sections 920, 921, 922, and 923, respectively; and
        (4) by inserting after section 918 the following:
    ``SEC. 919. REMITTANCE TRANSFERS.
    ``(a) Disclosures Required for Remittance Transfers.--
        ``(1) In general.--Each remittance transfer provider shall make 
    disclosures as required under this section and in accordance with 
    rules prescribed by the Board. Disclosures required under this 
    section shall be in addition to any other disclosures applicable 
    under this title.
        ``(2) Disclosures.--Subject to rules prescribed by the Board, a 
    remittance transfer provider shall provide, in writing and in a 
    form that the sender may keep, to each sender requesting a 
    remittance transfer, as applicable to the transaction--
            ``(A) at the time at which the sender requests a remittance 
        transfer to be initiated, and prior to the sender making any 
        payment in connection with the remittance transfer, a 
        disclosure describing--
                ``(i) the amount of currency that will be received by 
            the designated recipient, using the values of the currency 
            into which the funds will be exchanged;
                ``(ii) the amount of transfer and any other fees 
            charged by the remittance transfer provider for the 
            remittance transfer; and
                ``(iii) any exchange rate to be used by the remittance 
            transfer provider for the remittance transfer, to the 
            nearest 1/100th of a point; and
            ``(B) at the time at which the sender makes payment in 
        connection with the remittance transfer--
                ``(i) a receipt showing--

                    ``(I) the information described in subparagraph 
                (A);
                    ``(II) the promised date of delivery to the 
                designated recipient; and
                    ``(III) the name and either the telephone number or 
                the address of the designated recipient, if either the 
                telephone number or the address of the designated 
                recipient is provided by the sender; and

                ``(ii) a statement containing--

                    ``(I) information about the rights of the sender 
                under this section regarding the resolution of errors; 
                and
                    ``(II) appropriate contact information for--

                        ``(aa) the remittance transfer provider; and
                        ``(bb) the State agency that regulates the 
                    remittance transfer provider and the Board, 
                    including the toll-free telephone number 
                    established under section 1013 of the Consumer 
                    Financial Protection Act of 2010.
        ``(3) Requirements relating to disclosures.--With respect to 
    each disclosure required to be provided under paragraph (2) a 
    remittance transfer provider shall--
            ``(A) provide an initial notice and receipt, as required by 
        subparagraphs (A) and (B) of paragraph (2), and an error 
        resolution statement, as required by subsection (d), that 
        clearly and conspicuously describe the information required to 
        be disclosed therein; and
            ``(B) with respect to any transaction that a sender 
        conducts electronically, comply with the Electronic Signatures 
        in Global and National Commerce Act (15 U.S.C. 7001 et seq.).
        ``(4) Exception for disclosures of amount received.--
            ``(A) In general.--Subject to the rules prescribed by the 
        Board, and except as provided under subparagraph (B), the 
        disclosures required regarding the amount of currency that will 
        be received by the designated recipient shall be deemed to be 
        accurate, so long as the disclosures provide a reasonably 
        accurate estimate of the foreign currency to be received. This 
        paragraph shall apply only to a remittance transfer provider 
        who is an insured depository institution, as defined in section 
        3 of the Federal Deposit Insurance Act (12 U.S.C. 1813), or an 
        insured credit union, as defined in section 101 of the Federal 
        Credit Union Act (12 U.S.C. 1752), and if--
                ``(i) a remittance transfer is conducted through a 
            demand deposit, savings deposit, or other asset account 
            that the sender holds with such remittance transfer 
            provider; and
                ``(ii) at the time at which the sender requests the 
            transaction, the remittance transfer provider is unable to 
            know, for reasons beyond its control, the amount of 
            currency that will be made available to the designated 
            recipient.
            ``(B) Deadline.--The application of subparagraph (A) shall 
        terminate 5 years after the date of enactment of the Consumer 
        Financial Protection Act of 2010, unless the Board determines 
        that termination of such provision would negatively affect the 
        ability of remittance transfer providers described in 
        subparagraph (A) to send remittances to locations in foreign 
        countries, in which case, the Board may, by rule, extend the 
        application of subparagraph (A) to not longer than 10 years 
        after the date of enactment of the Consumer Financial 
        Protection Act of 2010.
        ``(5) Exemption authority.--The Board may, by rule, permit a 
    remittance transfer provider to satisfy the requirements of--
            ``(A) paragraph (2)(A) orally, if the transaction is 
        conducted entirely by telephone;
            ``(B) paragraph (2)(B), in the case of a transaction 
        conducted entirely by telephone, by mailing the disclosures 
        required under such subparagraph to the sender, not later than 
        1 business day after the date on which the transaction is 
        conducted, or by including such documents in the next periodic 
        statement, if the telephone transaction is conducted through a 
        demand deposit, savings deposit, or other asset account that 
        the sender holds with the remittance transfer provider;
            ``(C) subparagraphs (A) and (B) of paragraph (2) together 
        in one written disclosure, but only to the extent that the 
        information provided in accordance with paragraph (3)(A) is 
        accurate at the time at which payment is made in connection 
        with the subject remittance transfer; and
            ``(D) paragraph (2)(A), without compliance with section 
        101(c) of the Electronic Signatures in Global Commerce Act, if 
        a sender initiates the transaction electronically and the 
        information is displayed electronically in a manner that the 
        sender can keep.
        ``(6) Storefront and internet notices.--
            ``(A) In general.--
                ``(i) Prominent posting.--Subject to subparagraph (B), 
            the Board may prescribe rules to require a remittance 
            transfer provider to prominently post, and timely update, a 
            notice describing a model remittance transfer for one or 
            more amounts, as the Board may determine, which notice 
            shall show the amount of currency that will be received by 
            the designated recipient, using the values of the currency 
            into which the funds will be exchanged.
                ``(ii) Onsite displays.--The Board may require the 
            notice prescribed under this subparagraph to be displayed 
            in every physical storefront location owned or controlled 
            by the remittance transfer provider.
                ``(iii) Internet notices.--Subject to paragraph (3), 
            the Board shall prescribe rules to require a remittance 
            transfer provider that provides remittance transfers via 
            the Internet to provide a notice, comparable to a 
            storefront notice described in this subparagraph, located 
            on the home page or landing page (with respect to such 
            remittance transfer services) owned or controlled by the 
            remittance transfer provider.
                ``(iv) Rulemaking authority.--In prescribing rules 
            under this subparagraph, the Board may impose standards or 
            requirements regarding the provision of the storefront and 
            Internet notices required under this subparagraph and the 
            provision of the disclosures required under paragraphs (2) 
            and (3).
            ``(B) Study and analysis.--Prior to proposing rules under 
        subparagraph (A), the Board shall undertake appropriate studies 
        and analyses, which shall be consistent with section 904(a)(2), 
        and may include an advanced notice of proposed rulemaking, to 
        determine whether a storefront notice or Internet notice 
        facilitates the ability of a consumer--
                ``(i) to compare prices for remittance transfers; and
                ``(ii) to understand the types and amounts of any fees 
            or costs imposed on remittance transfers.
    ``(b) Foreign Language Disclosures.--The disclosures required under 
this section shall be made in English and in each of the foreign 
languages principally used by the remittance transfer provider, or any 
of its agents, to advertise, solicit, or market, either orally or in 
writing, at that office.
    ``(c) Regulations Regarding Transfers to Certain Nations.--If the 
Board determines that a recipient nation does not legally allow, or the 
method by which transactions are made in the recipient country do not 
allow, a remittance transfer provider to know the amount of currency 
that will be received by the designated recipient, the Board may 
prescribe rules (not later than 18 months after the date of enactment 
of the Consumer Financial Protection Act of 2010) addressing the issue, 
which rules shall include standards for a remittance transfer provider 
to provide--
        ``(1) a receipt that is consistent with subsections (a) and 
    (b); and
        ``(2) a reasonably accurate estimate of the foreign currency to 
    be received, based on the rate provided to the sender by the 
    remittance transfer provider at the time at which the transaction 
    was initiated by the sender.
    ``(d) Remittance Transfer Errors.--
        ``(1) Error resolution.--
            ``(A) In general.--If a remittance transfer provider 
        receives oral or written notice from the sender within 180 days 
        of the promised date of delivery that an error occurred with 
        respect to a remittance transfer, including the amount of 
        currency designated in subsection (a)(3)(A) that was to be sent 
        to the designated recipient of the remittance transfer, using 
        the values of the currency into which the funds should have 
        been exchanged, but was not made available to the designated 
        recipient in the foreign country, the remittance transfer 
        provider shall resolve the error pursuant to this subsection 
        and investigate the reason for the error.
            ``(B) Remedies.--Not later than 90 days after the date of 
        receipt of a notice from the sender pursuant to subparagraph 
        (A), the remittance transfer provider shall, as applicable to 
        the error and as designated by the sender--
                ``(i) refund to the sender the total amount of funds 
            tendered by the sender in connection with the remittance 
            transfer which was not properly transmitted;
                ``(ii) make available to the designated recipient, 
            without additional cost to the designated recipient or to 
            the sender, the amount appropriate to resolve the error;
                ``(iii) provide such other remedy, as determined 
            appropriate by rule of the Board for the protection of 
            senders; or
                ``(iv) provide written notice to the sender that there 
            was no error with an explanation responding to the specific 
            complaint of the sender.
        ``(2) Rules.--The Board shall establish, by rule issued not 
    later than 18 months after the date of enactment of the Consumer 
    Financial Protection Act of 2010, clear and appropriate standards 
    for remittance transfer providers with respect to error resolution 
    relating to remittance transfers, to protect senders from such 
    errors. Standards prescribed under this paragraph shall include 
    appropriate standards regarding record keeping, as required, 
    including documentation--
            ``(A) of the complaint of the sender;
            ``(B) that the sender provides the remittance transfer 
        provider with respect to the alleged error; and
            ``(C) of the findings of the remittance transfer provider 
        regarding the investigation of the alleged error that the 
        sender brought to their attention.
        ``(3) Cancellation and refund policy rules.--Not later than 18 
    months after the date of enactment of the Consumer Financial 
    Protection Act of 2010, the Board shall issue final rules regarding 
    appropriate remittance transfer cancellation and refund policies 
    for consumers.
    ``(e) Applicability of This Title.--
        ``(1) In general.--A remittance transfer that is not an 
    electronic fund transfer, as defined in section 903, shall not be 
    subject to any of the provisions of sections 905 through 913. A 
    remittance transfer that is an electronic fund transfer, as defined 
    in section 903, shall be subject to all provisions of this title, 
    except for section 908, that are otherwise applicable to electronic 
    fund transfers under this title.
        ``(2) Rule of construction.--Nothing in this section shall be 
    construed--
            ``(A) to affect the application to any transaction, to any 
        remittance provider, or to any other person of any of the 
        provisions of subchapter II of chapter 53 of title 31, United 
        States Code, section 21 of the Federal Deposit Insurance Act 
        (12 U.S.C. 1829b), or chapter 2 of title I of Public Law 91-508 
        (12 U.S.C. 1951-1959), or any regulations promulgated 
        thereunder; or
            ``(B) to cause any fund transfer that would not otherwise 
        be treated as such under paragraph (1) to be treated as an 
        electronic fund transfer, or as otherwise subject to this 
        title, for the purposes of any of the provisions referred to in 
        subparagraph (A) or any regulations promulgated thereunder.
    ``(f) Acts of Agents.--
        ``(1) In general.--A remittance transfer provider shall be 
    liable for any violation of this section by any agent, authorized 
    delegate, or person affiliated with such provider, when such agent, 
    authorized delegate, or affiliate acts for that remittance transfer 
    provider.
        ``(2) Obligations of remittance transfer providers.--The Board 
    shall prescribe rules to implement appropriate standards or 
    conditions of, liability of a remittance transfer provider, 
    including a provider who acts through an agent or authorized 
    delegate. An agency charged with enforcing the requirements of this 
    section, or rules prescribed by the Board under this section, may 
    consider, in any action or other proceeding against a remittance 
    transfer provider, the extent to which the provider had established 
    and maintained policies or procedures for compliance, including 
    policies, procedures, or other appropriate oversight measures 
    designed to assure compliance by an agent or authorized delegate 
    acting for such provider.
    ``(g) Definitions.--As used in this section--
        ``(1) the term `designated recipient' means any person located 
    in a foreign country and identified by the sender as the authorized 
    recipient of a remittance transfer to be made by a remittance 
    transfer provider, except that a designated recipient shall not be 
    deemed to be a consumer for purposes of this Act;
        ``(2) the term `remittance transfer'--
            ``(A) means the electronic (as defined in section 106(2) of 
        the Electronic Signatures in Global and National Commerce Act 
        (15 U.S.C. 7006(2))) transfer of funds requested by a sender 
        located in any State to a designated recipient that is 
        initiated by a remittance transfer provider, whether or not the 
        sender holds an account with the remittance transfer provider 
        or whether or not the remittance transfer is also an electronic 
        fund transfer, as defined in section 903; and
            ``(B) does not include a transfer described in subparagraph 
        (A) in an amount that is equal to or lesser than the amount of 
        a small-value transaction determined, by rule, to be excluded 
        from the requirements under section 906(a);
        ``(3) the term `remittance transfer provider' means any person 
    or financial institution that provides remittance transfers for a 
    consumer in the normal course of its business, whether or not the 
    consumer holds an account with such person or financial 
    institution; and
        ``(4) the term `sender' means a consumer who requests a 
    remittance provider to send a remittance transfer for the consumer 
    to a designated recipient.''.
    (b) Automated Clearinghouse System.--
        (1) Expansion of system.--The Board of Governors shall work 
    with the Federal reserve banks and the Department of the Treasury 
    to expand the use of the automated clearinghouse system and other 
    payment mechanisms for remittance transfers to foreign countries, 
    with a focus on countries that receive significant remittance 
    transfers from the United States, based on--
            (A) the number, volume, and size of such transfers;
            (B) the significance of the volume of such transfers 
        relative to the external financial flows of the receiving 
        country, including--
                (i) the total amount transferred; and
                (ii) the total volume of payments made by United States 
            Government agencies to beneficiaries and retirees living 
            abroad;
            (C) the feasibility of such an expansion; and
            (D) the ability of the Federal Reserve System to establish 
        payment gateways in different geographic regions and currency 
        zones to receive remittance transfers and route them through 
        the payments systems in the destination countries.
        (2) Report to congress.--Not later than one calendar year after 
    the date of enactment of this Act, and on April 30 biennially 
    thereafter during the 10-year period beginning on that date of 
    enactment, the Board of Governors shall submit a report to the 
    Committee on Banking, Housing, and Urban Affairs of the Senate and 
    the Committee on Financial Services of the House of Representatives 
    on the status of the automated clearinghouse system and its 
    progress in complying with the requirements of this subsection. The 
    report shall include an analysis of adoption rates of International 
    ACH Transactions rules and formats, the efficacy of increasing 
    adoption rates, and potential recommendations to increase adoption.
    (c) Expansion of Financial Institution Provision of Remittance 
Transfers.--
        (1) Provision of guidelines to institutions.--Each of the 
    Federal banking agencies and the National Credit Union 
    Administration shall provide guidelines to financial institutions 
    under the jurisdiction of the agency regarding the offering of low-
    cost remittance transfers and no-cost or low-cost basic consumer 
    accounts, as well as agency services to remittance transfer 
    providers.
        (2) Assistance to financial literacy commission.--As part of 
    its duties as members of the Financial Literacy and Education 
    Commission, the Bureau, the Federal banking agencies, and the 
    National Credit Union Administration shall assist the Financial 
    Literacy and Education Commission in executing the Strategy for 
    Assuring Financial Empowerment (or the ``SAFE Strategy''), as it 
    relates to remittances.
    (d) Federal Credit Union Act Conforming Amendment.--Paragraph (12) 
of section 107 of the Federal Credit Union Act (12 U.S.C. 1757) is 
amended to read as follows:
        ``(12) in accordance with regulations prescribed by the Board--
            ``(A) to sell, to persons in the field of membership, 
        negotiable checks (including travelers checks), money orders, 
        and other similar money transfer instruments (including 
        international and domestic electronic fund transfers and 
        remittance transfers, as defined in section 919 of the 
        Electronic Fund Transfer Act); and
            ``(B) to cash checks and money orders for persons in the 
        field of membership for a fee;''.
    (e) Report on Feasibility of and Impediments to Use of Remittance 
History in Calculation of Credit Score.--Before the end of the 365-day 
period beginning on the date of enactment of this Act, the Director 
shall submit a report to the President, the Committee on Banking, 
Housing, and Urban Affairs of the Senate, and the Committee on 
Financial Services of the House of Representatives regarding--
        (1) the manner in which the remittance history of a consumer 
    could be used to enhance the credit score of the consumer;
        (2) the current legal and business model barriers and 
    impediments that impede the use of the remittance history of the 
    consumer to enhance the credit score of the consumer; and
        (3) recommendations on the manner in which maximum transparency 
    and disclosure to consumers of exchange rates for remittance 
    transfers subject to this title and the amendments made by this 
    title may be accomplished, whether or not such exchange rates are 
    known at the time of origination or payment by the consumer for the 
    remittance transfer, including disclosure to the sender of the 
    actual exchange rate used and the amount of currency that the 
    recipient of the remittance transfer received, using the values of 
    the currency into which the funds were exchanged, as contained in 
    sections 919(a)(2)(D) and 919(a)(3) of the Electronic Fund Transfer 
    Act (as amended by this section).
SEC. 1074. DEPARTMENT OF THE TREASURY STUDY ON ENDING THE 
CONSERVATORSHIP OF FANNIE MAE, FREDDIE MAC, AND REFORMING THE HOUSING 
FINANCE SYSTEM.
    (a) Study Required.--
        (1) In general.--The Secretary of the Treasury shall conduct a 
    study of and develop recommendations regarding the options for 
    ending the conservatorship of the Federal National Mortgage 
    Association (in this section referred to as ``Fannie Mae'') and the 
    Federal Home Loan Mortgage Corporation (in this section referred to 
    as ``Freddie Mac''), while minimizing the cost to taxpayers, 
    including such options as--
            (A) the gradual wind-down and liquidation of such entities;
            (B) the privatization of such entities;
            (C) the incorporation of the functions of such entities 
        into a Federal agency;
            (D) the dissolution of Fannie Mae and Freddie Mac into 
        smaller companies; or
            (E) any other measures the Secretary determines 
        appropriate.
        (2) Analyses.--The study required under paragraph (1) shall 
    include an analysis of--
            (A) the role of the Federal Government in supporting a 
        stable, well-functioning housing finance system, and whether 
        and to what extent the Federal Government should bear risks in 
        meeting Federal housing finance objectives;
            (B) how the current structure of the housing finance system 
        can be improved;
            (C) how the housing finance system should support the 
        continued availability of mortgage credit to all segments of 
        the market;
            (D) how the housing finance system should be structured to 
        ensure that consumers continue to have access to 30-year, fixed 
        rate, pre-payable mortgages and other mortgage products that 
        have simple terms that can be easily understood;
            (E) the role of the Federal Housing Administration and the 
        Department of Veterans Affairs in a future housing system;
            (F) the impact of reforms of the housing finance system on 
        the financing of rental housing;
            (G) the impact of reforms of the housing finance system on 
        secondary market liquidity;
            (H) the role of standardization in the housing finance 
        system;
            (I) how housing finance systems in other countries offer 
        insights that can help inform options for reform in the United 
        States; and
            (J) the options for transition to a reformed housing 
        finance system.
    (b) Report and Recommendations.--Not later than January 31, 2011, 
the Secretary of the Treasury shall submit the report and 
recommendations required under 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.
SEC. 1075. REASONABLE FEES AND RULES FOR PAYMENT CARD TRANSACTIONS.
    (a) In General.--The Electronic Fund Transfer Act (15 U.S.C. 1693 
et seq.) is amended--
        (1) by redesignating sections 920 and 921 as sections 921 and 
    922, respectively; and
        (2) by inserting after section 919 the following:
    ``SEC. 920. REASONABLE FEES AND RULES FOR PAYMENT CARD 
      TRANSACTIONS.
    ``(a) Reasonable Interchange Transaction Fees for Electronic Debit 
Transactions.--
        ``(1) Regulatory authority over interchange transaction fees.--
    The Board may prescribe regulations, pursuant to section 553 of 
    title 5, United States Code, regarding any interchange transaction 
    fee that an issuer may receive or charge with respect to an 
    electronic debit transaction, to implement this subsection 
    (including related definitions), and to prevent circumvention or 
    evasion of this subsection.
        ``(2) Reasonable interchange transaction fees.--The amount of 
    any interchange transaction fee that an issuer may receive or 
    charge with respect to an electronic debit transaction shall be 
    reasonable and proportional to the cost incurred by the issuer with 
    respect to the transaction.
        ``(3) Rulemaking required.--
            ``(A) In general.--The Board shall prescribe regulations in 
        final form not later than 9 months after the date of enactment 
        of the Consumer Financial Protection Act of 2010, to establish 
        standards for assessing whether the amount of any interchange 
        transaction fee described in paragraph (2) is reasonable and 
        proportional to the cost incurred by the issuer with respect to 
        the transaction.
            ``(B) Information collection.--The Board may require any 
        issuer (or agent of an issuer) or payment card network to 
        provide the Board with such information as may be necessary to 
        carry out the provisions of this subsection and the Board, in 
        issuing rules under subparagraph (A) and on at least a bi-
        annual basis thereafter, shall disclose such aggregate or 
        summary information concerning the costs incurred, and 
        interchange transaction fees charged or received, by issuers or 
        payment card networks in connection with the authorization, 
        clearance or settlement of electronic debit transactions as the 
        Board considers appropriate and in the public interest.
        ``(4) Considerations; consultation.--In prescribing regulations 
    under paragraph (3)(A), the Board shall--
            ``(A) consider the functional similarity between--
                ``(i) electronic debit transactions; and
                ``(ii) checking transactions that are required within 
            the Federal Reserve bank system to clear at par;
            ``(B) distinguish between--
                ``(i) the incremental cost incurred by an issuer for 
            the role of the issuer in the authorization, clearance, or 
            settlement of a particular electronic debit transaction, 
            which cost shall be considered under paragraph (2); and
                ``(ii) other costs incurred by an issuer which are not 
            specific to a particular electronic debit transaction, 
            which costs shall not be considered under paragraph (2); 
            and
            ``(C) consult, as appropriate, with the Comptroller of the 
        Currency, the Board of Directors of the Federal Deposit 
        Insurance Corporation, the Director of the Office of Thrift 
        Supervision, the National Credit Union Administration Board, 
        the Administrator of the Small Business Administration, and the 
        Director of the Bureau of Consumer Financial Protection.
        ``(5) Adjustments to interchange transaction fees for fraud 
    prevention costs.--
            ``(A) Adjustments.--The Board may allow for an adjustment 
        to the fee amount received or charged by an issuer under 
        paragraph (2), if--
                ``(i) such adjustment is reasonably necessary to make 
            allowance for costs incurred by the issuer in preventing 
            fraud in relation to electronic debit transactions 
            involving that issuer; and
                ``(ii) the issuer complies with the fraud-related 
            standards established by the Board under subparagraph (B), 
            which standards shall--

                    ``(I) be designed to ensure that any fraud-related 
                adjustment of the issuer is limited to the amount 
                described in clause (i) and takes into account any 
                fraud-related reimbursements (including amounts from 
                charge-backs) received from consumers, merchants, or 
                payment card networks in relation to electronic debit 
                transactions involving the issuer; and
                    ``(II) require issuers to take effective steps to 
                reduce the occurrence of, and costs from, fraud in 
                relation to electronic debit transactions, including 
                through the development and implementation of cost-
                effective fraud prevention technology.

            ``(B) Rulemaking required.--
                ``(i) In general.--The Board shall prescribe 
            regulations in final form not later than 9 months after the 
            date of enactment of the Consumer Financial Protection Act 
            of 2010, to establish standards for making adjustments 
            under this paragraph.
                ``(ii) Factors for consideration.--In issuing the 
            standards and prescribing regulations under this paragraph, 
            the Board shall consider--

                    ``(I) the nature, type, and occurrence of fraud in 
                electronic debit transactions;
                    ``(II) the extent to which the occurrence of fraud 
                depends on whether authorization in an electronic debit 
                transaction is based on signature, PIN, or other means;
                    ``(III) the available and economical means by which 
                fraud on electronic debit transactions may be reduced;
                    ``(IV) the fraud prevention and data security costs 
                expended by each party involved in electronic debit 
                transactions (including consumers, persons who accept 
                debit cards as a form of payment, financial 
                institutions, retailers and payment card networks);
                    ``(V) the costs of fraudulent transactions absorbed 
                by each party involved in such transactions (including 
                consumers, persons who accept debit cards as a form of 
                payment, financial institutions, retailers and payment 
                card networks);
                    ``(VI) the extent to which interchange transaction 
                fees have in the past reduced or increased incentives 
                for parties involved in electronic debit transactions 
                to reduce fraud on such transactions; and
                    ``(VII) such other factors as the Board considers 
                appropriate.

        ``(6) Exemption for small issuers.--
            ``(A) In general.--This subsection shall not apply to any 
        issuer that, together with its affiliates, has assets of less 
        than $10,000,000,000, and the Board shall exempt such issuers 
        from regulations prescribed under paragraph (3)(A).
            ``(B) Definition.--For purposes of this paragraph, the term 
        ``issuer'' shall be limited to the person holding the asset 
        account that is debited through an electronic debit 
        transaction.
        ``(7) Exemption for government-administered payment programs 
    and reloadable prepaid cards.--
            ``(A) In general.--This subsection shall not apply to an 
        interchange transaction fee charged or received with respect to 
        an electronic debit transaction in which a person uses--
                ``(i) a debit card or general-use prepaid card that has 
            been provided to a person pursuant to a Federal, State or 
            local government-administered payment program, in which the 
            person may only use the debit card or general-use prepaid 
            card to transfer or debit funds, monetary value, or other 
            assets that have been provided pursuant to such program; or
                ``(ii) a plastic card, payment code, or device that 
            is--

                    ``(I) linked to funds, monetary value, or assets 
                which are purchased or loaded on a prepaid basis;
                    ``(II) not issued or approved for use to access or 
                debit any account held by or for the benefit of the 
                card holder (other than a subaccount or other method of 
                recording or tracking funds purchased or loaded on the 
                card on a prepaid basis);
                    ``(III) redeemable at multiple, unaffiliated 
                merchants or service providers, or automated teller 
                machines;
                    ``(IV) used to transfer or debit funds, monetary 
                value, or other assets; and
                    ``(V) reloadable and not marketed or labeled as a 
                gift card or gift certificate.

            ``(B) Exception.--Notwithstanding subparagraph (A), after 
        the end of the 1-year period beginning on the effective date 
        provided in paragraph (9), this subsection shall apply to an 
        interchange transaction fee charged or received with respect to 
        an electronic debit transaction described in subparagraph 
        (A)(i) in which a person uses a general-use prepaid card, or an 
        electronic debit transaction described in subparagraph (A)(ii), 
        if any of the following fees may be charged to a person with 
        respect to the card:
                ``(i) A fee for an overdraft, including a shortage of 
            funds or a transaction processed for an amount exceeding 
            the account balance.
                ``(ii) A fee imposed by the issuer for the first 
            withdrawal per month from an automated teller machine that 
            is part of the issuer's designated automated teller machine 
            network.
            ``(C) Definition.--For purposes of subparagraph (B), the 
        term `designated automated teller machine network' means 
        either--
                ``(i) all automated teller machines identified in the 
            name of the issuer; or
                ``(ii) any network of automated teller machines 
            identified by the issuer that provides reasonable and 
            convenient access to the issuer's customers.
            ``(D) Reporting.--Beginning 12 months after the date of 
        enactment of the Consumer Financial Protection Act of 2010, the 
        Board shall annually provide a report to the Congress regarding 
        --
                ``(i) the prevalence of the use of general-use prepaid 
            cards in Federal, State or local government-administered 
            payment programs; and
                ``(ii) the interchange transaction fees and cardholder 
            fees charged with respect to the use of such general-use 
            prepaid cards.
        ``(8) Regulatory authority over network fees.--
            ``(A) In general.--The Board may prescribe regulations, 
        pursuant to section 553 of title 5, United States Code, 
        regarding any network fee.
            ``(B) Limitation.--The authority under subparagraph (A) to 
        prescribe regulations shall be limited to regulations to ensure 
        that--
                ``(i) a network fee is not used to directly or 
            indirectly compensate an issuer with respect to an 
            electronic debit transaction; and
                ``(ii) a network fee is not used to circumvent or evade 
            the restrictions of this subsection and regulations 
            prescribed under such subsection.
            ``(C) Rulemaking required.--The Board shall prescribe 
        regulations in final form before the end of the 9-month period 
        beginning on the date of the enactment of the Consumer 
        Financial Protection Act of 2010, to carry out the authorities 
        provided under subparagraph (A).
        ``(9) Effective date.--This subsection shall take effect at the 
    end of the 12-month period beginning on the date of the enactment 
    of the Consumer Financial Protection Act of 2010.
    ``(b) Limitation on Payment Card Network Restrictions.--
        ``(1) Prohibitions against exclusivity arrangements.--
            ``(A) No exclusive network.--The Board shall, before the 
        end of the 1-year period beginning on the date of the enactment 
        of the Consumer Financial Protection Act of 2010, prescribe 
        regulations providing that an issuer or payment card network 
        shall not directly or through any agent, processor, or licensed 
        member of a payment card network, by contract, requirement, 
        condition, penalty, or otherwise, restrict the number of 
        payment card networks on which an electronic debit transaction 
        may be processed to--
                ``(i) 1 such network; or
                ``(ii) 2 or more such networks which are owned, 
            controlled, or otherwise operated by --

                    ``(I) affiliated persons; or
                    ``(II) networks affiliated with such issuer.

            ``(B) No routing restrictions.--The Board shall, before the 
        end of the 1-year period beginning on the date of the enactment 
        of the Consumer Financial Protection Act of 2010, prescribe 
        regulations providing that an issuer or payment card network 
        shall not, directly or through any agent, processor, or 
        licensed member of the network, by contract, requirement, 
        condition, penalty, or otherwise, inhibit the ability of any 
        person who accepts debit cards for payments to direct the 
        routing of electronic debit transactions for processing over 
        any payment card network that may process such transactions.
        ``(2) Limitation on restrictions on offering discounts for use 
    of a form of payment.--
            ``(A) In general.--A payment card network shall not, 
        directly or through any agent, processor, or licensed member of 
        the network, by contract, requirement, condition, penalty, or 
        otherwise, inhibit the ability of any person to provide a 
        discount or in-kind incentive for payment by the use of cash, 
        checks, debit cards, or credit cards to the extent that--
                ``(i) in the case of a discount or in-kind incentive 
            for payment by the use of debit cards, the discount or in-
            kind incentive does not differentiate on the basis of the 
            issuer or the payment card network;
                ``(ii) in the case of a discount or in-kind incentive 
            for payment by the use of credit cards, the discount or in-
            kind incentive does not differentiate on the basis of the 
            issuer or the payment card network; and
                ``(iii) to the extent required by Federal law and 
            applicable State law, such discount or in-kind incentive is 
            offered to all prospective buyers and disclosed clearly and 
            conspicuously.
            ``(B) Lawful discounts.--For purposes of this paragraph, 
        the network may not penalize any person for the providing of a 
        discount that is in compliance with Federal law and applicable 
        State law.
        ``(3) Limitation on restrictions on setting transaction 
    minimums or maximums.--
            ``(A) In general.--A payment card network shall not, 
        directly or through any agent, processor, or licensed member of 
        the network, by contract, requirement, condition, penalty, or 
        otherwise, inhibit the ability--
                ``(i) of any person to set a minimum dollar value for 
            the acceptance by that person of credit cards, to the 
            extent that --

                    ``(I) such minimum dollar value does not 
                differentiate between issuers or between payment card 
                networks; and
                    ``(II) such minimum dollar value does not exceed 
                $10.00; or

                ``(ii) of any Federal agency or institution of higher 
            education to set a maximum dollar value for the acceptance 
            by that Federal agency or institution of higher education 
            of credit cards, to the extent that such maximum dollar 
            value does not differentiate between issuers or between 
            payment card networks.
            ``(B) Increase in minimum dollar amount.--The Board may, by 
        regulation prescribed pursuant to section 553 of title 5, 
        United States Code, increase the amount of the dollar value 
        listed in subparagraph (A)(i)(II).
        ``(4) Rule of construction:.--No provision of this subsection 
    shall be construed to authorize any person--
            ``(A) to discriminate between debit cards within a payment 
        card network on the basis of the issuer that issued the debit 
        card; or
            ``(B) to discriminate between credit cards within a payment 
        card network on the basis of the issuer that issued the credit 
        card.
    ``(c) Definitions.--For purposes of this section, the following 
definitions shall apply:
        ``(1) Affiliate.--The term `affiliate' means any company that 
    controls, is controlled by, or is under common control with another 
    company.
        ``(2) Debit card.--The term `debit card'--
            ``(A) means any card, or other payment code or device, 
        issued or approved for use through a payment card network to 
        debit an asset account (regardless of the purpose for which the 
        account is established), whether authorization is based on 
        signature, PIN, or other means;
            ``(B) includes a general-use prepaid card, as that term is 
        defined in section 915(a)(2)(A); and
            ``(C) does not include paper checks.
        ``(3) Credit card.--The term `credit card' has the same meaning 
    as in section 103 of the Truth in Lending Act.
        ``(4) Discount.--The term `discount'--
            ``(A) means a reduction made from the price that customers 
        are informed is the regular price; and
            ``(B) does not include any means of increasing the price 
        that customers are informed is the regular price.
        ``(5) Electronic debit transaction.--The term `electronic debit 
    transaction' means a transaction in which a person uses a debit 
    card.
        ``(6) Federal agency.--The term `Federal agency' means--
            ``(A) an agency (as defined in section 101 of title 31, 
        United States Code); and
            ``(B) a Government corporation (as defined in section 103 
        of title 5, United States Code).
        ``(7) Institution of higher education.--The term `institution 
    of higher education' has the same meaning as in 101 and 102 of the 
    Higher Education Act of 1965 (20 U.S.C. 1001, 1002).
        ``(8) Interchange transaction fee.--The term `interchange 
    transaction fee' means any fee established, charged or received by 
    a payment card network for the purpose of compensating an issuer 
    for its involvement in an electronic debit transaction.
        ``(9) Issuer.--The term `issuer' means any person who issues a 
    debit card, or credit card, or the agent of such person with 
    respect to such card.
        ``(10) Network fee.--The term `network fee' means any fee 
    charged and received by a payment card network with respect to an 
    electronic debit transaction, other than an interchange transaction 
    fee.
        ``(11) Payment card network.--The term `payment card network' 
    means an entity that directly, or through licensed members, 
    processors, or agents, provides the proprietary services, 
    infrastructure, and software that route information and data to 
    conduct debit card or credit card transaction authorization, 
    clearance, and settlement, and that a person uses in order to 
    accept as a form of payment a brand of debit card, credit card or 
    other device that may be used to carry out debit or credit 
    transactions.
    ``(d) Enforcement.--
        ``(1) In general.--Compliance with the requirements imposed 
    under this section shall be enforced under section 918.
        ``(2) Exception.--Sections 916 and 917 shall not apply with 
    respect to this section or the requirements imposed pursuant to 
    this section.''.
    (b) Amendment to the Food and Nutrition Act of 2008.--Section 
7(h)(10) of the Food and Nutrition Act of 2008 (7 U.S.C. 2016(h)(10)) 
is amended to read as follows:
        ``(10) Federal law not applicable.--Section 920 of the 
    Electronic Fund Transfer Act shall not apply to electronic benefit 
    transfer or reimbursement systems under this Act.''.
    (c) Amendment to the Farm Security and Rural Investment Act of 
2002.--Section 4402 of the Farm Security and Rural Investment Act of 
2002 (7 U.S.C. 3007) is amended by adding at the end the following new 
subsection:
    ``(f) Federal Law Not Applicable.--Section 920 of the Electronic 
Fund Transfer Act shall not apply to electronic benefit transfer 
systems established under this section.''.
    (d) Amendment to the Child Nutrition Act of 1966.--Section 11 of 
the Child Nutrition Act of 1966 (42 U.S.C. 1780) is amended by adding 
at the end the following:
    ``(c) Federal Law Not Applicable.--Section 920 of the Electronic 
Fund Transfer Act shall not apply to electronic benefit transfer 
systems established under this Act or the Richard B. Russell National 
School Lunch Act (42 U.S.C. 1751 et seq.).''.
SEC. 1076. REVERSE MORTGAGE STUDY AND REGULATIONS.
    (a) Study.--Not later than 1 year after the designated transfer 
date, the Bureau shall conduct a study on reverse mortgage 
transactions.
    (b) Regulations.--
        (1) In general.--If the Bureau determines through the study 
    required under subsection (a) that conditions or limitations on 
    reverse mortgage transactions are necessary or appropriate for 
    accomplishing the purposes and objectives of this title, including 
    protecting borrowers with respect to the obtaining of reverse 
    mortgage loans for the purpose of funding investments, annuities, 
    and other investment products and the suitability of a borrower in 
    obtaining a reverse mortgage for such purpose.
        (2) Identified practices and integrated disclosures.--The 
    regulations prescribed under paragraph (1) may, as the Bureau may 
    so determine--
            (A) identify any practice as unfair, deceptive, or abusive 
        in connection with a reverse mortgage transaction; and
            (B) provide for an integrated disclosure standard and model 
        disclosures for reverse mortgage transactions, consistent with 
        section 4302(d), that combines the relevant disclosures 
        required under the Truth in Lending Act (15 U.S.C. 1601 et 
        seq.) and the Real Estate Settlement Procedures Act, with the 
        disclosures required to be provided to consumers for Home 
        Equity Conversion Mortgages under section 255 of the National 
        Housing Act.
    (c) Rule of Construction.--This section shall not be construed as 
limiting the authority of the Bureau to issue regulations, orders, or 
guidance that apply to reverse mortgages prior to the completion of the 
study required under subsection (a).
SEC. 1077. REPORT ON PRIVATE EDUCATION LOANS AND PRIVATE EDUCATIONAL 
LENDERS.
    (a) Report.--Not later than 2 years after the date of enactment of 
this Act, the Director and the Secretary of Education, in consultation 
with the Commissioners of the Federal Trade Commission, and the 
Attorney General of the United States, shall submit a report to the 
Committee on Banking, Housing, and Urban Affairs and the Committee on 
Health, Education, Labor, and Pensions of the Senate and the Committee 
on Financial Services and the Committee on Education and Labor of the 
House of Representatives, on private education loans (as that term is 
defined in section 140 of the Truth in Lending Act (15 U.S.C. 1650)) 
and private educational lenders (as that term is defined in such 
section).
    (b) Content.--The report required by this section shall examine, at 
a minimum--
        (1) the growth and changes of the private education loan market 
    in the United States;
        (2) factors influencing such growth and changes;
        (3) the extent to which students and parents of students rely 
    on private education loans to finance postsecondary education and 
    the private education loan indebtedness of borrowers;
        (4) the characteristics of private education loan borrowers, 
    including--
            (A) the types of institutions of higher education that they 
        attend;
            (B) socioeconomic characteristics (including income and 
        education levels, racial characteristics, geographical 
        background, age, and gender);
            (C) what other forms of financing borrowers use to pay for 
        education;
            (D) whether they exhaust their Federal loan options before 
        taking out a private loan;
            (E) whether such borrowers are dependent or independent 
        students (as determined under part F of title IV of the Higher 
        Education Act of 1965) or parents of such students;
            (F) whether such borrowers are students enrolled in a 
        program leading to a certificate, license, or credential other 
        than a degree, an associates degree, a baccalaureate degree, or 
        a graduate or professional degree; and
            (G) if practicable, employment and repayment behaviors;
        (5) the characteristics of private educational lenders, 
    including whether such creditors are for-profit, non-profit, or 
    institutions of higher education;
        (6) the underwriting criteria used by private educational 
    lenders, including the use of cohort default rate (as such term is 
    defined in section 435(m) of the Higher Education Act of 1965);
        (7) the terms, conditions, and pricing of private education 
    loans;
        (8) the consumer protections available to private education 
    loan borrowers, including the effectiveness of existing disclosures 
    and requirements and borrowers' awareness and understanding about 
    terms and conditions of various financial products;
        (9) whether Federal regulators and the public have access to 
    information sufficient to provide them with assurances that private 
    education loans are provided in accord with the Nation's fair 
    lending laws and that allows public officials to determine lender 
    compliance with fair lending laws; and
        (10) any statutory or legislative recommendations necessary to 
    improve consumer protections for private education loan borrowers 
    and to better enable Federal regulators and the public to ascertain 
    private educational lender compliance with fair lending laws.
SEC. 1078. STUDY AND REPORT ON CREDIT SCORES.
    (a) Study.--The Bureau shall conduct a study on the nature, range, 
and size of variations between the credit scores sold to creditors and 
those sold to consumers by consumer reporting agencies that compile and 
maintain files on consumers on a nationwide basis (as defined in 
section 603(p) of the Fair Credit Reporting Act; 15 U.S.C. 1681a(p)), 
and whether such variations disadvantage consumers.
    (b) Report to Congress.--The Bureau shall submit a report to 
Congress on the results of the study conducted under subsection (a) not 
later than 1 year after the date of enactment of this Act.
SEC. 1079. REVIEW, REPORT, AND PROGRAM WITH RESPECT TO EXCHANGE 
FACILITATORS.
    (a) Review.--The Director shall review all Federal laws and 
regulations relating to the protection of consumers who use exchange 
facilitators for transactions primarily for personal, family, or 
household purposes.
    (b) Report.--Not later than 1 year after the designated transfer 
date, the Director shall submit to Congress a report describing--
        (1) recommendations for legislation to ensure the appropriate 
    protection of consumers who use exchange facilitators for 
    transactions primarily for personal, family, or household purposes;
        (2) recommendations for updating the regulations of Federal 
    departments and agencies to ensure the appropriate protection of 
    such consumers; and
        (3) recommendations for regulations to ensure the appropriate 
    protection of such consumers.
    (c) Program.--Not later than 2 years after the date of the 
submission of the report under subsection (b), the Bureau shall, 
consistent with subtitle B, propose regulations or otherwise establish 
a program to protect consumers who use exchange facilitators.
    (d) Exchange Facilitator Defined.--In this section, the term 
``exchange facilitator'' means a person that--
        (1) facilitates, for a fee, an exchange of like kind property 
    by entering into an agreement with a taxpayer by which the exchange 
    facilitator acquires from the taxpayer the contractual rights to 
    sell the taxpayer's relinquished property and transfers a 
    replacement property to the taxpayer as a qualified intermediary 
    (within the meaning of Treasury Regulations section 1.1031(k)-
    1(g)(4)) or enters into an agreement with the taxpayer to take 
    title to a property as an exchange accommodation titleholder 
    (within the meaning of Revenue Procedure 2000-37) or enters into an 
    agreement with a taxpayer to act as a qualified trustee or 
    qualified escrow holder (within the meaning of Treasury Regulations 
    section 1.1031(k)-1(g)(3));
        (2) maintains an office for the purpose of soliciting business 
    to perform the services described in paragraph (1); or
        (3) advertises any of the services described in paragraph (1) 
    or solicits clients in printed publications, direct mail, 
    television or radio advertisements, telephone calls, facsimile 
    transmissions, or other electronic communications directed to the 
    general public for purposes of providing any such services.
SEC. 1079A. FINANCIAL FRAUD PROVISIONS.
    (a) Sentencing Guidelines.--
        (1) Securities fraud.--
            (A) Directive.--Pursuant to its authority under section 994 
        of title 28, United States Code, and in accordance with this 
        paragraph, the United States Sentencing Commission shall review 
        and, if appropriate, amend the Federal Sentencing Guidelines 
        and policy statements applicable to persons convicted of 
        offenses relating to securities fraud or any other similar 
        provision of law, in order to reflect the intent of Congress 
        that penalties for the offenses under the guidelines and policy 
        statements appropriately account for the potential and actual 
        harm to the public and the financial markets from the offenses.
            (B) Requirements.--In making any amendments to the Federal 
        Sentencing Guidelines and policy statements under subparagraph 
        (A), the United States Sentencing Commission shall--
                (i) ensure that the guidelines and policy statements, 
            particularly section 2B1.1(b)(14) and section 2B1.1(b)(17) 
            (and any successors thereto), reflect--

                    (I) the serious nature of the offenses described in 
                subparagraph (A);
                    (II) the need for an effective deterrent and 
                appropriate punishment to prevent the offenses; and
                    (III) the effectiveness of incarceration in 
                furthering the objectives described in subclauses (I) 
                and (II);

                (ii) consider the extent to which the guidelines 
            appropriately account for the potential and actual harm to 
            the public and the financial markets resulting from the 
            offenses;
                (iii) ensure reasonable consistency with other relevant 
            directives and guidelines and Federal statutes;
                (iv) make any necessary conforming changes to 
            guidelines; and
                (v) ensure that the guidelines adequately meet the 
            purposes of sentencing, as set forth in section 3553(a)(2) 
            of title 18, United States Code.
        (2) Financial institution fraud.--
            (A) Directive.--Pursuant to its authority under section 994 
        of title 28, United States Code, and in accordance with this 
        paragraph, the United States Sentencing Commission shall review 
        and, if appropriate, amend the Federal Sentencing Guidelines 
        and policy statements applicable to persons convicted of fraud 
        offenses relating to financial institutions or federally 
        related mortgage loans and any other similar provisions of law, 
        to reflect the intent of Congress that the penalties for the 
        offenses under the guidelines and policy statements ensure 
        appropriate terms of imprisonment for offenders involved in 
        substantial bank frauds or other frauds relating to financial 
        institutions.
            (B) Requirements.--In making any amendments to the Federal 
        Sentencing Guidelines and policy statements under subparagraph 
        (A), the United States Sentencing Commission shall--
                (i) ensure that the guidelines and policy statements 
            reflect--

                    (I) the serious nature of the offenses described in 
                subparagraph (A);
                    (II) the need for an effective deterrent and 
                appropriate punishment to prevent the offenses; and
                    (III) the effectiveness of incarceration in 
                furthering the objectives described in subclauses (I) 
                and (II);

                (ii) consider the extent to which the guidelines 
            appropriately account for the potential and actual harm to 
            the public and the financial markets resulting from the 
            offenses;
                (iii) ensure reasonable consistency with other relevant 
            directives and guidelines and Federal statutes;
                (iv) make any necessary conforming changes to 
            guidelines; and
                (v) ensure that the guidelines adequately meet the 
            purposes of sentencing, as set forth in section 3553(a)(2) 
            of title 18, United States Code.
    (b) Extension of Statute of Limitations for Securities Fraud 
Violations.--
        (1) In general.--Chapter 213 of title 18, United States Code, 
    is amended by adding at the end the following:
``Sec. 3301. Securities fraud offenses
    ``(a) Definition.--In this section, the term `securities fraud 
offense' means a violation of, or a conspiracy or an attempt to 
violate--
        ``(1) section 1348;
        ``(2) section 32(a) of the Securities Exchange Act of 1934 (15 
    U.S.C. 78ff(a));
        ``(3) section 24 of the Securities Act of 1933 (15 U.S.C. 77x);
        ``(4) section 217 of the Investment Advisers Act of 1940 (15 
    U.S.C. 80b-17);
        ``(5) section 49 of the Investment Company Act of 1940 (15 
    U.S.C. 80a-48); or
        ``(6) section 325 of the Trust Indenture Act of 1939 (15 U.S.C. 
    77yyy).
    ``(b) Limitation.--No person shall be prosecuted, tried, or 
punished for a securities fraud offense, unless the indictment is found 
or the information is instituted within 6 years after the commission of 
the offense.''.
        (2) Technical and conforming amendment.--The table of sections 
    for chapter 213 of title 18, United States Code, is amended by 
    adding at the end the following:

``3301. Securities fraud offenses.''.

    (c) Amendments to the False Claims Act Relating to Limitations on 
Actions.--Section 3730(h) of title 31, United States Code, is amended--
        (1) in paragraph (1), by striking ``or agent on behalf of the 
    employee, contractor, or agent or associated others in furtherance 
    of other efforts to stop 1 or more violations of this subchapter'' 
    and inserting ``agent or associated others in furtherance of an 
    action under this section or other efforts to stop 1 or more 
    violations of this subchapter''; and
        (2) by adding at the end the following:
        ``(3) Limitation on bringing civil action.--A civil action 
    under this subsection may not be brought more than 3 years after 
    the date when the retaliation occurred.''.

                   Subtitle H--Conforming Amendments

SEC. 1081. AMENDMENTS TO THE INSPECTOR GENERAL ACT.
    Effective on the date of enactment of this Act, the Inspector 
General Act of 1978 (5 U.S.C. App. 3) is amended--
        (1) in section 8G(a)(2), by inserting ``and the Bureau of 
    Consumer Financial Protection'' after ``Board of Governors of the 
    Federal Reserve System'';
        (2) in section 8G(c), by adding at the end the following: ``For 
    purposes of implementing this section, the Chairman of the Board of 
    Governors of the Federal Reserve System shall appoint the Inspector 
    General of the Board of Governors of the Federal Reserve System and 
    the Bureau of Consumer Financial Protection. The Inspector General 
    of the Board of Governors of the Federal Reserve System and the 
    Bureau of Consumer Financial Protection shall have all of the 
    authorities and responsibilities provided by this Act with respect 
    to the Bureau of Consumer Financial Protection, as if the Bureau 
    were part of the Board of Governors of the Federal Reserve 
    System.''; and
        (3) in section 8G(g)(3), by inserting ``and the Bureau of 
    Consumer Financial Protection'' after ``Board of Governors of the 
    Federal Reserve System'' the first place that term appears.
SEC. 1082. AMENDMENTS TO THE PRIVACY ACT OF 1974.
    Effective on the date of enactment of this Act, section 552a of 
title 5, United States Code, is amended by adding at the end the 
following:
    ``(w) Applicability to Bureau of Consumer Financial Protection.--
Except as provided in the Consumer Financial Protection Act of 2010, 
this section shall apply with respect to the Bureau of Consumer 
Financial Protection.''.
SEC. 1083. AMENDMENTS TO THE ALTERNATIVE MORTGAGE TRANSACTION PARITY 
ACT OF 1982.
    (a) In General.--The Alternative Mortgage Transaction Parity Act of 
1982 (12 U.S.C. 3801 et seq.) is amended--
        (1) in section 803 (12 U.S.C. 3802(1)), by striking ``1974'' 
    and all that follows through ``described and defined'' and 
    inserting the following: ``1974), in which the interest rate or 
    finance charge may be adjusted or renegotiated, described and 
    defined''; and
        (2) in section 804 (12 U.S.C. 3803)--
            (A) in subsection (a)--
                (i) in each of paragraphs (1), (2), and (3), by 
            inserting after ``transactions made'' each place that term 
            appears ``on or before the designated transfer date, as 
            determined under section 1062 of the Consumer Financial 
            Protection Act of 2010,'';
                (ii) in paragraph (2), by striking ``and'' at the end;
                (iii) in paragraph (3), by striking the period at the 
            end and inserting ``; and''; and
                (iv) by adding at the end the following new paragraph:
        ``(4) with respect to transactions made after the designated 
    transfer date, only in accordance with regulations governing 
    alternative mortgage transactions, as issued by the Bureau of 
    Consumer Financial Protection for federally chartered housing 
    creditors, in accordance with the rulemaking authority granted to 
    the Bureau of Consumer Financial Protection with regard to 
    federally chartered housing creditors under provisions of law other 
    than this section.'';
            (B) by striking subsection (c) and inserting the following:
    ``(c) Preemption of State Law.--An alternative mortgage transaction 
may be made by a housing creditor in accordance with this section, 
notwithstanding any State constitution, law, or regulation that 
prohibits an alternative mortgage transaction. For purposes of this 
subsection, a State constitution, law, or regulation that prohibits an 
alternative mortgage transaction does not include any State 
constitution, law, or regulation that regulates mortgage transactions 
generally, including any restriction on prepayment penalties or late 
charges.''; and
            (C) by adding at the end the following:
    ``(d) Bureau Actions.--The Bureau of Consumer Financial Protection 
shall--
        ``(1) review the regulations identified by the Comptroller of 
    the Currency and the National Credit Union Administration, (as 
    those rules exist on the designated transfer date), as applicable 
    under paragraphs (1) through (3) of subsection (a);
        ``(2) determine whether such regulations are fair and not 
    deceptive and otherwise meet the objectives of the Consumer 
    Financial Protection Act of 2010; and
        ``(3) promulgate regulations under subsection (a)(4) after the 
    designated transfer date.
    ``(e) Designated Transfer Date.--As used in this section, the term 
`designated transfer date' means the date determined under section 1062 
of the Consumer Financial Protection Act of 2010.''.
    (b) Effective Date.--This section and the amendments made by this 
section shall become effective on the designated transfer date.
    (c) Rule of Construction.--The amendments made by subsection (a) 
shall not affect any transaction covered by the Alternative Mortgage 
Transaction Parity Act of l982 (12 U.S.C. 3801 et seq.) and entered 
into on or before the designated transfer date.
SEC. 1084. AMENDMENTS TO THE ELECTRONIC FUND TRANSFER ACT.
    The Electronic Fund Transfer Act (15 U.S.C. 1693 et seq.) is 
amended--
        (1) by striking ``Board'' each place that term appears and 
    inserting ``Bureau'', except in subsections (a) and (e) of section 
    904 (as amended in paragraph (3) of this section) and in 918 (15 
    U.S.C. 1693o) (as so designated by the Credit Card Act of 2009) and 
    section 920 (as added by section 1076);
        (2) in section 903 (15 U.S.C. 1693a)--
            (A) by redesignating paragraphs (3) through (11) as 
        paragraphs (4) through (12), respectively; and
            (B) by inserting after paragraph (3) the following:
        ``(4) the term `Bureau' means the Bureau of Consumer Financial 
    Protection;'';
        (3) in section 904 (15 U.S.C. 1693b)--
            (A) in subsection (a), by striking ``(a) Prescription by 
        Board.--The Board shall prescribe regulations to carry out the 
        purposes of this title.'' and inserting the following:
    ``(a) Prescription by the Bureau and the Board.--
        ``(1) In general.--Except as provided in paragraph (2), the 
    Bureau shall prescribe rules to carry out the purposes of this 
    title.
        ``(2) Authority of the board.--The Board shall have sole 
    authority to prescribe rules--
            ``(A) to carry out the purposes of this title with respect 
        to a person described in section 1029(a) of the Consumer 
        Financial Protection Act of 2010; and
            ``(B) to carry out the purposes of section 920.''; and
            (B) by adding at the end the following new subsection:
    ``(e) Deference.--No provision of this title may be construed as 
altering, limiting, or otherwise affecting the deference that a court 
affords to--
        ``(1) the Bureau in making determinations regarding the meaning 
    or interpretation of any provision of this title for which the 
    Bureau has authority to prescribe regulations; or
        ``(2) the Board in making determinations regarding the meaning 
    or interpretation of section 920.''.
        (4) in section 916(d) (15 U.S.C. 1693m) (as so designated by 
    the Credit CARD Act of 2009)--
            (A) in the subsection heading, by striking ``of Board or 
        Approval of Duly Authorized Official or Employee of Federal 
        Reserve System'';
            (B) by inserting ``Bureau or the'' before ``Board'' each 
        place that term appears; and
            (C) by inserting ``Bureau of Consumer Financial Protection 
        or the'' before ``Federal Reserve System''; and
        (5) in section 918 (15 U.S.C. 1693o) (as so designated by the 
    Credit CARD Act of 2009)--
            (A) in subsection (a)--
                (i) by striking ``Compliance'' and inserting ``Subject 
            to subtitle B of the Consumer Financial Protection Act of 
            2010, compliance'';
                (ii) by striking paragraphs (1) and (2), and inserting 
            the following:
        ``(1) section 8 of the Federal Deposit Insurance Act, by the 
    appropriate Federal banking agency, as defined in section 3(q) of 
    the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), with respect 
    to--
            ``(A) national banks, Federal savings associations, and 
        Federal branches and Federal agencies of foreign banks;
            ``(B) 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
            ``(C) banks and State savings associations insured by the 
        Federal Deposit Insurance Corporation (other than members of 
        the Federal Reserve System), and insured State branches of 
        foreign banks;'';
                (iii) by redesignating paragraphs (3) through (5) as 
            paragraphs (2) through (4), respectively;
                (iv) in paragraph (2) (as so redesignated), by striking 
            the period at the end and inserting a semicolon;
                (v) in paragraph (3) (as so redesignated), by striking 
            ``and'' at the end;
                (vi) in paragraph (4) (as so redesignated), by striking 
            the period at the end and inserting ``and''; and
                (vii) by adding at the end the following:
        ``(5) subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau, with respect to any person subject to this 
    title, except that the Bureau shall not have authority to enforce 
    the requirements of section 920 or any regulations prescribed by 
    the Board under section 920.'';
            (B) in subsection (b), by inserting ``any of paragraphs (1) 
        through (4) of'' before ``subsection (a)'' each place that term 
        appears; and
            (C) by striking subsection (c) and inserting the following:
    ``(c) Overall Enforcement Authority of the Federal Trade 
Commission.--Except to the extent that enforcement of the requirements 
imposed under this title is specifically committed to some other 
Government agency under any of paragraphs (1) through (4) of subsection 
(a), and subject to subtitle B of the Consumer Financial Protection Act 
of 2010, the Federal Trade Commission shall be authorized to enforce 
such requirements. For the purpose of the exercise by the Federal Trade 
Commission of its functions and powers under the Federal Trade 
Commission Act, a violation of any requirement imposed under this title 
shall be deemed a violation of a requirement imposed under that Act. 
All of the functions and powers of the Federal Trade Commission under 
the Federal Trade Commission Act are available to the Federal Trade 
Commission to enforce compliance by any person subject to the 
jurisdiction of the Federal Trade Commission with the requirements 
imposed under this title, irrespective of whether that person is 
engaged in commerce or meets any other jurisdictional tests under the 
Federal Trade Commission Act.''.
SEC. 1085. AMENDMENTS TO THE EQUAL CREDIT OPPORTUNITY ACT.
    The Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.) is 
amended--
        (1) by striking ``Board'' each place that term appears, other 
    than in section 703(f) (as added by this section) and section 
    704(a)(4) (15 U.S.C. 1691c(a)(4)), and inserting ``Bureau'';
        (2) in section 702 (15 U.S.C. 1691a), by striking subsection 
    (c) and inserting the following:
    ``(c) The term `Bureau' means the Bureau of Consumer Financial 
Protection.'';
        (3) in section 703 (15 U.S.C. 1691b)--
            (A) by striking the section heading and inserting the 
        following:
    ``SEC. 703. PROMULGATION OF REGULATIONS BY THE BUREAU.'';
            (B) by striking ``(a) Regulations.--'';
            (C) by striking subsection (b);
            (D) by redesignating paragraphs (1) through (5) as 
        subsections (a) through (e), respectively;
            (E) in subsection (c), as so redesignated, by striking 
        ``paragraph (2)'' and inserting ``subsection (b)''; and
            (F) by adding at the end the following:
    ``(f) Board Authority.--Notwithstanding subsection (a), the Board 
shall prescribe regulations to carry out the purposes of this title 
with respect to a person described in section 1029(a) of the Consumer 
Financial Protection Act of 2010. These regulations may contain but are 
not limited to such classifications, differentiation, or other 
provision, and may provide for such adjustments and exceptions for any 
class of transactions, as in the judgment of the Board are necessary or 
proper to effectuate the purposes of this title, to prevent 
circumvention or evasion thereof, or to facilitate or substantiate 
compliance therewith.
    ``(g) Deference.--Notwithstanding any power granted to any Federal 
agency under this title, the deference that a court affords to a 
Federal agency with respect to a determination made by such agency 
relating to the meaning or interpretation of any provision of this 
title that is subject to the jurisdiction of such agency shall be 
applied as if that agency were the only agency authorized to apply, 
enforce, interpret, or administer the provisions of this title'';
        (4) in section 704 (15 U.S.C. 1691c)--
            (A) in subsection (a)--
                (i) by striking ``Compliance'' and inserting ``Subject 
            to subtitle B of the Consumer Protection Financial 
            Protection Act of 2010'';
                (ii) by striking paragraphs (1) and (2) and inserting 
            the following:
        ``(1) section 8 of the Federal Deposit Insurance Act, by the 
    appropriate Federal banking agency, as defined in section 3(q) of 
    the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), with respect 
    to--
            ``(A) national banks, Federal savings associations, and 
        Federal branches and Federal agencies of foreign banks;
            ``(B) 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
            ``(C) banks and State savings associations insured by the 
        Federal Deposit Insurance Corporation (other than members of 
        the Federal Reserve System), and insured State branches of 
        foreign banks;'';
                (iii) by redesignating paragraphs (3) through (9) as 
            paragraphs (2) through (8), respectively;
                (iv) in paragraph (7) (as so redesignated), by striking 
            ``and'' at the end;
                (v) in paragraph (8) (as so redesignated), by striking 
            the period at the end, and inserting ``; and''; and
                (vi) by adding at the end the following:
        ``(9) Subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau, with respect to any person subject to this 
    title.'';
            (B) by striking subsection (c) and inserting the following:
    ``(c) Overall Enforcement Authority of Federal Trade Commission.--
Except to the extent that enforcement of the requirements imposed under 
this title is specifically committed to some other Government agency 
under any of paragraphs (1) through (8) of subsection (a), and subject 
to subtitle B of the Consumer Financial Protection Act of 2010, the 
Federal Trade Commission shall be authorized to enforce such 
requirements. For the purpose of the exercise by the Federal Trade 
Commission of its functions and powers under the Federal Trade 
Commission Act (15 U.S.C. 41 et seq.), a violation of any requirement 
imposed under this subchapter shall be deemed a violation of a 
requirement imposed under that Act. All of the functions and powers of 
the Federal Trade Commission under the Federal Trade Commission Act are 
available to the Federal Trade Commission to enforce compliance by any 
person with the requirements imposed under this title, irrespective of 
whether that person is engaged in commerce or meets any other 
jurisdictional tests under the Federal Trade Commission Act, including 
the power to enforce any rule prescribed by the Bureau under this title 
in the same manner as if the violation had been a violation of a 
Federal Trade Commission trade regulation rule.''; and
            (C) in subsection (d), by striking ``Board'' and inserting 
        ``Bureau'';
        (5) in section 706(e) (15 U.S.C. 1691e(e))--
            (A) in the subsection heading--
                (i) by striking ``Board'' each place that term appears 
            and inserting ``Bureau''; and
                (ii) by striking ``Federal Reserve System'' and 
            inserting ``Bureau of Consumer Financial Protection''; and
            (B) by striking ``Federal Reserve System'' and inserting 
        ``Bureau of Consumer Financial Protection'';
        (6) in section 706(g) (15 U.S.C. 1691e(g)), by striking ``(3)'' 
    and inserting ``(9)''; and
        (7) in section 706(f) (15 U.S.C. 1691e(f)), by striking ``two 
    years from'' each place that term appears and inserting ``5 years 
    after''.
SEC. 1086. AMENDMENTS TO THE EXPEDITED FUNDS AVAILABILITY ACT.
    (a) Amendment to Section 603.--Section 603(d)(1) of the Expedited 
Funds Availability Act (12 U.S.C. 4002) is amended by inserting after 
``Board'' the following ``, jointly with the Director of the Bureau of 
Consumer Financial Protection,''.
    (b) Amendments to Section 604.--Section 604 of the Expedited Funds 
Availability Act (12 U.S.C. 4003) is amended--
        (1) by inserting after ``Board'' each place that term appears, 
    other than in subsection (f), the following: ``, jointly with the 
    Director of the Bureau of Consumer Financial Protection,''; and
        (2) in subsection (f), by striking ``Board.'' each place that 
    term appears and inserting the following: ``Board, jointly with the 
    Director of the Bureau of Consumer Financial Protection.''.
    (c) Amendments to Section 605.--Section 605 of the Expedited Funds 
Availability Act (12 U.S.C. 4004) is amended--
        (1) by inserting after ``Board'' each place that term appears, 
    other than in the heading for section 605(f)(1), the following: ``, 
    jointly with the Director of the Bureau of Consumer Financial 
    Protection,''; and
        (2) in subsection (f)(1), in the paragraph heading, by 
    inserting ``and bureau'' after ``board''.
    (d) Amendments to Section 609.--Section 609 of the Expedited Funds 
Availability Act (12 U.S.C. 4008) is amended:
        (1) in subsection (a), by inserting after ``Board'' the 
    following ``, jointly with the Director of the Bureau of Consumer 
    Financial Protection,''; and
        (2) by striking subsection (e) and inserting the following:
    ``(e) Consultations.--In prescribing regulations under subsections 
(a) and (b), the Board and the Director of the Bureau of Consumer 
Financial Protection, in the case of subsection (a), and the Board, in 
the case of subsection (b), shall consult with the Comptroller of the 
Currency, the Board of Directors of the Federal Deposit Insurance 
Corporation, and the National Credit Union Administration Board.''.
    (e) Expedited Funds Availability Improvements.--Section 603 of the 
Expedited Funds Availability Act (12 U.S.C. 4002) is amended--
        (1) in subsection (a)(2)(D), by striking ``$100'' and inserting 
    ``$200''; and
        (2) in subsection (b)(3)(C), in the subparagraph heading, by 
    striking ``$100'' and inserting ``$200''; and
        (3) in subsection (c)(1)(B)(iii), in the clause heading, by 
    striking ``$100'' and inserting ``$200''.
    (f) Regular Adjustments for Inflation.--Section 607 of the 
Expedited Funds Availability Act (12 U.S.C. 4006) is amended by adding 
at the end the following:
    ``(f) Adjustments to Dollar Amounts for Inflation.--The dollar 
amounts under this title shall be adjusted every 5 years after December 
31, 2011, by the annual percentage increase in the Consumer Price Index 
for Urban Wage Earners and Clerical Workers, as published by the Bureau 
of Labor Statistics, rounded to the nearest multiple of $25.''.
SEC. 1087. AMENDMENTS TO THE FAIR CREDIT BILLING ACT.
    The Fair Credit Billing Act (15 U.S.C. 1666-1666j) is amended by 
striking ``Board'' each place that term appears, other than in section 
105(i) (as added by this subtitle) and inserting ``Bureau''.
SEC. 1088. AMENDMENTS TO THE FAIR CREDIT REPORTING ACT AND THE FAIR AND 
ACCURATE CREDIT TRANSACTIONS ACT OF 2003.
    (a) 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) by redesignating subsections (w) and (x) as subsections 
        (x) and (y), respectively; and
            (B) by inserting after subsection (v) the following:
    ``(w) The term `Bureau' means the Bureau of Consumer Financial 
Protection.''; and
        (2) except as otherwise specifically provided in this 
    subsection--
            (A) by striking ``Federal Trade Commission'' each place 
        that term appears and inserting ``Bureau'';
            (B) by striking ``FTC'' each place that term appears and 
        inserting ``Bureau'';
            (C) by striking ``the Commission'' each place that term 
        appears, other than sections 615(e) (15 U.S.C. 1681m(e)) and 
        628(a)(1) (15 U.S.C. 1681w(a)(1)), and inserting ``the 
        Bureau''; and
            (D) by striking ``The Federal banking agencies, the 
        National Credit Union Administration, and the Commission shall 
        jointly'' each place that term appears, other than section 
        615(e)(1) (15 U.S.C. 1681m(e)) and section 628(a)(1) (15 U.S.C. 
        1681w(a)(1)), and inserting ``The Bureau shall'';
        (3) in section 603(k)(2) (15 U.S.C. 1681a(k)(2)), by striking 
    ``Board of Governors of the Federal Reserve System'' and inserting 
    ``Bureau'';
        (4) in section 604(g) (15 U.S.C. 1681b(g))--
            (A) in paragraph (3), by striking subparagraph (C) and 
        inserting the following:
            ``(C) as otherwise determined to be necessary and 
        appropriate, by regulation or order, by the Bureau or the 
        applicable State insurance authority (with respect to any 
        person engaged in providing insurance or annuities).''; and
            (B) by striking paragraph (5) and inserting the following:
        ``(5) Regulations and effective date for paragraph (2).--
            ``(A) Regulations required.--The Bureau may, after notice 
        and opportunity for comment, prescribe regulations that permit 
        transactions under paragraph (2) that are determined to be 
        necessary and appropriate to protect legitimate operational, 
        transactional, risk, consumer, and other needs (and which shall 
        include permitting actions necessary for administrative 
        verification purposes), consistent with the intent of paragraph 
        (2) to restrict the use of medical information for 
        inappropriate purposes.'';
        (5) in section 605(h)(2)(A) (15 U.S.C. 1681c(h)(2)(A)), by 
    striking ``with respect to the entities that are subject to their 
    respective enforcement authority under section 621'' and inserting 
    ``, in consultation with the Federal banking agencies, the National 
    Credit Union Administration, and the Federal Trade Commission,''.
        (6) in section 611(e)(2) (15 U.S.C. 1681i(e)), by striking 
    paragraph (2) and inserting the following:
        ``(2) Exclusion.--Complaints received or obtained by the Bureau 
    pursuant to its investigative authority under the Consumer 
    Financial Protection Act of 2010 shall not be subject to paragraph 
    (1).'';
        (7) in section 615(d)(2)(B) (15 U.S.C. 1681m(d)(2)(B)), by 
    striking ``the Federal banking agencies'' and inserting ``the 
    Federal Trade Commission, the Federal banking agencies,'';
        (8) in section 615(e)(1) (15 U.S.C. 1681m(e)(1)), by striking 
    ``and the Commission'' and inserting ``the Federal Trade 
    Commission, the Commodity Futures Trading Commission, and the 
    Securities and Exchange Commission'';
        (9) in section 615(h)(6) (15 U.S.C. 1681m(h)(6)), by striking 
    subparagraph (A) and inserting the following:
            ``(A) Rules required.--The Bureau shall prescribe rules to 
        carry out this subsection.'';
        (10) in section 621 (15 U.S.C. 1681s)--
            (A) by striking subsection (a) and inserting the following:
    ``(a) Enforcement by Federal Trade Commission.--
        ``(1) In general.--The Federal Trade Commission shall be 
    authorized to enforce compliance with the requirements imposed by 
    this title under the Federal Trade Commission Act (15 U.S.C. 41 et 
    seq.), with respect to consumer reporting agencies and all other 
    persons subject thereto, except to the extent that enforcement of 
    the requirements imposed under this title is specifically committed 
    to some other Government agency under any of subparagraphs (A) 
    through (G) of subsection (b)(1), and subject to subtitle B of the 
    Consumer Financial Protection Act of 2010, subsection (b). For the 
    purpose of the exercise by the Federal Trade Commission of its 
    functions and powers under the Federal Trade Commission Act, a 
    violation of any requirement or prohibition imposed under this 
    title shall constitute an unfair or deceptive act or practice in 
    commerce, in violation of section 5(a) of the Federal Trade 
    Commission Act (15 U.S.C. 45(a)), and shall be subject to 
    enforcement by the Federal Trade Commission under section 5(b) of 
    that Act with respect to any consumer reporting agency or person 
    that is subject to enforcement by the Federal Trade Commission 
    pursuant to this subsection, irrespective of whether that person is 
    engaged in commerce or meets any other jurisdictional tests under 
    the Federal Trade Commission Act. The Federal Trade Commission 
    shall have such procedural, investigative, and enforcement powers, 
    including the power to issue procedural rules in enforcing 
    compliance with the requirements imposed under this title and to 
    require the filing of reports, the production of documents, and the 
    appearance of witnesses, as though the applicable terms and 
    conditions of the Federal Trade Commission Act were part of this 
    title. Any person violating any of the provisions of this title 
    shall be subject to the penalties and entitled to the privileges 
    and immunities provided in the Federal Trade Commission Act as 
    though the applicable terms and provisions of such Act are part of 
    this title.
        ``(2) Penalties.--
            ``(A) Knowing violations.--Except as otherwise provided by 
        subtitle B of the Consumer Financial Protection Act of 2010, in 
        the event of a knowing violation, which constitutes a pattern 
        or practice of violations of this title, the Federal Trade 
        Commission may commence a civil action to recover a civil 
        penalty in a district court of the United States against any 
        person that violates this title. In such action, such person 
        shall be liable for a civil penalty of not more than $2,500 per 
        violation.
            ``(B) Determining penalty amount.--In determining the 
        amount of a civil penalty under subparagraph (A), the court 
        shall take into account the degree of culpability, any history 
        of such prior conduct, ability to pay, effect on ability to 
        continue to do business, and such other matters as justice may 
        require.
            ``(C) Limitation.--Notwithstanding paragraph (2), a court 
        may not impose any civil penalty on a person for a violation of 
        section 623(a)(1), unless the person has been enjoined from 
        committing the violation, or ordered not to commit the 
        violation, in an action or proceeding brought by or on behalf 
        of the Federal Trade Commission, and has violated the 
        injunction or order, and the court may not impose any civil 
        penalty for any violation occurring before the date of the 
        violation of the injunction or order.'';
            (B) by striking subsection (b) and inserting the following:
    ``(b) Enforcement by Other Agencies.--
        ``(1) In general.--Subject to subtitle B of the Consumer 
    Financial Protection Act of 2010, compliance with the requirements 
    imposed under this title with respect to consumer reporting 
    agencies, persons who use consumer reports from such agencies, 
    persons who furnish information to such agencies, and users of 
    information that are subject to section 615(d) shall be enforced 
    under--
            ``(A) section 8 of the Federal Deposit Insurance Act (12 
        U.S.C. 1818), by the appropriate Federal banking agency, as 
        defined in section 3(q) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813(q)), with respect to--
                ``(i) any national bank or State savings association, 
            and any Federal branch or Federal agency of a foreign bank;
                ``(ii) any member bank of the Federal Reserve System 
            (other than a national bank), a branch or agency of a 
            foreign bank (other than a Federal branch, Federal agency, 
            or insured State branch of a foreign bank), a commercial 
            lending company owned or controlled by a foreign bank, and 
            any organization operating under section 25 or 25A of the 
            Federal Reserve Act; and
                ``(iii) any bank or Federal savings association insured 
            by the Federal Deposit Insurance Corporation (other than a 
            member of the Federal Reserve System) and any insured State 
            branch of a foreign bank;
            ``(B) the Federal Credit Union Act (12 U.S.C. 1751 et 
        seq.), by the Administrator of the National Credit Union 
        Administration with respect to any Federal credit union;
            ``(C) subtitle IV of title 49, United States Code, by the 
        Secretary of Transportation, with respect to all carriers 
        subject to the jurisdiction of the Surface Transportation 
        Board;
            ``(D) the Federal Aviation Act of 1958 (49 U.S.C. App. 1301 
        et seq.), by the Secretary of Transportation, with respect to 
        any air carrier or foreign air carrier subject to that Act;
            ``(E) the Packers and Stockyards Act, 1921 (7 U.S.C. 181 et 
        seq.) (except as provided in section 406 of that Act), by the 
        Secretary of Agriculture, with respect to any activities 
        subject to that Act;
            ``(F) the Commodity Exchange Act, with respect to a person 
        subject to the jurisdiction of the Commodity Futures Trading 
        Commission;
            ``(G) the Federal securities laws, and any other laws that 
        are subject to the jurisdiction of the Securities and Exchange 
        Commission, with respect to a person that is subject to the 
        jurisdiction of the Securities and Exchange Commission; and
            ``(H) subtitle E of the Consumer Financial Protection Act 
        of 2010, by the Bureau, with respect to any person subject to 
        this title.
        ``(2) Incorporated definitions.--The terms used in paragraph 
    (1) that are not defined in this title or otherwise defined in 
    section 3(s) of the Federal Deposit Insurance Act (12 U.S.C. 
    1813(s)) have the same meanings as in section 1(b) of the 
    International Banking Act of 1978 (12 U.S.C. 3101).'';
            (C) in subsection (c)(2)--
                (i) by inserting ``and the Federal Trade Commission'' 
            before ``or the appropriate''; and
                (ii) by inserting ``and the Federal Trade Commission'' 
            before ``or appropriate'' each place that term appears;
            (D) in subsection (c)(4), by inserting before ``or the 
        appropriate'' each place that term appears the following: ``, 
        the Federal Trade Commission,'';
            (E) by striking subsection (e) and inserting the following:
    ``(e) Regulatory Authority.--
        ``(1) In general.--The Bureau shall prescribe such regulations 
    as are necessary to carry out the purposes of this title, except 
    with respect to sections 615(e) and 628. The Bureau may prescribe 
    regulations as may be necessary or appropriate to administer and 
    carry out the purposes and objectives of this title, and to prevent 
    evasions thereof or to facilitate compliance therewith. Except as 
    provided in section 1029(a) of the Consumer Financial Protection 
    Act of 2010, the regulations prescribed by the Bureau under this 
    title shall apply to any person that is subject to this title, 
    notwithstanding the enforcement authorities granted to other 
    agencies under this section.
        ``(2) Deference.--Notwithstanding any power granted to any 
    Federal agency under this title, the deference that a court affords 
    to a Federal agency with respect to a determination made by such 
    agency relating to the meaning or interpretation of any provision 
    of this title that is subject to the jurisdiction of such agency 
    shall be applied as if that agency were the only agency authorized 
    to apply, enforce, interpret, or administer the provisions of this 
    title The regulations prescribed by the Bureau under this title 
    shall apply to any person that is subject to this title, 
    notwithstanding the enforcement authorities granted to other 
    agencies under this section.''; and
            (F) in subsection (f)(2), by striking ``the Federal banking 
        agencies'' and insert ``the Federal Trade Commission, the 
        Federal banking agencies,'';
        (11) in section 623 (15 U.S.C. 1681s-2)--
            (A) in subsection (a)(7), by striking subparagraph (D) and 
        inserting the following:
            ``(D) Model disclosure.--
                ``(i) Duty of bureau.--The Bureau shall prescribe a 
            brief model disclosure that a financial institution may use 
            to comply with subparagraph (A), which shall not exceed 30 
            words.
                ``(ii) Use of model not required.--No provision of this 
            paragraph may be construed to require a financial 
            institution to use any such model form prescribed by the 
            Bureau.
                ``(iii) Compliance using model.--A financial 
            institution shall be deemed to be in compliance with 
            subparagraph (A) if the financial institution uses any 
            model form prescribed by the Bureau under this 
            subparagraph, or the financial institution uses any such 
            model form and rearranges its format.'';
            (B) in subsection (a)(8), by inserting ``, in consultation 
        with the Federal Trade Commission, the Federal banking 
        agencies, and the National Credit Union Administration,'' 
        before ``shall jointly''; and
            (C) by striking subsection (e) and inserting the following:
    ``(e) Accuracy Guidelines and Regulations Required.--
        ``(1) Guidelines.--The Bureau shall, with respect to persons or 
    entities that are subject to the enforcement authority of the 
    Bureau under section 621--
            ``(A) establish and maintain guidelines for use by each 
        person that furnishes information to a consumer reporting 
        agency regarding the accuracy and integrity of the information 
        relating to consumers that such entities furnish to consumer 
        reporting agencies, and update such guidelines as often as 
        necessary; and
            ``(B) prescribe regulations requiring each person that 
        furnishes information to a consumer reporting agency to 
        establish reasonable policies and procedures for implementing 
        the guidelines established pursuant to subparagraph (A).
        ``(2) Criteria.--In developing the guidelines required by 
    paragraph (1)(A), the Bureau shall--
            ``(A) identify patterns, practices, and specific forms of 
        activity that can compromise the accuracy and integrity of 
        information furnished to consumer reporting agencies;
            ``(B) review the methods (including technological means) 
        used to furnish information relating to consumers to consumer 
        reporting agencies;
            ``(C) determine whether persons that furnish information to 
        consumer reporting agencies maintain and enforce policies to 
        ensure the accuracy and integrity of information furnished to 
        consumer reporting agencies; and
            ``(D) examine the policies and processes that persons that 
        furnish information to consumer reporting agencies employ to 
        conduct reinvestigations and correct inaccurate information 
        relating to consumers that has been furnished to consumer 
        reporting agencies.'';
        (12) in section 628(a)(1) (15 U.S.C. 1681w(a)(1)), by striking 
    ``Not later than'' and all that follows through ``Exchange 
    Commission,'' and inserting ``The Federal Trade Commission, the 
    Securities and Exchange Commission, the Commodity Futures Trading 
    Commission, the Federal banking agencies, and the National Credit 
    Union Administration, with respect to the entities that are subject 
    to their respective enforcement authority under section 621,''; and
        (13) in section 628(a)(3) (15 U.S.C. 1681w(a)(3)), by striking 
    ``the Federal banking agencies, the National Credit Union 
    Administration, the Commission, and the Securities and Exchange 
    Commission'' and inserting ``the agencies identified in paragraph 
    (1)''.
    (b) Fair and Accurate Credit Transactions Act of 2003.--The Fair 
and Accurate Credit Transactions Act of 2003 (Public Law 108-159) is 
amended--
        (1) in section 112(b) (15 U.S.C. 1681c-1 note), by striking 
    ``Commission'' and inserting ``Bureau'';
        (2) in section 211(d) (15 U.S.C. 1681j note), by striking 
    ``Commission'' each place that term appears and inserting 
    ``Bureau'';
        (3) in section 214(b) (15 U.S.C. 1681s-3 note), by striking 
    paragraph (1) and inserting the following:
        ``(1) In general.--Regulations to carry out section 624 of the 
    Fair Credit Reporting Act (15 U.S.C. 1681s-3), shall be prescribed, 
    as described in paragraph (2), by--
            ``(A) the Commodity Futures Trading Commission, with 
        respect to entities subject to its enforcement authorities;
            ``(B) the Securities and Exchange Commission, with respect 
        to entities subject to its enforcement authorities; and
            ``(C) the Bureau, with respect to other entities subject to 
        this Act.''; and
        (4) in section 214(e)(1) (15 U.S.C. 1681s-3 note), by striking 
    ``Commission'' and inserting ``Bureau''.
SEC. 1089. AMENDMENTS TO THE FAIR DEBT COLLECTION PRACTICES ACT.
    The Fair Debt Collection Practices Act (15 U.S.C. 1692 et seq.) is 
amended--
        (1) by striking ``Commission'' each place that term appears and 
    inserting ``Bureau'';
        (2) in section 803 (15 U.S.C. 1692a)--
            (A) by striking paragraph (1) and inserting the following:
        ``(1) The term `Bureau' means the Bureau of Consumer Financial 
    Protection.'';
        (3) in section 814 (15 U.S.C. 1692l)--
            (A) by striking subsection (a) and inserting the following:
    ``(a) Federal Trade Commission.--The Federal Trade Commission shall 
be authorized to enforce compliance with this title, except to the 
extent that enforcement of the requirements imposed under this title is 
specifically committed to another Government agency under any of 
paragraphs (1) through (5) of subsection (b), subject to subtitle B of 
the Consumer Financial Protection Act of 2010. For purpose of the 
exercise by the Federal Trade Commission of its functions and powers 
under the Federal Trade Commission Act (15 U.S.C. 41 et seq.), a 
violation of this title shall be deemed an unfair or deceptive act or 
practice in violation of that Act. All of the functions and powers of 
the Federal Trade Commission under the Federal Trade Commission Act are 
available to the Federal Trade Commission to enforce compliance by any 
person with this title, irrespective of whether that person is engaged 
in commerce or meets any other jurisdictional tests under the Federal 
Trade Commission Act, including the power to enforce the provisions of 
this title, in the same manner as if the violation had been a violation 
of a Federal Trade Commission trade regulation rule.''; and
            (B) in subsection (b)--
                (i) by striking ``Compliance'' and inserting ``Subject 
            to subtitle B of the Consumer Financial Protection Act of 
            2010, compliance'';
                (ii) by striking paragraphs (1) and (2) and inserting 
            the following:
        ``(1) section 8 of the Federal Deposit Insurance Act, by the 
    appropriate Federal banking agency, as defined in section 3(q) of 
    the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), with respect 
    to--
            ``(A) national banks, Federal savings associations, and 
        Federal branches and Federal agencies of foreign banks;
            ``(B) 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
            ``(C) banks and State savings associations insured by the 
        Federal Deposit Insurance Corporation (other than members of 
        the Federal Reserve System), and insured State branches of 
        foreign banks;'';
                (iii) by redesignating paragraphs (3) through (6), as 
            paragraphs (2) through (5), respectively;
                (iv) in paragraph (4) (as so redesignated), by striking 
            ``and'' at the end;
                (v) in paragraph (5) (as so redesignated), by striking 
            the period at the end and inserting ``; and''; and
                (vi) by inserting before the undesignated matter at the 
            end the following:
        ``(6) subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau, with respect to any person subject to this 
    title.''.
        (4) in subsection (d), by striking ``Neither the Commission'' 
    and all that follows through the end of the subsection and 
    inserting the following: ``Except as provided in section 1029(a) of 
    the Consumer Financial Protection Act of 2010, the Bureau may 
    prescribe rules with respect to the collection of debts by debt 
    collectors, as defined in this title.''.
SEC. 1090. AMENDMENTS TO THE FEDERAL DEPOSIT INSURANCE ACT.
    The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is 
amended--
        (1) in section 8(t) (12 U.S.C. 1818(t)), by adding at the end 
    the following:
        ``(6) Referral to bureau of consumer financial protection.--
    Subject to subtitle B of the Consumer Financial Protection Act of 
    2010, each appropriate Federal banking agency shall make a referral 
    to the Bureau of Consumer Financial Protection when the Federal 
    banking agency has a reasonable belief that a violation of an 
    enumerated consumer law, as defined in the Consumer Financial 
    Protection Act of 2010, has been committed by any insured 
    depository institution or institution-affiliated party within the 
    jurisdiction of that appropriate Federal banking agency.''; and
        (2) in section 43 (12 U.S.C. 1831t)--
            (A) in subsection (c), by striking ``Federal Trade 
        Commission'' and inserting ``Bureau'';
            (B) in subsection (d), by striking ``Federal Trade 
        Commission'' and inserting ``Bureau'';
            (C) in subsection (e)--
                (i) in paragraph (2), by striking ``Federal Trade 
            Commission'' and inserting ``Bureau''; and
                (ii) by adding at the end the following new paragraph:
        ``(5) Bureau.--The term `Bureau' means the Bureau of Consumer 
    Financial Protection.''; and
            (D) in subsection (f)--
                (i) by striking paragraph (1) and inserting the 
            following:
        ``(1) Limited enforcement authority.--Compliance with the 
    requirements of subsections (b), (c), and (e), and any regulation 
    prescribed or order issued under such subsection, shall be enforced 
    under the Consumer Financial Protection Act of 2010, by the Bureau, 
    subject to subtitle B of the Consumer Financial Protection Act of 
    2010, and under the Federal Trade Commission Act (15 U.S.C. 41 et 
    seq.) by the Federal Trade Commission.''; and
                (ii) in paragraph (2), by striking subparagraph (C) and 
            inserting the following:
            ``(C) Limitation on state action while federal action 
        pending.--If the Bureau or Federal Trade Commission has 
        instituted an enforcement action for a violation of this 
        section, no appropriate State supervisory agency may, during 
        the pendency of such action, bring an action under this section 
        against any defendant named in the complaint of the Bureau or 
        Federal Trade Commission for any violation of this section that 
        is alleged in that complaint.''.
SEC. 1091. AMENDMENT TO FEDERAL FINANCIAL INSTITUTIONS EXAMINATION 
COUNCIL ACT OF 1978.
    Section 1004(a)(4) of the Federal Financial Institutions 
Examination Council Act of 1978 (12 U.S.C. 3303(a)(4)) is amended by 
striking ``Director, Office of Thrift Supervision'' and inserting 
``Director of the Consumer Financial Protection Bureau''.
SEC. 1092. AMENDMENTS TO THE FEDERAL TRADE COMMISSION ACT.
    Section 18(f) of the Federal Trade Commission Act (15 U.S.C. 
57a(f)) is amended--
        (1) by striking the subsection heading and inserting the 
    following:
    ``(f) Definitions of Banks, Savings and Loan Institutions, and 
Federal Credit Unions.--''.
        (2) by striking paragraph (1) and inserting the following:
        ``(1) [Repealed.]'';
        (3) by striking paragraphs (5) through (7);
        (4) in paragraph (2)--
            (A) by striking ``(2) Enforcement'' and all that follows 
        through ``in the case of'' and inserting the following:
        ``(2) Definition.--For purposes of this Act, the term `bank' 
    means'';
            (B) in subparagraph (A), by striking ``, by the division'' 
        and all that follows through ``Currency'';
            (C) in subparagraph (B)--
                (i) by striking ``, by the division'' and all that 
            follows through ``System''; and
                (ii) by striking ``25(a)'' and inserting ``25A''; and
            (D) in subparagraph (C)--
                (i) by striking ``(other'' and inserting ``(other 
            than''; and
                (ii) by striking ``, by the division'' and all that 
            follows through ``Corporation'';
        (5) in paragraph (3), by striking ``Compliance'' and all that 
    follows through ``as defined in'' and inserting the following: 
    ``For purposes of this Act, the term ``savings and loan 
    institution'' has the same meaning as in''; and
        (6) in paragraph (4), by striking ``Compliance'' and all that 
    follows through ``credit unions under'' and inserting the 
    following: ``For purposes of this Act, the term ``Federal credit 
    union'' has the same meaning as in''.
SEC. 1093. AMENDMENTS TO THE GRAMM-LEACH-BLILEY ACT.
    Title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) is 
amended--
        (1) in section 501(b) (15 U.S.C. 6801(b)), by inserting ``, 
    other than the Bureau of Consumer Financial Protection,'' after 
    ``505(a)'';
        (2) in section 502(e)(5) (15 U.S.C. 6802(e)(5)), by inserting 
    ``the Bureau of Consumer Financial Protection'' after 
    ``(including'';
        (3) in section 504(a) (15 U.S.C. 6804(a))--
            (A) by striking paragraphs (1) and (2) and inserting the 
        following:
        ``(1) Rulemaking.--
            ``(A) In general.--Except as provided in subparagraph (C), 
        the Bureau of Consumer Financial Protection and the Securities 
        and Exchange Commission shall have authority to prescribe such 
        regulations as may be necessary to carry out the purposes of 
        this subtitle with respect to financial institutions and other 
        persons subject to their respective jurisdiction under section 
        505 (and notwithstanding subtitle B of the Consumer Financial 
        Protection Act of 2010), except that the Bureau of Consumer 
        Financial Protection shall not have authority to prescribe 
        regulations with respect to the standards under section 501.
            ``(B) CFTC.--The Commodity Futures Trading Commission shall 
        have authority to prescribe such regulations as may be 
        necessary to carry out the purposes of this subtitle with 
        respect to financial institutions and other persons subject to 
        the jurisdiction of the Commodity Futures Trading Commission 
        under section 5g of the Commodity Exchange Act.
            ``(C) Federal trade commission authority.--Notwithstanding 
        the authority of the Bureau of Consumer Financial Protection 
        under subparagraph (A), the Federal Trade Commission shall have 
        authority to prescribe such regulations as may be necessary to 
        carry out the purposes of this subtitle with respect to any 
        financial institution that is a person described in section 
        1029(a) of the Consumer Financial Protection Act of 2010.
            ``(D) Rule of construction.--Nothing in this paragraph 
        shall be construed to alter, affect, or otherwise limit the 
        authority of a State insurance authority to adopt regulations 
        to carry out this subtitle.
        ``(2) Coordination, consistency, and comparability.--Each of 
    the agencies authorized under paragraph (1) to prescribe 
    regulations shall consult and coordinate with the other such 
    agencies and, as appropriate, and with representatives of State 
    insurance authorities designated by the National Association of 
    Insurance Commissioners, for the purpose of assuring, to the extent 
    possible, that the regulations prescribed by each such agency are 
    consistent and comparable with the regulations prescribed by the 
    other such agencies.''; and
            (B) in paragraph (3), by striking ``, and shall be issued 
        in final form not later than 6 months after the date of 
        enactment of this Act'';
        (4) in section 505(a) (15 U.S.C. 6805(a))--
            (A) by striking ``This subtitle'' and all that follows 
        through ``as follows:'' and inserting ``Subject to subtitle B 
        of the Consumer Financial Protection Act of 2010, this subtitle 
        and the regulations prescribed thereunder shall be enforced by 
        the Bureau of Consumer Financial Protection, the Federal 
        functional regulators, the State insurance authorities, and the 
        Federal Trade Commission with respect to financial institutions 
        and other persons subject to their jurisdiction under 
        applicable law, as follows:'';
            (B) in paragraph (1)--
                (i) in the matter preceding subparagraph (A), by 
            inserting ``by the appropriate Federal banking agency, as 
            defined in section 3(q) of the Federal Deposit Insurance 
            Act,'' after ``Act,'';
                (ii) in subparagraph (A), by striking ``, by the Office 
            of the Comptroller of the Currency'';
                (iii) in subparagraph (B), by striking ``, by the Board 
            of Governors of the Federal Reserve System'';
                (iv) in subparagraph (C), by striking ``, by the Board 
            of Directors of the Federal Deposit Insurance 
            Corporation''; and
                (v) in subparagraph (D), by striking ``, by the 
            Director of the Office of Thrift Supervision''; and
            (C) by adding at the end the following:
        ``(8) Under subtitle E of the Consumer Financial Protection Act 
    of 2010, by the Bureau of Consumer Financial Protection, in the 
    case of any financial institution and other covered person or 
    service provider that is subject to the jurisdiction of the Bureau 
    and any person subject to this subtitle, but not with respect to 
    the standards under section 501.'';
        (5) in section 505(b)(1) (15 U.S.C. 6805(b)(1)), by inserting 
    ``, other than the Bureau of Consumer Financial Protection,'' after 
    ``subsection (a)''; and
        (6) in section 507(b) (15 U.S.C. 6807), by striking ``Federal 
    Trade Commission'' and inserting ``Bureau of Consumer Financial 
    Protection''.
SEC. 1094. AMENDMENTS TO THE HOME MORTGAGE DISCLOSURE ACT OF 1975.
    The Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) 
is amended--
        (1) by striking ``Board'' each place that term appears, other 
    than in sections 303, 304(h), 305(b) (as amended by this section), 
    and 307(a) (as amended by this section) and inserting ``Bureau''.
        (2) in section 303 (12 U.S.C. 2802)--
            (A) by redesignating paragraphs (1) through (6) as 
        paragraphs (2) through (7), respectively; and
            (B) by inserting before paragraph (2) the following:
        ``(1) the term `Bureau' means the Bureau of Consumer Financial 
    Protection;'';
        (3) in section 304 (12 U.S.C. 2803)--
            (A) in subsection (b)--
                (i) in paragraph (4), by inserting ``age,'' before 
            ``and gender'';
                (ii) in paragraph (3), by striking ``and'' at the end;
                (iii) in paragraph (4), by striking the period at the 
            end and inserting a semicolon; and
                (iv) by adding at the end the following:
        ``(5) the number and dollar amount of mortgage loans grouped 
    according to measurements of--
            ``(A) the total points and fees payable at origination in 
        connection with the mortgage as determined by the Bureau, 
        taking into account 15 U.S.C. 1602(aa)(4);
            ``(B) the difference between the annual percentage rate 
        associated with the loan and a benchmark rate or rates for all 
        loans;
            ``(C) the term in months of any prepayment penalty or other 
        fee or charge payable on repayment of some portion of principal 
        or the entire principal in advance of scheduled payments; and
            ``(D) such other information as the Bureau may require; and
        ``(6) the number and dollar amount of mortgage loans and 
    completed applications grouped according to measurements of--
            ``(A) the value of the real property pledged or proposed to 
        be pledged as collateral;
            ``(B) the actual or proposed term in months of any 
        introductory period after which the rate of interest may 
        change;
            ``(C) the presence of contractual terms or proposed 
        contractual terms that would allow the mortgagor or applicant 
        to make payments other than fully amortizing payments during 
        any portion of the loan term;
            ``(D) the actual or proposed term in months of the mortgage 
        loan;
            ``(E) the channel through which application was made, 
        including retail, broker, and other relevant categories;
            ``(F) as the Bureau may determine to be appropriate, a 
        unique identifier that identifies the loan originator as set 
        forth in section 1503 of the S.A.F.E. Mortgage Licensing Act of 
        2008;
            ``(G) as the Bureau may determine to be appropriate, a 
        universal loan identifier;
            ``(H) as the Bureau may determine to be appropriate, the 
        parcel number that corresponds to the real property pledged or 
        proposed to be pledged as collateral;
            ``(I) the credit score of mortgage applicants and 
        mortgagors, in such form as the Bureau may prescribe; and
            ``(J) such other information as the Bureau may require.'';
            (B) by striking subsection (h) and inserting the following:
    ``(h) Submission to Agencies.--
        ``(1) In general.--The data required to be disclosed under 
    subsection (b) shall be submitted to the Bureau or to the 
    appropriate agency for the institution reporting under this title, 
    in accordance with rules prescribed by the Bureau. Notwithstanding 
    the requirement of subsection (a)(2)(A) for disclosure by census 
    tract, the Bureau, in consultation with other appropriate agencies 
    described in paragraph (2) and, after notice and comment, shall 
    develop regulations that--
            ``(A) prescribe the format for such disclosures, the method 
        for submission of the data to the appropriate agency, and the 
        procedures for disclosing the information to the public;
            ``(B) require the collection of data required to be 
        disclosed under subsection (b) with respect to loans sold by 
        each institution reporting under this title;
            ``(C) require disclosure of the class of the purchaser of 
        such loans;
            ``(D) permit any reporting institution to submit in writing 
        to the Bureau or to the appropriate agency such additional data 
        or explanations as it deems relevant to the decision to 
        originate or purchase mortgage loans; and
            ``(E) modify or require modification of itemized 
        information, for the purpose of protecting the privacy 
        interests of the mortgage applicants or mortgagors, that is or 
        will be available to the public.
        ``(2) Other appropriate agencies.--The appropriate agencies 
    described in this paragraph are--
            ``(A) the appropriate Federal banking agencies, as defined 
        in section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
        1813(q)), with respect to the entities that are subject to the 
        jurisdiction of each such agency, respectively;
            ``(B) the Federal Deposit Insurance Corporation for banks 
        insured by the Federal Deposit Insurance Corporation (other 
        than members of the Federal Reserve System), mutual savings 
        banks, insured State branches of foreign banks, and any other 
        depository institution described in section 303(2)(A) which is 
        not otherwise referred to in this paragraph;
            ``(C) the National Credit Union Administration Board with 
        respect to credit unions; and
            ``(D) the Secretary of Housing and Urban Development with 
        respect to other lending institutions not regulated by the 
        agencies referred to in subparagraph (A) or (B).
        ``(3) Rules for modifications under paragraph (1).--
            ``(A) Application.--A modification under paragraph (1)(E) 
        shall apply to information concerning--
                ``(i) credit score data described in subsection 
            (b)(6)(I), in a manner that is consistent with the purpose 
            described in paragraph (1)(E); and
                ``(ii) age or any other category of data described in 
            paragraph (5) or (6) of subsection (b), as the Bureau 
            determines to be necessary to satisfy the purpose described 
            in paragraph (1)(E), and in a manner consistent with that 
            purpose.
            ``(B) Standards.--The Bureau shall prescribe standards for 
        any modification under paragraph (1)(E) to effectuate the 
        purposes of this title, in light of the privacy interests of 
        mortgage applicants or mortgagors. Where necessary to protect 
        the privacy interests of mortgage applicants or mortgagors, the 
        Bureau shall provide for the disclosure of information 
        described in subparagraph (A) in aggregate or other reasonably 
        modified form, in order to effectuate the purposes of this 
        title.'';
            (C) in subsection (i), by striking ``subsection (b)(4)'' 
        and inserting ``subsections (b)(4), (b)(5), and (b)(6)'';
            (D) in subsection (j)--
                (i) by striking paragraph (3) and inserting the 
            following:
        ``(3) Change of form not required.--A depository institution 
    meets the disclosure requirement of paragraph (1) if the 
    institution provides the information required under such paragraph 
    in such formats as the Bureau may require''; and
                (ii) in paragraph (2)(A), by striking ``in the format 
            in which such information is maintained by the 
            institution'' and inserting ``in such formats as the Bureau 
            may require'';
            (E) in subsection (m), by striking paragraph (2) and 
        inserting the following:
        ``(2) Form of information.--In complying with paragraph (1), a 
    depository institution shall provide the person requesting the 
    information with a copy of the information requested in such 
    formats as the Bureau may require.''; and
            (F) by adding at the end the following:
    ``(n) Timing of Certain Disclosures.--The data required to be 
disclosed under subsection (b) shall be submitted to the Bureau or to 
the appropriate agency for any institution reporting under this title, 
in accordance with regulations prescribed by the Bureau. Institutions 
shall not be required to report new data under paragraph (5) or (6) of 
subsection (b) before the first January 1 that occurs after the end of 
the 9-month period beginning on the date on which regulations are 
issued by the Bureau in final form with respect to such disclosures.'';
        (4) in section 305 (12 U.S.C. 2804)--
            (A) by striking subsection (b) and inserting the following:
    ``(b) Powers of Certain Other Agencies.--
        ``(1) In general.--Subject to subtitle B of the Consumer 
    Financial Protection Act of 2010, compliance with the requirements 
    of this title shall be enforced--
            ``(A) under section 8 of the Federal Deposit Insurance Act, 
        the appropriate Federal banking agency, as defined in section 
        3(q) of the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), 
        with respect to--
                ``(i) any national bank or Federal savings association, 
            and any Federal branch or Federal agency of a foreign bank;
                ``(ii) any member bank of the Federal Reserve System 
            (other than a national bank), branch or agency of a foreign 
            bank (other than a Federal branch, Federal agency, and 
            insured State branch of a foreign bank), commercial lending 
            company owned or controlled by a foreign bank, and any 
            organization operating under section 25 or 25A of the 
            Federal Reserve Act; and
                ``(iii) any bank or State savings association insured 
            by the Federal Deposit Insurance Corporation (other than a 
            member of the Federal Reserve System), any mutual savings 
            bank as, defined in section 3(f) of the Federal Deposit 
            Insurance Act (12 U.S.C. 1813(f)), any insured State branch 
            of a foreign bank, and any other depository institution not 
            referred to in this paragraph or subparagraph (B) or (C);
            ``(B) under subtitle E of the Consumer Financial Protection 
        Act of 2010, by the Bureau, with respect to any person subject 
        to this subtitle;
            ``(C) under the Federal Credit Union Act, by the 
        Administrator of the National Credit Union Administration with 
        respect to any insured credit union; and
            ``(D) with respect to other lending institutions, by the 
        Secretary of Housing and Urban Development.
        ``(2) Incorporated definitions.--The terms used in paragraph 
    (1) that are not defined in this title or otherwise defined in 
    section 3(s) of the Federal Deposit Insurance Act (12 U.S.C. 
    1813(s)) shall have the same meanings as in section 1(b) of the 
    International Banking Act of 1978 (12 U.S.C. 3101).''; and
            (B) by adding at the end the following:
    ``(d) Overall Enforcement Authority of the Bureau of Consumer 
Financial Protection.--Subject to subtitle B of the Consumer Financial 
Protection Act of 2010, enforcement of the requirements imposed under 
this title is committed to each of the agencies under subsection (b). 
To facilitate research, examinations, and enforcement, all data 
collected pursuant to section 304 shall be available to the entities 
listed under subsection (b). The Bureau may exercise its authorities 
under the Consumer Financial Protection Act of 2010 to exercise 
principal authority to examine and enforce compliance by any person 
with the requirements of this title.'';
        (5) in section 306 (12 U.S.C. 2805(b)), by striking subsection 
    (b) and inserting the following:
    ``(b) Exemption Authority.--The Bureau may, by regulation, exempt 
from the requirements of this title any State-chartered depository 
institution within any State or subdivision thereof, if the agency 
determines that, under the law of such State or subdivision, that 
institution is subject to requirements that are substantially similar 
to those imposed under this title, and that such law contains adequate 
provisions for enforcement. Notwithstanding any other provision of this 
subsection, compliance with the requirements imposed under this 
subsection shall be enforced by the Office of the Comptroller of the 
Currency under section 8 of the Federal Deposit Insurance Act, in the 
case of national banks and Federal savings associations, the deposits 
of which are insured by the Federal Deposit Insurance Corporation.''; 
and
        (6) by striking section 307 (12 U.S.C. 2806) and inserting the 
    following:
    ``SEC. 307. COMPLIANCE IMPROVEMENT METHODS.
    ``(a) In General.--
        ``(1) Consultation required.--The Director of the Bureau of 
    Consumer Financial Protection, with the assistance of the 
    Secretary, the Director of the Bureau of the Census, the Board of 
    Governors of the Federal Reserve System, the Federal Deposit 
    Insurance Corporation, and such other persons as the Bureau deems 
    appropriate, shall develop or assist in the improvement of, methods 
    of matching addresses and census tracts to facilitate compliance by 
    depository institutions in as economical a manner as possible with 
    the requirements of this title.
        ``(2) Authorization of appropriations.--There are authorized to 
    be appropriated, such sums as may be necessary to carry out this 
    subsection.
        ``(3) Contracting authority.--The Director of the Bureau of 
    Consumer Financial Protection is authorized to utilize, contract 
    with, act through, or compensate any person or agency in order to 
    carry out this subsection.
    ``(b) Recommendations to Congress.--The Director of the Bureau of 
Consumer Financial Protection shall recommend to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives, such additional 
legislation as the Director of the Bureau of Consumer Financial 
Protection deems appropriate to carry out the purpose of this title.''.
SEC. 1095. AMENDMENTS TO THE HOMEOWNERS PROTECTION ACT OF 1998.
    Section 10 of the Homeowners Protection Act of 1998 (12 U.S.C. 
4909) is amended--
        (1) in subsection (a)--
            (A) by striking ``Compliance'' and all that follows through 
        the end of paragraph (1) and inserting the following: ``Subject 
        to subtitle B of the Consumer Financial Protection Act of 2010, 
        compliance with the requirements imposed under this Act shall 
        be enforced under--
        ``(1) section 8 of the Federal Deposit Insurance Act, by the 
    appropriate Federal banking agency (as defined in section 3(q) of 
    that Act), with respect to--
            ``(A) insured depository institutions (as defined in 
        section 3(c)(2) of that Act);
            ``(B) depository institutions described in clause (i), 
        (ii), or (iii) of section 19(b)(1)(A) of the Federal Reserve 
        Act which are not insured depository institutions (as defined 
        in section 3(c)(2) of the Federal Deposit Insurance Act); and
            ``(C) depository institutions described in clause (v) or 
        (vi) of section 19(b)(1)(A) of the Federal Reserve Act which 
        are not insured depository institutions (as defined in section 
        3(c)(2) of the Federal Deposit Insurance Act);'';
            (B) in paragraph (2), by striking ``and'' at the end;
            (C) in paragraph (3), by striking the period at the end and 
        inserting ``; and''; and
            (D) by adding at the end the following:
        ``(4) subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau of Consumer Financial Protection, with respect 
    to any person subject to this Act.''; and
        (2) in subsection (b)(2), by inserting before the period at the 
    end the following: ``, subject to subtitle B of the Consumer 
    Financial Protection Act of 2010''.
SEC. 1096. AMENDMENTS TO THE HOME OWNERSHIP AND EQUITY PROTECTION ACT 
OF 1994.
    The Home Ownership and Equity Protection Act of 1994 (15 U.S.C. 
1601 note) is amended--
        (1) in section 158(a), by striking ``Board of Governors of the 
    Federal Reserve System, in consultation with the Consumer Advisory 
    Council of the Board'' and inserting ``Bureau, in consultation with 
    the Advisory Board to the Bureau''; and
        (2) in section 158(b), by striking ``Board of Governors of the 
    Federal Reserve System'' and inserting ``Bureau''.
SEC. 1097. AMENDMENTS TO THE OMNIBUS APPROPRIATIONS ACT, 2009.
    Section 626 of the Omnibus Appropriations Act, 2009 (15 U.S.C. 1638 
note) is amended--
        (1) by striking subsection (a) and inserting the following:
    ``(a)(1) The Bureau of Consumer Financial Protection shall have 
authority to prescribe rules with respect to mortgage loans in 
accordance with section 553 of title 5, United States Code. Such 
rulemaking shall relate to unfair or deceptive acts or practices 
regarding mortgage loans, which may include unfair or deceptive acts or 
practices involving loan modification and foreclosure rescue services. 
Any violation of a rule prescribed under this paragraph shall be 
treated as a violation of a rule prohibiting unfair, deceptive, or 
abusive acts or practices under the Consumer Financial Protection Act 
of 2010 and a violation of a rule under section 18 of the Federal Trade 
Commission Act (15 U.S.C. 57a) regarding unfair or deceptive acts or 
practices.
    ``(2) The Bureau of Consumer Financial Protection shall enforce the 
rules issued under paragraph (1) in the same manner, by the same means, 
and with the same jurisdiction, powers, and duties, as though all 
applicable terms and provisions of the Consumer Financial Protection 
Act of 2010 were incorporated into and made part of this subsection.
    ``(3) Subject to subtitle B of the Consumer Financial Protection 
Act of 2010, the Federal Trade Commission shall enforce the rules 
issued under paragraph (1), in the same manner, by the same means, and 
with the same jurisdiction, as though all applicable terms and 
provisions of the Federal Trade Commission Act were incorporated into 
and made part of this section.''; and
        (2) in subsection (b)--
            (A) by striking paragraph (1) and inserting the following:
        ``(1) Except as provided in paragraph (6), in any case in which 
    the attorney general of a State has reason to believe that an 
    interest of the residents of the State has been or is threatened or 
    adversely affected by the engagement of any person subject to a 
    rule prescribed under subsection (a) in practices that violate such 
    rule, the State, as parens patriae, may bring a civil action on 
    behalf of its residents in an appropriate district court of the 
    United States or other court of competent jurisdiction--
            ``(A) to enjoin that practice;
            ``(B) to enforce compliance with the rule;
            ``(C) to obtain damages, restitution, or other compensation 
        on behalf of the residents of the State; or
            ``(D) to obtain penalties and relief provided under the 
        Consumer Financial Protection Act of 2010, the Federal Trade 
        Commission Act, and such other relief as the court deems 
        appropriate.'';
            (B) in paragraphs (2) and (3), by striking ``the primary 
        Federal regulator'' each time the term appears and inserting 
        ``the Bureau of Consumer Financial Protection or the 
        Commission, as appropriate'';
            (C) in paragraph (3), by inserting ``and subject to 
        subtitle B of the Consumer Financial Protection Act of 2010,'' 
        after ``paragraph (2),''; and
            (D) in paragraph (6), by striking ``the primary Federal 
        regulator'' each place that term appears and inserting ``the 
        Bureau of Consumer Financial Protection or the Commission''.
SEC. 1098. AMENDMENTS TO THE REAL ESTATE SETTLEMENT PROCEDURES ACT OF 
1974.
    The Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2601 
et seq.) is amended--
        (1) in section 3 (12 U.S.C. 2602)--
            (A) in paragraph (7), by striking ``and'' at the end;
            (B) in paragraph (8), by striking the period at the end and 
        inserting ``; and''; and
            (C) by adding at the end the following:
        ``(9) the term `Bureau' means the Bureau of Consumer Financial 
    Protection.'';
        (2) in section 4 (12 U.S.C. 2603)--
            (A) in subsection (a), by striking the first sentence and 
        inserting the following: ``The Bureau shall publish a single, 
        integrated disclosure for mortgage loan transactions (including 
        real estate settlement cost statements) which includes the 
        disclosure requirements of this section and section 5, in 
        conjunction with the disclosure requirements of the Truth in 
        Lending Act that, taken together, may apply to a transaction 
        that is subject to both or either provisions of law. The 
        purpose of such model disclosure shall be to facilitate 
        compliance with the disclosure requirements of this title and 
        the Truth in Lending Act, and to aid the borrower or lessee in 
        understanding the transaction by utilizing readily 
        understandable language to simplify the technical nature of the 
        disclosures.'';
            (B) by striking ``Secretary'' each place that term appears 
        and inserting ``Bureau''; and
            (C) by striking ``form'' each place that term appears and 
        inserting ``forms'';
        (3) in section 5 (12 U.S.C. 2604)--
            (A) by striking ``Secretary'' each place that term appears 
        and inserting ``Bureau''; and
            (B) in subsection (a), by striking the first sentence and 
        inserting the following: ``The Bureau shall prepare and 
        distribute booklets jointly addressing compliance with the 
        requirements of the Truth in Lending Act and the provisions of 
        this title, in order to help persons borrowing money to finance 
        the purchase of residential real estate better to understand 
        the nature and costs of real estate settlement services.'';
        (4) in section 6(j)(3) (12 U.S.C. 2605(j)(3))--
            (A) by striking ``Secretary'' and inserting ``Bureau''; and
            (B) by striking ``, by regulations that shall take effect 
        not later than April 20, 1991,'';
        (5) in section 7(b) (12 U.S.C. 2606(b)) by striking 
    ``Secretary'' and inserting ``Bureau'';
        (6) in section 8(c)(5) (12 U.S.C. 2607(c)(5)), by striking 
    ``Secretary'' and inserting ``Bureau'';
        (7) in section 8(d) (12 U.S.C. 2607(d))--
            (A) in the subsection heading, by inserting ``Bureau and'' 
        before ``Secretary''; and
            (B) by striking paragraph (4), and inserting the following:
        ``(4) The Bureau, the Secretary, or the attorney general or the 
    insurance commissioner of any State may bring an action to enjoin 
    violations of this section. Except, to the extent that a person is 
    subject to the jurisdiction of the Bureau, the Secretary, or the 
    attorney general or the insurance commissioner of any State, the 
    Bureau shall have primary authority to enforce or administer this 
    section, subject to subtitle B of the Consumer Financial Protection 
    Act of 2010.'';
        (8) in section 10(c) (12 U.S.C. 2609(c) and (d)), by striking 
    ``Secretary'' and inserting ``Bureau'';
        (9) in section 16 (12 U.S.C. 2614), by inserting ``the 
    Bureau,'' before ``the Secretary'';
        (10) in section 18 (12 U.S.C. 2616), by striking ``Secretary'' 
    each place that term appears and inserting ``Bureau''; and
        (11) in section 19 (12 U.S.C. 2617)--
            (A) in the section heading by striking ``secretary'' and 
        inserting ``bureau'';
            (B) in subsection (a), by striking ``Secretary'' each place 
        that term appears and inserting ``Bureau''; and
            (C) in subsections (b) and (c), by striking ``the 
        Secretary'' each place that term appears and inserting ``the 
        Bureau''.
SEC. 1098A. AMENDMENTS TO THE INTERSTATE LAND SALES FULL DISCLOSURE 
ACT.
    The Interstate Land Sales Full Disclosure Act (15 U.S.C. 1701 et 
seq.) is amended--
        (1) by striking ``Secretary'' each place that term appears and 
    inserting ``Director'';
        (2) by striking ``Department of Housing and Urban Development'' 
    each place that term appears and inserting ``Bureau of Consumer 
    Financial Protection'';
        (3) by striking ``Department'' each place that term appears and 
    inserting ``Bureau'';
        (4) in section 1402 (15 U.S.C. 1701)--
            (A) by striking paragraph (1) and inserting the following:
        ``(1) `Director' means the Director of the Bureau of Consumer 
    Financial Protection;'';
            (B) in paragraph (10), by striking ``and'' at the end;
            (C) in paragraph (11), by striking the period at the end 
        and inserting ``; and''; and
            (D) by adding at the end the following:
        ``(12) `Bureau' means the Bureau of Consumer Financial 
    Protection.''; and
        (5) in section 1416(a) (15 U.S.C. 1715(a)), by striking 
    ``Secretary of Housing and Urban Development'' and inserting 
    ``Director of the Bureau of Consumer Financial Protection''.
SEC. 1099. AMENDMENTS TO THE RIGHT TO FINANCIAL PRIVACY ACT OF 1978.
    The Right to Financial Privacy Act of 1978 (12 U.S.C. 3401 et seq.) 
is amended--
        (1) in section 1101--
            (A) in paragraph (6)--
                (i) in subparagraph (A), by inserting ``and'' after the 
            semicolon;
                (ii) in subparagraph (B), by striking ``and'' at the 
            end; and
                (iii) by striking subparagraph (C); and
            (B) in paragraph (7), by striking subparagraph (B), and 
        inserting the following:
            ``(B) the Bureau of Consumer Financial Protection;'';
        (2) in section 1112(e) (12 U.S.C. 3412(e)), by striking ``and 
    the Commodity Futures Trading Commission is permitted'' and 
    inserting ``the Commodity Futures Trading Commission, and the 
    Bureau of Consumer Financial Protection is permitted''; and
        (3) in section 1113 (12 U.S.C. 3413), by adding at the end the 
    following new subsection:
    ``(r) Disclosure to the Bureau of Consumer Financial Protection.--
Nothing in this title shall apply to the examination by or disclosure 
to the Bureau of Consumer Financial Protection of financial records or 
information in the exercise of its authority with respect to a 
financial institution.''.
SEC. 1100. AMENDMENTS TO THE SECURE AND FAIR ENFORCEMENT FOR MORTGAGE 
LICENSING ACT OF 2008.
    The S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5101 et 
seq.) is amended--
        (1) by striking ``a Federal banking agency'' each place that 
    term appears, other than in paragraphs (7) and (11) of section 1503 
    and section 1507(a)(1), and inserting ``the Bureau'';
        (2) by striking ``Federal banking agencies'' each place that 
    term appears and inserting ``Bureau''; and
        (3) by striking ``Secretary'' each place that term appears and 
    inserting ``Director'';
        (4) in section 1503 (12 U.S.C. 5102)--
            (A) by redesignating paragraphs (2) through (12) as (3) 
        through (13), respectively;
            (B) by striking paragraph (1) and inserting the following:
        ``(1) Bureau.--The term `Bureau' means the Bureau of Consumer 
    Financial Protection.
        ``(2) Federal banking agency.--The term `Federal banking 
    agency' means the Board of Governors of the Federal Reserve System, 
    the Office of the Comptroller of the Currency, the National Credit 
    Union Administration, and the Federal Deposit Insurance 
    Corporation.''; and
            (C) by striking paragraph (10), as so designated by this 
        section, and inserting the following:
        ``(10) Director.--The term `Director' means the Director of the 
    Bureau of Consumer Financial Protection.''; and
        (5) in section 1507 (12 U.S.C. 5106)--
            (A) in subsection (a)--
                (i) by striking paragraph (1) and inserting the 
            following:
        ``(1) In general.--The Bureau shall develop and maintain a 
    system for registering employees of a depository institution, 
    employees of a subsidiary that is owned and controlled by a 
    depository institution and regulated by a Federal banking agency, 
    or employees of an institution regulated by the Farm Credit 
    Administration, as registered loan originators with the Nationwide 
    Mortgage Licensing System and Registry. The system shall be 
    implemented before the end of the 1-year period beginning on the 
    date of enactment of the Consumer Financial Protection Act of 
    2010.''; and
                (ii) in paragraph (2)--

                    (I) by striking ``appropriate Federal banking 
                agency and the Farm Credit Administration'' and 
                inserting ``Bureau''; and
                    (II) by striking ``employees's identity'' and 
                inserting ``identity of the employee''; and

            (B) in subsection (b), by striking ``through the Financial 
        Institutions Examination Council, and the Farm Credit 
        Administration'', and inserting ``and the Bureau of Consumer 
        Financial Protection'';
        (6) in section 1508 (12 U.S.C. 5107)--
            (A) by striking the section heading and inserting the 
        following: ``sec. 1508. bureau of consumer financial protection 
        backup authority to establish loan originator licensing 
        system.''; and
            (B) by adding at the end the following:
    ``(f) Regulation Authority.--
        ``(1) In general.--The Bureau is authorized to promulgate 
    regulations setting minimum net worth or surety bond requirements 
    for residential mortgage loan originators and minimum requirements 
    for recovery funds paid into by loan originators.
        ``(2) Considerations.--In issuing regulations under paragraph 
    (1), the Bureau shall take into account the need to provide 
    originators adequate incentives to originate affordable and 
    sustainable mortgage loans, as well as the need to ensure a 
    competitive origination market that maximizes consumer access to 
    affordable and sustainable mortgage loans.'';
        (7) by striking section 1510 (12 U.S.C. 5109) and inserting the 
    following:
``SEC. 1510. FEES.
    ``The Bureau, the Farm Credit Administration, and the Nationwide 
Mortgage Licensing System and Registry may charge reasonable fees to 
cover the costs of maintaining and providing access to information from 
the Nationwide Mortgage Licensing System and Registry, to the extent 
that such fees are not charged to consumers for access to such system 
and registry.'';
        (8) by striking section 1513 (12 U.S.C. 5112) and inserting the 
    following:
``SEC. 1513. LIABILITY PROVISIONS.
    ``The Bureau, any State official or agency, or any organization 
serving as the administrator of the Nationwide Mortgage Licensing 
System and Registry or a system established by the Director under 
section 1509, or any officer or employee of any such entity, shall not 
be subject to any civil action or proceeding for monetary damages by 
reason of the good faith action or omission of any officer or employee 
of any such entity, while acting within the scope of office or 
employment, relating to the collection, furnishing, or dissemination of 
information concerning persons who are loan originators or are applying 
for licensing or registration as loan originators.''; and
        (9) in section 1514 (12 U.S.C. 5113) in the section heading, by 
    striking ``under hud backup licensing system'' and inserting ``by 
    the bureau''.
SEC. 1100A. AMENDMENTS TO THE TRUTH IN LENDING ACT.
    The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended--
        (1) in section 103 (15 U.S.C. 1602)--
            (A) by redesignating subsections (b) through (bb) as 
        subsections (c) through (cc), respectively; and
            (B) by inserting after subsection (a) the following:
    ``(b) Bureau.--The term `Bureau' means the Bureau of Consumer 
Financial Protection.'';
        (2) by striking ``Board'' each place that term appears, other 
    than in section 140(d) and sections 105(i) and 108(a), as amended 
    by this section, and inserting ``Bureau'';
        (3) by striking ``Federal Trade Commission'' each place that 
    term appears, other than in section 108(c) and section 129(m), as 
    amended by this Act, and other than in the context of a reference 
    to the Federal Trade Commission Act, and inserting ``Bureau'';
        (4) in section 105(a) (15 U.S.C. 1604(a)), in the second 
    sentence--
            (A) by striking ``Except in the case of a mortgage referred 
        to in section 103(aa), these regulations may contain such'' and 
        inserting ``Except with respect to the provisions of section 
        129 that apply to a mortgage referred to in section 103(aa), 
        such regulations may contain such additional requirements,''; 
        and
            (B) by inserting ``all or'' after ``exceptions for'';
        (5) in section 105(b) (15 U.S.C. 1604(b)), by striking the 
    first sentence and inserting the following: ``The Bureau shall 
    publish a single, integrated disclosure for mortgage loan 
    transactions (including real estate settlement cost statements) 
    which includes the disclosure requirements of this title in 
    conjunction with the disclosure requirements of the Real Estate 
    Settlement Procedures Act of 1974 that, taken together, may apply 
    to a transaction that is subject to both or either provisions of 
    law. The purpose of such model disclosure shall be to facilitate 
    compliance with the disclosure requirements of this title and the 
    Real Estate Settlement Procedures Act of 1974, and to aid the 
    borrower or lessee in understanding the transaction by utilizing 
    readily understandable language to simplify the technical nature of 
    the disclosures.'';
        (6) in section 105(f)(1) (15 U.S.C. 1604(f)(1)), by inserting 
    ``all or'' after ``from all or part of this title'';
        (7) in section 105 (15 U.S.C. 1604), by adding at the end the 
    following:
                ``(i) Authority of the board to prescribe rules.--
            Notwithstanding subsection (a), the Board shall have 
            authority to prescribe rules under this title with respect 
            to a person described in section 1029(a) of the Consumer 
            Financial Protection Act of 2010. Regulations prescribed 
            under this subsection may contain such classifications, 
            differentiations, or other provisions, as in the judgment 
            of the Board are necessary or proper to effectuate the 
            purposes of this title, to prevent circumvention or evasion 
            thereof, or to facilitate compliance therewith.'';
        (8) in section 108 (15 U.S.C. 1604), by adding at the end the 
    following:
            (A) by striking subsection (a) and inserting the following:
    ``(a) Enforcing Agencies.--Subject to subtitle B of the Consumer 
Financial Protection Act of 2010, compliance with the requirements 
imposed under this title shall be enforced under--
        ``(1) section 8 of the Federal Deposit Insurance Act, by the 
    appropriate Federal banking agency, as defined in section 3(q) of 
    the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), with respect 
    to--
            ``(A) national banks, Federal savings associations, and 
        Federal branches and Federal agencies of foreign banks;
            ``(B) 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
            ``(C) banks and State savings associations insured by the 
        Federal Deposit Insurance Corporation (other than members of 
        the Federal Reserve System), and insured State branches of 
        foreign banks;
        ``(2) the Federal Credit Union Act, by the Director of the 
    National Credit Union Administration, with respect to any Federal 
    credit union;
        ``(3) the Federal Aviation Act of 1958, by the Secretary of 
    Transportation, with respect to any air carrier or foreign air 
    carrier subject to that Act;
        ``(4) the Packers and Stockyards Act, 1921 (except as provided 
    in section 406 of that Act), by the Secretary of Agriculture, with 
    respect to any activities subject to that Act;
        ``(5) the Farm Credit Act of 1971, by the Farm Credit 
    Administration with respect to any Federal land bank, Federal land 
    bank association, Federal intermediate credit bank, or production 
    credit association; and
        ``(6) subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau, with respect to any person subject to this 
    title.''; and
            (B) by striking subsection (c) and inserting the following:
    ``(c) Overall Enforcement Authority of the Federal Trade 
Commission.--Except to the extent that enforcement of the requirements 
imposed under this title is specifically committed to some other 
Government agency under any of paragraphs (1) through (5) of subsection 
(a), and subject to subtitle B of the Consumer Financial Protection Act 
of 2010, the Federal Trade Commission shall be authorized to enforce 
such requirements. For the purpose of the exercise by the Federal Trade 
Commission of its functions and powers under the Federal Trade 
Commission Act, a violation of any requirement imposed under this title 
shall be deemed a violation of a requirement imposed under that Act. 
All of the functions and powers of the Federal Trade Commission under 
the Federal Trade Commission Act are available to the Federal Trade 
Commission to enforce compliance by any person with the requirements 
under this title, irrespective of whether that person is engaged in 
commerce or meets any other jurisdictional tests under the Federal 
Trade Commission Act.''; and
        (9) in section 129 (15 U.S.C. 1639), by striking subsection (m) 
    and inserting the following:
    ``(m) Civil Penalties in Federal Trade Commission Enforcement 
Actions.--For purposes of enforcement by the Federal Trade Commission, 
any violation of a regulation issued by the Bureau pursuant to 
subsection (l)(2) shall be treated as a violation of a rule promulgated 
under section 18 of the Federal Trade Commission Act (15 U.S.C. 57a) 
regarding unfair or deceptive acts or practices.''; and
        (10) in chapter 5 (15 U.S.C. 1667 et seq.)--
            (A) by striking ``the Board'' each place that term appears 
        and inserting ``the Bureau''; and
            (B) by striking ``The Board'' each place that term appears 
        and inserting ``The Bureau''.
SEC. 1100B. AMENDMENTS TO THE TRUTH IN SAVINGS ACT.
    The Truth in Savings Act (12 U.S.C. 4301 et seq.) is amended--
        (1) by striking ``Board'' each place that term appears, other 
    than in section 272(b) (12 U.S.C. 4311), and inserting ``Bureau'';
        (2) in section 270(a) (12 U.S.C. 4309)--
            (A) by striking ``Compliance'' and all that follows through 
        the end of paragraph (1) and inserting: ``Subject to subtitle B 
        of the Consumer Financial Protection Act of 2010, compliance 
        with the requirements imposed under this subtitle shall be 
        enforced under--
        ``(1) section 8 of the Federal Deposit Insurance Act by the 
    appropriate Federal banking agency (as defined in section 3(q) of 
    that Act), with respect to--
            ``(A) insured depository institutions (as defined in 
        section 3(c)(2) of that Act);
            ``(B) depository institutions described in clause (i), 
        (ii), or (iii) of section 19(b)(1)(A) of the Federal Reserve 
        Act which are not insured depository institutions (as defined 
        in section 3(c)(2) of the Federal Deposit Insurance Act); and
            ``(C) depository institutions described in clause (v) or 
        (vi) of section 19(b)(1)(A) of the Federal Reserve Act which 
        are not insured depository institutions (as defined in section 
        3(c)(2) of the Federal Deposit Insurance Act);'';
            (B) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (C) by adding at the end the following:
        ``(3) subtitle E of the Consumer Financial Protection Act of 
    2010, by the Bureau, with respect to any person subject to this 
    subtitle.'';
        (3) in section 272(b) (12 U.S.C. 4311(b)), by striking 
    ``regulation prescribed by the Board'' each place that term appears 
    and inserting ``regulation prescribed by the Bureau''; and
        (4) in section 274 (12 U.S.C. 4313), by striking paragraph (4) 
    and inserting the following:
        ``(4) Bureau.--The term `Bureau' means the Bureau of Consumer 
    Financial Protection.''.
SEC. 1100C. AMENDMENTS TO THE TELEMARKETING AND CONSUMER FRAUD AND 
ABUSE PREVENTION ACT.
    (a) Amendments to Section 3.--Section 3 of the Telemarketing and 
Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6102) is amended by 
striking subsections (b) and (c) and inserting the following:
    ``(b) Rulemaking Authority.--The Commission shall have authority to 
prescribe rules under subsection (a), in accordance with section 553 of 
title 5, United States Code. In prescribing a rule under this section 
that relates to the provision of a consumer financial product or 
service that is subject to the Consumer Financial Protection Act of 
2010, including any enumerated consumer law thereunder, the Commission 
shall consult with the Bureau of Consumer Financial Protection 
regarding the consistency of a proposed rule with standards, purposes, 
or objectives administered by the Bureau of Consumer Financial 
Protection.
    ``(c) Violations.--Any violation of any rule prescribed under 
subsection (a)--
        ``(1) shall be treated as a violation of a rule under section 
    18 of the Federal Trade Commission Act regarding unfair or 
    deceptive acts or practices; and
        ``(2) that is committed by a person subject to the Consumer 
    Financial Protection Act of 2010 shall be treated as a violation of 
    a rule under section 1031 of that Act regarding unfair, deceptive, 
    or abusive acts or practices.''.
    (b) Amendments to Section 4.--Section 4(d) of the Telemarketing and 
Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6103(d)) is amended 
by inserting after ``Commission'' each place that term appears the 
following: ``or the Bureau of Consumer Financial Protection''.
    (c) Amendments to Section 5.--Section 5(c) of the Telemarketing and 
Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6104(c)) is amended 
by inserting after ``Commission'' each place that term appears the 
following: ``or the Bureau of Consumer Financial Protection''.
    (d) Amendment to Section 6.--Section 6 of the Telemarketing and 
Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6105) is amended by 
adding at the end the following:
    ``(d) Enforcement by Bureau of Consumer Financial Protection.--
Except as otherwise provided in sections 3(d), 3(e), 4, and 5, and 
subject to subtitle B of the Consumer Financial Protection Act of 2010, 
this Act shall be enforced by the Bureau of Consumer Financial 
Protection under subtitle E of the Consumer Financial Protection Act of 
2010, with respect to the offering or provision of a consumer financial 
product or service subject to that Act.''.
SEC. 1100D. AMENDMENTS TO THE PAPERWORK REDUCTION ACT.
    (a) Designation as an Independent Agency.--Section 2(5) of the 
Paperwork Reduction Act (44 U.S.C. 3502(5)) is amended by inserting 
``the Bureau of Consumer Financial Protection, the Office of Financial 
Research,'' after ``the Securities and Exchange Commission,''.
    (b) Comparable Treatment.--Section 3513 of title 44, United States 
Code, is amended by adding at the end the following:
    ``(c) Comparable Treatment.--Notwithstanding any other provision of 
law, the Director shall treat or review a rule or order prescribed or 
proposed by the Director of the Bureau of Consumer Financial Protection 
on the same terms and conditions as apply to any rule or order 
prescribed or proposed by the Board of Governors of the Federal Reserve 
System.''.
SEC. 1100E. ADJUSTMENTS FOR INFLATION IN THE TRUTH IN LENDING ACT.
    (a) Caps.--
        (1) Credit transactions.--Section 104(3) of the Truth in 
    Lending Act (15 U.S.C. 1603(3)) is amended by striking ``$25,000'' 
    and inserting ``$50,000''.
        (2) Consumer leases.--Section 181(1) of the Truth in Lending 
    Act (15 U.S.C. 1667(1)) is amended by striking ``$25,000'' and 
    inserting ``$50,000''.
    (b) Adjustments for Inflation.--On and after December 31, 2011, the 
Bureau shall adjust annually the dollar amounts described in sections 
104(3) and 181(1) of the Truth in Lending Act (as amended by this 
section), by the annual percentage increase in the Consumer Price Index 
for Urban Wage Earners and Clerical Workers, as published by the Bureau 
of Labor Statistics, rounded to the nearest multiple of $100, or 
$1,000, as applicable.
SEC. 1100F. USE OF CONSUMER REPORTS.
    Section 615 of the Fair Credit Reporting Act (15 U.S.C. 1681m) is 
amended--
        (1) in subsection (a)--
            (A) by redesignating paragraphs (2) and (3) as paragraphs 
        (3) and (4), respectively;
            (B) by inserting after paragraph (1) the following:
        ``(2) provide to the consumer written or electronic 
    disclosure--
            ``(A) of a numerical credit score as defined in section 
        609(f)(2)(A) used by such person in taking any adverse action 
        based in whole or in part on any information in a consumer 
        report; and
            ``(B) of the information set forth in subparagraphs (B) 
        through (E) of section 609(f)(1);''; and
            (C) in paragraph (4) (as so redesignated), by striking 
        ``paragraph (2)'' and inserting ``paragraph (3)''; and
        (2) in subsection (h)(5)--
            (A) in subparagraph (C), by striking ``; and'' and 
        inserting a semicolon;
            (B) in subparagraph (D), by striking the period and 
        inserting ``; and''; and
            (C) by inserting at the end the following:
            ``(E) include a statement informing the consumer of--
                ``(i) a numerical credit score as defined in section 
            609(f)(2)(A), used by such person in making the credit 
            decision described in paragraph (1) based in whole or in 
            part on any information in a consumer report; and
                ``(ii) the information set forth in subparagraphs (B) 
            through (E) of section 609(f)(1).''.
SEC. 1100G. SMALL BUSINESS FAIRNESS AND REGULATORY TRANSPARENCY.
    (a) Panel Requirement.--Section 609(d) of title 5, United States 
Code, is amended by striking ``means the'' and all that follows and 
inserting the following: ``means--
        ``(1) the Environmental Protection Agency;
        ``(2) the Consumer Financial Protection Bureau of the Federal 
    Reserve System; and
        ``(3) the Occupational Safety and Health Administration of the 
    Department of Labor.''.
    (b) Initial Regulatory Flexibility Analysis.--Section 603 of title 
5, United States Code, is amended by adding at the end the following:
    ``(d)(1) For a covered agency, as defined in section 609(d)(2), 
each initial regulatory flexibility analysis shall include a 
description of--
        ``(A) any projected increase in the cost of credit for small 
    entities;
        ``(B) any significant alternatives to the proposed rule which 
    accomplish the stated objectives of applicable statutes and which 
    minimize any increase in the cost of credit for small entities; and
        ``(C) advice and recommendations of representatives of small 
    entities relating to issues described in subparagraphs (A) and (B) 
    and subsection (b).
    ``(2) A covered agency, as defined in section 609(d)(2), shall, for 
purposes of complying with paragraph (1)(C)--
        ``(A) identify representatives of small entities in 
    consultation with the Chief Counsel for Advocacy of the Small 
    Business Administration; and
        ``(B) collect advice and recommendations from the 
    representatives identified under subparagraph (A) relating to 
    issues described in subparagraphs (A) and (B) of paragraph (1) and 
    subsection (b).''.
    (c) Final Regulatory Flexibility Analysis.--Section 604(a) of title 
5, United States Code, is amended--
        (1) in paragraph (4), by striking ``and'' at the end;
        (2) in paragraph (5), by striking the period at the end and 
    inserting ``; and''; and
        (3) by adding at the end the following:
        ``(6) for a covered agency, as defined in section 609(d)(2), a 
    description of the steps the agency has taken to minimize any 
    additional cost of credit for small entities.''.
SEC. 1100H. EFFECTIVE DATE.
    Except as otherwise provided in this subtitle and the amendments 
made by this subtitle, this subtitle and the amendments made by this 
subtitle, other than sections 1081 and 1082, shall become effective on 
the designated transfer date.

              TITLE XI--FEDERAL RESERVE SYSTEM PROVISIONS

SEC. 1101. FEDERAL RESERVE ACT AMENDMENTS ON EMERGENCY LENDING 
AUTHORITY.
    (a) Federal Reserve Act.--The third undesignated paragraph of 
section 13 of the Federal Reserve Act (12 U.S.C. 343) (relating to 
emergency lending authority) is amended--
        (1) by inserting ``(3)(A)'' before ``In unusual'';
        (2) by striking ``individual, partnership, or corporation'' the 
    first place that term appears and inserting the following: 
    ``participant in any program or facility with broad-based 
    eligibility'';
        (3) by striking ``exchange for an individual or a partnership 
    or corporation'' and inserting ``exchange,'';
        (4) by striking ``such individual, partnership, or 
    corporation'' and inserting the following: ``such participant in 
    any program or facility with broad-based eligibility'';
        (5) by striking ``for individuals, partnerships, corporations'' 
    and inserting ``for any participant in any program or facility with 
    broad-based eligibility''; and
        (6) by striking ``may prescribe.'' and inserting the following: 
    ``may prescribe.
            ``(B)(i) As soon as is practicable after the date of 
        enactment of this subparagraph, the Board shall establish, by 
        regulation, in consultation with the Secretary of the Treasury, 
        the policies and procedures governing emergency lending under 
        this paragraph. Such policies and procedures shall be designed 
        to ensure that any emergency lending program or facility is for 
        the purpose of providing liquidity to the financial system, and 
        not to aid a failing financial company, and that the security 
        for emergency loans is sufficient to protect taxpayers from 
        losses and that any such program is terminated in a timely and 
        orderly fashion. The policies and procedures established by the 
        Board shall require that a Federal reserve bank assign, 
        consistent with sound risk management practices and to ensure 
        protection for the taxpayer, a lendable value to all collateral 
        for a loan executed by a Federal reserve bank under this 
        paragraph in determining whether the loan is secured 
        satisfactorily for purposes of this paragraph.
            ``(ii) The Board shall establish procedures to prohibit 
        borrowing from programs and facilities by borrowers that are 
        insolvent. Such procedures may include a certification from the 
        chief executive officer (or other authorized officer) of the 
        borrower, at the time the borrower initially borrows under the 
        program or facility (with a duty by the borrower to update the 
        certification if the information in the certification 
        materially changes), that the borrower is not insolvent. A 
        borrower shall be considered insolvent for purposes of this 
        subparagraph, if the borrower is in bankruptcy, resolution 
        under title II of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act, or any other Federal or State 
        insolvency proceeding.
            ``(iii) A program or facility that is structured to remove 
        assets from the balance sheet of a single and specific company, 
        or that is established for the purpose of assisting a single 
        and specific company avoid bankruptcy, resolution under title 
        II of the Dodd-Frank Wall Street Reform and Consumer Protection 
        Act, or any other Federal or State insolvency proceeding, shall 
        not be considered a program or facility with broad-based 
        eligibility.
            ``(iv) The Board may not establish any program or facility 
        under this paragraph without the prior approval of the 
        Secretary of the Treasury.
            ``(C) The Board 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--
                ``(i) not later than 7 days after the Board authorizes 
            any loan or other financial assistance under this 
            paragraph, a report that includes--

                    ``(I) the justification for the exercise of 
                authority to provide such assistance;
                    ``(II) the identity of the recipients of such 
                assistance;
                    ``(III) the date and amount of the assistance, and 
                form in which the assistance was provided; and
                    ``(IV) the material terms of the assistance, 
                including--

                        ``(aa) duration;
                        ``(bb) collateral pledged and the value 
                    thereof;
                        ``(cc) all interest, fees, and other revenue or 
                    items of value to be received in exchange for the 
                    assistance;
                        ``(dd) any requirements imposed on the 
                    recipient with respect to employee compensation, 
                    distribution of dividends, or any other corporate 
                    decision in exchange for the assistance; and
                        ``(ee) the expected costs to the taxpayers of 
                    such assistance; and
                ``(ii) once every 30 days, with respect to any 
            outstanding loan or other financial assistance under this 
            paragraph, written updates on--

                    ``(I) the value of collateral;
                    ``(II) the amount of interest, fees, and other 
                revenue or items of value received in exchange for the 
                assistance; and
                    ``(III) the expected or final cost to the taxpayers 
                of such assistance.

            ``(D) The information required to be submitted to Congress 
        under subparagraph (C) related to--
                ``(i) the identity of the participants in an emergency 
            lending program or facility commenced under this paragraph;
                ``(ii) the amounts borrowed by each participant in any 
            such program or facility;
                ``(iii) identifying details concerning the assets or 
            collateral held by, under, or in connection with such a 
            program or facility,
        shall be kept confidential, upon the written request of the 
        Chairman of the Board, in which case such information shall be 
        made available only to the Chairpersons or Ranking Members of 
        the Committees described in subparagraph (C).
            ``(E) If an entity to which a Federal reserve bank has 
        provided a loan under this paragraph becomes a covered 
        financial company, as defined in section 201 of the Dodd-Frank 
        Wall Street Reform and Consumer Protection Act, at any time 
        while such loan is outstanding, and the Federal reserve bank 
        incurs a realized net loss on the loan, then the Federal 
        reserve bank shall have a claim equal to the amount of the net 
        realized loss against the covered entity, with the same 
        priority as an obligation to the Secretary of the Treasury 
        under section 210(b) of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act.''.
    (b) Conforming Amendment.--Section 507(a)(2) of title 11, United 
States Code, is amended by inserting ``unsecured claims of any Federal 
reserve bank related to loans made through programs or facilities 
authorized under section 13(3) of the Federal Reserve Act (12 U.S.C. 
343),'' after ``this title,''.
    (c) References.--On and after the date of enactment of this Act, 
any reference in any provision of Federal law to the third undesignated 
paragraph of section 13 of the Federal Reserve Act (12 U.S.C. 343) 
shall be deemed to be a reference to section 13(3) of the Federal 
Reserve Act, as so designated by this section.
SEC. 1102. AUDITS OF SPECIAL FEDERAL RESERVE CREDIT FACILITIES.
    (a) Audits.--Section 714 of title 31, United States Code, is 
amended by adding at the end the following:
    ``(f) Audits of Credit Facilities of the Federal Reserve System.--
        ``(1) Definitions.--In this subsection, the following 
    definitions shall apply:
            ``(A) Credit facility.--The term `credit facility' 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) 
        of the Federal Reserve Act (12 U.S.C. 343), that is not subject 
        to audit under subsection (e).
            ``(B) Covered transaction.--The term `covered transaction' 
        means any open market transaction or discount window advance 
        that meets the definition of `covered transaction' in section 
        11(s) of the Federal Reserve Act.
        ``(2) Authority for audits and examinations.--Subject to 
    paragraph (3), and notwithstanding any limitation in subsection (b) 
    on the auditing and oversight of certain functions of the Board of 
    Governors of the Federal Reserve System or any Federal reserve 
    bank, the Comptroller General of the United States may conduct 
    audits, including onsite examinations, of the Board of Governors, a 
    Federal reserve bank, or a credit facility, if the Comptroller 
    General determines that such audits are appropriate, solely for the 
    purposes of assessing, with respect to a credit facility or a 
    covered transaction--
            ``(A) the operational integrity, accounting, financial 
        reporting, and internal controls governing the credit facility 
        or covered transaction;
            ``(B) the effectiveness of the security and collateral 
        policies established for the facility or covered transaction in 
        mitigating risk to the relevant Federal reserve bank and 
        taxpayers;
            ``(C) whether the credit facility or the conduct of a 
        covered transaction inappropriately favors one or more specific 
        participants over other institutions eligible to utilize the 
        facility; and
            ``(D) the policies governing the use, selection, or payment 
        of third-party contractors by or for any credit facility or to 
        conduct any covered transaction.
        ``(3) Reports and delayed disclosure.--
            ``(A) Reports required.--A report on each audit conducted 
        under paragraph (2) shall be submitted by the Comptroller 
        General to the Congress before the end of the 90-day period 
        beginning on the date on which such audit is completed.
            ``(B) Contents.--The report under subparagraph (A) shall 
        include a detailed description of the findings and conclusions 
        of the Comptroller General with respect to the matters 
        described in paragraph (2) that were audited and are the 
        subject of the report, together with such recommendations for 
        legislative or administrative action relating to such matters 
        as the Comptroller General may determine to be appropriate.
            ``(C) Delayed release of certain information.--
                ``(i) In general.--The Comptroller General shall not 
            disclose to any person or entity, including to Congress, 
            the names or identifying details of specific participants 
            in any credit facility or covered transaction, the amounts 
            borrowed by or transferred by or to specific participants 
            in any credit facility or covered transaction, or 
            identifying details regarding assets or collateral held or 
            transferred by, under, or in connection with any credit 
            facility or covered transaction, and any report provided 
            under subparagraph (A) shall be redacted to ensure that 
            such names and details are not disclosed.
                ``(ii) Delayed release.--The nondisclosure obligation 
            under clause (i) shall expire with respect to any 
            participant on the date on which the Board of Governors, 
            directly or through a Federal reserve bank, publicly 
            discloses the identity of the subject participant or the 
            identifying details of the subject assets, collateral, or 
            transaction.
                ``(iii) General release.--The Comptroller General shall 
            release a nonredacted version of any report on a credit 
            facility 1 year after the effective date of the termination 
            by the Board of Governors of the authorization for the 
            credit facility. For purposes of this clause, a credit 
            facility shall be deemed to have terminated 24 months after 
            the date on which the credit facility ceases to make 
            extensions of credit and loans, unless the credit facility 
            is otherwise terminated by the Board of Governors.
                ``(iv) Exceptions.--The nondisclosure obligation under 
            clause (i) shall not apply to the credit facilities Maiden 
            Lane, Maiden Lane II, and Maiden Lane III.
                ``(v) Release of covered transaction information.--The 
            Comptroller General shall release a nonredacted version of 
            any report regarding covered transactions upon the release 
            of the information regarding such covered transactions by 
            the Board of Governors of the Federal Reserve System, as 
            provided in section 11(s) of the Federal Reserve Act.''.
    (b) Access to Records.--Section 714(d) of title 31, United States 
Code, is amended--
        (1) in paragraph (2), by inserting ``or any person or entity 
    described in paragraph (3)(A)'' after ``used by an agency'';
        (2) in paragraph (3), by inserting ``or (f)'' after 
    ``subsection (e)'' each place that term appears;
        (3) in clauses (i) and (ii) of paragraph (3)(A), by inserting 
    ``or the Federal Reserve banks'' after ``by the Board'' each place 
    that term appears;
        (4) in paragraph (3)(A)(ii), by inserting ``participating in 
    or'' after ``any entity''; and
        (5) in paragraph (3)(B), by adding at the end the following: 
    ``The Comptroller General may make and retain copies of books, 
    accounts, and other records provided under subparagraph (A) as the 
    Comptroller General deems appropriate. The Comptroller General 
    shall provide to any person or entity described in subparagraph (A) 
    a current list of officers and employees to whom, with proper 
    identification, records and property may be made available, and who 
    may make notes or copies necessary to carry out a audit or 
    examination under this subsection.''.
SEC. 1103. PUBLIC ACCESS TO INFORMATION.
    (a) In General.--Section 2B of the Federal Reserve Act (12 U.S.C. 
225b) is amended by adding at the end the following:
    ``(c) Public Access to Information.--The Board shall place on its 
home Internet website, a link entitled `Audit', which shall link to a 
webpage that shall serve as a repository of information made available 
to the public for a reasonable period of time, not less than 6 months 
following the date of release of the relevant information, including--
        ``(1) the reports prepared by the Comptroller General under 
    section 714 of title 31, United States Code;
        ``(2) the annual financial statements prepared by an 
    independent auditor for the Board in accordance with section 11B;
        ``(3) the reports to the Committee on Banking, Housing, and 
    Urban Affairs of the Senate required under section 13(3) (relating 
    to emergency lending authority); and
        ``(4) such other information as the Board reasonably believes 
    is necessary or helpful to the public in understanding the 
    accounting, financial reporting, and internal controls of the Board 
    and the Federal reserve banks.''.
    (b) Federal Reserve Transparency and Release of Information.--
Section 11 of the Federal Reserve Act (12 U.S.C. 248) is amended by 
adding at the end the following new subsection:
    ``(s) Federal Reserve Transparency and Release of Information.--
        ``(1) In general.--In order to ensure the disclosure in a 
    timely manner consistent with the purposes of this Act of 
    information concerning the borrowers and counterparties 
    participating in emergency credit facilities, discount window 
    lending programs, and open market operations authorized or 
    conducted by the Board or a Federal reserve bank, the Board of 
    Governors shall disclose, as provided in paragraph (2)--
            ``(A) the names and identifying details of each borrower, 
        participant, or counterparty in any credit facility or covered 
        transaction;
            ``(B) the amount borrowed by or transferred by or to a 
        specific borrower, participant, or counterparty in any credit 
        facility or covered transaction;
            ``(C) the interest rate or discount paid by each borrower, 
        participant, or counterparty in any credit facility or covered 
        transaction; and
            ``(D) information identifying the types and amounts of 
        collateral pledged or assets transferred in connection with 
        participation in any credit facility or covered transaction.
        ``(2) Mandatory release date.--In the case of--
            ``(A) a credit facility, the Board shall disclose the 
        information described in paragraph (1) on the date that is 1 
        year after the effective date of the termination by the Board 
        of the authorization of the credit facility; and
            ``(B) a covered transaction, the Board shall disclose the 
        information described in paragraph (1) on the last day of the 
        eighth calendar quarter following the calendar quarter in which 
        the covered transaction was conducted.
        ``(3) Earlier release date authorized.--The Chairman of the 
    Board may publicly release the information described in paragraph 
    (1) before the relevant date specified in paragraph (2), if the 
    Chairman determines that such disclosure would be in the public 
    interest and would not harm the effectiveness of the relevant 
    credit facility or the purpose or conduct of covered transactions.
        ``(4) Definitions.--For purposes of this subsection, the 
    following definitions shall apply:
            ``(A) Credit facility.--The term `credit facility' has the 
        same meaning as in section 714(f)(1)(A) of title 31, United 
        States Code.
            ``(B) Covered transaction.--The term `covered transaction' 
        means--
                ``(i) any open market transaction with a 
            nongovernmental third party conducted under the first 
            undesignated paragraph of section 14 or subparagraph (a), 
            (b), or (c) of the 2nd undesignated paragraph of such 
            section, after the date of enactment of the Dodd-Frank Wall 
            Street Reform and Consumer Protection Act; and
                ``(ii) any advance made under section 10B after the 
            date of enactment of that Act.
        ``(5) Termination of credit facility by operation of law.--A 
    credit facility shall be deemed to have terminated as of the end of 
    the 24-month period beginning on the date on which the credit 
    facility ceases to make extensions of credit and loans, unless the 
    credit facility is otherwise terminated by the Board before such 
    date.
        ``(6) Consistent treatment of information.--Except as provided 
    in this subsection or section 13(3)(D), 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, shall be confidential, including 
    for purposes of section 552(b)(3) of title 5 of such Code, until 
    the relevant mandatory release date described in paragraph (2), 
    unless the Chairman of the Board determines that earlier disclosure 
    of such information would be in the public interest and would not 
    harm the effectiveness of the relevant credit facility or the 
    purpose of conduct of the relevant transactions.
        ``(7) Protection of personal privacy.--This subsection and 
    section 13(3)(C), section 714(f)(3)(C) of title 31, United States 
    Code, and subsection (a) or (c) of section 1109 of the Dodd-Frank 
    Wall Street Reform and Consumer Protection Act shall not be 
    construed as requiring any disclosure of nonpublic personal 
    information (as defined for purposes of section 502 of the Gramm-
    Leach-Bliley Act (12 U.S.C. 6802)) concerning any individual who is 
    referenced in collateral pledged or assets transferred in 
    connection with a credit facility or covered transaction, unless 
    the person is a borrower, participant, or counterparty under the 
    credit facility or covered transaction.
        ``(8) Study of foia exemption impact.--
            ``(A) Study.--The Inspector General of the Board of 
        Governors of the Federal Reserve System shall--
                ``(i) conduct a study on the impact that the exemption 
            from section 552(b)(3) of title 5 (known as the Freedom of 
            Information Act) established under paragraph (6) has had on 
            the ability of the public to access information about the 
            administration by the Board of Governors of emergency 
            credit facilities, discount window lending programs, and 
            open market operations; and
                ``(ii) make any recommendations on whether the 
            exemption described in clause (i) should remain in effect.
            ``(B) Report.--Not later than 30 months after the date of 
        enactment of this section, the Inspector General of the Board 
        of Governors of the Federal Reserve System shall submit a 
        report on the findings of the study required under subparagraph 
        (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 publish the report on the website of 
        the Board.
        ``(9) Rule of construction.--Nothing in this section is meant 
    to affect any pending litigation or lawsuit filed under section 552 
    of title 5, United States Code (popularly known as the Freedom of 
    Information Act), on or before the date of enactment of the Dodd-
    Frank Wall Street Reform and Consumer Protection Act.''.
SEC. 1104. LIQUIDITY EVENT DETERMINATION.
    (a) Determination and Written Recommendation.--
        (1) Determination request.--The Secretary may request the 
    Corporation and the Board of Governors to determine whether a 
    liquidity event exists that warrants use of the guarantee program 
    authorized under section 1105.
        (2) Requirements of determination.--Any determination pursuant 
    to paragraph (1) shall--
            (A) be written; and
            (B) contain an evaluation of the evidence that--
                (i) a liquidity event exists;
                (ii) failure to take action would have serious adverse 
            effects on financial stability or economic conditions in 
            the United States; and
                (iii) actions authorized under section 1105 are needed 
            to avoid or mitigate potential adverse effects on the 
            United States financial system or economic conditions.
    (b) Procedures.--Notwithstanding any other provision of Federal or 
State law, upon the determination of both the Corporation (upon a vote 
of not fewer than \2/3\ of the members of the Corporation then serving) 
and the Board of Governors (upon a vote of not fewer than \2/3\ of the 
members of the Board of Governors then serving) under subsection (a) 
that a liquidity event exists that warrants use of the guarantee 
program authorized under section 1105, and with the written consent of 
the Secretary--
        (1) the Corporation shall take action in accordance with 
    section 1105(a); and
        (2) the Secretary (in consultation with the President) shall 
    take action in accordance with section 1105(c).
    (c) Documentation and Review.--
        (1) Documentation.--The Secretary shall--
            (A) maintain the written documentation of each 
        determination of the Corporation and the Board of Governors 
        under this section; and
            (B) provide the documentation for review under paragraph 
        (2).
        (2) GAO review.--The Comptroller General of the United States 
    shall review and report to Congress on any determination of the 
    Corporation and the Board of Governors under subsection (a), 
    including--
            (A) the basis for the determination; and
            (B) the likely effect of the actions taken.
    (d) Report to Congress.--On the earlier of the date of a submission 
made to Congress under section 1105(c), or within 30 days of the date 
of a determination under subsection (a), the Secretary shall provide 
written notice of the determination of the Corporation and the Board of 
Governors to the Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services of the House of 
Representatives, including a description of the basis for the 
determination.
SEC. 1105. EMERGENCY FINANCIAL STABILIZATION.
    (a) In General.--Upon the written determination of the Corporation 
and the Board of Governors under section 1104, the Corporation shall 
create a widely available program to guarantee obligations of solvent 
insured depository institutions or solvent depository institution 
holding companies (including any affiliates thereof) during times of 
severe economic distress, except that a guarantee of obligations under 
this section may not include the provision of equity in any form.
    (b) Rulemaking and Terms and Conditions.--
        (1) Policies and procedures.--As soon as is practicable after 
    the date of enactment of this Act, the Corporation shall establish, 
    by regulation, and in consultation with the Secretary, policies and 
    procedures governing the issuance of guarantees authorized by this 
    section. Such policies and procedures may include a requirement of 
    collateral as a condition of any such guarantee.
        (2) Terms and conditions.--The terms and conditions of any 
    guarantee program shall be established by the Corporation, with the 
    concurrence of the Secretary.
    (c) Determination of Guaranteed Amount.--
        (1) In general.--In connection with any program established 
    pursuant to subsection (a) and subject to paragraph (2) of this 
    subsection, the Secretary (in consultation with the President) 
    shall determine the maximum amount of debt outstanding that the 
    Corporation may guarantee under this section, and the President may 
    transmit to Congress a written report on the plan of the 
    Corporation to exercise the authority under this section to issue 
    guarantees up to that maximum amount and a request for approval of 
    such plan. The Corporation shall exercise the authority under this 
    section to issue guarantees up to that specified maximum amount 
    upon passage of the joint resolution of approval, as provided in 
    subsection (d). Absent such approval, the Corporation shall issue 
    no such guarantees.
        (2) Additional debt guarantee authority.--If the Secretary (in 
    consultation with the President) determines, after a submission to 
    Congress under paragraph (1), that the maximum guarantee amount 
    should be raised, and the Council concurs with that determination, 
    the President may transmit to Congress a written report on the plan 
    of the Corporation to exercise the authority under this section to 
    issue guarantees up to the increased maximum debt guarantee amount. 
    The Corporation shall exercise the authority under this section to 
    issue guarantees up to that specified maximum amount upon passage 
    of the joint resolution of approval, as provided in subsection (d). 
    Absent such approval, the Corporation shall issue no such 
    guarantees.
    (d) Resolution of Approval.--
        (1) Additional debt guarantee authority.--A request by the 
    President under this section shall be considered granted by 
    Congress upon adoption of a joint resolution approving such 
    request. Such joint resolution shall be considered in the Senate 
    under expedited procedures.
        (2) Fast track consideration in senate.--
            (A) Reconvening.--Upon receipt of a request under 
        subsection (c), if the Senate has adjourned or recessed for 
        more than 2 days, the majority leader of the Senate, after 
        consultation with the minority leader of the Senate, shall 
        notify the Members of the Senate that, pursuant to this 
        section, the Senate shall convene not later than the second 
        calendar day after receipt of such message.
            (B) Placement on calendar.--Upon introduction in the 
        Senate, the joint resolution shall be placed immediately on the 
        calendar.
            (C) Floor consideration.--
                (i) In general.--Notwithstanding Rule XXII of the 
            Standing Rules of the Senate, it is in order at any time 
            during the period beginning on the 4th day after the date 
            on which Congress receives a request under subsection (c), 
            and ending on the 7th day after that date (even though a 
            previous motion to the same effect has been disagreed to) 
            to move 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 to proceed is not 
            debatable. The motion is not subject to a motion to 
            postpone. 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 
            resolution is agreed to, the joint resolution shall remain 
            the unfinished business until disposed of.
                (ii) Debate.--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 the majority and minority leaders 
            or their designees. A motion further to 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.
                (iii) Vote on passage.--The vote on passage shall occur 
            immediately following the conclusion of the debate on the 
            joint resolution, and a single quorum call at the 
            conclusion of the debate if requested in accordance with 
            the rules of the Senate.
                (iv) Rulings of the chair on procedure.--Appeals from 
            the decisions of the Chair relating to the application of 
            the rules of the Senate, as the case may be, to the 
            procedure relating to a joint resolution shall be decided 
            without debate.
        (3) Rules.--
            (A) Coordination with action by house of representatives.--
        If, before the passage by the Senate of a joint resolution of 
        the Senate, the Senate receives a joint resolution, from the 
        House of Representatives, then the following procedures shall 
        apply:
                (i) The joint resolution of the House of 
            Representatives shall not be referred to a committee.
                (ii) With respect to a joint resolution of the Senate--

                    (I) the procedure in the Senate shall be the same 
                as if no joint resolution had been received from the 
                other House; but
                    (II) the vote on passage shall be on the joint 
                resolution of the House of Representatives.

            (B) Treatment of joint resolution of house of 
        representatives.--If the Senate fails to introduce or consider 
        a joint resolution under this section, the joint resolution of 
        the House of Representatives shall be entitled to expedited 
        floor procedures under this subsection.
            (C) Treatment of companion measures.--If, following passage 
        of the joint resolution in the Senate, the Senate then receives 
        the companion measure from the House of Representatives, the 
        companion measure shall not be debatable.
            (D) Rules of the senate.--This subsection is enacted by 
        Congress--
                (i) as an exercise of the rulemaking power of the 
            Senate, and as such it is deemed a part of the rules of the 
            Senate, but applicable only with respect to the procedure 
            to be followed in the Senate in the case of a joint 
            resolution, and it supersedes other rules, only to the 
            extent that it is inconsistent with such rules; and
                (ii) with full recognition of the constitutional right 
            of the Senate to change the rules (so far as relating to 
            the procedure of the Senate) at any time, in the same 
            manner, and to the same extent as in the case of any other 
            rule of the Senate.
        (4) Definition.--As used in this subsection, the term ``joint 
    resolution'' means only a joint resolution--
            (A) that is introduced not later than 3 calendar days after 
        the date on which the request referred to in subsection (c) is 
        received by Congress;
            (B) that does not have a preamble;
            (C) the title of which is as follows: ``Joint resolution 
        relating to the approval of a plan to guarantee obligations 
        under section 1105 of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act''; and
            (D) the matter after the resolving clause of which is as 
        follows: ``That Congress approves the obligation of any amount 
        described in section 1105(c) of the Dodd-Frank Wall Street 
        Reform and Consumer Protection Act.''.
    (e) Funding.--
        (1) Fees and other charges.--The Corporation shall charge fees 
    and other assessments to all participants in the program 
    established pursuant to this section, in such amounts as are 
    necessary to offset projected losses and administrative expenses, 
    including amounts borrowed pursuant to paragraph (3), and such 
    amounts shall be available to the Corporation.
        (2) Excess funds.--If, at the conclusion of the program 
    established under this section, there are any excess funds 
    collected from the fees associated with such program, the funds 
    shall be deposited in the General Fund of the Treasury.
        (3) Authority of corporation.--The Corporation--
            (A) may borrow funds from the Secretary of the Treasury and 
        issue obligations of the Corporation to the Secretary for 
        amounts borrowed, and the amounts borrowed shall be available 
        to the Corporation for purposes of carrying out a program 
        established pursuant to this section, including the payment of 
        reasonable costs of administering the program, and the 
        obligations issued shall be repaid in full with interest 
        through fees and charges paid by participants in accordance 
        with paragraphs (1) and (4), as applicable; and
            (B) may not borrow funds from the Deposit Insurance Fund 
        established pursuant to section 11(a)(4) of the Federal Deposit 
        Insurance Act.
        (4) Backup special assessments.--To the extent that the funds 
    collected pursuant to paragraph (1) are insufficient to cover any 
    losses or expenses, including amounts borrowed pursuant to 
    paragraph (3), arising from a program established pursuant to this 
    section, the Corporation shall impose a special assessment solely 
    on participants in the program, in amounts necessary to address 
    such insufficiency, and which shall be available to the Corporation 
    to cover such losses or expenses.
        (5) Authority of the secretary.--The Secretary may purchase any 
    obligations issued under paragraph (3)(A). For such purpose, the 
    Secretary may use the proceeds of the sale of any securities issued 
    under chapter 31 of title 31, United States Code, and the purposes 
    for which securities may be issued under that chapter 31 are 
    extended to include such purchases, and the amount of any 
    securities issued under that chapter 31 for such purpose shall be 
    treated in the same manner as securities issued under section 
    208(n)(5)(E).
    (f) Rule of Construction.--For purposes of this section, a 
guarantee of deposits held by insured depository institutions shall not 
be treated as a debt guarantee program.
    (g) Definitions.--For purposes of this section, the following 
definitions shall apply:
        (1) Company.--The term ``company'' means any entity other than 
    a natural person that is incorporated or organized under Federal 
    law or the laws of any State.
        (2) Depository institution holding company.--The term 
    ``depository institution holding company'' has the same meaning as 
    in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).
        (3) Liquidity event.--The term ``liquidity event'' means--
            (A) an exceptional and broad reduction in the general 
        ability of financial market participants--
                (i) to sell financial assets without an unusual and 
            significant discount; or
                (ii) to borrow using financial assets as collateral 
            without an unusual and significant increase in margin; or
            (B) an unusual and significant reduction in the ability of 
        financial market participants to obtain unsecured credit.
        (4) Solvent.--The term ``solvent'' means that the value of the 
    assets of an entity exceed its obligations to creditors.
SEC. 1106. ADDITIONAL RELATED AMENDMENTS.
    (a) Suspension of Parallel Federal Deposit Insurance Act 
Authority.--Effective upon the date of enactment of this section, the 
Corporation may not exercise its authority under section 13(c)(4)(G)(i) 
of the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(G)(i)) to 
establish any widely available debt guarantee program for which section 
1105 would provide authority.
    (b) Federal Deposit Insurance Act.--Section 13(c)(4)(G) of the 
Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(G)) is amended--
        (1) in clause (i)--
            (A) in subclause (I), by inserting ``for which the 
        Corporation has been appointed receiver'' before ``would have 
        serious''; and
            (B) in the undesignated matter following subclause (II), by 
        inserting ``for the purpose of winding up the insured 
        depository institution for which the Corporation has been 
        appointed receiver'' after ``provide assistance under this 
        section''; and
        (2) in clause (v)(I), by striking ``The'' and inserting ``Not 
    later than 3 days after making a determination under clause (i), 
    the''.
    (c) Effect of Default on an FDIC Guarantee.--If an insured 
depository institution or depository institution holding company (as 
those terms are defined in section 3 of the Federal Deposit Insurance 
Act) participating in a program under section 1105, or any participant 
in a debt guarantee program established pursuant to section 
13(c)(4)(G)(i) of the Federal Deposit Insurance Act defaults on any 
obligation guaranteed by the Corporation after the date of enactment of 
this Act, the Corporation shall--
        (1) appoint itself as receiver for the insured depository 
    institution that defaults; and
        (2) with respect to any other participating company that is not 
    an insured depository institution that defaults--
            (A) require--
                (i) consideration of whether a determination shall be 
            made, as provided in section 203 to resolve the company 
            under section 202; and
                (ii) the company to file a petition for bankruptcy 
            under section 301 of title 11, United States Code, if the 
            Corporation is not appointed receiver pursuant to section 
            202 within 30 days of the date of default; or
            (B) file a petition for involuntary bankruptcy on behalf of 
        the company under section 303 of title 11, United States Code.
SEC. 1107. FEDERAL RESERVE ACT AMENDMENTS ON FEDERAL RESERVE BANK 
GOVERNANCE.
    The 5th subparagraph of the 4th undesignated paragraph of section 4 
of the Federal Reserve Act (12 U.S.C. 341) is amended by striking the 
2nd sentence and inserting the following: ``The president shall be the 
chief executive officer of the bank and shall be appointed by the Class 
B and Class C directors of the bank, with the approval of the Board of 
Governors of the Federal Reserve System, for a term of 5 years; and all 
other executive officers and all employees of the bank shall be 
directly responsible to the president.''.
SEC. 1108. FEDERAL RESERVE ACT AMENDMENTS ON SUPERVISION AND REGULATION 
POLICY.
    (a) Establishment of the Position of Vice Chairman for 
Supervision.--
        (1) Position established.--The second undesignated paragraph of 
    section 10 of the Federal Reserve Act (12 U.S.C. 242) (relating to 
    the Chairman and Vice Chairman of the Board) is amended by striking 
    the third sentence and inserting the following: ``Of the persons 
    thus appointed, 1 shall be designated by the President, by and with 
    the advice and consent of the Senate, to serve as Chairman of the 
    Board for a term of 4 years, and 2 shall be designated by the 
    President, by and with the advice and consent of the Senate, to 
    serve as Vice Chairmen of the Board, each for a term of 4 years, 1 
    of whom shall serve in the absence of the Chairman, as provided in 
    the fourth undesignated paragraph of this section, and 1 of whom 
    shall be designated Vice Chairman for Supervision. The Vice 
    Chairman for Supervision shall develop policy recommendations for 
    the Board regarding supervision and regulation of depository 
    institution holding companies and other financial firms supervised 
    by the Board, and shall oversee the supervision and regulation of 
    such firms.''.
        (2) Effective date.--The amendment made by subsection (a) takes 
    effect on the date of enactment of this title and applies to 
    individuals who are designated by the President on or after that 
    date to serve as Vice Chairman of Supervision.
    (b) Appearances Before Congress.--Section 10 of the Federal Reserve 
Act (12 U.S.C. 241 et seq.) is amended by adding at the end the 
following:
        ``(12) Appearances before congress.--The Vice Chairman for 
    Supervision shall appear before the Committee on Banking, Housing, 
    and Urban Affairs of the Senate and the Committee on Financial 
    Services of the House of Representatives and at semi-annual 
    hearings regarding the efforts, activities, objectives, and plans 
    of the Board with respect to the conduct of supervision and 
    regulation of depository institution holding companies and other 
    financial firms supervised by the Board.''.
    (c) Board Responsibility To Set Supervision and Regulatory 
Policy.--Section 11 of the Federal Reserve Act (12 U.S.C. 248) 
(relating to enumerated powers of the Board) is amended by adding at 
the end of subsection (k) (relating to delegation) the following: ``The 
Board of Governors may not delegate to a Federal reserve bank its 
functions for the establishment of policies for the supervision and 
regulation of depository institution holding companies and other 
financial firms supervised by the Board of Governors.''.
    (d) Exercise of Federal Reserve Authority.--
        (1) No decisions by federal reserve bank presidents.--No 
    provision of title I relating to the authority of the Board of 
    Governors shall be construed as conferring any decision-making 
    authority on presidents of Federal reserve banks.
        (2) Voting decisions by board.--The Board of Governors shall 
    not delegate the authority to make any voting decision that the 
    Board of Governors is authorized or required to make under title I 
    of this Act in contravention of section 11(k) of the Federal 
    Reserve Act.
SEC. 1109. GAO AUDIT OF THE FEDERAL RESERVE FACILITIES; PUBLICATION OF 
BOARD ACTIONS.
    (a) GAO Audit.--
        (1) In general.--Notwithstanding section 714(b) of title 31, 
    United States Code, or any other provision of law, the Comptroller 
    General of the United States (in this subsection referred to as the 
    ``Comptroller General'') shall conduct a one-time audit of all 
    loans and other financial assistance provided during the period 
    beginning on December 1, 2007 and ending on the date of enactment 
    of this Act by the Board of Governors or a Federal reserve bank 
    under the Asset-Backed Commercial Paper Money Market Mutual Fund 
    Liquidity Facility, the Term Asset-Backed Securities Loan Facility, 
    the Primary Dealer Credit Facility, the Commercial Paper Funding 
    Facility, the Term Securities Lending Facility, the Term Auction 
    Facility, Maiden Lane, Maiden Lane II, Maiden Lane III, the agency 
    Mortgage-Backed Securities program, foreign currency liquidity swap 
    lines, and any other program created as a result of section 13(3) 
    of the Federal Reserve Act (as so designated by this title).
        (2) Assessments.--In conducting the audit under paragraph (1), 
    the Comptroller General shall assess--
            (A) the operational integrity, accounting, financial 
        reporting, and internal controls of the credit facility;
            (B) the effectiveness of the security and collateral 
        policies established for the facility in mitigating risk to the 
        relevant Federal reserve bank and taxpayers;
            (C) whether the credit facility inappropriately favors one 
        or more specific participants over other institutions eligible 
        to utilize the facility;
            (D) the policies governing the use, selection, or payment 
        of third-party contractors by or for any credit facility; and
            (E) whether there were conflicts of interest with respect 
        to the manner in which such facility was established or 
        operated.
        (3) Timing.--The audit required by this subsection shall be 
    commenced not later than 30 days after the date of enactment of 
    this Act, and shall be completed not later than 12 months after 
    that date of enactment.
        (4) Report required.--The Comptroller General shall submit a 
    report on the audit conducted under paragraph (1) to the Congress 
    not later than 12 months after the date of enactment of this Act, 
    and such report shall be made available to--
            (A) the Speaker of the House of Representatives;
            (B) the majority and minority leaders of the House of 
        Representatives;
            (C) the majority and minority leaders of the Senate;
            (D) the Chairman and Ranking Member of the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and of the 
        Committee on Financial Services of the House of 
        Representatives; and
            (E) any member of Congress who requests it.
    (b) Audit of Federal Reserve Bank Governance.--
        (1) Audit.--
            (A) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Comptroller General shall complete 
        an audit of the governance of the Federal reserve bank system.
            (B) Required examinations.--The audit required under 
        subparagraph (A) shall--
                (i) examine the extent to which the current system of 
            appointing Federal reserve bank directors effectively 
            represents ``the public, without discrimination on the 
            basis of race, creed, color, sex or national origin, and 
            with due but not exclusive consideration to the interests 
            of agriculture, commerce, industry, services, labor, and 
            consumers'' in the selection of bank directors, as such 
            requirement is set forth under section 4 of the Federal 
            Reserve Act;
                (ii) examine whether there are actual or potential 
            conflicts of interest created when the directors of Federal 
            reserve banks, which execute the supervisory functions of 
            the Board of Governors of the Federal Reserve System, are 
            elected by member banks;
                (iii) examine the establishment and operations of each 
            facility described in subsection (a)(1) and each Federal 
            reserve bank involved in the establishment and operations 
            thereof; and
                (iv) identify changes to selection procedures for 
            Federal reserve bank directors, or to other aspects of 
            Federal reserve bank governance, that would--

                    (I) improve how the public is represented;
                    (II) eliminate actual or potential conflicts of 
                interest in bank supervision;
                    (III) increase the availability of information 
                useful for the formation and execution of monetary 
                policy; or
                    (IV) in other ways increase the effectiveness or 
                efficiency of reserve banks.

        (2) Report required.--A report on the audit conducted under 
    paragraph (1) shall be submitted by the Comptroller General to the 
    Congress before the end of the 90-day period beginning on the date 
    on which such audit is completed, and such report shall be made 
    available to--
            (A) the Speaker of the House of Representatives;
            (B) the majority and minority leaders of the House of 
        Representatives;
            (C) the majority and minority leaders of the Senate;
            (D) the Chairman and Ranking Member of the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and of the 
        Committee on Financial Services of the House of 
        Representatives; and
            (E) any member of Congress who requests it.
    (c) Publication of Board Actions.--Notwithstanding any other 
provision of law, the Board of Governors shall publish on its website, 
not later than December 1, 2010, with respect to all loans and other 
financial assistance provided during the period beginning on December 
1, 2007 and ending on the date of enactment of this Act under the 
Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity 
Facility, the Term Asset-Backed Securities Loan Facility, the Primary 
Dealer Credit Facility, the Commercial Paper Funding Facility, the Term 
Securities Lending Facility, the Term Auction Facility, Maiden Lane, 
Maiden Lane II, Maiden Lane III, the agency Mortgage-Backed Securities 
program, foreign currency liquidity swap lines, and any other program 
created as a result of section 13(3) of the Federal Reserve Act (as so 
designated by this title)--
        (1) the identity of each business, individual, entity, or 
    foreign central bank to which the Board of Governors or a Federal 
    reserve bank has provided such assistance;
        (2) the type of financial assistance provided to that business, 
    individual, entity, or foreign central bank;
        (3) the value or amount of that financial assistance;
        (4) the date on which the financial assistance was provided;
        (5) the specific terms of any repayment expected, including the 
    repayment time period, interest charges, collateral, limitations on 
    executive compensation or dividends, and other material terms; and
        (6) the specific rationale for each such facility or program.

    TITLE XII--IMPROVING ACCESS TO MAINSTREAM FINANCIAL INSTITUTIONS

SEC. 1201. SHORT TITLE.
    This title may be cited as the ``Improving Access to Mainstream 
Financial Institutions Act of 2010''.
SEC. 1202. PURPOSE.
    The purpose of this title is to encourage initiatives for financial 
products and services that are appropriate and accessible for millions 
of Americans who are not fully incorporated into the financial 
mainstream.
SEC. 1203. DEFINITIONS.
    In this title, the following definitions shall apply:
        (1) Account.--The term ``account'' means an agreement between 
    an individual and an eligible entity under which the individual 
    obtains from or through the entity 1 or more banking products and 
    services, and includes a deposit account, a savings account 
    (including a money market savings account), an account for a 
    closed-end loan, and other products or services, as the Secretary 
    deems appropriate.
        (2) Community development financial institution.--The term 
    ``community development financial institution'' has the same 
    meaning as in section 103(5) of the Community Development Banking 
    and Financial Institutions Act of 1994 (12 U.S.C. 4702(5)).
        (3) Eligible entity.--The term ``eligible entity'' means--
            (A) an organization described in section 501(c)(3) of the 
        Internal Revenue Code of 1986, and exempt from tax under 
        section 501(a) of such Code;
            (B) a federally insured depository institution;
            (C) a community development financial institution;
            (D) a State, local, or tribal government entity; or
            (E) a partnership or other joint venture comprised of 1 or 
        more of the entities described in subparagraphs (A) through 
        (D), in accordance with regulations prescribed by the Secretary 
        under this title.
        (4) Federally insured depository institution.--The term 
    ``federally insured depository institution'' means any insured 
    depository institution (as that term is defined in section 3 of the 
    Federal Deposit Insurance Act (12 U.S.C. 1813)) and any insured 
    credit union (as that term is defined in section 101 of the Federal 
    Credit Union Act (12 U.S.C. 1752)).
SEC. 1204. EXPANDED ACCESS TO MAINSTREAM FINANCIAL INSTITUTIONS.
    (a) In General.--The Secretary is authorized to establish a 
multiyear program of grants, cooperative agreements, financial agency 
agreements, and similar contracts or undertakings to promote 
initiatives designed--
        (1) to enable low- and moderate-income individuals to establish 
    one or more accounts in a federally insured depository institution 
    that are appropriate to meet the financial needs of such 
    individuals; and
        (2) to improve access to the provision of accounts, on 
    reasonable terms, for low- and moderate-income individuals.
    (b) Program Eligibility and Activities.--
        (1) In general.--The Secretary shall restrict participation in 
    any program established under subsection (a) to an eligible entity. 
    Subject to regulations prescribed by the Secretary under this 
    title, 1 or more eligible entities may participate in 1 or several 
    programs established under subsection (a).
        (2) Account activities.--Subject to regulations prescribed by 
    the Secretary, an eligible entity may, in participating in a 
    program established under subsection (a), offer or provide to low- 
    and moderate-income individuals products and services relating to 
    accounts, including--
            (A) small-dollar value loans; and
            (B) financial education and counseling relating to 
        conducting transactions in and managing accounts.
SEC. 1205. LOW-COST ALTERNATIVES TO SMALL DOLLAR LOANS.
    (a) Grants Authorized.--The Secretary is authorized to establish 
multiyear demonstration programs by means of grants, cooperative 
agreements, financial agency agreements, and similar contracts or 
undertakings, with eligible entities to provide low-cost, small loans 
to consumers that will provide alternatives to more costly small dollar 
loans.
    (b) Terms and Conditions.--
        (1) In general.--Loans under this section shall be made on 
    terms and conditions, and pursuant to lending practices, that are 
    reasonable for consumers.
        (2) Financial literacy and education opportunities.--
            (A) In general.--Each eligible entity awarded a grant under 
        this section shall promote and take appropriate steps to ensure 
        the provision of financial literacy and education 
        opportunities, such as relevant counseling services, 
        educational courses, or wealth building programs, to each 
        consumer provided with a loan pursuant to this section.
            (B) Authority to expand access.--As part of the grants, 
        agreements, and undertakings established under this section, 
        the Secretary may implement reasonable measures or programs 
        designed to expand access to financial literacy and education 
        opportunities, including relevant counseling services, 
        educational courses, or wealth building programs to be provided 
        to individuals who obtain loans from eligible entities under 
        this section.
SEC. 1206. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS.
    The Community Development Banking and Financial Institutions Act of 
1994 (12 U.S.C. 4701 et seq.) is amended by adding at the end the 
following:
    ``SEC. 122. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS.
    ``(a) Purposes.--The purposes of this section are--
        ``(1) to make financial assistance available from the Fund in 
    order to help community development financial institutions defray 
    the costs of operating small dollar loan programs, by providing the 
    amounts necessary for such institutions to establish their own loan 
    loss reserve funds to mitigate some of the losses on such small 
    dollar loan programs; and
        ``(2) to encourage community development financial institutions 
    to establish and maintain small dollar loan programs that would 
    help give consumers access to mainstream financial institutions and 
    combat high cost small dollar lending.
    ``(b) Grants.--
        ``(1) Loan-loss reserve fund grants.--The Fund shall make 
    grants to community development financial institutions or to any 
    partnership between such community development financial 
    institutions and any other federally insured depository institution 
    with a primary mission to serve targeted investment areas, as such 
    areas are defined under section 103(16), to enable such 
    institutions or any partnership of such institutions to establish a 
    loan-loss reserve fund in order to defray the costs of a small 
    dollar loan program established or maintained by such institution.
        ``(2) Matching requirement.--A community development financial 
    institution or any partnership of institutions established pursuant 
    to paragraph (1) shall provide non-Federal matching funds in an 
    amount equal to 50 percent of the amount of any grant received 
    under this section.
        ``(3) Use of funds.--Any grant amounts received by a community 
    development financial institution or any partnership between or 
    among such institutions under paragraph (1)--
            ``(A) may not be used by such institution to provide direct 
        loans to consumers;
            ``(B) may be used by such institution to help recapture a 
        portion or all of a defaulted loan made under the small dollar 
        loan program of such institution; and
            ``(C) may be used to designate and utilize a fiscal agent 
        for services normally provided by such an agent.
        ``(4) Technical assistance grants.--The Fund shall make 
    technical assistance grants to community development financial 
    institutions or any partnership between or among such institutions 
    to support and maintain a small dollar loan program. Any grant 
    amounts received under this paragraph may be used for technology, 
    staff support, and other costs associated with establishing a small 
    dollar loan program.
    ``(c) Definitions.--For purposes of this section--
        ``(1) the term `consumer reporting agency that compiles and 
    maintains files on consumers on a nationwide basis' has the same 
    meaning given such term in section 603(p) of the Fair Credit 
    Reporting Act (15 U.S.C. 1681a(p)); and
        ``(2) the term `small dollar loan program' means a loan program 
    wherein a community development financial institution or any 
    partnership between or among such institutions offers loans to 
    consumers that--
            ``(A) are made in amounts not exceeding $2,500;
            ``(B) must be repaid in installments;
            ``(C) have no pre-payment penalty;
            ``(D) the institution has to report payments regarding the 
        loan to at least 1 of the consumer reporting agencies that 
        compiles and maintains files on consumers on a nationwide 
        basis; and
            ``(E) meet any other affordability requirements as may be 
        established by the Administrator.''.
SEC. 1207. PROCEDURAL PROVISIONS.
    An eligible entity desiring to participate in a program or obtain a 
grant under this title shall submit an application to the Secretary, in 
such form and containing such information as the Secretary may require.
SEC. 1208. AUTHORIZATION OF APPROPRIATIONS.
    (a) Authorization to the Secretary.--There are authorized to be 
appropriated to the Secretary, such sums as are necessary to both 
administer and fund the programs and projects authorized by this title, 
to remain available until expended.
    (b) Authorization to the Fund.--There is authorized to be 
appropriated to the Fund for each fiscal year beginning in fiscal year 
2010, an amount equal to the amount of the administrative costs of the 
Fund for the operation of the grant program established under this 
title.
SEC. 1209. REGULATIONS.
    (a) In General.--The Secretary is authorized to promulgate 
regulations to implement and administer the grant programs and 
undertakings authorized by this title.
    (b) Regulatory Authority.--Regulations prescribed under this 
section may contain such classifications, differentiations, or other 
provisions, and may provide for such adjustments and exceptions for any 
class of grant programs, undertakings, or eligible entities, as, in the 
judgment of the Secretary, are necessary or proper to effectuate the 
purposes of this title, to prevent circumvention or evasion of this 
title, or to facilitate compliance with this title.
SEC. 1210. EVALUATION AND REPORTS TO CONGRESS.
    For each fiscal year in which a program or project is carried out 
under this title, the Secretary shall submit a report to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives containing a 
description of the activities funded, amounts distributed, and 
measurable results, as appropriate and available.

                      TITLE XIII--PAY IT BACK ACT

SEC. 1301. SHORT TITLE.
    This title may be cited as the ``Pay It Back Act''.
SEC. 1302. AMENDMENT TO REDUCE TARP AUTHORIZATION.
    Section 115(a) of the Emergency Economic Stabilization Act of 2008 
(12 U.S.C. 5225(a)) is amended--
        (1) in paragraph (3)--
            (A) by striking ``, $700,000,000,000, as such amount is 
        reduced by $1,259,000,000, as such amount is reduced by 
        $1,244,000,000'' and inserting ``$475,000,000,000''; and
            (B) by striking ``outstanding at any one time''; and
        (2) by adding at the end the following:
        ``(4) For purposes of this subsection, the amount of authority 
    considered to be exercised by the Secretary shall not be reduced 
    by--
            ``(A) any amounts received by the Secretary before, on, or 
        after the date of enactment of the Pay It Back Act from 
        repayment of the principal of financial assistance by an entity 
        that has received financial assistance under the TARP or any 
        other program enacted by the Secretary under the authorities 
        granted to the Secretary under this Act;
            ``(B) any amounts committed for any guarantees pursuant to 
        the TARP that became or become uncommitted; or
            ``(C) any losses realized by the Secretary.
        ``(5) No authority under this Act may be used to incur any 
    obligation for a program or initiative that was not initiated prior 
    to June 25, 2010.''.
SEC. 1303. REPORT.
    Section 106 of the Emergency Economic Stabilization Act of 2008 (12 
U.S.C. 5216) is amended by inserting at the end the following:
    ``(f) Report.--The Secretary of the Treasury shall report to 
Congress every 6 months on amounts received and transferred to the 
general fund under subsection (d).''.
SEC. 1304. AMENDMENTS TO HOUSING AND ECONOMIC RECOVERY ACT OF 2008.
    (a) Sale of Fannie Mae Obligations and Securities by the Treasury; 
Deficit Reduction.--Section 304(g)(2) of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1719(g)(2)) is amended--
        (1) by redesignating subparagraph (C) as subparagraph (D); and
        (2) by inserting after subparagraph (B) the following:
            ``(C) Deficit reduction.--The Secretary of the Treasury 
        shall deposit in the General Fund of the Treasury any amounts 
        received by the Secretary from the sale of any obligation 
        acquired by the Secretary under this subsection, where such 
        amounts shall be--
                ``(i) dedicated for the sole purpose of deficit 
            reduction; and
                ``(ii) prohibited from use as an offset for other 
            spending increases or revenue reductions.''.
    (b) Sale of Freddie Mac Obligations and Securities by the Treasury; 
Deficit Reduction.--Section 306(l)(2) of the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1455(l)(2)) is amended--
        (1) by redesignating subparagraph (C) as subparagraph (D); and
        (2) by inserting after subparagraph (B) the following:
            ``(C) Deficit reduction.--The Secretary of the Treasury 
        shall deposit in the General Fund of the Treasury any amounts 
        received by the Secretary from the sale of any obligation 
        acquired by the Secretary under this subsection, where such 
        amounts shall be--
                ``(i) dedicated for the sole purpose of deficit 
            reduction; and
                ``(ii) prohibited from use as an offset for other 
            spending increases or revenue reductions.''.
    (c) Sale of Federal Home Loan Banks Obligations by the Treasury; 
Deficit Reduction.--Section 11(l)(2) of the Federal Home Loan Bank Act 
(12 U.S.C. 1431(l)(2)) is amended--
        (1) by redesignating subparagraph (C) as subparagraph (D); and
        (2) by inserting after subparagraph (B) the following:
            ``(C) Deficit reduction.--The Secretary of the Treasury 
        shall deposit in the General Fund of the Treasury any amounts 
        received by the Secretary from the sale of any obligation 
        acquired by the Secretary under this subsection, where such 
        amounts shall be--
                ``(i) dedicated for the sole purpose of deficit 
            reduction; and
                ``(ii) prohibited from use as an offset for other 
            spending increases or revenue reductions.''.
    (d) Repayment of Fees.--Any periodic commitment fee or any other 
fee or assessment paid by the Federal National Mortgage Association or 
Federal Home Loan Mortgage Corporation to the Secretary of the Treasury 
as a result of any preferred stock purchase agreement, mortgage-backed 
security purchase program, or any other program or activity authorized 
or carried out pursuant to the authorities granted to the Secretary of 
the Treasury under section 1117 of the Housing and Economic Recovery 
Act of 2008 (Public Law 110-289; 122 Stat. 2683), including any fee 
agreed to by contract between the Secretary and the Association or 
Corporation, shall be deposited in the General Fund of the Treasury 
where such amounts shall be--
        (1) dedicated for the sole purpose of deficit reduction; and
        (2) prohibited from use as an offset for other spending 
    increases or revenue reductions.
SEC. 1305. FEDERAL HOUSING FINANCE AGENCY REPORT.
    The Director of the Federal Housing Finance Agency shall submit to 
Congress a report on the plans of the Agency to continue to support and 
maintain the Nation's vital housing industry, while at the same time 
guaranteeing that the American taxpayer will not suffer unnecessary 
losses.
SEC. 1306. REPAYMENT OF UNOBLIGATED ARRA FUNDS.
    (a) Rejection of ARRA Funds by State.--Section 1607 of the American 
Recovery and Reinvestment Act of 2009 (Public Law 111-5; 123 Stat. 305) 
is amended by adding at the end the following:
    ``(d) Statewide Rejection of Funds.--If funds provided to any State 
in any division of this Act are not accepted for use by the Governor of 
the State pursuant to subsection (a) or by the State legislature 
pursuant to subsection (b), then all such funds shall be--
        ``(1) rescinded; and
        ``(2) deposited in the General Fund of the Treasury where such 
    amounts shall be--
            ``(A) dedicated for the sole purpose of deficit reduction; 
        and
            ``(B) prohibited from use as an offset for other spending 
        increases or revenue reductions.''.
    (b) Withdrawal or Recapture of Unobligated Funds.--Title XVI of the 
American Recovery and Reinvestment Act of 2009 (Public Law 111-5; 123 
Stat. 302) is amended by adding at the end the following:
``SEC. 1613. WITHDRAWAL OR RECAPTURE OF UNOBLIGATED FUNDS.
    ``Notwithstanding any other provision of this Act, if the head of 
any executive agency withdraws or recaptures for any reason funds 
appropriated or otherwise made available under this division, and such 
funds have not been obligated by a State to a local government or for a 
specific project, such recaptured funds shall be--
        ``(1) rescinded; and
        ``(2) deposited in the General Fund of the Treasury where such 
    amounts shall be--
            ``(A) dedicated for the sole purpose of deficit reduction; 
        and
            ``(B) prohibited from use as an offset for other spending 
        increases or revenue reductions.''.
    (c) Return of Unobligated Funds by End of 2012.--Section 1603 of 
the American Recovery and Reinvestment Act of 2009 (Public Law 111-5; 
123 Stat. 302) is amended by--
        (1) striking ``All funds'' and inserting ``(a) In General.--All 
    funds''; and
        (2) adding at the end the following:
    ``(b) Repayment of Unobligated Funds.--Any discretionary 
appropriations made available in this division that have not been 
obligated as of December 31, 2012, are hereby rescinded, and such 
amounts shall be deposited in the General Fund of the Treasury where 
such amounts shall be--
        ``(1) dedicated for the sole purpose of deficit reduction; and
        ``(2) prohibited from use as an offset for other spending 
    increases or revenue reductions.
    ``(c) Presidential Waiver Authority.--
        ``(1) In general.--The President may waive the requirements 
    under subsection (b), if the President determines that it is not in 
    the best interest of the Nation to rescind a specific unobligated 
    amount after December 31, 2012.
        ``(2) Requests.--The head of an executive agency may also apply 
    to the President for a waiver from the requirements under 
    subsection (b).''.

       TITLE XIV--MORTGAGE REFORM AND ANTI-PREDATORY LENDING ACT

SEC. 1400. SHORT TITLE; DESIGNATION AS ENUMERATED CONSUMER LAW.
    (a) Short Title.--This title may be cited as the ``Mortgage Reform 
and Anti-Predatory Lending Act''.
    (b) Designation as Enumerated Consumer Law Under the Purview of the 
Bureau of Consumer Financial Protection.--Subtitles A, B, C, and E and 
sections 1471, 1472, 1475, and 1476, and the amendments made by such 
subtitles and sections, shall be enumerated consumer laws, as defined 
in section 1002, and come under the purview of the Bureau of Consumer 
Financial Protection for purposes of title X, including the transfer of 
functions and personnel under subtitle F of title X and the savings 
provisions of such subtitle.
    (c) Regulations; Effective Date.--
        (1) Regulations.--The regulations required to be prescribed 
    under this title or the amendments made by this title shall--
            (A) be prescribed in final form before the end of the 18-
        month period beginning on the designated transfer date; and
            (B) take effect not later than 12 months after the date of 
        issuance of the regulations in final form.
        (2) Effective date established by rule.--Except as provided in 
    paragraph (3), a section, or provision thereof, of this title shall 
    take effect on the date on which the final regulations implementing 
    such section, or provision, take effect.
        (3) Effective date.--A section of this title for which 
    regulations have not been issued on the date that is 18 months 
    after the designated transfer date shall take effect on such date.

      Subtitle A--Residential Mortgage Loan Origination Standards

SEC. 1401. DEFINITIONS.
    Section 103 of the Truth in Lending Act (15 U.S.C. 1602) is amended 
by adding at the end the following new subsection:
    ``(cc) Definitions Relating to Mortgage Origination and Residential 
Mortgage Loans.--
        ``(1) Commission.--Unless otherwise specified, the term 
    `Commission' means the Federal Trade Commission.
        ``(2) Mortgage originator.--The term `mortgage originator'--
            ``(A) means any person who, for direct or indirect 
        compensation or gain, or in the expectation of direct or 
        indirect compensation or gain--
                ``(i) takes a residential mortgage loan application;
                ``(ii) assists a consumer in obtaining or applying to 
            obtain a residential mortgage loan; or
                ``(iii) offers or negotiates terms of a residential 
            mortgage loan;
            ``(B) includes any person who represents to the public, 
        through advertising or other means of communicating or 
        providing information (including the use of business cards, 
        stationery, brochures, signs, rate lists, or other promotional 
        items), that such person can or will provide any of the 
        services or perform any of the activities described in 
        subparagraph (A);
            ``(C) does not include any person who is (i) not otherwise 
        described in subparagraph (A) or (B) and who performs purely 
        administrative or clerical tasks on behalf of a person who is 
        described in any such subparagraph, or (ii) 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);
            ``(D) does not include a person or entity that only 
        performs real estate brokerage activities and is licensed or 
        registered in accordance with applicable State law, unless such 
        person or entity is compensated by a lender, a mortgage broker, 
        or other mortgage originator or by any agent of such lender, 
        mortgage broker, or other mortgage originator;
            ``(E) does not include, with respect to a residential 
        mortgage loan, a person, estate, or trust that provides 
        mortgage financing for the sale of 3 properties in any 12-month 
        period to purchasers of such properties, each of which is owned 
        by such person, estate, or trust and serves as security for the 
        loan, provided that such loan--
                ``(i) is not made by a person, estate, or trust that 
            has constructed, or acted as a contractor for the 
            construction of, a residence on the property in the 
            ordinary course of business of such person, estate, or 
            trust;
                ``(ii) is fully amortizing;
                ``(iii) is with respect to a sale for which the seller 
            determines in good faith and documents that the buyer has a 
            reasonable ability to repay the loan;
                ``(iv) has a fixed rate or an adjustable rate that is 
            adjustable after 5 or more years, subject to reasonable 
            annual and lifetime limitations on interest rate increases; 
            and
                ``(v) meets any other criteria the Board may prescribe;
            ``(F) does not include the creditor (except the creditor in 
        a table-funded transaction) under paragraph (1), (2), or (4) of 
        section 129B(c); and
            ``(G) does not include a servicer or servicer employees, 
        agents and contractors, including but not limited to those who 
        offer or negotiate terms of a residential mortgage loan for 
        purposes of renegotiating, modifying, replacing and 
        subordinating principal of existing mortgages where borrowers 
        are behind in their payments, in default or have a reasonable 
        likelihood of being in default or falling behind.
        ``(3) Nationwide mortgage licensing system and registry.--The 
    term `Nationwide Mortgage Licensing System and Registry' has the 
    same meaning as in the Secure and Fair Enforcement for Mortgage 
    Licensing Act of 2008.
        ``(4) Other definitions relating to mortgage originator.--For 
    purposes of this subsection, a person `assists a consumer in 
    obtaining or applying to obtain a residential mortgage loan' by, 
    among other things, advising on residential mortgage loan terms 
    (including rates, fees, and other costs), preparing residential 
    mortgage loan packages, or collecting information on behalf of the 
    consumer with regard to a residential mortgage loan.
        ``(5) Residential mortgage loan.--The term `residential 
    mortgage loan' means any consumer credit transaction that is 
    secured by a mortgage, deed of trust, or other equivalent 
    consensual security interest on a dwelling or on residential real 
    property that includes a dwelling, other than a consumer credit 
    transaction under an open end credit plan or, for purposes of 
    sections 129B and 129C and section 128(a) (16), (17), (18), and 
    (19), and sections 128(f) and 130(k), and any regulations 
    promulgated thereunder, an extension of credit relating to a plan 
    described in section 101(53D) of title 11, United States Code.
        ``(6) Secretary.--The term `Secretary', when used in connection 
    with any transaction or person involved with a residential mortgage 
    loan, means the Secretary of Housing and Urban Development.
        ``(7) Servicer.--The term `servicer' has the same meaning as in 
    section 6(i)(2) of the Real Estate Settlement Procedures Act of 
    1974 (12 U.S.C. 2605(i)(2)).''.
SEC. 1402. RESIDENTIAL MORTGAGE LOAN ORIGINATION.
    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended--
        (1) by redesignating the 2nd of the 2 sections designated as 
    section 129 (15 U.S.C. 1639a) (relating to duty of servicers of 
    residential mortgages) as section 129A; and
        (2) by inserting after section 129A (as so redesignated) the 
    following new section:
``Sec. 129B. Residential mortgage loan origination
    ``(a) Finding and Purpose.--
        ``(1) Finding.--The Congress finds that economic stabilization 
    would be enhanced by the protection, limitation, and regulation of 
    the terms of residential mortgage credit and the practices related 
    to such credit, while ensuring that responsible, affordable 
    mortgage credit remains available to consumers.
        ``(2) Purpose.--It is the purpose of this section and section 
    129C to assure that consumers are offered and receive residential 
    mortgage loans on terms that reasonably reflect their ability to 
    repay the loans and that are understandable and not unfair, 
    deceptive or abusive.
    ``(b) Duty of Care.--
        ``(1) Standard.--Subject to regulations prescribed under this 
    subsection, each mortgage originator shall, in addition to the 
    duties imposed by otherwise applicable provisions of State or 
    Federal law--
            ``(A) be qualified and, when required, registered and 
        licensed as a mortgage originator in accordance with applicable 
        State or Federal law, including the Secure and Fair Enforcement 
        for Mortgage Licensing Act of 2008; and
            ``(B) include on all loan documents any unique identifier 
        of the mortgage originator provided by the Nationwide Mortgage 
        Licensing System and Registry.
        ``(2) Compliance procedures required.--The Board shall 
    prescribe regulations requiring depository institutions to 
    establish and maintain procedures reasonably designed to assure and 
    monitor the compliance of such depository institutions, the 
    subsidiaries of such institutions, and the employees of such 
    institutions or subsidiaries with the requirements of this section 
    and the registration procedures established under section 1507 of 
    the Secure and Fair Enforcement for Mortgage Licensing Act of 
    2008.''.
    (b) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129 the following new items:

``129A. Fiduciary duty of servicers of pooled residential mortgages.
``129B. Residential mortgage loan origination.''.
SEC. 1403. PROHIBITION ON STEERING INCENTIVES.
    Section 129B of the Truth in Lending Act (as added by section 
1402(a)) is amended by inserting after subsection (b) the following new 
subsection:
    ``(c) Prohibition on Steering Incentives.--
        ``(1) In general.--For any residential mortgage loan, no 
    mortgage originator shall receive from any person and no person 
    shall pay to a mortgage originator, directly or indirectly, 
    compensation that varies based on the terms of the loan (other than 
    the amount of the principal).
        ``(2) Restructuring of financing origination fee.--
            ``(A) In general.--For any mortgage loan, a mortgage 
        originator may not receive from any person other than the 
        consumer and no person, other than the consumer, who knows or 
        has reason to know that a consumer has directly compensated or 
        will directly compensate a mortgage originator may pay a 
        mortgage originator any origination fee or charge except bona 
        fide third party charges not retained by the creditor, mortgage 
        originator, or an affiliate of the creditor or mortgage 
        originator .
            ``(B) Exception.--Notwithstanding subparagraph (A), a 
        mortgage originator may receive from a person other than the 
        consumer an origination fee or charge, and a person other than 
        the consumer may pay a mortgage originator an origination fee 
        or charge, if--
                ``(i) the mortgage originator does not receive any 
            compensation directly from the consumer; and
                ``(ii) the consumer does not make an upfront payment of 
            discount points, origination points, or fees, however 
            denominated (other than bona fide third party charges not 
            retained by the mortgage originator, creditor, or an 
            affiliate of the creditor or originator), except that the 
            Board may, by rule, waive or provide exemptions to this 
            clause if the Board determines that such waiver or 
            exemption is in the interest of consumers and in the public 
            interest.
        ``(3) Regulations.--The Board shall prescribe regulations to 
    prohibit--
            ``(A) mortgage originators from steering any consumer to a 
        residential mortgage loan that--
                ``(i) the consumer lacks a reasonable ability to repay 
            (in accordance with regulations prescribed under section 
            129C(a)); or
                ``(ii) has predatory characteristics or effects (such 
            as equity stripping, excessive fees, or abusive terms);
            ``(B) mortgage originators from steering any consumer from 
        a residential mortgage loan for which the consumer is qualified 
        that is a qualified mortgage (as defined in section 129C(b)(2)) 
        to a residential mortgage loan that is not a qualified 
        mortgage;
            ``(C) abusive or unfair lending practices that promote 
        disparities among consumers of equal credit worthiness but of 
        different race, ethnicity, gender, or age; and
            ``(D) mortgage originators from--
                ``(i) mischaracterizing the credit history of a 
            consumer or the residential mortgage loans available to a 
            consumer;
                ``(ii) mischaracterizing or suborning the 
            mischaracterization of the appraised value of the property 
            securing the extension of credit; or
                ``(iii) if unable to suggest, offer, or recommend to a 
            consumer a loan that is not more expensive than a loan for 
            which the consumer qualifies, discouraging a consumer from 
            seeking a residential mortgage loan secured by a consumer's 
            principal dwelling from another mortgage originator.
        ``(4) Rules of construction.--No provision of this subsection 
    shall be construed as--
            ``(A) permitting any yield spread premium or other similar 
        compensation that would, for any residential mortgage loan, 
        permit the total amount of direct and indirect compensation 
        from all sources permitted to a mortgage originator to vary 
        based on the terms of the loan (other than the amount of the 
        principal);
            ``(B) limiting or affecting the amount of compensation 
        received by a creditor upon the sale of a consummated loan to a 
        subsequent purchaser;
            ``(C) restricting a consumer's ability to finance, at the 
        option of the consumer, including through principal or rate, 
        any origination fees or costs permitted under this subsection, 
        or the mortgage originator's right to receive such fees or 
        costs (including compensation) from any person, subject to 
        paragraph (2)(B), so long as such fees or costs do not vary 
        based on the terms of the loan (other than the amount of the 
        principal) or the consumer's decision about whether to finance 
        such fees or costs; or
            ``(D) prohibiting incentive payments to a mortgage 
        originator based on the number of residential mortgage loans 
        originated within a specified period of time.''.
SEC. 1404. LIABILITY.
    Section 129B of the Truth in Lending Act is amended by inserting 
after subsection (c) (as added by section 1403) the following new 
subsection:
    ``(d) Liability for Violations.--
        ``(1) In general.--For purposes of providing a cause of action 
    for any failure by a mortgage originator, other than a creditor, to 
    comply with any requirement imposed under this section and any 
    regulation prescribed under this section, section 130 shall be 
    applied with respect to any such failure by substituting `mortgage 
    originator' for `creditor' each place such term appears in each 
    such subsection.
        ``(2) Maximum.--The maximum amount of any liability of a 
    mortgage originator under paragraph (1) to a consumer for any 
    violation of this section shall not exceed the greater of actual 
    damages or an amount equal to 3 times the total amount of direct 
    and indirect compensation or gain accruing to the mortgage 
    originator in connection with the residential mortgage loan 
    involved in the violation, plus the costs to the consumer of the 
    action, including a reasonable attorney's fee.''.
SEC. 1405. REGULATIONS.
    (a) Discretionary Regulatory Authority.--Section 129B of the Truth 
in Lending Act is amended by inserting after subsection (d) (as added 
by section 1404) the following new subsection:
    ``(e) Discretionary Regulatory Authority.--
        ``(1) In general.--The Board shall, by regulations, prohibit or 
    condition terms, acts or practices relating to residential mortgage 
    loans that the Board finds to be abusive, unfair, deceptive, 
    predatory, necessary or proper to ensure that responsible, 
    affordable mortgage credit remains available to consumers in a 
    manner consistent with the purposes of this section and section 
    129C, necessary or proper to effectuate the purposes of this 
    section and section 129C, to prevent circumvention or evasion 
    thereof, or to facilitate compliance with such sections, or are not 
    in the interest of the borrower.
        ``(2) Application.--The regulations prescribed under paragraph 
    (1) shall be applicable to all residential mortgage loans and shall 
    be applied in the same manner as regulations prescribed under 
    section 105.
    ``(f) Section 129B and any regulations promulgated thereunder do 
not apply to an extension of credit relating to a plan described in 
section 101(53D) of title 11, United States Code.''.
    (b) Disclosures.--Notwithstanding any other provision of this 
title, in order to improve consumer awareness and understanding of 
transactions involving residential mortgage loans through the use of 
disclosures, the Board may, by rule, exempt from or modify disclosure 
requirements, in whole or in part, for any class of residential 
mortgage loans if the Board determines that such exemption or 
modification is in the interest of consumers and in the public 
interest.
SEC. 1406. STUDY OF SHARED APPRECIATION MORTGAGES.
    (a) Study.--The Secretary of Housing and Urban Development, in 
consultation with the Secretary of the Treasury and other relevant 
agencies, shall conduct a comprehensive study to determine prudent 
statutory and regulatory requirements sufficient to provide for the 
widespread use of shared appreciation mortgages to strengthen local 
housing markets, provide new opportunities for affordable 
homeownership, and enable homeowners at risk of foreclosure to 
refinance or modify their mortgages.
    (b) Report.--Not later than the expiration of the 6-month period 
beginning on the date of the enactment of this Act, the Secretary of 
Housing and Urban Development shall submit a report to the Congress on 
the results of the study, which shall include recommendations for the 
regulatory and legislative requirements referred to in subsection (a).

              Subtitle B--Minimum Standards For Mortgages

SEC. 1411. ABILITY TO REPAY.
    (a) In General.--
        (1) Rule of construction.--No regulation, order, or guidance 
    issued by the Bureau under this title shall be construed as 
    requiring a depository institution to apply mortgage underwriting 
    standards that do not meet the minimum underwriting standards 
    required by the appropriate prudential regulator of the depository 
    institution.
        (2) Amendment to truth in lending act.--Chapter 2 of the Truth 
    in Lending Act (15 U.S.C. 1631 et seq.) is amended by inserting 
    after section 129B (as added by section 1402(a)) the following new 
    section:
``Sec. 129C. Minimum standards for residential mortgage loans
    ``(a) Ability To Repay.--
        ``(1) In general.--In accordance with regulations prescribed by 
    the Board, no creditor may make a residential mortgage loan unless 
    the creditor makes a reasonable and good faith determination based 
    on verified and documented information that, at the time the loan 
    is consummated, the consumer has a reasonable ability to repay the 
    loan, according to its terms, and all applicable taxes, insurance 
    (including mortgage guarantee insurance), and assessments.
        ``(2) Multiple loans.--If the creditor knows, or has reason to 
    know, that 1 or more residential mortgage loans secured by the same 
    dwelling will be made to the same consumer, the creditor shall make 
    a reasonable and good faith determination, based on verified and 
    documented information, that the consumer has a reasonable ability 
    to repay the combined payments of all loans on the same dwelling 
    according to the terms of those loans and all applicable taxes, 
    insurance (including mortgage guarantee insurance), and 
    assessments.
        ``(3) Basis for determination.--A determination under this 
    subsection of a consumer's ability to repay a residential mortgage 
    loan shall include consideration of the consumer's credit history, 
    current income, expected income the consumer is reasonably assured 
    of receiving, current obligations, debt-to-income ratio or the 
    residual income the consumer will have after paying non-mortgage 
    debt and mortgage-related obligations, employment status, and other 
    financial resources other than the consumer's equity in the 
    dwelling or real property that secures repayment of the loan. A 
    creditor shall determine the ability of the consumer to repay using 
    a payment schedule that fully amortizes the loan over the term of 
    the loan.
        ``(4) Income verification.--A creditor making a residential 
    mortgage loan shall verify amounts of income or assets that such 
    creditor relies on to determine repayment ability, including 
    expected income or assets, by reviewing the consumer's Internal 
    Revenue Service Form W-2, tax returns, payroll receipts, financial 
    institution records, or other third-party documents that provide 
    reasonably reliable evidence of the consumer's income or assets. In 
    order to safeguard against fraudulent reporting, any consideration 
    of a consumer's income history in making a determination under this 
    subsection shall include the verification of such income by the use 
    of--
            ``(A) Internal Revenue Service transcripts of tax returns; 
        or
            ``(B) a method that quickly and effectively verifies income 
        documentation by a third party subject to rules prescribed by 
        the Board.
        ``(5) Exemption.--With respect to loans made, guaranteed, or 
    insured by Federal departments or agencies identified in subsection 
    (b)(3)(B)(ii), such departments or agencies may exempt refinancings 
    under a streamlined refinancing from this income verification 
    requirement as long as the following conditions are met:
            ``(A) The consumer is not 30 days or more past due on the 
        prior existing residential mortgage loan.
            ``(B) The refinancing does not increase the principal 
        balance outstanding on the prior existing residential mortgage 
        loan, except to the extent of fees and charges allowed by the 
        department or agency making, guaranteeing, or insuring the 
        refinancing.
            ``(C) Total points and fees (as defined in section 
        103(aa)(4), other than bona fide third party charges not 
        retained by the mortgage originator, creditor, or an affiliate 
        of the creditor or mortgage originator) payable in connection 
        with the refinancing do not exceed 3 percent of the total new 
        loan amount.
            ``(D) The interest rate on the refinanced loan is lower 
        than the interest rate of the original loan, unless the 
        borrower is refinancing from an adjustable rate to a fixed-rate 
        loan, under guidelines that the department or agency shall 
        establish for loans they make, guarantee, or issue.
            ``(E) The refinancing is subject to a payment schedule that 
        will fully amortize the refinancing in accordance with the 
        regulations prescribed by the department or agency making, 
        guaranteeing, or insuring the refinancing.
            ``(F) The terms of the refinancing do not result in a 
        balloon payment, as defined in subsection (b)(2)(A)(ii).
            ``(G) Both the residential mortgage loan being refinanced 
        and the refinancing satisfy all requirements of the department 
        or agency making, guaranteeing, or insuring the refinancing.
        ``(6) Nonstandard loans.--
            ``(A) Variable rate loans that defer repayment of any 
        principal or interest.--For purposes of determining, under this 
        subsection, a consumer's ability to repay a variable rate 
        residential mortgage loan that allows or requires the consumer 
        to defer the repayment of any principal or interest, the 
        creditor shall use a fully amortizing repayment schedule.
            ``(B) Interest-only loans.--For purposes of determining, 
        under this subsection, a consumer's ability to repay a 
        residential mortgage loan that permits or requires the payment 
        of interest only, the creditor shall use the payment amount 
        required to amortize the loan by its final maturity.
            ``(C) Calculation for negative amortization.--In making any 
        determination under this subsection, a creditor shall also take 
        into consideration any balance increase that may accrue from 
        any negative amortization provision.
            ``(D) Calculation process.--For purposes of making any 
        determination under this subsection, a creditor shall calculate 
        the monthly payment amount for principal and interest on any 
        residential mortgage loan by assuming--
                ``(i) the loan proceeds are fully disbursed on the date 
            of the consummation of the loan;
                ``(ii) the loan is to be repaid in substantially equal 
            monthly amortizing payments for principal and interest over 
            the entire term of the loan with no balloon payment, unless 
            the loan contract requires more rapid repayment (including 
            balloon payment), in which case the calculation shall be 
            made (I) in accordance with regulations prescribed by the 
            Board, with respect to any loan which has an annual 
            percentage rate that does not exceed the average prime 
            offer rate for a comparable transaction, as of the date the 
            interest rate is set, by 1.5 or more percentage points for 
            a first lien residential mortgage loan; and by 3.5 or more 
            percentage points for a subordinate lien residential 
            mortgage loan; or (II) using the contract's repayment 
            schedule, with respect to a loan which has an annual 
            percentage rate, as of the date the interest rate is set, 
            that is at least 1.5 percentage points above the average 
            prime offer rate for a first lien residential mortgage 
            loan; and 3.5 percentage points above the average prime 
            offer rate for a subordinate lien residential mortgage 
            loan; and
                ``(iii) the interest rate over the entire term of the 
            loan is a fixed rate equal to the fully indexed rate at the 
            time of the loan closing, without considering the 
            introductory rate.
            ``(E) Refinance of hybrid loans with current lender.--In 
        considering any application for refinancing an existing hybrid 
        loan by the creditor into a standard loan to be made by the 
        same creditor in any case in which there would be a reduction 
        in monthly payment and the mortgagor has not been delinquent on 
        any payment on the existing hybrid loan, the creditor may--
                ``(i) consider the mortgagor's good standing on the 
            existing mortgage;
                ``(ii) consider if the extension of new credit would 
            prevent a likely default should the original mortgage reset 
            and give such concerns a higher priority as an acceptable 
            underwriting practice; and
                ``(iii) offer rate discounts and other favorable terms 
            to such mortgagor that would be available to new customers 
            with high credit ratings based on such underwriting 
            practice.
        ``(7) Fully-indexed rate defined.--For purposes of this 
    subsection, the term `fully indexed rate' means the index rate 
    prevailing on a residential mortgage loan at the time the loan is 
    made plus the margin that will apply after the expiration of any 
    introductory interest rates.
        ``(8) Reverse mortgages and bridge loans.--This subsection 
    shall not apply with respect to any reverse mortgage or temporary 
    or bridge loan with a term of 12 months or less, including to any 
    loan to purchase a new dwelling where the consumer plans to sell a 
    different dwelling within 12 months.
        ``(9) Seasonal income.--If documented income, including income 
    from a small business, is a repayment source for a residential 
    mortgage loan, a creditor may consider the seasonality and 
    irregularity of such income in the underwriting of and scheduling 
    of payments for such credit.''.
    (b) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129B (as added by section 1402(b)) the following new item:

``129C. Minimum standards for residential mortgage loans.''.
SEC. 1412. SAFE HARBOR AND REBUTTABLE PRESUMPTION.
    Section 129C of the Truth in Lending Act is amended by inserting 
after subsection (a) (as added by section 1411) the following new 
subsection:
    ``(b) Presumption of Ability To Repay.--
        ``(1) In general.--Any creditor with respect to any residential 
    mortgage loan, and any assignee of such loan subject to liability 
    under this title, may presume that the loan has met the 
    requirements of subsection (a), if the loan is a qualified 
    mortgage.
        ``(2) Definitions.--For purposes of this subsection, the 
    following definitions shall apply:
            ``(A) Qualified mortgage.--The term `qualified mortgage' 
        means any residential mortgage loan--
                ``(i) for which the regular periodic payments for the 
            loan may not--

                    ``(I) result in an increase of the principal 
                balance; or
                    ``(II) except as provided in subparagraph (E), 
                allow the consumer to defer repayment of principal;

                ``(ii) except as provided in subparagraph (E), the 
            terms of which do not result in a balloon payment, where a 
            `balloon payment' is a scheduled payment that is more than 
            twice as large as the average of earlier scheduled 
            payments;
                ``(iii) for which the income and financial resources 
            relied upon to qualify the obligors on the loan are 
            verified and documented;
                ``(iv) in the case of a fixed rate loan, for which the 
            underwriting process is based on a payment schedule that 
            fully amortizes the loan over the loan term and takes into 
            account all applicable taxes, insurance, and assessments;
                ``(v) in the case of an adjustable rate loan, for which 
            the underwriting is based on the maximum rate permitted 
            under the loan during the first 5 years, and a payment 
            schedule that fully amortizes the loan over the loan term 
            and takes into account all applicable taxes, insurance, and 
            assessments;
                ``(vi) that complies with any guidelines or regulations 
            established by the Board relating to ratios of total 
            monthly debt to monthly income or alternative measures of 
            ability to pay regular expenses after payment of total 
            monthly debt, taking into account the income levels of the 
            borrower and such other factors as the Board may determine 
            relevant and consistent with the purposes described in 
            paragraph (3)(B)(i);
                ``(vii) for which the total points and fees (as defined 
            in subparagraph (C)) payable in connection with the loan do 
            not exceed 3 percent of the total loan amount;
                ``(viii) for which the term of the loan does not exceed 
            30 years, except as such term may be extended under 
            paragraph (3), such as in high-cost areas; and
                ``(ix) in the case of a reverse mortgage (except for 
            the purposes of subsection (a) of section 129C, to the 
            extent that such mortgages are exempt altogether from those 
            requirements), a reverse mortgage which meets the standards 
            for a qualified mortgage, as set by the Board in rules that 
            are consistent with the purposes of this subsection.
            ``(B) Average prime offer rate.--The term `average prime 
        offer rate' means the average prime offer rate for a comparable 
        transaction as of the date on which the interest rate for the 
        transaction is set, as published by the Board..
            ``(C) Points and fees.--
                ``(i) In general.--For purposes of subparagraph (A), 
            the term `points and fees' means points and fees as defined 
            by section 103(aa)(4) (other than bona fide third party 
            charges not retained by the mortgage originator, creditor, 
            or an affiliate of the creditor or mortgage originator).
                ``(ii) Computation.--For purposes of computing the 
            total points and fees under this subparagraph, the total 
            points and fees shall exclude either of the amounts 
            described in the following subclauses, but not both:

                    ``(I) Up to and including 2 bona fide discount 
                points payable by the consumer in connection with the 
                mortgage, but only if the interest rate from which the 
                mortgage's interest rate will be discounted does not 
                exceed by more than 1 percentage point the average 
                prime offer rate.
                    ``(II) Unless 2 bona fide discount points have been 
                excluded under subclause (I), up to and including 1 
                bona fide discount point payable by the consumer in 
                connection with the mortgage, but only if the interest 
                rate from which the mortgage's interest rate will be 
                discounted does not exceed by more than 2 percentage 
                points the average prime offer rate.

                ``(iii) Bona fide discount points defined.--For 
            purposes of clause (ii), the term `bona fide discount 
            points' means loan discount points which are knowingly paid 
            by the consumer for the purpose of reducing, and which in 
            fact result in a bona fide reduction of, the interest rate 
            or time-price differential applicable to the mortgage.
                ``(iv) Interest rate reduction.--Subclauses (I) and 
            (II) of clause (ii) shall not apply to discount points used 
            to purchase an interest rate reduction unless the amount of 
            the interest rate reduction purchased is reasonably 
            consistent with established industry norms and practices 
            for secondary mortgage market transactions.
            ``(D) Smaller loans.--The Board shall prescribe rules 
        adjusting the criteria under subparagraph (A)(vii) in order to 
        permit lenders that extend smaller loans to meet the 
        requirements of the presumption of compliance under paragraph 
        (1). In prescribing such rules, the Board shall consider the 
        potential impact of such rules on rural areas and other areas 
        where home values are lower.
            ``(E) Balloon loans.--The Board may, by regulation, provide 
        that the term `qualified mortgage' includes a balloon loan--
                ``(i) that meets all of the criteria for a qualified 
            mortgage under subparagraph (A) (except clauses (i)(II), 
            (ii), (iv), and (v) of such subparagraph);
                ``(ii) for which the creditor makes a determination 
            that the consumer is able to make all scheduled payments, 
            except the balloon payment, out of income or assets other 
            than the collateral;
                ``(iii) for which the underwriting is based on a 
            payment schedule that fully amortizes the loan over a 
            period of not more than 30 years and takes into account all 
            applicable taxes, insurance, and assessments; and
                ``(iv) that is extended by a creditor that--

                    ``(I) operates predominantly in rural or 
                underserved areas;
                    ``(II) together with all affiliates, has total 
                annual residential mortgage loan originations that do 
                not exceed a limit set by the Board;
                    ``(III) retains the balloon loans in portfolio; and
                    ``(IV) meets any asset size threshold and any other 
                criteria as the Board may establish, consistent with 
                the purposes of this subtitle.

        ``(3) Regulations.--
            ``(A) In general.--The Board shall prescribe regulations to 
        carry out the purposes of this subsection.
            ``(B) Revision of safe harbor criteria.--
                ``(i) In general.--The Board may prescribe regulations 
            that revise, add to, or subtract from the criteria that 
            define a qualified mortgage upon a finding that such 
            regulations are necessary or proper to ensure that 
            responsible, affordable mortgage credit remains available 
            to consumers in a manner consistent with the purposes of 
            this section, necessary and appropriate to effectuate the 
            purposes of this section and section 129B, to prevent 
            circumvention or evasion thereof, or to facilitate 
            compliance with such sections.
                ``(ii) Loan definition.--The following agencies shall, 
            in consultation with the Board, prescribe rules defining 
            the types of loans they insure, guarantee, or administer, 
            as the case may be, that are qualified mortgages for 
            purposes of paragraph (2)(A), and such rules may revise, 
            add to, or subtract from the criteria used to define a 
            qualified mortgage under paragraph (2)(A), upon a finding 
            that such rules are consistent with the purposes of this 
            section and section 129B, to prevent circumvention or 
            evasion thereof, or to facilitate compliance with such 
            sections:

                    ``(I) The Department of Housing and Urban 
                Development, with regard to mortgages insured under the 
                National Housing Act (12 U.S.C. 1707 et seq.).
                    ``(II) The Department of Veterans Affairs, with 
                regard to a loan made or guaranteed by the Secretary of 
                Veterans Affairs.
                    ``(III) The Department of Agriculture, with regard 
                loans guaranteed by the Secretary of Agriculture 
                pursuant to 42 U.S.C. 1472(h).
                    ``(IV) The Rural Housing Service, with regard to 
                loans insured by the Rural Housing Service.''.

SEC. 1413. DEFENSE TO FORECLOSURE.
    Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended 
by adding at the end the following new subsection:
    ``(k) Defense to Foreclosure.--
        ``(1) In general.--Notwithstanding any other provision of law, 
    when a creditor, assignee, or other holder of a residential 
    mortgage loan or anyone acting on behalf of such creditor, 
    assignee, or holder, initiates a judicial or nonjudicial 
    foreclosure of the residential mortgage loan, or any other action 
    to collect the debt in connection with such loan, a consumer may 
    assert a violation by a creditor of paragraph (1) or (2) of section 
    129B(c), or of section 129C(a), as a matter of defense by 
    recoupment or set off without regard for the time limit on a 
    private action for damages under subsection (e).
        ``(2) Amount of recoupment or setoff.--
            ``(A) In general.--The amount of recoupment or set-off 
        under paragraph (1) shall equal the amount to which the 
        consumer would be entitled under subsection (a) for damages for 
        a valid claim brought in an original action against the 
        creditor, plus the costs to the consumer of the action, 
        including a reasonable attorney's fee.
            ``(B) Special rule.--Where such judgment is rendered after 
        the expiration of the applicable time limit on a private action 
        for damages under subsection (e), the amount of recoupment or 
        set-off under paragraph (1) derived from damages under 
        subsection (a)(4) shall not exceed the amount to which the 
        consumer would have been entitled under subsection (a)(4) for 
        damages computed up to the day preceding the expiration of the 
        applicable time limit.''.
SEC. 1414. ADDITIONAL STANDARDS AND REQUIREMENTS.
    (a) In General.--Section 129C of the Truth in Lending Act is 
amended by inserting after subsection (b) (as added by this title) the 
following new subsections:
    ``(c) Prohibition on Certain Prepayment Penalties.--
        ``(1) Prohibited on certain loans.--
            ``(A) In general.--A residential mortgage loan that is not 
        a `qualified mortgage', as defined under subsection (b)(2), may 
        not contain terms under which a consumer must pay a prepayment 
        penalty for paying all or part of the principal after the loan 
        is consummated.
            ``(B) Exclusions.--For purposes of this subsection, a 
        `qualified mortgage' may not include a residential mortgage 
        loan that--
                ``(i) has an adjustable rate; or
                ``(ii) has an annual percentage rate that exceeds the 
            average prime offer rate for a comparable transaction, as 
            of the date the interest rate is set--

                    ``(I) by 1.5 or more percentage points, in the case 
                of a first lien residential mortgage loan having a 
                original principal obligation amount that is equal to 
                or less than the amount of the maximum limitation on 
                the original principal obligation of mortgage in effect 
                for a residence of the applicable size, as of the date 
                of such interest rate set, pursuant to the 6th sentence 
                of section 305(a)(2) the Federal Home Loan Mortgage 
                Corporation Act (12 U.S.C. 1454(a)(2));
                    ``(II) by 2.5 or more percentage points, in the 
                case of a first lien residential mortgage loan having a 
                original principal obligation amount that is more than 
                the amount of the maximum limitation on the original 
                principal obligation of mortgage in effect for a 
                residence of the applicable size, as of the date of 
                such interest rate set, pursuant to the 6th sentence of 
                section 305(a)(2) the Federal Home Loan Mortgage 
                Corporation Act (12 U.S.C. 1454(a)(2)); and
                    ``(III) by 3.5 or more percentage points, in the 
                case of a subordinate lien residential mortgage loan.

        ``(2)  Publication of average prime offer rate and apr 
    thresholds.--The Board--
            ``(A) shall publish, and update at least weekly, average 
        prime offer rates;
            ``(B) may publish multiple rates based on varying types of 
        mortgage transactions; and
            ``(C) shall adjust the thresholds established under 
        subclause (I), (II), and (III) of paragraph (1)(B)(ii) as 
        necessary to reflect significant changes in market conditions 
        and to effectuate the purposes of the Mortgage Reform and Anti-
        Predatory Lending Act.
        ``(3) Phased-out penalties on qualified mortgages.--A qualified 
    mortgage (as defined in subsection (b)(2)) may not contain terms 
    under which a consumer must pay a prepayment penalty for paying all 
    or part of the principal after the loan is consummated in excess of 
    the following limitations:
            ``(A) During the 1-year period beginning on the date the 
        loan is consummated, the prepayment penalty shall not exceed an 
        amount equal to 3 percent of the outstanding balance on the 
        loan.
            ``(B) During the 1-year period beginning after the period 
        described in subparagraph (A), the prepayment penalty shall not 
        exceed an amount equal to 2 percent of the outstanding balance 
        on the loan.
            ``(C) During the 1-year period beginning after the 1-year 
        period described in subparagraph (B), the prepayment penalty 
        shall not exceed an amount equal to 1 percent of the 
        outstanding balance on the loan.
            ``(D) After the end of the 3-year period beginning on the 
        date the loan is consummated, no prepayment penalty may be 
        imposed on a qualified mortgage.
        ``(4) Option for no prepayment penalty required.--A creditor 
    may not offer a consumer a residential mortgage loan product that 
    has a prepayment penalty for paying all or part of the principal 
    after the loan is consummated as a term of the loan without 
    offering the consumer a residential mortgage loan product that does 
    not have a prepayment penalty as a term of the loan.
    ``(d) Single Premium Credit Insurance Prohibited.--No creditor may 
finance, directly or indirectly, in connection with any residential 
mortgage loan or with any extension of credit under an open end 
consumer credit plan secured by the principal dwelling of the consumer, 
any credit life, credit disability, credit unemployment, or credit 
property insurance, or any other accident, loss-of-income, life, or 
health insurance, or any payments directly or indirectly for any debt 
cancellation or suspension agreement or contract, except that--
        ``(1) insurance premiums or debt cancellation or suspension 
    fees calculated and paid in full on a monthly basis shall not be 
    considered financed by the creditor; and
        ``(2) this subsection shall not apply to credit unemployment 
    insurance for which the unemployment insurance premiums are 
    reasonable, the creditor receives no direct or indirect 
    compensation in connection with the unemployment insurance 
    premiums, and the unemployment insurance premiums are paid pursuant 
    to another insurance contract and not paid to an affiliate of the 
    creditor.
    ``(e) Arbitration.--
        ``(1) In general.--No residential mortgage loan and no 
    extension of credit under an open end consumer credit plan secured 
    by the principal dwelling of the consumer may include terms which 
    require arbitration or any other nonjudicial procedure as the 
    method for resolving any controversy or settling any claims arising 
    out of the transaction.
        ``(2) Post-controversy agreements.--Subject to paragraph (3), 
    paragraph (1) shall not be construed as limiting the right of the 
    consumer and the creditor or any assignee to agree to arbitration 
    or any other nonjudicial procedure as the method for resolving any 
    controversy at any time after a dispute or claim under the 
    transaction arises.
        ``(3) No waiver of statutory cause of action.--No provision of 
    any residential mortgage loan or of any extension of credit under 
    an open end consumer credit plan secured by the principal dwelling 
    of the consumer, and no other agreement between the consumer and 
    the creditor relating to the residential mortgage loan or extension 
    of credit referred to in paragraph (1), shall be applied or 
    interpreted so as to bar a consumer from bringing an action in an 
    appropriate district court of the United States, or any other court 
    of competent jurisdiction, pursuant to section 130 or any other 
    provision of law, for damages or other relief in connection with 
    any alleged violation of this section, any other provision of this 
    title, or any other Federal law.
    ``(f) Mortgages With Negative Amortization.--No creditor may extend 
credit to a borrower in connection with a consumer credit transaction 
under an open or closed end consumer credit plan secured by a dwelling 
or residential real property that includes a dwelling, other than a 
reverse mortgage, that provides or permits a payment plan that may, at 
any time over the term of the extension of credit, result in negative 
amortization unless, before such transaction is consummated--
        ``(1) the creditor provides the consumer with a statement 
    that--
            ``(A) the pending transaction will or may, as the case may 
        be, result in negative amortization;
            ``(B) describes negative amortization in such manner as the 
        Board shall prescribe;
            ``(C) negative amortization increases the outstanding 
        principal balance of the account; and
            ``(D) negative amortization reduces the consumer's equity 
        in the dwelling or real property; and
        ``(2) in the case of a first-time borrower with respect to a 
    residential mortgage loan that is not a qualified mortgage, the 
    first-time borrower provides the creditor with sufficient 
    documentation to demonstrate that the consumer received 
    homeownership counseling from organizations or counselors certified 
    by the Secretary of Housing and Urban Development as competent to 
    provide such counseling.''.
    (b) Conforming Amendment Relating to Enforcement.--Section 108(a) 
of the Truth in Lending Act (15 U.S.C. 1607(a)) is amended by inserting 
after paragraph (6) the following new paragraph:
        ``(7) sections 21B and 21C of the Securities Exchange Act of 
    1934, in the case of a broker or dealer, other than a depository 
    institution, by the Securities and Exchange Commission.''.
    (c) Protection Against Loss of Anti-deficiency Protection.--Section 
129C of the Truth in Lending Act is amended by inserting after 
subsection (f) (as added by subsection (a)) the following new 
subsection:
    ``(g) Protection Against Loss of Anti-deficiency Protection.--
        ``(1) Definition.--For purposes of this subsection, the term 
    `anti-deficiency law' means the law of any State which provides 
    that, in the event of foreclosure on the residential property of a 
    consumer securing a mortgage, the consumer is not liable, in 
    accordance with the terms and limitations of such State law, for 
    any deficiency between the sale price obtained on such property 
    through foreclosure and the outstanding balance of the mortgage.
        ``(2) Notice at time of consummation.--In the case of any 
    residential mortgage loan that is, or upon consummation will be, 
    subject to protection under an anti-deficiency law, the creditor or 
    mortgage originator shall provide a written notice to the consumer 
    describing the protection provided by the anti-deficiency law and 
    the significance for the consumer of the loss of such protection 
    before such loan is consummated.
        ``(3) Notice before refinancing that would cause loss of 
    protection.--In the case of any residential mortgage loan that is 
    subject to protection under an anti-deficiency law, if a creditor 
    or mortgage originator provides an application to a consumer, or 
    receives an application from a consumer, for any type of 
    refinancing for such loan that would cause the loan to lose the 
    protection of such anti-deficiency law, the creditor or mortgage 
    originator shall provide a written notice to the consumer 
    describing the protection provided by the anti-deficiency law and 
    the significance for the consumer of the loss of such protection 
    before any agreement for any such refinancing is consummated.''.
    (d) Policy Regarding Acceptance of Partial Payment.--Section 129C 
of the Truth in Lending Act is amended by inserting after subsection 
(g) (as added by subsection (c)) the following new subsection:
    ``(h) Policy Regarding Acceptance of Partial Payment.--In the case 
of any residential mortgage loan, a creditor shall disclose prior to 
settlement or, in the case of a person becoming a creditor with respect 
to an existing residential mortgage loan, at the time such person 
becomes a creditor--
        ``(1) the creditor's policy regarding the acceptance of partial 
    payments; and
        ``(2) if partial payments are accepted, how such payments will 
    be applied to such mortgage and if such payments will be placed in 
    escrow.
    ``(i) Timeshare Plans.--This section and any regulations 
promulgated under this section do not apply to an extension of credit 
relating to a plan described in section 101(53D) of title 11, United 
States Code.''.
SEC. 1415. RULE OF CONSTRUCTION.
    Except as otherwise expressly provided in section 129B or 129C of 
the Truth in Lending Act (as added by this title), no provision of such 
section 129B or 129C shall be construed as superseding, repealing, or 
affecting any duty, right, obligation, privilege, or remedy of any 
person under any other provision of the Truth in Lending Act or any 
other provision of Federal or State law.
SEC. 1416. AMENDMENTS TO CIVIL LIABILITY PROVISIONS.
    (a) Increase in Amount of Civil Money Penalties for Certain 
Violations.--Section 130(a) of the Truth in Lending Act (15 U.S.C. 
1640(a)) is amended--
        (1) in paragraph (2)(A)(ii)--
            (A) by striking ``$100'' and inserting ``$200''; and
            (B) by striking ``$1,000'' and inserting ``$2,000'';
        (2) in paragraph (2)(B), by striking ``$500,000'' and inserting 
    ``$1,000,000''; and
        (3) in paragraph (4), by inserting ``, paragraph (1) or (2) of 
    section 129B(c), or section 129C(a)'' after ``section 129''.
    (b) Statute of Limitations Extended for Section 129 Violations.--
Section 130(e) of the Truth in Lending Act (15 U.S.C. 1640(e)) is 
amended--
        (1) in the first sentence, by striking ``Any action'' and 
    inserting ``Except as provided in the subsequent sentence, any 
    action''; and
        (2) by inserting after the first sentence the following new 
    sentence: ``Any action under this section with respect to any 
    violation of section 129, 129B, or 129C may be brought in any 
    United States district court, or in any other court of competent 
    jurisdiction, before the end of the 3-year period beginning on the 
    date of the occurrence of the violation.''.
SEC. 1417. LENDER RIGHTS IN THE CONTEXT OF BORROWER DECEPTION.
    Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended 
by adding after subsection (k) (as added by this title) the following 
new subsection:
    ``(l) Exemption From Liability and Rescission in Case of Borrower 
Fraud or Deception.--In addition to any other remedy available by law 
or contract, no creditor or assignee shall be liable to an obligor 
under this section, if such obligor, or co-obligor has been convicted 
of obtaining by actual fraud such residential mortgage loan.''.
SEC. 1418. SIX-MONTH NOTICE REQUIRED BEFORE RESET OF HYBRID ADJUSTABLE 
RATE MORTGAGES.
    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by inserting after section 128 the following 
new section:
``Sec. 128A. Reset of hybrid adjustable rate mortgages
    ``(a) Hybrid Adjustable Rate Mortgages Defined.--For purposes of 
this section, the term `hybrid adjustable rate mortgage' means a 
consumer credit transaction secured by the consumer's principal 
residence with a fixed interest rate for an introductory period that 
adjusts or resets to a variable interest rate after such period.
    ``(b) Notice of Reset and Alternatives.--During the 1-month period 
that ends 6 months before the date on which the interest rate in effect 
during the introductory period of a hybrid adjustable rate mortgage 
adjusts or resets to a variable interest rate or, in the case of such 
an adjustment or resetting that occurs within the first 6 months after 
consummation of such loan, at consummation, the creditor or servicer of 
such loan shall provide a written notice, separate and distinct from 
all other correspondence to the consumer, that includes the following:
        ``(1) Any index or formula used in making adjustments to or 
    resetting the interest rate and a source of information about the 
    index or formula.
        ``(2) An explanation of how the new interest rate and payment 
    would be determined, including an explanation of how the index was 
    adjusted, such as by the addition of a margin.
        ``(3) A good faith estimate, based on accepted industry 
    standards, of the creditor or servicer of the amount of the monthly 
    payment that will apply after the date of the adjustment or reset, 
    and the assumptions on which this estimate is based.
        ``(4) A list of alternatives consumers may pursue before the 
    date of adjustment or reset, and descriptions of the actions 
    consumers must take to pursue these alternatives, including--
            ``(A) refinancing;
            ``(B) renegotiation of loan terms;
            ``(C) payment forbearances; and
            ``(D) pre-foreclosure sales.
        ``(5) The names, addresses, telephone numbers, and Internet 
    addresses of counseling agencies or programs reasonably available 
    to the consumer that have been certified or approved and made 
    publicly available by the Secretary of Housing and Urban 
    Development or a State housing finance authority (as defined in 
    section 1301 of the Financial Institutions Reform, Recovery, and 
    Enforcement Act of 1989).
        ``(6) The address, telephone number, and Internet address for 
    the State housing finance authority (as so defined) for the State 
    in which the consumer resides.
    ``(c) Savings Clause.--The Board may require the notice in 
paragraph (b) or other notice consistent with this Act for adjustable 
rate mortgage loans that are not hybrid adjustable rate mortgage 
loans.''.
    (b) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 128 the following new item:

``128A. Reset of hybrid adjustable rate mortgages.''.
SEC. 1419. REQUIRED DISCLOSURES.
    Section 128(a) of Truth in Lending Act (15 U.S.C. 1638(a)) is 
amended by adding at the end the following new paragraphs:
        ``(16) In the case of a variable rate residential mortgage loan 
    for which an escrow or impound account will be established for the 
    payment of all applicable taxes, insurance, and assessments--
            ``(A) the amount of initial monthly payment due under the 
        loan for the payment of principal and interest, and the amount 
        of such initial monthly payment including the monthly payment 
        deposited in the account for the payment of all applicable 
        taxes, insurance, and assessments; and
            ``(B) the amount of the fully indexed monthly payment due 
        under the loan for the payment of principal and interest, and 
        the amount of such fully indexed monthly payment including the 
        monthly payment deposited in the account for the payment of all 
        applicable taxes, insurance, and assessments.
        ``(17) In the case of a residential mortgage loan, the 
    aggregate amount of settlement charges for all settlement services 
    provided in connection with the loan, the amount of charges that 
    are included in the loan and the amount of such charges the 
    borrower must pay at closing, the approximate amount of the 
    wholesale rate of funds in connection with the loan, and the 
    aggregate amount of other fees or required payments in connection 
    with the loan.
        ``(18) In the case of a residential mortgage loan, the 
    aggregate amount of fees paid to the mortgage originator in 
    connection with the loan, the amount of such fees paid directly by 
    the consumer, and any additional amount received by the originator 
    from the creditor.
        ``(19) In the case of a residential mortgage loan, the total 
    amount of interest that the consumer will pay over the life of the 
    loan as a percentage of the principal of the loan. Such amount 
    shall be computed assuming the consumer makes each monthly payment 
    in full and on-time, and does not make any over-payments.''.
SEC. 1420. DISCLOSURES REQUIRED IN MONTHLY STATEMENTS FOR RESIDENTIAL 
MORTGAGE LOANS.
    Section 128 of the Truth in Lending Act (15 U.S.C. 1638) is amended 
by adding at the end the following new subsection:
    ``(f) Periodic Statements for Residential Mortgage Loans.--
        ``(1) In general.--The creditor, assignee, or servicer with 
    respect to any residential mortgage loan shall transmit to the 
    obligor, for each billing cycle, a statement setting forth each of 
    the following items, to the extent applicable, in a conspicuous and 
    prominent manner:
            ``(A) The amount of the principal obligation under the 
        mortgage.
            ``(B) The current interest rate in effect for the loan.
            ``(C) The date on which the interest rate may next reset or 
        adjust.
            ``(D) The amount of any prepayment fee to be charged, if 
        any.
            ``(E) A description of any late payment fees.
            ``(F) A telephone number and electronic mail address that 
        may be used by the obligor to obtain information regarding the 
        mortgage.
            ``(G) The names, addresses, telephone numbers, and Internet 
        addresses of counseling agencies or programs reasonably 
        available to the consumer that have been certified or approved 
        and made publicly available by the Secretary of Housing and 
        Urban Development or a State housing finance authority (as 
        defined in section 1301 of the Financial Institutions Reform, 
        Recovery, and Enforcement Act of 1989).
            ``(H) Such other information as the Board may prescribe in 
        regulations.
        ``(2) Development and use of standard form.--The Board shall 
    develop and prescribe a standard form for the disclosure required 
    under this subsection, taking into account that the statements 
    required may be transmitted in writing or electronically.
        ``(3) Exception.--Paragraph (1) shall not apply to any fixed 
    rate residential mortgage loan where the creditor, assignee, or 
    servicer provides the obligor with a coupon book that provides the 
    obligor with substantially the same information as required in 
    paragraph (1).''.
SEC. 1421. REPORT BY THE GAO.
    (a) Report Required.--The Comptroller General of the United States 
shall conduct a study to determine the effects the enactment of this 
Act will have on the availability and affordability of credit for 
consumers, small businesses, homebuyers, and mortgage lending, 
including the effect--
        (1) on the mortgage market for mortgages that are not within 
    the safe harbor provided in the amendments made by this subtitle;
        (2) on the ability of prospective homebuyers to obtain 
    financing;
        (3) on the ability of homeowners facing resets or adjustments 
    to refinance--for example, do they have fewer refinancing options 
    due to the unavailability of certain loan products that were 
    available before the enactment of this Act;
        (4) on minorities' ability to access affordable credit compared 
    with other prospective borrowers;
        (5) on home sales and construction;
        (6) of extending the rescission right, if any, on adjustable 
    rate loans and its impact on litigation;
        (7) of State foreclosure laws and, if any, an investor's 
    ability to transfer a property after foreclosure;
        (8) of expanding the existing provisions of the Home Ownership 
    and Equity Protection Act of 1994;
        (9) of prohibiting prepayment penalties on high-cost mortgages; 
    and
        (10) of establishing counseling services under the Department 
    of Housing and Urban Development and offered through the Office of 
    Housing Counseling.
    (b) Report.--Before 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 the findings and conclusions of the 
Comptroller General with respect to the study conducted pursuant to 
subsection (a).
    (c) Examination Related to Certain Credit Risk Retention 
Provisions.--The report required by subsection (b) shall also include 
an analysis by the Comptroller General of the effect on the capital 
reserves and funding of lenders of credit risk retention provisions for 
non-qualified mortgages, including an analysis of the exceptions and 
adjustments authorized in section 129C(b)(3) of the Truth in Lending 
Act and a recommendation on whether a uniform standard is needed.
    (d) Analysis of Credit Risk Retention Provisions.--The report 
required by subsection (b) shall also include--
        (1) an analysis by the Comptroller General of whether the 
    credit risk retention provisions have significantly reduced risks 
    to the larger credit market of the repackaging and selling of 
    securitized loans on a secondary market; and
        (2) recommendations to the Congress on adjustments that should 
    be made, or additional measures that should be undertaken.
SEC. 1422. STATE ATTORNEY GENERAL ENFORCEMENT AUTHORITY.
    Section 130(e) of the Truth in Lending Act (15 U.S.C. 1640(e)) is 
amended by striking ``section 129 may also'' and inserting ``section 
129, 129B, 129C, 129D, 129E, 129F, 129G, or 129H of this Act may 
also''.

                    Subtitle C--High-Cost Mortgages

SEC. 1431. DEFINITIONS RELATING TO HIGH-COST MORTGAGES.
    (a) High-cost Mortgage Defined.--Section 103(aa) of the Truth in 
Lending Act (15 U.S.C. 1602(aa)) is amended by striking all that 
precedes paragraph (2) and inserting the following:
    ``(aa) High-cost Mortgage.--
        ``(1) Definition.--
            ``(A) In general.--The term `high-cost mortgage', and a 
        mortgage referred to in this subsection, means a consumer 
        credit transaction that is secured by the consumer's principal 
        dwelling, other than a reverse mortgage transaction, if--
                ``(i) in the case of a credit transaction secured--

                    ``(I) by a first mortgage on the consumer's 
                principal dwelling, the annual percentage rate at 
                consummation of the transaction will exceed by more 
                than 6.5 percentage points (8.5 percentage points, if 
                the dwelling is personal property and the transaction 
                is for less than $50,000) the average prime offer rate, 
                as defined in section 129C(b)(2)(B), for a comparable 
                transaction; or
                    ``(II) by a subordinate or junior mortgage on the 
                consumer's principal dwelling, the annual percentage 
                rate at consummation of the transaction will exceed by 
                more than 8.5 percentage points the average prime offer 
                rate, as defined in section 129C(b)(2)(B), for a 
                comparable transaction;

                ``(ii) the total points and fees payable in connection 
            with the transaction, other than bona fide third party 
            charges not retained by the mortgage originator, creditor, 
            or an affiliate of the creditor or mortgage originator, 
            exceed--

                    ``(I) in the case of a transaction for $20,000 or 
                more, 5 percent of the total transaction amount; or
                    ``(II) in the case of a transaction for less than 
                $20,000, the lesser of 8 percent of the total 
                transaction amount or $1,000 (or such other dollar 
                amount as the Board shall prescribe by regulation); or

                ``(iii) the credit transaction documents permit the 
            creditor to charge or collect prepayment fees or penalties 
            more than 36 months after the transaction closing or such 
            fees or penalties exceed, in the aggregate, more than 2 
            percent of the amount prepaid.
            ``(B) Introductory rates taken into account.--For purposes 
        of subparagraph (A)(i), the annual percentage rate of interest 
        shall be determined based on the following interest rate:
                ``(i) In the case of a fixed-rate transaction in which 
            the annual percentage rate will not vary during the term of 
            the loan, the interest rate in effect on the date of 
            consummation of the transaction.
                ``(ii) In the case of a transaction in which the rate 
            of interest varies solely in accordance with an index, the 
            interest rate determined by adding the index rate in effect 
            on the date of consummation of the transaction to the 
            maximum margin permitted at any time during the loan 
            agreement.
                ``(iii) In the case of any other transaction in which 
            the rate may vary at any time during the term of the loan 
            for any reason, the interest charged on the transaction at 
            the maximum rate that may be charged during the term of the 
            loan.
            ``(C) Mortgage insurance.--For the purposes of computing 
        the total points and fees under paragraph (4), the total points 
        and fees shall exclude--
                ``(i) any premium provided by an agency of the Federal 
            Government or an agency of a State;
                ``(ii) any amount that is not in excess of the amount 
            payable under policies in effect at the time of origination 
            under section 203(c)(2)(A) of the National Housing Act (12 
            U.S.C. 1709(c)(2)(A)), provided that the premium, charge, 
            or fee is required to be refundable on a pro-rated basis 
            and the refund is automatically issued upon notification of 
            the satisfaction of the underlying mortgage loan; and
                ``(iii) any premium paid by the consumer after 
            closing.''.
    (b) Adjustment of Percentage Points.--Section 103(aa)(2) of the 
Truth in Lending Act (15 U.S.C. 1602(aa)(2)) is amended by striking 
subparagraph (B) and inserting the following new subparagraph:
            ``(B) An increase or decrease under subparagraph (A)--
                ``(i) may not result in the number of percentage points 
            referred to in paragraph (1)(A)(i)(I) being less than 6 
            percentage points or greater than 10 percentage points; and
                ``(ii) may not result in the number of percentage 
            points referred to in paragraph (1)(A)(i)(II) being less 
            than 8 percentage points or greater than 12 percentage 
            points.''.
    (c) Points and Fees Defined.--
        (1) In general.--Section 103(aa)(4) of the Truth in Lending Act 
    (15 U.S.C. 1602(aa)(4)) is amended--
            (A) by striking subparagraph (B) and inserting the 
        following:
            ``(B) all compensation paid directly or indirectly by a 
        consumer or creditor to a mortgage originator from any source, 
        including a mortgage originator that is also the creditor in a 
        table-funded transaction;'';
            (B) by redesignating subparagraph (D) as subparagraph (G); 
        and
            (C) by inserting after subparagraph (C) the following new 
        subparagraphs:
            ``(D) premiums or other charges payable at or before 
        closing for any credit life, credit disability, credit 
        unemployment, or credit property insurance, or any other 
        accident, loss-of-income, life or health insurance, or any 
        payments directly or indirectly for any debt cancellation or 
        suspension agreement or contract, except that insurance 
        premiums or debt cancellation or suspension fees calculated and 
        paid in full on a monthly basis shall not be considered 
        financed by the creditor;
            ``(E) the maximum prepayment fees and penalties which may 
        be charged or collected under the terms of the credit 
        transaction;
            ``(F) all prepayment fees or penalties that are incurred by 
        the consumer if the loan refinances a previous loan made or 
        currently held by the same creditor or an affiliate of the 
        creditor; and''.
        (2) Calculation of points and fees for open-end consumer credit 
    plans.--Section 103(aa) of the Truth in Lending Act (15 U.S.C. 
    1602(aa)) is amended--
            (A) by redesignating paragraph (5) as paragraph (6); and
            (B) by inserting after paragraph (4) the following new 
        paragraph:
        ``(5) Calculation of points and fees for open-end consumer 
    credit plans.--In the case of open-end consumer credit plans, 
    points and fees shall be calculated, for purposes of this section 
    and section 129, by adding the total points and fees known at or 
    before closing, including the maximum prepayment penalties which 
    may be charged or collected under the terms of the credit 
    transaction, plus the minimum additional fees the consumer would be 
    required to pay to draw down an amount equal to the total credit 
    line.''.
    (d) Bona Fide Discount Loan Discount Points.--Section 103 of the 
Truth in Lending Act (15 U.S.C. 1602) is amended by inserting after 
subsection (cc) (as added by section 1401) the following new 
subsection:
    ``(dd) Bona Fide Discount Points and Prepayment Penalties.--For the 
purposes of determining the amount of points and fees for purposes of 
subsection (aa), either the amounts described in paragraph (1) or (2) 
of the following paragraphs, but not both, shall be excluded:
        ``(1) Up to and including 2 bona fide discount points payable 
    by the consumer in connection with the mortgage, but only if the 
    interest rate from which the mortgage's interest rate will be 
    discounted does not exceed by more than 1 percentage point--
            ``(A) the average prime offer rate, as defined in section 
        129C; or
            ``(B) if secured by a personal property loan, the average 
        rate on a loan in connection with which insurance is provided 
        under title I of the National Housing Act (12 U.S.C. 1702 et 
        seq.).
        ``(2) Unless 2 bona fide discount points have been excluded 
    under paragraph (1), up to and including 1 bona fide discount point 
    payable by the consumer in connection with the mortgage, but only 
    if the interest rate from which the mortgage's interest rate will 
    be discounted does not exceed by more than 2 percentage points--
            ``(A) the average prime offer rate, as defined in section 
        129C; or
            ``(B) if secured by a personal property loan, the average 
        rate on a loan in connection with which insurance is provided 
        under title I of the National Housing Act (12 U.S.C. 1702 et 
        seq.).
        ``(3) For purposes of paragraph (1), the term `bona fide 
    discount points' means loan discount points which are knowingly 
    paid by the consumer for the purpose of reducing, and which in fact 
    result in a bona fide reduction of, the interest rate or time-price 
    differential applicable to the mortgage.
        ``(4) Paragraphs (1) and (2) shall not apply to discount points 
    used to purchase an interest rate reduction unless the amount of 
    the interest rate reduction purchased is reasonably consistent with 
    established industry norms and practices for secondary mortgage 
    market transactions.''.
SEC. 1432. AMENDMENTS TO EXISTING REQUIREMENTS FOR CERTAIN MORTGAGES.
    (a) Prepayment Penalty Provisions.--Section 129(c)(2) of the Truth 
in Lending Act (15 U.S.C. 1639(c)(2)) is hereby repealed.
    (b) No Balloon Payments.--Section 129(e) of the Truth in Lending 
Act (15 U.S.C. 1639(e)) is amended to read as follows:
    ``(e) No Balloon Payments.--No high-cost mortgage may contain a 
scheduled payment that is more than twice as large as the average of 
earlier scheduled payments. This subsection shall not apply when the 
payment schedule is adjusted to the seasonal or irregular income of the 
consumer.''.
SEC. 1433. ADDITIONAL REQUIREMENTS FOR CERTAIN MORTGAGES.
    (a) Additional Requirements for Certain Mortgages.--Section 129 of 
the Truth in Lending Act (15 U.S.C. 1639) is amended--
        (1) by redesignating subsections (j), (k), (l) and (m) as 
    subsections (n), (o), (p), and (q) respectively; and
        (2) by inserting after subsection (i) the following new 
    subsections:
    ``(j) Recommended Default.--No creditor shall recommend or 
encourage default on an existing loan or other debt prior to and in 
connection with the closing or planned closing of a high-cost mortgage 
that refinances all or any portion of such existing loan or debt.
    ``(k) Late Fees.--
        ``(1) In general.--No creditor may impose a late payment charge 
    or fee in connection with a high-cost mortgage--
            ``(A) in an amount in excess of 4 percent of the amount of 
        the payment past due;
            ``(B) unless the loan documents specifically authorize the 
        charge or fee;
            ``(C) before the end of the 15-day period beginning on the 
        date the payment is due, or in the case of a loan on which 
        interest on each installment is paid in advance, before the end 
        of the 30-day period beginning on the date the payment is due; 
        or
            ``(D) more than once with respect to a single late payment.
        ``(2) Coordination with subsequent late fees.--If a payment is 
    otherwise a full payment for the applicable period and is paid on 
    its due date or within an applicable grace period, and the only 
    delinquency or insufficiency of payment is attributable to any late 
    fee or delinquency charge assessed on any earlier payment, no late 
    fee or delinquency charge may be imposed on such payment.
        ``(3) Failure to make installment payment.--If, in the case of 
    a loan agreement the terms of which provide that any payment shall 
    first be applied to any past due principal balance, the consumer 
    fails to make an installment payment and the consumer subsequently 
    resumes making installment payments but has not paid all past due 
    installments, the creditor may impose a separate late payment 
    charge or fee for any principal due (without deduction due to late 
    fees or related fees) until the default is cured.
    ``(l) Acceleration of Debt.--No high-cost mortgage may contain a 
provision which permits the creditor to accelerate the indebtedness, 
except when repayment of the loan has been accelerated by default in 
payment, or pursuant to a due-on-sale provision, or pursuant to a 
material violation of some other provision of the loan document 
unrelated to payment schedule.
    ``(m) Restriction on Financing Points and Fees.--No creditor may 
directly or indirectly finance, in connection with any high-cost 
mortgage, any of the following:
        ``(1) Any prepayment fee or penalty payable by the consumer in 
    a refinancing transaction if the creditor or an affiliate of the 
    creditor is the noteholder of the note being refinanced.
        ``(2) Any points or fees.''.
    (b) Prohibitions on Evasions.--Section 129 of the Truth in Lending 
Act (15 U.S.C. 1639) is amended by inserting after subsection (q) (as 
so redesignated by subsection (a)(1)) the following new subsection:
    ``(r) Prohibitions on Evasions, Structuring of Transactions, and 
Reciprocal Arrangements.--A creditor may not take any action in 
connection with a high-cost mortgage--
        ``(1) to structure a loan transaction as an open-end credit 
    plan or another form of loan for the purpose and with the intent of 
    evading the provisions of this title; or
        ``(2) to divide any loan transaction into separate parts for 
    the purpose and with the intent of evading provisions of this 
    title.''.
    (c) Modification or Deferral Fees.--Section 129 of the Truth in 
Lending Act (15 U.S.C. 1639) is amended by inserting after subsection 
(r) (as added by subsection (b) of this section) the following new 
subsection:
    ``(s) Modification and Deferral Fees Prohibited.--A creditor, 
successor in interest, assignee, or any agent of any of the above, may 
not charge a consumer any fee to modify, renew, extend, or amend a 
high-cost mortgage, or to defer any payment due under the terms of such 
mortgage.''.
    (d) Payoff Statement.--Section 129 of the Truth in Lending Act (15 
U.S.C. 1639) is amended by inserting after subsection (s) (as added by 
subsection (c) of this section) the following new subsection:
    ``(t) Payoff Statement.--
        ``(1) Fees.--
            ``(A) In general.--Except as provided in subparagraph (B), 
        no creditor or servicer may charge a fee for informing or 
        transmitting to any person the balance due to pay off the 
        outstanding balance on a high-cost mortgage.
            ``(B) Transaction fee.--When payoff information referred to 
        in subparagraph (A) is provided by facsimile transmission or by 
        a courier service, a creditor or servicer may charge a 
        processing fee to cover the cost of such transmission or 
        service in an amount not to exceed an amount that is comparable 
        to fees imposed for similar services provided in connection 
        with consumer credit transactions that are secured by the 
        consumer's principal dwelling and are not high-cost mortgages.
            ``(C) Fee disclosure.--Prior to charging a transaction fee 
        as provided in subparagraph (B), a creditor or servicer shall 
        disclose that payoff balances are available for free pursuant 
        to subparagraph (A).
            ``(D) Multiple requests.--If a creditor or servicer has 
        provided payoff information referred to in subparagraph (A) 
        without charge, other than the transaction fee allowed by 
        subparagraph (B), on 4 occasions during a calendar year, the 
        creditor or servicer may thereafter charge a reasonable fee for 
        providing such information during the remainder of the calendar 
        year.
        ``(2) Prompt delivery.--Payoff balances shall be provided 
    within 5 business days after receiving a request by a consumer or a 
    person authorized by the consumer to obtain such information.''.
    (e) Pre-Loan Counseling Required.--Section 129 of the Truth in 
Lending Act (15 U.S.C. 1639) is amended by inserting after subsection 
t) (as added by subsection (d) of this section) the following new 
subsection:
    ``(u) Pre-Loan Counseling.--
        ``(1) In general.--A creditor may not extend credit to a 
    consumer under a high-cost mortgage without first receiving 
    certification from a counselor that is approved by the Secretary of 
    Housing and Urban Development, or at the discretion of the 
    Secretary, a State housing finance authority, that the consumer has 
    received counseling on the advisability of the mortgage. Such 
    counselor shall not be employed by the creditor or an affiliate of 
    the creditor or be affiliated with the creditor.
        ``(2) Disclosures required prior to counseling.--No counselor 
    may certify that a consumer has received counseling on the 
    advisability of the high-cost mortgage unless the counselor can 
    verify that the consumer has received each statement required (in 
    connection with such loan) by this section or the Real Estate 
    Settlement Procedures Act of 1974 with respect to the transaction.
        ``(3) Regulations.--The Board may prescribe such regulations as 
    the Board determines to be appropriate to carry out the 
    requirements of paragraph (1).''.
    (f) Corrections and Unintentional Violations.--Section 129 of the 
Truth in Lending Act (15 U.S.C. 1639) is amended by inserting after 
subsection (u) (as added by subsection (e)) the following new 
subsection:
    ``(v) Corrections and Unintentional Violations.--A creditor or 
assignee in a high-cost mortgage who, when acting in good faith, fails 
to comply with any requirement under this section will not be deemed to 
have violated such requirement if the creditor or assignee establishes 
that either--
        ``(1) within 30 days of the loan closing and prior to the 
    institution of any action, the consumer is notified of or discovers 
    the violation, appropriate restitution is made, and whatever 
    adjustments are necessary are made to the loan to either, at the 
    choice of the consumer--
            ``(A) make the loan satisfy the requirements of this 
        chapter; or
            ``(B) in the case of a high-cost mortgage, change the terms 
        of the loan in a manner beneficial to the consumer so that the 
        loan will no longer be a high-cost mortgage; or
        ``(2) within 60 days of the creditor's discovery or receipt of 
    notification of an unintentional violation or bona fide error and 
    prior to the institution of any action, the consumer is notified of 
    the compliance failure, appropriate restitution is made, and 
    whatever adjustments are necessary are made to the loan to either, 
    at the choice of the consumer--
            ``(A) make the loan satisfy the requirements of this 
        chapter; or
            ``(B) in the case of a high-cost mortgage, change the terms 
        of the loan in a manner beneficial so that the loan will no 
        longer be a high-cost mortgage.''.

                Subtitle D--Office of Housing Counseling

SEC. 1441. SHORT TITLE.
    This subtitle may be cited as the ``Expand and Preserve Home 
Ownership Through Counseling Act''.
SEC. 1442. ESTABLISHMENT OF OFFICE OF HOUSING COUNSELING.
    Section 4 of the Department of Housing and Urban Development Act 
(42 U.S.C. 3533) is amended by adding at the end the following new 
subsection:
    ``(g) Office of Housing Counseling.--
        ``(1) Establishment.--There is established, in the Department, 
    the Office of Housing Counseling.
        ``(2) Director.--There is established the position of Director 
    of Housing Counseling. The Director shall be the head of the Office 
    of Housing Counseling and shall be appointed by, and shall report 
    to, the Secretary. Such position shall be a career-reserved 
    position in the Senior Executive Service.
        ``(3) Functions.--
            ``(A) In general.--The Director shall have primary 
        responsibility within the Department for all activities and 
        matters relating to homeownership counseling and rental housing 
        counseling, including--
                ``(i) research, grant administration, public outreach, 
            and policy development relating to such counseling; and
                ``(ii) establishment, coordination, and administration 
            of all regulations, requirements, standards, and 
            performance measures under programs and laws administered 
            by the Department that relate to housing counseling, 
            homeownership counseling (including maintenance of homes), 
            mortgage-related counseling (including home equity 
            conversion mortgages and credit protection options to avoid 
            foreclosure), and rental housing counseling, including the 
            requirements, standards, and performance measures relating 
            to housing counseling.
            ``(B) Specific functions.--The Director shall carry out the 
        functions assigned to the Director and the Office under this 
        section and any other provisions of law. Such functions shall 
        include establishing rules necessary for--
                ``(i) the counseling procedures under section 106(g)(1) 
            of the Housing and Urban Development Act of 1968 (12 U.S.C. 
            1701x(h)(1));
                ``(ii) carrying out all other functions of the 
            Secretary under section 106(g) of the Housing and Urban 
            Development Act of 1968, including the establishment, 
            operation, and publication of the availability of the toll-
            free telephone number under paragraph (2) of such section;
                ``(iii) contributing to the distribution of home buying 
            information booklets pursuant to section 5 of the Real 
            Estate Settlement Procedures Act of 1974 (12 U.S.C. 2604);
                ``(iv) carrying out the certification program under 
            section 106(e) of the Housing and Urban Development Act of 
            1968 (12 U.S.C. 1701x(e));
                ``(v) carrying out the assistance program under section 
            106(a)(4) of the Housing and Urban Development Act of 1968, 
            including criteria for selection of applications to receive 
            assistance;
                ``(vi) carrying out any functions regarding abusive, 
            deceptive, or unscrupulous lending practices relating to 
            residential mortgage loans that the Secretary considers 
            appropriate, which shall include conducting the study under 
            section 6 of the Expand and Preserve Home Ownership Through 
            Counseling Act;
                ``(vii) providing for operation of the advisory 
            committee established under paragraph (4) of this 
            subsection;
                ``(viii) collaborating with community-based 
            organizations with expertise in the field of housing 
            counseling; and
                ``(ix) providing for the building of capacity to 
            provide housing counseling services in areas that lack 
            sufficient services, including underdeveloped areas that 
            lack basic water and sewer systems, electricity services, 
            and safe, sanitary housing.
        ``(4) Advisory committee.--
            ``(A) In general.--The Secretary shall appoint an advisory 
        committee to provide advice regarding the carrying out of the 
        functions of the Director.
            ``(B) Members.--Such advisory committee shall consist of 
        not more than 12 individuals, and the membership of the 
        committee shall equally represent the mortgage and real estate 
        industry, including consumers and housing counseling agencies 
        certified by the Secretary.
            ``(C) Terms.--Except as provided in subparagraph (D), each 
        member of the advisory committee shall be appointed for a term 
        of 3 years. Members may be reappointed at the discretion of the 
        Secretary.
            ``(D) Terms of initial appointees.--As designated by the 
        Secretary at the time of appointment, of the members first 
        appointed to the advisory committee, 4 shall be appointed for a 
        term of 1 year and 4 shall be appointed for a term of 2 years.
            ``(E) Prohibition of pay; travel expenses.--Members of the 
        advisory committee shall serve without pay, but shall receive 
        travel expenses, including per diem in lieu of subsistence, in 
        accordance with applicable provisions under subchapter I of 
        chapter 57 of title 5, United States Code.
            ``(F) Advisory role only.--The advisory committee shall 
        have no role in reviewing or awarding housing counseling 
        grants.
        ``(5) Scope of homeownership counseling.--In carrying out the 
    responsibilities of the Director, the Director shall ensure that 
    homeownership counseling provided by, in connection with, or 
    pursuant to any function, activity, or program of the Department 
    addresses the entire process of homeownership, including the 
    decision to purchase a home, the selection and purchase of a home, 
    issues arising during or affecting the period of ownership of a 
    home (including refinancing, default and foreclosure, and other 
    financial decisions), and the sale or other disposition of a 
    home.''.
SEC. 1443. COUNSELING PROCEDURES.
    (a) In General.--Section 106 of the Housing and Urban Development 
Act of 1968 (12 U.S.C. 1701x) is amended by adding at the end the 
following new subsection:
    ``(g) Procedures and Activities.--
        ``(1) Counseling procedures.--
            ``(A) In general.--The Secretary shall establish, 
        coordinate, and monitor the administration by the Department of 
        Housing and Urban Development of the counseling procedures for 
        homeownership counseling and rental housing counseling provided 
        in connection with any program of the Department, including all 
        requirements, standards, and performance measures that relate 
        to homeownership and rental housing counseling.
            ``(B) Homeownership counseling.--For purposes of this 
        subsection and as used in the provisions referred to in this 
        subparagraph, the term `homeownership counseling' means 
        counseling related to homeownership and residential mortgage 
        loans. Such term includes counseling related to homeownership 
        and residential mortgage loans that is provided pursuant to--
                ``(i) section 105(a)(20) of the Housing and Community 
            Development Act of 1974 (42 U.S.C. 5305(a)(20));
                ``(ii) in the United States Housing Act of 1937--

                    ``(I) section 9(e) (42 U.S.C. 1437g(e));
                    ``(II) section 8(y)(1)(D) (42 U.S.C. 
                1437f(y)(1)(D));
                    ``(III) section 18(a)(4)(D) (42 U.S.C. 
                1437p(a)(4)(D));
                    ``(IV) section 23(c)(4) (42 U.S.C. 1437u(c)(4));
                    ``(V) section 32(e)(4) (42 U.S.C. 1437z-4(e)(4));
                    ``(VI) section 33(d)(2)(B) (42 U.S.C. 1437z-
                5(d)(2)(B));
                    ``(VII) sections 302(b)(6) and 303(b)(7) (42 U.S.C. 
                1437aaa-1(b)(6), 1437aaa-2(b)(7)); and
                    ``(VIII) section 304(c)(4) (42 U.S.C. 1437aaa-
                3(c)(4));

                ``(iii) section 302(a)(4) of the American Homeownership 
            and Economic Opportunity Act of 2000 (42 U.S.C. 1437f 
            note);
                ``(iv) sections 233(b)(2) and 258(b) of the Cranston-
            Gonzalez National Affordable Housing Act (42 U.S.C. 
            12773(b)(2), 12808(b));
                ``(v) this section and section 101(e) of the Housing 
            and Urban Development Act of 1968 (12 U.S.C. 1701x, 
            1701w(e));
                ``(vi) section 220(d)(2)(G) of the Low-Income Housing 
            Preservation and Resident Homeownership Act of 1990 (12 
            U.S.C. 4110(d)(2)(G));
                ``(vii) sections 422(b)(6), 423(b)(7), 424(c)(4), 
            442(b)(6), and 443(b)(6) of the Cranston-Gonzalez National 
            Affordable Housing Act (42 U.S.C. 12872(b)(6), 12873(b)(7), 
            12874(c)(4), 12892(b)(6), and 12893(b)(6));
                ``(viii) section 491(b)(1)(F)(iii) of the McKinney-
            Vento Homeless Assistance Act (42 U.S.C. 
            11408(b)(1)(F)(iii));
                ``(ix) sections 202(3) and 810(b)(2)(A) of the Native 
            American Housing and Self-Determination Act of 1996 (25 
            U.S.C. 4132(3), 4229(b)(2)(A));
                ``(x) in the National Housing Act--

                    ``(I) in section 203 (12 U.S.C. 1709), the 
                penultimate undesignated paragraph of paragraph (2) of 
                subsection (b), subsection (c)(2)(A), and subsection 
                (r)(4);
                    ``(II) subsections (a) and (c)(3) of section 237 
                (12 U.S.C. 1715z-2); and
                    ``(III) subsections (d)(2)(B) and (m)(1) of section 
                255 (12 U.S.C. 1715z-20);

                ``(xi) section 502(h)(4)(B) of the Housing Act of 1949 
            (42 U.S.C. 1472(h)(4)(B));
                ``(xii) section 508 of the Housing and Urban 
            Development Act of 1970 (12 U.S.C. 1701z-7); and
                ``(xiii) section 106 of the Energy Policy Act of 1992 
            (42 U.S.C. 12712 note).
            ``(C) Rental housing counseling.--For purposes of this 
        subsection, the term `rental housing counseling' means 
        counseling related to rental of residential property, which may 
        include counseling regarding future homeownership opportunities 
        and providing referrals for renters and prospective renters to 
        entities providing counseling and shall include counseling 
        related to such topics that is provided pursuant to--
                ``(i) section 105(a)(20) of the Housing and Community 
            Development Act of 1974 (42 U.S.C. 5305(a)(20));
                ``(ii) in the United States Housing Act of 1937--

                    ``(I) section 9(e) (42 U.S.C. 1437g(e));
                    ``(II) section 18(a)(4)(D) (42 U.S.C. 
                1437p(a)(4)(D));
                    ``(III) section 23(c)(4) (42 U.S.C. 1437u(c)(4));
                    ``(IV) section 32(e)(4) (42 U.S.C. 1437z-4(e)(4));
                    ``(V) section 33(d)(2)(B) (42 U.S.C. 1437z-
                5(d)(2)(B)); and
                    ``(VI) section 302(b)(6) (42 U.S.C. 1437aaa-
                1(b)(6));

                ``(iii) section 233(b)(2) of the Cranston-Gonzalez 
            National Affordable Housing Act (42 U.S.C. 12773(b)(2));
                ``(iv) section 106 of the Housing and Urban Development 
            Act of 1968 (12 U.S.C. 1701x);
                ``(v) section 422(b)(6) of the Cranston-Gonzalez 
            National Affordable Housing Act (42 U.S.C. 12872(b)(6));
                ``(vi) section 491(b)(1)(F)(iii) of the McKinney-Vento 
            Homeless Assistance Act (42 U.S.C. 11408(b)(1)(F)(iii));
                ``(vii) sections 202(3) and 810(b)(2)(A) of the Native 
            American Housing and Self-Determination Act of 1996 (25 
            U.S.C. 4132(3), 4229(b)(2)(A)); and
                ``(viii) the rental assistance program under section 8 
            of the United States Housing Act of 1937 (42 U.S.C. 1437f).
        ``(2) Standards for materials.--The Secretary, in consultation 
    with the advisory committee established under subsection (g)(4) of 
    the Department of Housing and Urban Development Act, shall 
    establish standards for materials and forms to be used, as 
    appropriate, by organizations providing homeownership counseling 
    services, including any recipients of assistance pursuant to 
    subsection (a)(4).
        ``(3) Mortgage software systems.--
            ``(A) Certification.--The Secretary shall provide for the 
        certification of various computer software programs for 
        consumers to use in evaluating different residential mortgage 
        loan proposals. The Secretary shall require, for such 
        certification, that the mortgage software systems take into 
        account--
                ``(i) the consumer's financial situation and the cost 
            of maintaining a home, including insurance, taxes, and 
            utilities;
                ``(ii) the amount of time the consumer expects to 
            remain in the home or expected time to maturity of the 
            loan; and
                ``(iii) such other factors as the Secretary considers 
            appropriate to assist the consumer in evaluating whether to 
            pay points, to lock in an interest rate, to select an 
            adjustable or fixed rate loan, to select a conventional or 
            government-insured or guaranteed loan and to make other 
            choices during the loan application process.
        If the Secretary determines that available existing software is 
        inadequate to assist consumers during the residential mortgage 
        loan application process, the Secretary shall arrange for the 
        development by private sector software companies of new 
        mortgage software systems that meet the Secretary's 
        specifications.
            ``(B) Use and initial availability.--Such certified 
        computer software programs shall be used to supplement, not 
        replace, housing counseling. The Secretary shall provide that 
        such programs are initially used only in connection with the 
        assistance of housing counselors certified pursuant to 
        subsection (e).
            ``(C) Availability.--After a period of initial availability 
        under subparagraph (B) as the Secretary considers appropriate, 
        the Secretary shall take reasonable steps to make mortgage 
        software systems certified pursuant to this paragraph widely 
        available through the Internet and at public locations, 
        including public libraries, senior-citizen centers, public 
        housing sites, offices of public housing agencies that 
        administer rental housing assistance vouchers, and housing 
        counseling centers.
            ``(D) Budget compliance.--This paragraph shall be effective 
        only to the extent that amounts to carry out this paragraph are 
        made available in advance in appropriations Acts.
        ``(4) National public service multimedia campaigns to promote 
    housing counseling.--
            ``(A) In general.--The Director of Housing Counseling shall 
        develop, implement, and conduct national public service 
        multimedia campaigns designed to make persons facing mortgage 
        foreclosure, persons considering a subprime mortgage loan to 
        purchase a home, elderly persons, persons who face language 
        barriers, low-income persons, minorities, and other potentially 
        vulnerable consumers aware that it is advisable, before seeking 
        or maintaining a residential mortgage loan, to obtain 
        homeownership counseling from an unbiased and reliable sources 
        and that such homeownership counseling is available, including 
        through programs sponsored by the Secretary of Housing and 
        Urban Development.
            ``(B) Contact information.--Each segment of the multimedia 
        campaign under subparagraph (A) shall publicize the toll-free 
        telephone number and website of the Department of Housing and 
        Urban Development through which persons seeking housing 
        counseling can locate a housing counseling agency in their 
        State that is certified by the Secretary of Housing and Urban 
        Development and can provide advice on buying a home, renting, 
        defaults, foreclosures, credit issues, and reverse mortgages.
            ``(C) Authorization of appropriations.--There are 
        authorized to be appropriated to the Secretary, not to exceed 
        $3,000,000 for fiscal years 2009, 2010, and 2011, for the 
        development, implementation, and conduct of national public 
        service multimedia campaigns under this paragraph.
            ``(D) Foreclosure rescue education programs.--
                ``(i) In general.--Ten percent of any funds 
            appropriated pursuant to the authorization under 
            subparagraph (C) shall be used by the Director of Housing 
            Counseling to conduct an education program in areas that 
            have a high density of foreclosure. Such program shall 
            involve direct mailings to persons living in such areas 
            describing--

                    ``(I) tips on avoiding foreclosure rescue scams;
                    ``(II) tips on avoiding predatory lending mortgage 
                agreements;
                    ``(III) tips on avoiding for-profit foreclosure 
                counseling services; and
                    ``(IV) local counseling resources that are approved 
                by the Department of Housing and Urban Development.

                ``(ii) Program emphasis.--In conducting the education 
            program described under clause (i), the Director of Housing 
            Counseling shall also place an emphasis on serving 
            communities that have a high percentage of retirement 
            communities or a high percentage of low-income minority 
            communities.
                ``(iii) Terms defined.--For purposes of this 
            subparagraph:

                    ``(I) High density of foreclosures.--An area has a 
                `high density of foreclosures' if such area is one of 
                the metropolitan statistical areas (as that term is 
                defined by the Director of the Office of Management and 
                Budget) with the highest home foreclosure rates.
                    ``(II) High percentage of retirement communities.--
                An area has a `high percentage of retirement 
                communities' if such area is one of the metropolitan 
                statistical areas (as that term is defined by the 
                Director of the Office of Management and Budget) with 
                the highest percentage of residents aged 65 or older.
                    ``(III) High percentage of low-income minority 
                communities.--An area has a `high percentage of low-
                income minority communities' if such area contains a 
                higher-than-normal percentage of residents who are both 
                minorities and low-income, as defined by the Director 
                of Housing Counseling.

        ``(5) Education programs.--The Secretary shall provide advice 
    and technical assistance to States, units of general local 
    government, and nonprofit organizations regarding the establishment 
    and operation of, including assistance with the development of 
    content and materials for, educational programs to inform and 
    educate consumers, particularly those most vulnerable with respect 
    to residential mortgage loans (such as elderly persons, persons 
    facing language barriers, low-income persons, minorities, and other 
    potentially vulnerable consumers), regarding home mortgages, 
    mortgage refinancing, home equity loans, home repair loans, and 
    where appropriate by region, any requirements and costs associated 
    with obtaining flood or other disaster-specific insurance 
    coverage.''.
    (b) Conforming Amendments to Grant Program for Homeownership 
Counseling Organizations.--Section 106(c)(5)(A)(ii) of the Housing and 
Urban Development Act of 1968 (12 U.S.C. 1701x(c)(5)(A)(ii)) is 
amended--
        (1) in subclause (III), by striking ``and'' at the end;
        (2) in subclause (IV) by striking the period at the end and 
    inserting ``; and''; and
        (3) by inserting after subclause (IV) the following new 
    subclause:

                    ``(V) notify the housing or mortgage applicant of 
                the availability of mortgage software systems provided 
                pursuant to subsection (g)(3).''.

SEC. 1444. GRANTS FOR HOUSING COUNSELING ASSISTANCE.
    Section 106(a) of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x(a)) is amended by adding at the end the following new 
paragraph:
    ``(4) Homeownership and Rental Counseling Assistance.--
        ``(A) In general.--The Secretary shall make financial 
    assistance available under this paragraph to HUD-approved housing 
    counseling agencies and State housing finance agencies.
        ``(B) Qualified entities.--The Secretary shall establish 
    standards and guidelines for eligibility of organizations 
    (including governmental and nonprofit organizations) to receive 
    assistance under this paragraph, in accordance with subparagraph 
    (D).
        ``(C) Distribution.--Assistance made available under this 
    paragraph shall be distributed in a manner that encourages 
    efficient and successful counseling programs and that ensures 
    adequate distribution of amounts for rural areas having 
    traditionally low levels of access to such counseling services, 
    including areas with insufficient access to the Internet. In 
    distributing such assistance, the Secretary may give priority 
    consideration to entities serving areas with the highest home 
    foreclosure rates.
        ``(D) Limitation on distribution of assistance.--
            ``(i) In general.--None of the amounts made available under 
        this paragraph shall be distributed to--
                ``(I) any organization which has been convicted for a 
            violation under Federal law relating to an election for 
            Federal office; or
                ``(II) any organization which employs applicable 
            individuals.
            ``(ii) Definition of applicable individuals.--In this 
        subparagraph, the term `applicable individual' means an 
        individual who--
                ``(I) is--

                    ``(aa) employed by the organization in a permanent 
                or temporary capacity;
                    ``(bb) contracted or retained by the organization; 
                or
                    ``(cc) acting on behalf of, or with the express or 
                apparent authority of, the organization; and

                ``(II) has been convicted for a violation under Federal 
            law relating to an election for Federal office.
        ``(E) Grantmaking process.--In making assistance available 
    under this paragraph, the Secretary shall consider appropriate ways 
    of streamlining and improving the processes for grant application, 
    review, approval, and award.
        ``(F) Authorization of appropriations.--There are authorized to 
    be appropriated $45,000,000 for each of fiscal years 2009 through 
    2012 for--
            ``(i) the operations of the Office of Housing Counseling of 
        the Department of Housing and Urban Development;
            ``(ii) the responsibilities of the Director of Housing 
        Counseling under paragraphs (2) through (5) of subsection (g); 
        and
            ``(iii) assistance pursuant to this paragraph for entities 
        providing homeownership and rental counseling.''.
SEC. 1445. REQUIREMENTS TO USE HUD-CERTIFIED COUNSELORS UNDER HUD 
PROGRAMS.
    Section 106(e) of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x(e)) is amended--
        (1) by striking paragraph (1) and inserting the following new 
    paragraph:
        ``(1) Requirement for assistance.--An organization may not 
    receive assistance for counseling activities under subsection 
    (a)(1)(iii), (a)(2), (a)(4), (c), or (d) of this section, or under 
    section 101(e), unless the organization, or the individuals through 
    which the organization provides such counseling, has been certified 
    by the Secretary under this subsection as competent to provide such 
    counseling.'';
        (2) in paragraph (2)--
            (A) by inserting ``and for certifying organizations'' 
        before the period at the end of the first sentence; and
            (B) in the second sentence by striking ``for 
        certification'' and inserting ``, for certification of an 
        organization, that each individual through which the 
        organization provides counseling shall demonstrate, and, for 
        certification of an individual,'';
        (3) in paragraph (3), by inserting ``organizations and'' before 
    ``individuals'';
        (4) by redesignating paragraph (3) as paragraph (5); and
        (5) by inserting after paragraph (2) the following new 
    paragraphs:
        ``(3) Requirement under hud programs.--Any homeownership 
    counseling or rental housing counseling (as such terms are defined 
    in subsection (g)(1)) required under, or provided in connection 
    with, any program administered by the Department of Housing and 
    Urban Development shall be provided only by organizations or 
    counselors certified by the Secretary under this subsection as 
    competent to provide such counseling.
        ``(4) Outreach.--The Secretary shall take such actions as the 
    Secretary considers appropriate to ensure that individuals and 
    organizations providing homeownership or rental housing counseling 
    are aware of the certification requirements and standards of this 
    subsection and of the training and certification programs under 
    subsection (f).''.
SEC. 1446. STUDY OF DEFAULTS AND FORECLOSURES.
    The Secretary of Housing and Urban Development shall conduct an 
extensive study of the root causes of default and foreclosure of home 
loans, using as much empirical data as are available. The study shall 
also examine the role of escrow accounts in helping prime and nonprime 
borrowers to avoid defaults and foreclosures, and the role of computer 
registries of mortgages, including those used for trading mortgage 
loans. Not later than 12 months after the date of the enactment of this 
Act, the Secretary shall submit to the Congress a preliminary report 
regarding the study. Not later than 24 months after such date of 
enactment, the Secretary shall submit a final report regarding the 
results of the study, which shall include any recommended legislation 
relating to the study, and recommendations for best practices and for a 
process to identify populations that need counseling the most.
SEC. 1447. DEFAULT AND FORECLOSURE DATABASE.
    (a) Establishment.--The Secretary of Housing and Urban Development 
and the Director of the Bureau, in consultation with the Federal 
agencies responsible for regulation of banking and financial 
institutions involved in residential mortgage lending and servicing, 
shall establish and maintain a database of information on foreclosures 
and defaults on mortgage loans for one- to four-unit residential 
properties and shall make such information publicly available, subject 
to subsection (e).
    (b) Census Tract Data.--Information in the database may be 
collected, aggregated, and made available on a census tract basis.
    (c) Requirements.--Information collected and made available through 
the database shall include--
        (1) the number and percentage of such mortgage loans that are 
    delinquent by more than 30 days;
        (2) the number and percentage of such mortgage loans that are 
    delinquent by more than 90 days;
        (3) the number and percentage of such properties that are real 
    estate-owned;
        (4) number and percentage of such mortgage loans that are in 
    the foreclosure process;
        (5) the number and percentage of such mortgage loans that have 
    an outstanding principal obligation amount that is greater than the 
    value of the property for which the loan was made; and
        (6) such other information as the Secretary of Housing and 
    Urban Development and the Director of the Bureau consider 
    appropriate.
    (d) Rule of Construction.--Nothing in this section shall be 
construed to encourage discriminatory or unsound allocation of credit 
or lending policies or practices.
    (e) Privacy and Confidentiality.--In establishing and maintaining 
the database described in subsection (a), the Secretary of Housing and 
Urban Development and the Director of the Bureau shall--
        (1) be subject to the standards applicable to Federal agencies 
    for the protection of the confidentiality of personally 
    identifiable information and for data security and integrity;
        (2) implement the necessary measures to conform to the 
    standards for data integrity and security described in paragraph 
    (1); and
        (3) collect and make available information under this section, 
    in accordance with paragraphs (5) and (6) of section 1022(c) and 
    the rules prescribed under such paragraphs, in order to protect 
    privacy and confidentiality.
SEC. 1448. DEFINITIONS FOR COUNSELING-RELATED PROGRAMS.
    Section 106 of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x), as amended by the preceding provisions of this subtitle, 
is amended by adding at the end the following new subsection:
    ``(h) Definitions.--For purposes of this section:
        ``(1) Nonprofit organization.--The term `nonprofit 
    organization' has the meaning given such term in section 104(5) of 
    the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
    12704(5)), except that subparagraph (D) of such section shall not 
    apply for purposes of this section.
        ``(2) State.--The term `State' means each of the several 
    States, the Commonwealth of Puerto Rico, the District of Columbia, 
    the Commonwealth of the Northern Mariana Islands, Guam, the Virgin 
    Islands, American Samoa, the Trust Territories of the Pacific, or 
    any other possession of the United States.
        ``(3) Unit of general local government.--The term `unit of 
    general local government' means any city, county, parish, town, 
    township, borough, village, or other general purpose political 
    subdivision of a State.
        ``(4) HUD-approved counseling agency.--The term `HUD-approved 
    counseling agency' means a private or public nonprofit organization 
    that is--
            ``(A) exempt from taxation under section 501(c) of the 
        Internal Revenue Code of 1986; and
            ``(B) certified by the Secretary to provide housing 
        counseling services.
        ``(5) State housing finance agency.--The term `State housing 
    finance agency' means any public body, agency, or instrumentality 
    specifically created under State statute that is authorised to 
    finance activities designed to provide housing and related 
    facilities throughout an entire State through land acquisition, 
    construction, or rehabilitation.''.
SEC. 1449. ACCOUNTABILITY AND TRANSPARENCY FOR GRANT RECIPIENTS.
    Section 106 of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x), as amended by the preceding provisions of this subtitle, 
is amended by adding at the end the following:
    ``(i) Accountability for Recipients of Covered Assistance.--
        ``(1) Tracking of funds.--The Secretary shall--
            ``(A) develop and maintain a system to ensure that any 
        organization or entity that receives any covered assistance 
        uses all amounts of covered assistance in accordance with this 
        section, the regulations issued under this section, and any 
        requirements or conditions under which such amounts were 
        provided; and
            ``(B) require any organization or entity, as a condition of 
        receipt of any covered assistance, to agree to comply with such 
        requirements regarding covered assistance as the Secretary 
        shall establish, which shall include--
                ``(i) appropriate periodic financial and grant activity 
            reporting, record retention, and audit requirements for the 
            duration of the covered assistance to the organization or 
            entity to ensure compliance with the limitations and 
            requirements of this section, the regulations under this 
            section, and any requirements or conditions under which 
            such amounts were provided; and
                ``(ii) any other requirements that the Secretary 
            determines are necessary to ensure appropriate 
            administration and compliance.
        ``(2) Misuse of funds.--If any organization or entity that 
    receives any covered assistance is determined by the Secretary to 
    have used any covered assistance in a manner that is materially in 
    violation of this section, the regulations issued under this 
    section, or any requirements or conditions under which such 
    assistance was provided--
            ``(A) the Secretary shall require that, within 12 months 
        after the determination of such misuse, the organization or 
        entity shall reimburse the Secretary for such misused amounts 
        and return to the Secretary any such amounts that remain unused 
        or uncommitted for use; and
            ``(B) such organization or entity shall be ineligible, at 
        any time after such determination, to apply for or receive any 
        further covered assistance.
    The remedies under this paragraph are in addition to any other 
    remedies that may be available under law.
        ``(3) Covered assistance.--For purposes of this subsection, the 
    term `covered assistance' means any grant or other financial 
    assistance provided under this section.''.
SEC. 1450. UPDATING AND SIMPLIFICATION OF MORTGAGE INFORMATION BOOKLET.
    Section 5 of the Real Estate Settlement Procedures Act of 1974 (12 
U.S.C. 2604) is amended--
        (1) in the section heading, by striking ``special'' and 
    inserting ``home buying'';
        (2) by striking subsections (a) and (b) and inserting the 
    following new subsections:
    ``(a) Preparation and Distribution.--The Director of the Bureau of 
Consumer Financial Protection (hereafter in this section referred to as 
the `Director') shall prepare, at least once every 5 years, a booklet 
to help consumers applying for federally related mortgage loans to 
understand the nature and costs of real estate settlement services. The 
Director shall prepare the booklet in various languages and cultural 
styles, as the Director determines to be appropriate, so that the 
booklet is understandable and accessible to homebuyers of different 
ethnic and cultural backgrounds. The Director shall distribute such 
booklets to all lenders that make federally related mortgage loans. The 
Director shall also distribute to such lenders lists, organized by 
location, of homeownership counselors certified under section 106(e) of 
the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(e)) for 
use in complying with the requirement under subsection (c) of this 
section.
    ``(b) Contents.--Each booklet shall be in such form and detail as 
the Director shall prescribe and, in addition to such other information 
as the Director may provide, shall include in plain and understandable 
language the following information:
        ``(1) A description and explanation of the nature and purpose 
    of the costs incident to a real estate settlement or a federally 
    related mortgage loan. The description and explanation shall 
    provide general information about the mortgage process as well as 
    specific information concerning, at a minimum--
            ``(A) balloon payments;
            ``(B) prepayment penalties;
            ``(C) the advantages of prepayment; and
            ``(D) the trade-off between closing costs and the interest 
        rate over the life of the loan.
        ``(2) An explanation and sample of the uniform settlement 
    statement required by section 4.
        ``(3) A list and explanation of lending practices, including 
    those prohibited by the Truth in Lending Act or other applicable 
    Federal law, and of other unfair practices and unreasonable or 
    unnecessary charges to be avoided by the prospective buyer with 
    respect to a real estate settlement.
        ``(4) A list and explanation of questions a consumer obtaining 
    a federally related mortgage loan should ask regarding the loan, 
    including whether the consumer will have the ability to repay the 
    loan, whether the consumer sufficiently shopped for the loan, 
    whether the loan terms include prepayment penalties or balloon 
    payments, and whether the loan will benefit the borrower.
        ``(5) An explanation of the right of rescission as to certain 
    transactions provided by sections 125 and 129 of the Truth in 
    Lending Act.
        ``(6) A brief explanation of the nature of a variable rate 
    mortgage and a reference to the booklet entitled `Consumer Handbook 
    on Adjustable Rate Mortgages', published by the Director, or to any 
    suitable substitute of such booklet that the Director may 
    subsequently adopt pursuant to such section.
        ``(7) A brief explanation of the nature of a home equity line 
    of credit and a reference to the pamphlet required to be provided 
    under section 127A of the Truth in Lending Act.
        ``(8) Information about homeownership counseling services made 
    available pursuant to section 106(a)(4) of the Housing and Urban 
    Development Act of 1968 (12 U.S.C. 1701x(a)(4)), a recommendation 
    that the consumer use such services, and notification that a list 
    of certified providers of homeownership counseling in the area, and 
    their contact information, is available.
        ``(9) An explanation of the nature and purpose of escrow 
    accounts when used in connection with loans secured by residential 
    real estate and the requirements under section 10 of this Act 
    regarding such accounts.
        ``(10) An explanation of the choices available to buyers of 
    residential real estate in selecting persons to provide necessary 
    services incidental to a real estate settlement.
        ``(11) An explanation of a consumer's responsibilities, 
    liabilities, and obligations in a mortgage transaction.
        ``(12) An explanation of the nature and purpose of real estate 
    appraisals, including the difference between an appraisal and a 
    home inspection.
        ``(13) Notice that the Office of Housing of the Department of 
    Housing and Urban Development has made publicly available a 
    brochure regarding loan fraud and a World Wide Web address and 
    toll-free telephone number for obtaining the brochure.
The booklet prepared pursuant to this section shall take into 
consideration differences in real estate settlement procedures that may 
exist among the several States and territories of the United States and 
among separate political subdivisions within the same State and 
territory.'';
        (3) in subsection (c), by inserting at the end the following 
    new sentence: ``Each lender shall also include with the booklet a 
    reasonably complete or updated list of homeownership counselors who 
    are certified pursuant to section 106(e) of the Housing and Urban 
    Development Act of 1968 (12 U.S.C. 1701x(e)) and located in the 
    area of the lender.''; and
        (4) in subsection (d), by inserting after the period at the end 
    of the first sentence the following: ``The lender shall provide the 
    booklet in the version that is most appropriate for the person 
    receiving it.''.
SEC. 1451. HOME INSPECTION COUNSELING.
    (a) Public Outreach.--
        (1) In general.--The Secretary of Housing and Urban Development 
    (in this section referred to as the ``Secretary'') shall take such 
    actions as may be necessary to inform potential homebuyers of the 
    availability and importance of obtaining an independent home 
    inspection. Such actions shall include--
            (A) publication of the HUD/FHA form HUD 92564-CN entitled 
        ``For Your Protection: Get a Home Inspection'', in both English 
        and Spanish languages;
            (B) publication of the HUD/FHA booklet entitled ``For Your 
        Protection: Get a Home Inspection'', in both English and 
        Spanish languages;
            (C) development and publication of a HUD booklet entitled 
        ``For Your Protection--Get a Home Inspection'' that does not 
        reference FHA-insured homes, in both English and Spanish 
        languages; and
            (D) publication of the HUD document entitled ``Ten 
        Important Questions To Ask Your Home Inspector'', in both 
        English and Spanish languages.
        (2) Availability.--The Secretary shall make the materials 
    specified in paragraph (1) available for electronic access and, 
    where appropriate, inform potential homebuyers of such availability 
    through home purchase counseling public service announcements and 
    toll-free telephone hotlines of the Department of Housing and Urban 
    Development. The Secretary shall give special emphasis to reaching 
    first-time and low-income homebuyers with these materials and 
    efforts.
        (3) Updating.--The Secretary may periodically update and revise 
    such materials, as the Secretary determines to be appropriate.
    (b) Requirement for FHA-approved Lenders.--Each mortgagee approved 
for participation in the mortgage insurance programs under title II of 
the National Housing Act shall provide prospective homebuyers, at first 
contact, whether upon pre-qualification, pre-approval, or initial 
application, the materials specified in subparagraphs (A), (B), and (D) 
of subsection (a)(1).
    (c) Requirements for HUD-approved Counseling Agencies.--Each 
counseling agency certified pursuant by the Secretary to provide 
housing counseling services shall provide each of their clients, as 
part of the home purchase counseling process, the materials specified 
in subparagraphs (C) and (D) of subsection (a)(1).
    (d) Training.--Training provided the Department of Housing and 
Urban Development for housing counseling agencies, whether such 
training is provided directly by the Department or otherwise, shall 
include--
        (1) providing information on counseling potential homebuyers of 
    the availability and importance of getting an independent home 
    inspection;
        (2) providing information about the home inspection process, 
    including the reasons for specific inspections such as radon and 
    lead-based paint testing;
        (3) providing information about advising potential homebuyers 
    on how to locate and select a qualified home inspector; and
        (4) review of home inspection public outreach materials of the 
    Department.
SEC. 1452. WARNINGS TO HOMEOWNERS OF FORECLOSURE RESCUE SCAMS.
    (a) Assistance to NRC.--Notwithstanding any other provision of law, 
of any amounts made available for any fiscal year pursuant to section 
106(a)(4)(F) of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x(a)(4)(F)) (as added by section 1444), 10 percent shall be 
used only for assistance to the Neighborhood Reinvestment Corporation 
for activities, in consultation with servicers of residential mortgage 
loans, to provide notice to borrowers under such loans who are 
delinquent with respect to payments due under such loans that makes 
such borrowers aware of the dangers of fraudulent activities associated 
with foreclosure.
    (b) Notice.--The Neighborhood Reinvestment Corporation, in 
consultation with servicers of residential mortgage loans, shall use 
the amounts provided pursuant to subsection (a) to carry out activities 
to inform borrowers under residential mortgage loans--
        (1) that the foreclosure process is complex and can be 
    confusing;
        (2) that the borrower may be approached during the foreclosure 
    process by persons regarding saving their home and they should use 
    caution in any such dealings;
        (3) that there are Federal Government and nonprofit agencies 
    that may provide information about the foreclosure process, 
    including the Department of Housing and Urban Development;
        (4) that they should contact their lender immediately, contact 
    the Department of Housing and Urban Development to find a housing 
    counseling agency certified by the Department to assist in avoiding 
    foreclosure, or visit the Department's website regarding tips for 
    avoiding foreclosure; and
        (5) of the telephone number of the loan servicer or successor, 
    the telephone number of the Department of Housing and Urban 
    Development housing counseling line, and the Uniform Resource 
    Locators (URLs) for the Department of Housing and Urban Development 
    Web sites for housing counseling and for tips for avoiding 
    foreclosure.

                     Subtitle E--Mortgage Servicing

SEC. 1461. ESCROW AND IMPOUND ACCOUNTS RELATING TO CERTAIN CONSUMER 
CREDIT TRANSACTIONS.
    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by inserting after section 129C (as added by 
section 1411) the following new section:
``Sec. 129D. Escrow or impound accounts relating to certain consumer 
    credit transactions
    ``(a) In General.--Except as provided in subsection (b), (c), (d), 
or (e), a creditor, in connection with the consummation of a consumer 
credit transaction secured by a first lien on the principal dwelling of 
the consumer, other than a consumer credit transaction under an open 
end credit plan or a reverse mortgage, shall establish, before the 
consummation of such transaction, an escrow or impound account for the 
payment of taxes and hazard insurance, and, if applicable, flood 
insurance, mortgage insurance, ground rents, and any other required 
periodic payments or premiums with respect to the property or the loan 
terms, as provided in, and in accordance with, this section.
    ``(b) When Required.--No impound, trust, or other type of account 
for the payment of property taxes, insurance premiums, or other 
purposes relating to the property may be required as a condition of a 
real property sale contract or a loan secured by a first deed of trust 
or mortgage on the principal dwelling of the consumer, other than a 
consumer credit transaction under an open end credit plan or a reverse 
mortgage, except when--
        ``(1) any such impound, trust, or other type of escrow or 
    impound account for such purposes is required by Federal or State 
    law;
        ``(2) a loan is made, guaranteed, or insured by a State or 
    Federal governmental lending or insuring agency;
        ``(3) the transaction is secured by a first mortgage or lien on 
    the consumer's principal dwelling having an original principal 
    obligation amount that--
            ``(A) does not exceed the amount of the maximum limitation 
        on the original principal obligation of mortgage in effect for 
        a residence of the applicable size, as of the date such 
        interest rate set, pursuant to the sixth sentence of section 
        305(a)(2) the Federal Home Loan Mortgage Corporation Act (12 
        U.S.C. 1454(a)(2)), and the annual percentage rate will exceed 
        the average prime offer rate as defined in section 129C by 1.5 
        or more percentage points; or
            ``(B) exceeds the amount of the maximum limitation on the 
        original principal obligation of mortgage in effect for a 
        residence of the applicable size, as of the date such interest 
        rate set, pursuant to the sixth sentence of section 305(a)(2) 
        the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
        1454(a)(2)), and the annual percentage rate will exceed the 
        average prime offer rate as defined in section 129C by 2.5 or 
        more percentage points; or
        ``(4) so required pursuant to regulation.
    ``(c) Exemptions.--The Board may, by regulation, exempt from the 
requirements of subsection (a) a creditor that--
        ``(1) operates predominantly in rural or underserved areas;
        ``(2) together with all affiliates, has total annual mortgage 
    loan originations that do not exceed a limit set by the Board;
        ``(3) retains its mortgage loan originations in portfolio; and
        ``(4) meets any asset size threshold and any other criteria the 
    Board may establish, consistent with the purposes of this subtitle.
    ``(d) Duration of Mandatory Escrow or Impound Account.--An escrow 
or impound account established pursuant to subsection (b) shall remain 
in existence for a minimum period of 5 years, beginning with the date 
of the consummation of the loan, unless and until--
        ``(1) such borrower has sufficient equity in the dwelling 
    securing the consumer credit transaction so as to no longer be 
    required to maintain private mortgage insurance;
        ``(2) such borrower is delinquent;
        ``(3) such borrower otherwise has not complied with the legal 
    obligation, as established by rule; or
        ``(4) the underlying mortgage establishing the account is 
    terminated.
    ``(e) Limited Exemptions for Loans Secured by Shares in a 
Cooperative or in Which an Association Must Maintain a Master Insurance 
Policy.--Escrow accounts need not be established for loans secured by 
shares in a cooperative. Insurance premiums need not be included in 
escrow accounts for loans secured by dwellings or units, where the 
borrower must join an association as a condition of ownership, and that 
association has an obligation to the dwelling or unit owners to 
maintain a master policy insuring the dwellings or units.
    ``(f) Clarification on Escrow Accounts for Loans Not Meeting 
Statutory Test.--For mortgages not covered by the requirements of 
subsection (b), no provision of this section shall be construed as 
precluding the establishment of an impound, trust, or other type of 
account for the payment of property taxes, insurance premiums, or other 
purposes relating to the property--
        ``(1) on terms mutually agreeable to the parties to the loan;
        ``(2) at the discretion of the lender or servicer, as provided 
    by the contract between the lender or servicer and the borrower; or
        ``(3) pursuant to the requirements for the escrowing of flood 
    insurance payments for regulated lending institutions in section 
    102(d) of the Flood Disaster Protection Act of 1973.
    ``(g) Administration of Mandatory Escrow or Impound Accounts.--
        ``(1) In general.--Except as may otherwise be provided for in 
    this title or in regulations prescribed by the Board, escrow or 
    impound accounts established pursuant to subsection (b) shall be 
    established in a federally insured depository institution or credit 
    union.
        ``(2) Administration.--Except as provided in this section or 
    regulations prescribed under this section, an escrow or impound 
    account subject to this section shall be administered in accordance 
    with--
            ``(A) the Real Estate Settlement Procedures Act of 1974 and 
        regulations prescribed under such Act;
            ``(B) the Flood Disaster Protection Act of 1973 and 
        regulations prescribed under such Act; and
            ``(C) the law of the State, if applicable, where the real 
        property securing the consumer credit transaction is located.
        ``(3) Applicability of payment of interest.--If prescribed by 
    applicable State or Federal law, each creditor shall pay interest 
    to the consumer on the amount held in any impound, trust, or escrow 
    account that is subject to this section in the manner as prescribed 
    by that applicable State or Federal law.
        ``(4) Penalty coordination with respa.--Any action or omission 
    on the part of any person which constitutes a violation of the Real 
    Estate Settlement Procedures Act of 1974 or any regulation 
    prescribed under such Act for which the person has paid any fine, 
    civil money penalty, or other damages shall not give rise to any 
    additional fine, civil money penalty, or other damages under this 
    section, unless the action or omission also constitutes a direct 
    violation of this section.
    ``(h) Disclosures Relating to Mandatory Escrow or Impound 
Account.--In the case of any impound, trust, or escrow account that is 
required under subsection (b), the creditor shall disclose by written 
notice to the consumer at least 3 business days before the consummation 
of the consumer credit transaction giving rise to such account or in 
accordance with timeframes established in prescribed regulations the 
following information:
        ``(1) The fact that an escrow or impound account will be 
    established at consummation of the transaction.
        ``(2) The amount required at closing to initially fund the 
    escrow or impound account.
        ``(3) The amount, in the initial year after the consummation of 
    the transaction, of the estimated taxes and hazard insurance, 
    including flood insurance, if applicable, and any other required 
    periodic payments or premiums that reflects, as appropriate, either 
    the taxable assessed value of the real property securing the 
    transaction, including the value of any improvements on the 
    property or to be constructed on the property (whether or not such 
    construction will be financed from the proceeds of the transaction) 
    or the replacement costs of the property.
        ``(4) The estimated monthly amount payable to be escrowed for 
    taxes, hazard insurance (including flood insurance, if applicable) 
    and any other required periodic payments or premiums.
        ``(5) The fact that, if the consumer chooses to terminate the 
    account in the future, the consumer will become responsible for the 
    payment of all taxes, hazard insurance, and flood insurance, if 
    applicable, as well as any other required periodic payments or 
    premiums on the property unless a new escrow or impound account is 
    established.
        ``(6) Such other information as the Board determines necessary 
    for the protection of the consumer.
    ``(i) Definitions.--For purposes of this section, the following 
definitions shall apply:
        ``(1) Flood insurance.--The term `flood insurance' means flood 
    insurance coverage provided under the national flood insurance 
    program pursuant to the National Flood Insurance Act of 1968.
        ``(2) Hazard insurance.--The term `hazard insurance' shall have 
    the same meaning as provided for `hazard insurance', `casualty 
    insurance', `homeowner's insurance', or other similar term under 
    the law of the State where the real property securing the consumer 
    credit transaction is located.''.
    (b) Exemptions and Modifications.--The Board may prescribe rules 
that revise, add to, or subtract from the criteria of section 129D(b) 
of the Truth in Lending Act if the Board determines that such rules are 
in the interest of consumers and in the public interest.
    (c) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129C (as added by section 1411) the following new item:

``129D. Escrow or impound accounts relating to certain consumer credit 
          transactions.''.
SEC. 1462. DISCLOSURE NOTICE REQUIRED FOR CONSUMERS WHO WAIVE ESCROW 
SERVICES.
    Section 129D of the Truth in Lending Act (as added by section 1461) 
is amended by adding at the end the following new subsection:
    ``(j) Disclosure Notice Required for Consumers Who Waive Escrow 
Services.--
        ``(1) In general.--If--
            ``(A) an impound, trust, or other type of account for the 
        payment of property taxes, insurance premiums, or other 
        purposes relating to real property securing a consumer credit 
        transaction is not established in connection with the 
        transaction; or
            ``(B) a consumer chooses, and provides written notice to 
        the creditor or servicer of such choice, at any time after such 
        an account is established in connection with any such 
        transaction and in accordance with any statute, regulation, or 
        contractual agreement, to close such account,
    the creditor or servicer shall provide a timely and clearly written 
    disclosure to the consumer that advises the consumer of the 
    responsibilities of the consumer and implications for the consumer 
    in the absence of any such account.
        ``(2) Disclosure requirements.--Any disclosure provided to a 
    consumer under paragraph (1) shall include the following:
            ``(A) Information concerning any applicable fees or costs 
        associated with either the non-establishment of any such 
        account at the time of the transaction, or any subsequent 
        closure of any such account.
            ``(B) A clear and prominent statement that the consumer is 
        responsible for personally and directly paying the non-escrowed 
        items, in addition to paying the mortgage loan payment, in the 
        absence of any such account, and the fact that the costs for 
        taxes, insurance, and related fees can be substantial.
            ``(C) A clear explanation of the consequences of any 
        failure to pay non-escrowed items, including the possible 
        requirement for the forced placement of insurance by the 
        creditor or servicer and the potentially higher cost (including 
        any potential commission payments to the servicer) or reduced 
        coverage for the consumer in the event of any such creditor-
        placed insurance.
            ``(D) Such other information as the Board determines 
        necessary for the protection of the consumer.''.
SEC. 1463. REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974 AMENDMENTS.
    (a) Servicer Prohibitions.--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 new subsections:
    ``(k) Servicer Prohibitions.--
        ``(1) In general.--A servicer of a federally related mortgage 
    shall not--
            ``(A) obtain force-placed hazard insurance unless there is 
        a reasonable basis to believe the borrower has failed to comply 
        with the loan contract's requirements to maintain property 
        insurance;
            ``(B) charge fees for responding to valid qualified written 
        requests (as defined in regulations which the Bureau of 
        Consumer Financial Protection shall prescribe) under this 
        section;
            ``(C) fail to take timely action to respond to a borrower's 
        requests to correct errors relating to allocation of payments, 
        final balances for purposes of paying off the loan, or avoiding 
        foreclosure, or other standard servicer's duties;
            ``(D) fail to respond within 10 business days to a request 
        from a borrower to provide the identity, address, and other 
        relevant contact information about the owner or assignee of the 
        loan; or
            ``(E) fail to comply with any other obligation found by the 
        Bureau of Consumer Financial Protection, by regulation, to be 
        appropriate to carry out the consumer protection purposes of 
        this Act.
        ``(2) Force-placed insurance defined.--For purposes of this 
    subsection and subsections (l) and (m), the term `force-placed 
    insurance' means hazard insurance coverage obtained by a servicer 
    of a federally related mortgage when the borrower has failed to 
    maintain or renew hazard insurance on such property as required of 
    the borrower under the terms of the mortgage.
    ``(l) Requirements for Force-placed Insurance.--A servicer of a 
federally related mortgage shall not be construed as having a 
reasonable basis for obtaining force-placed insurance unless the 
requirements of this subsection have been met.
        ``(1) Written notices to borrower.--A servicer may not impose 
    any charge on any borrower for force-placed insurance with respect 
    to any property securing a federally related mortgage unless--
            ``(A) the servicer has sent, by first-class mail, a written 
        notice to the borrower containing--
                ``(i) a reminder of the borrower's obligation to 
            maintain hazard insurance on the property securing the 
            federally related mortgage;
                ``(ii) a statement that the servicer does not have 
            evidence of insurance coverage of such property;
                ``(iii) a clear and conspicuous statement of the 
            procedures by which the borrower may demonstrate that the 
            borrower already has insurance coverage; and
                ``(iv) a statement that the servicer may obtain such 
            coverage at the borrower's expense if the borrower does not 
            provide such demonstration of the borrower's existing 
            coverage in a timely manner;
            ``(B) the servicer has sent, by first-class mail, a second 
        written notice, at least 30 days after the mailing of the 
        notice under subparagraph (A) that contains all the information 
        described in each clause of such subparagraph; and
            ``(C) the servicer has not received from the borrower any 
        demonstration of hazard insurance coverage for the property 
        securing the mortgage by the end of the 15-day period beginning 
        on the date the notice under subparagraph (B) was sent by the 
        servicer.
        ``(2) Sufficiency of demonstration.--A servicer of a federally 
    related mortgage shall accept any reasonable form of written 
    confirmation from a borrower of existing insurance coverage, which 
    shall include the existing insurance policy number along with the 
    identity of, and contact information for, the insurance company or 
    agent, or as otherwise required by the Bureau of Consumer Financial 
    Protection.
        ``(3) Termination of force-placed insurance.--Within 15 days of 
    the receipt by a servicer of confirmation of a borrower's existing 
    insurance coverage, the servicer shall--
            ``(A) terminate the force-placed insurance; and
            ``(B) refund to the consumer all force-placed insurance 
        premiums paid by the borrower during any period during which 
        the borrower's insurance coverage and the force-placed 
        insurance coverage were each in effect, and any related fees 
        charged to the consumer's account with respect to the force-
        placed insurance during such period.
        ``(4) Clarification with respect to flood disaster protection 
    act.--No provision of this section shall be construed as 
    prohibiting a servicer from providing simultaneous or concurrent 
    notice of a lack of flood insurance pursuant to section 102(e) of 
    the Flood Disaster Protection Act of 1973.
    ``(m) Limitations on Force-placed Insurance Charges.--All charges, 
apart from charges subject to State regulation as the business of 
insurance, related to force-placed insurance imposed on the borrower by 
or through the servicer shall be bona fide and reasonable.''.
    (b) Increase in Penalty Amounts.--Section 6(f) of the Real Estate 
Settlement Procedures Act of 1974 (12 U.S.C. 2605(f)) is amended--
        (1) in paragraphs (1)(B) and (2)(B), by striking ``$1,000'' 
    each place such term appears and inserting ``$2,000''; and
        (2) in paragraph (2)(B)(i), by striking ``$500,000'' and 
    inserting ``$1,000,000''.
    (c) Decrease in Response Times.--Section 6(e) of the Real Estate 
Settlement Procedures Act of 1974 (12 U.S.C. 2605(e)) is amended--
        (1) in paragraph (1)(A), by striking ``20 days'' and inserting 
    ``5 days'';
        (2) in paragraph (2), by striking ``60 days'' and inserting 
    ``30 days''; and
        (3) by adding at the end the following new paragraph:
        ``(4) Limited extension of response time.--The 30-day period 
    described in paragraph (2) may be extended for not more than 15 
    days if, before the end of such 30-day period, the servicer 
    notifies the borrower of the extension and the reasons for the 
    delay in responding.''.
    (d) Prompt Refund of Escrow Accounts Upon Payoff.--Section 6(g) of 
the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2605(g)) 
is amended by adding at the end the following new sentence: ``Any 
balance in any such account that is within the servicer's control at 
the time the loan is paid off shall be promptly returned to the 
borrower within 20 business days or credited to a similar account for a 
new mortgage loan to the borrower with the same lender.''.
SEC. 1464. TRUTH IN LENDING ACT AMENDMENTS.
    (a) Requirements for Prompt Crediting of Home Loan Payments.--
Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is 
amended by inserting after section 129E (as added by section 1472) the 
following new section:
``Sec. 129F. Requirements for prompt crediting of home loan payments
    ``(a) In General.--In connection with a consumer credit transaction 
secured by a consumer's principal dwelling, no servicer shall fail to 
credit a payment to the consumer's loan account as of the date of 
receipt, except when a delay in crediting does not result in any charge 
to the consumer or in the reporting of negative information to a 
consumer reporting agency, except as required in subsection (b).
    ``(b) Exception.--If a servicer specifies in writing requirements 
for the consumer to follow in making payments, but accepts a payment 
that does not conform to the requirements, the servicer shall credit 
the payment as of 5 days after receipt.''.
    (b) Requests for Payoff Amounts.--Chapter 2 of the Truth in Lending 
Act (15 U.S.C. 1631 et seq.), as amended by this title, is amended by 
inserting after section 129F (as added by subsection (a)) the following 
new section:
``Sec. 129G. Requests for payoff amounts of home loan
    ``A creditor or servicer of a home loan shall send an accurate 
payoff balance within a reasonable time, but in no case more than 7 
business days, after the receipt of a written request for such balance 
from or on behalf of the borrower.''.
SEC. 1465. ESCROWS INCLUDED IN REPAYMENT ANALYSIS.
    Section 128(b) of the Truth in Lending Act (15 U.S.C. 1638(b)) is 
amended by adding at the end the following new paragraph:
        ``(4) Repayment analysis required to include escrow payments.--
            ``(A) In general.--In the case of any consumer credit 
        transaction secured by a first mortgage or lien on the 
        principal dwelling of the consumer, other than a consumer 
        credit transaction under an open end credit plan or a reverse 
        mortgage, for which an impound, trust, or other type of account 
        has been or will be established in connection with the 
        transaction for the payment of property taxes, hazard and flood 
        (if any) insurance premiums, or other periodic payments or 
        premiums with respect to the property, the information required 
        to be provided under subsection (a) with respect to the number, 
        amount, and due dates or period of payments scheduled to repay 
        the total of payments shall take into account the amount of any 
        monthly payment to such account for each such repayment in 
        accordance with section 10(a)(2) of the Real Estate Settlement 
        Procedures Act of 1974.
            ``(B) Assessment value.--The amount taken into account 
        under subparagraph (A) for the payment of property taxes, 
        hazard and flood (if any) insurance premiums, or other periodic 
        payments or premiums with respect to the property shall reflect 
        the taxable assessed value of the real property securing the 
        transaction after the consummation of the transaction, 
        including the value of any improvements on the property or to 
        be constructed on the property (whether or not such 
        construction will be financed from the proceeds of the 
        transaction), if known, and the replacement costs of the 
        property for hazard insurance, in the initial year after the 
        transaction.''.

                    Subtitle F--Appraisal Activities

SEC. 1471. PROPERTY APPRAISAL REQUIREMENTS.
    Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is 
amended by inserting after 129G (as added by section 1464(b)) the 
following new section:
``Sec. 129H. Property appraisal requirements
    ``(a) In General.--A creditor may not extend credit in the form of 
a higher-risk mortgage to any consumer without first obtaining a 
written appraisal of the property to be mortgaged prepared in 
accordance with the requirements of this section.
    ``(b) Appraisal Requirements.--
        ``(1) Physical property visit.--Subject to the rules prescribed 
    under paragraph (4), an appraisal of property to be secured by a 
    higher-risk mortgage does not meet the requirement of this section 
    unless it is performed by a certified or licensed appraiser who 
    conducts a physical property visit of the interior of the mortgaged 
    property.
        ``(2) Second appraisal under certain circumstances.--
            ``(A) In general.--If the purpose of a higher-risk mortgage 
        is to finance the purchase or acquisition of the mortgaged 
        property from a person within 180 days of the purchase or 
        acquisition of such property by that person at a price that was 
        lower than the current sale price of the property, the creditor 
        shall obtain a second appraisal from a different certified or 
        licensed appraiser. The second appraisal shall include an 
        analysis of the difference in sale prices, changes in market 
        conditions, and any improvements made to the property between 
        the date of the previous sale and the current sale.
            ``(B) No cost to applicant.--The cost of any second 
        appraisal required under subparagraph (A) may not be charged to 
        the applicant.
        ``(3) Certified or licensed appraiser defined.--For purposes of 
    this section, the term `certified or licensed appraiser' means a 
    person who--
            ``(A) is, at a minimum, certified or licensed by the State 
        in which the property to be appraised is located; and
            ``(B) performs each appraisal in conformity with the 
        Uniform Standards of Professional Appraisal Practice and title 
        XI of the Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989, and the regulations prescribed under 
        such title, as in effect on the date of the appraisal.
        ``(4) Regulations.--
            ``(A) In general.--The Board, the Comptroller of the 
        Currency, the Federal Deposit Insurance Corporation, the 
        National Credit Union Administration Board, the Federal Housing 
        Finance Agency, and the Bureau shall jointly prescribe 
        regulations to implement this section.
            ``(B) Exemption.--The agencies listed in subparagraph (A) 
        may jointly exempt, by rule, a class of loans from the 
        requirements of this subsection or subsection (a) if the 
        agencies determine that the exemption is in the public interest 
        and promotes the safety and soundness of creditors.
    ``(c) Free Copy of Appraisal.--A creditor shall provide 1 copy of 
each appraisal conducted in accordance with this section in connection 
with a higher-risk mortgage to the applicant without charge, and at 
least 3 days prior to the transaction closing date.
    ``(d) Consumer Notification.--At the time of the initial mortgage 
application, the applicant shall be provided with a statement by the 
creditor that any appraisal prepared for the mortgage is for the sole 
use of the creditor, and that the applicant may choose to have a 
separate appraisal conducted at the expense of the applicant.
    ``(e) Violations.--In addition to any other liability to any person 
under this title, a creditor found to have willfully failed to obtain 
an appraisal as required in this section shall be liable to the 
applicant or borrower for the sum of $2,000.
    ``(f) Higher-risk Mortgage Defined.--For purposes of this section, 
the term `higher-risk mortgage' means a residential mortgage loan, 
other than a reverse mortgage loan that is a qualified mortgage, as 
defined in section 129C, secured by a principal dwelling--
        ``(1) that is not a qualified mortgage, as defined in section 
    129C; and
        ``(2) with an annual percentage rate that exceeds the average 
    prime offer rate for a comparable transaction, as defined in 
    section 129C, as of the date the interest rate is set--
            ``(A) by 1.5 or more percentage points, in the case of a 
        first lien residential mortgage loan having an original 
        principal obligation amount that does not exceed the amount of 
        the maximum limitation on the original principal obligation of 
        mortgage in effect for a residence of the applicable size, as 
        of the date of such interest rate set, pursuant to the sixth 
        sentence of section 305(a)(2) the Federal Home Loan Mortgage 
        Corporation Act (12 U.S.C. 1454(a)(2));
            ``(B) by 2.5 or more percentage points, in the case of a 
        first lien residential mortgage loan having an original 
        principal obligation amount that exceeds the amount of the 
        maximum limitation on the original principal obligation of 
        mortgage in effect for a residence of the applicable size, as 
        of the date of such interest rate set, pursuant to the sixth 
        sentence of section 305(a)(2) the Federal Home Loan Mortgage 
        Corporation Act (12 U.S.C. 1454(a)(2)); and
            ``(C) by 3.5 or more percentage points for a subordinate 
        lien residential mortgage loan.''.
SEC. 1472. APPRAISAL INDEPENDENCE REQUIREMENTS.
    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by inserting after section 129D (as added by 
section 1461(a)) the following new section:
``Sec. 129E. Appraisal independence requirements
    ``(a) In General.--It shall be unlawful, in extending credit or in 
providing any services for a consumer credit transaction secured by the 
principal dwelling of the consumer, to engage in any act or practice 
that violates appraisal independence as described in or pursuant to 
regulations prescribed under this section.
    ``(b) Appraisal Independence.--For purposes of subsection (a), acts 
or practices that violate appraisal independence shall include--
        ``(1) any appraisal of a property offered as security for 
    repayment of the consumer credit transaction that is conducted in 
    connection with such transaction in which a person with an interest 
    in the underlying transaction compensates, coerces, extorts, 
    colludes, instructs, induces, bribes, or intimidates a person, 
    appraisal management company, firm, or other entity conducting or 
    involved in an appraisal, or attempts, to compensate, coerce, 
    extort, collude, instruct, induce, bribe, or intimidate such a 
    person, for the purpose of causing the appraised value assigned, 
    under the appraisal, to the property to be based on any factor 
    other than the independent judgment of the appraiser;
        ``(2) mischaracterizing, or suborning any mischaracterization 
    of, the appraised value of the property securing the extension of 
    the credit;
        ``(3) seeking to influence an appraiser or otherwise to 
    encourage a targeted value in order to facilitate the making or 
    pricing of the transaction; and
        ``(4) withholding or threatening to withhold timely payment for 
    an appraisal report or for appraisal services rendered when the 
    appraisal report or services are provided for in accordance with 
    the contract between the parties.
    ``(c) Exceptions.--The requirements of subsection (b) shall not be 
construed as prohibiting a mortgage lender, mortgage broker, mortgage 
banker, real estate broker, appraisal management company, employee of 
an appraisal management company, consumer, or any other person with an 
interest in a real estate transaction from asking an appraiser to 
undertake 1 or more of the following:
        ``(1) Consider additional, appropriate property information, 
    including the consideration of additional comparable properties to 
    make or support an appraisal.
        ``(2) Provide further detail, substantiation, or explanation 
    for the appraiser's value conclusion.
        ``(3) Correct errors in the appraisal report.
    ``(d) Prohibitions on Conflicts of Interest.--No certified or 
licensed appraiser conducting, and no appraisal management company 
procuring or facilitating, an appraisal in connection with a consumer 
credit transaction secured by the principal dwelling of a consumer may 
have a direct or indirect interest, financial or otherwise, in the 
property or transaction involving the appraisal.
    ``(e) Mandatory Reporting.--Any mortgage lender, mortgage broker, 
mortgage banker, real estate broker, appraisal management company, 
employee of an appraisal management company, or any other person 
involved in a real estate transaction involving an appraisal in 
connection with a consumer credit transaction secured by the principal 
dwelling of a consumer who has a reasonable basis to believe an 
appraiser is failing to comply with the Uniform Standards of 
Professional Appraisal Practice, is violating applicable laws, or is 
otherwise engaging in unethical or unprofessional conduct, shall refer 
the matter to the applicable State appraiser certifying and licensing 
agency.
    ``(f) No Extension of Credit.--In connection with a consumer credit 
transaction secured by a consumer's principal dwelling, a creditor who 
knows, at or before loan consummation, of a violation of the appraisal 
independence standards established in subsections (b) or (d) shall not 
extend credit based on such appraisal unless the creditor documents 
that the creditor has acted with reasonable diligence to determine that 
the appraisal does not materially misstate or misrepresent the value of 
such dwelling.
    ``(g) Rules and Interpretive Guidelines.--
        ``(1) In general.--Except as provided under paragraph (2), the 
    Board, the Comptroller of the Currency, the Federal Deposit 
    Insurance Corporation, the National Credit Union Administration 
    Board, the Federal Housing Finance Agency, and the Bureau may 
    jointly issue rules, interpretive guidelines, and general 
    statements of policy with respect to acts or practices that violate 
    appraisal independence in the provision of mortgage lending 
    services for a consumer credit transaction secured by the principal 
    dwelling of the consumer and mortgage brokerage services for such a 
    transaction, within the meaning of subsections (a), (b), (c), (d), 
    (e), (f), (h), and (i).
        ``(2) Interim final regulations.--The Board shall, for purposes 
    of this section, prescribe interim final regulations no later than 
    90 days after the date of enactment of this section defining with 
    specificity acts or practices that violate appraisal independence 
    in the provision of mortgage lending services for a consumer credit 
    transaction secured by the principal dwelling of the consumer or 
    mortgage brokerage services for such a transaction and defining any 
    terms in this section or such regulations. Rules prescribed by the 
    Board under this paragraph shall be deemed to be rules prescribed 
    by the agencies jointly under paragraph (1).
    ``(h) Appraisal Report Portability.--Consistent with the 
requirements of this section, the Board, the Comptroller of the 
Currency, the Federal Deposit Insurance Corporation, the National 
Credit Union Administration Board, the Federal Housing Finance Agency, 
and the Bureau may jointly issue regulations that address the issue of 
appraisal report portability, including regulations that ensure the 
portability of the appraisal report between lenders for a consumer 
credit transaction secured by a 1-4 unit single family residence that 
is the principal dwelling of the consumer, or mortgage brokerage 
services for such a transaction.
    ``(i) Customary and Reasonable Fee.--
        ``(1) In general.--Lenders and their agents shall compensate 
    fee appraisers at a rate that is customary and reasonable for 
    appraisal services performed in the market area of the property 
    being appraised. Evidence for such fees may be established by 
    objective third-party information, such as government agency fee 
    schedules, academic studies, and independent private sector 
    surveys. Fee studies shall exclude assignments ordered by known 
    appraisal management companies.
        ``(2) Fee appraiser definition.--For purposes of this section, 
    the term `fee appraiser' means a person who is not an employee of 
    the mortgage loan originator or appraisal management company 
    engaging the appraiser and is--
            ``(A) a State licensed or certified appraiser who receives 
        a fee for performing an appraisal and certifies that the 
        appraisal has been prepared in accordance with the Uniform 
        Standards of Professional Appraisal Practice; or
            ``(B) a company not subject to the requirements of section 
        1124 of the Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989 (12 U.S.C. 3331 et seq.) that utilizes 
        the services of State licensed or certified appraisers and 
        receives a fee for performing appraisals in accordance with the 
        Uniform Standards of Professional Appraisal Practice.
        ``(3) Exception for complex assignments.--In the case of an 
    appraisal involving a complex assignment, the customary and 
    reasonable fee may reflect the increased time, difficulty, and 
    scope of the work required for such an appraisal and include an 
    amount over and above the customary and reasonable fee for non-
    complex assignments.
    ``(j) Sunset.--Effective on the date the interim final regulations 
are promulgated pursuant to subsection (g), the Home Valuation Code of 
Conduct announced by the Federal Housing Finance Agency on December 23, 
2008, shall have no force or effect.
    ``(k) Penalties.--
        ``(1) First violation.--In addition to the enforcement 
    provisions referred to in section 130, each person who violates 
    this section shall forfeit and pay a civil penalty of not more than 
    $10,000 for each day any such violation continues.
        ``(2) Subsequent violations.--In the case of any person on whom 
    a civil penalty has been imposed under paragraph (1), paragraph (1) 
    shall be applied by substituting `$20,000' for `$10,000' with 
    respect to all subsequent violations.
        ``(3) Assessment.--The agency referred to in subsection (a) or 
    (c) of section 108 with respect to any person described in 
    paragraph (1) shall assess any penalty under this subsection to 
    which such person is subject.''.
    (b) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129D (as added by section 1461(c)) the following new items:

``129E. Appraisal independence requirements.
``129F. Requirements for prompt crediting of home loan payments.
``129G. Requests for payoff amounts of home loan.
``129H. Property appraisal requirements.''.

    (c) Deference.--Section 105 of the Truth in Lending Act (15 U.S.C. 
1604) is amended by adding at the end the following:
    ``(h) Deference.--Notwithstanding any power granted to any Federal 
agency under this title, the deference that a court affords to the 
Bureau with respect to a determination made by the Bureau relating to 
the meaning or interpretation of any provision of this title, other 
than section 129E or 129H, shall be applied as if the Bureau were the 
only agency authorized to apply, enforce, interpret, or administer the 
provisions of this title.''.
    (d) Conforming Amendments in Title X Not Applicable to Sections 
129E and 129H.--Notwithstanding section 1099A, the term ``Board'' in 
sections 129E and 129H, as added by this subtitle, shall not be 
substituted by the term ``Bureau''.
SEC. 1473. AMENDMENTS RELATING TO APPRAISAL SUBCOMMITTEE OF FFIEC, 
APPRAISER INDEPENDENCE MONITORING, APPROVED APPRAISER EDUCATION, 
APPRAISAL MANAGEMENT COMPANIES, APPRAISER COMPLAINT HOTLINE, AUTOMATED 
VALUATION MODELS, AND BROKER PRICE OPINIONS.
    (a) Threshold Levels.--Section 1112(b) of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3341(b)) is amended by inserting before the period the following: ``, 
and receives concurrence from the Bureau of Consumer Financial 
Protection that such threshold level provides reasonable protection for 
consumers who purchase 1-4 unit single-family residences''.
    (b) Annual Report of Appraisal Subcommittee.--Section 1103(a) of 
the Financial Institutions Reform, Recovery, and Enforcement Act of 
1989 (12 U.S.C. 3332(a)) is amended at the end by inserting the 
following new paragraph:
        ``(5) transmit an annual report to the Congress not later than 
    June 15 of each year that describes the manner in which each 
    function assigned to the Appraisal Subcommittee has been carried 
    out during the preceding year. The report shall also detail the 
    activities of the Appraisal Subcommittee, including the results of 
    all audits of State appraiser regulatory agencies, and provide an 
    accounting of disapproved actions and warnings taken in the 
    previous year, including a description of the conditions causing 
    the disapproval and actions taken to achieve compliance.''.
    (c) Open Meetings.--Section 1104(b) of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3333(b)) is 
amended--
        (1) by inserting ``in public session after notice in the 
    Federal Register, but may close certain portions of these meetings 
    related to personnel and review of preliminary State audit 
    reports,'' after ``shall meet''; and
        (2) by adding after the final period the following: ``The 
    subject matter discussed in any closed or executive session shall 
    be described in the Federal Register notice of the meeting.''.
    (d) Regulations.--Section 1106 of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3335) is 
amended--
        (1) by inserting ``prescribe regulations in accordance with 
    chapter 5 of title 5, United States Code (commonly referred to as 
    the Administrative Procedures Act) after notice and opportunity for 
    comment,'' after ``hold hearings''; and
        (2) at the end by inserting ``Any regulations prescribed by the 
    Appraisal Subcommittee shall (unless otherwise provided in this 
    title) be limited to the following functions: temporary practice, 
    national registry, information sharing, and enforcement. For 
    purposes of prescribing regulations, the Appraisal Subcommittee 
    shall establish an advisory committee of industry participants, 
    including appraisers, lenders, consumer advocates, real estate 
    agents, and government agencies, and hold meetings as necessary to 
    support the development of regulations.''.
    (e) Appraisal Reviews and Complex Appraisals.--
        (1) Section 1110.--Section 1110 of the Financial Institutions 
    Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3339) is 
    amended--
            (A) in paragraph (1), by striking ``and'';
            (B) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (C) by inserting after paragraph (2) the following:
        ``(3) that such appraisals shall be subject to appropriate 
    review for compliance with the Uniform Standards of Professional 
    Appraisal Practice.''.
        (2) Section 1113.--Section 1113 of the Financial Institutions 
    and Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3342) 
    is amended by inserting before the period the following: ``, where 
    a complex 1-to-4 unit single family residential appraisal means an 
    appraisal for which the property to be appraised, the form of 
    ownership, the property characteristics, or the market conditions 
    are atypical''.
    (f) Appraisal Management Services.--
        (1) Supervision of third party providers of appraisal 
    management services.--Section 1103(a) of the Financial Institutions 
    Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3332(a)) 
    (as previously amended by this section) is amended--
            (A) by amending paragraph (1) to read as follows:
        ``(1) monitor the requirements established by States--
            ``(A) for the certification and licensing of individuals 
        who are qualified to perform appraisals in connection with 
        federally related transactions, including a code of 
        professional responsibility; and
            ``(B) for the registration and supervision of the 
        operations and activities of an appraisal management 
        company;''; and
            (B) by adding at the end the following new paragraph:
        ``(6) maintain a national registry of appraisal management 
    companies that either are registered with and subject to 
    supervision of a State appraiser certifying and licensing agency or 
    are operating subsidiaries of a Federally regulated financial 
    institution.''.
        (2) Appraisal management company minimum requirements.--Title 
    XI of the Financial Institutions Reform, Recovery, and Enforcement 
    Act of 1989 (12 U.S.C. 3331 et seq.) is amended by adding at the 
    end the following new section (and amending the table of contents 
    accordingly):
``SEC. 1124. APPRAISAL MANAGEMENT COMPANY MINIMUM REQUIREMENTS.
    ``(a) In General.--The Board of Governors of the Federal Reserve 
System, the Comptroller of the Currency, the Federal Deposit Insurance 
Corporation, the National Credit Union Administration Board, the 
Federal Housing Finance Agency, and the Bureau of Consumer Financial 
Protection shall jointly, by rule, establish minimum requirements to be 
applied by a State in the registration of appraisal management 
companies. Such requirements shall include a requirement that such 
companies--
        ``(1) register with and be subject to supervision by a State 
    appraiser certifying and licensing agency in each State in which 
    such company operates;
        ``(2) verify that only licensed or certified appraisers are 
    used for federally related transactions;
        ``(3) require that appraisals coordinated by an appraisal 
    management company comply with the Uniform Standards of 
    Professional Appraisal Practice; and
        ``(4) require that appraisals are conducted independently and 
    free from inappropriate influence and coercion pursuant to the 
    appraisal independence standards established under section 129E of 
    the Truth in Lending Act.
    ``(b) Relation to State Law.--Nothing in this section shall be 
construed to prevent States from establishing requirements in addition 
to any rules promulgated under subsection (a).
    ``(c) Federally Regulated Financial Institutions.--The requirements 
of subsection (a) shall apply to an appraisal management company that 
is a subsidiary owned and controlled by a financial institution and 
regulated by a Federal financial institution regulatory agency. An 
appraisal management company that is a subsidiary owned and controlled 
by a financial institution regulated by a Federal financial institution 
regulatory agency shall not be required to register with a State.
    ``(d) Registration Limitations.--An appraisal management company 
shall not be registered by a State or included on the national registry 
if such company, in whole or in part, directly or indirectly, is owned 
by any person who has had an appraiser license or certificate refused, 
denied, cancelled, surrendered in lieu of revocation, or revoked in any 
State. Additionally, each person that owns more than 10 percent of an 
appraisal management company shall be of good moral character, as 
determined by the State appraiser certifying and licensing agency, and 
shall submit to a background investigation carried out by the State 
appraiser certifying and licensing agency.
    ``(e) Reporting.--The Board of Governors of the Federal Reserve 
System, the Comptroller of the Currency, the Federal Deposit Insurance 
Corporation, the National Credit Union Administration Board, the 
Federal Housing Finance Agency, and the Bureau of Consumer Financial 
Protection shall jointly promulgate regulations for the reporting of 
the activities of appraisal management companies to the Appraisal 
Subcommittee in determining the payment of the annual registry fee.
    ``(f) Effective Date.--
        ``(1) In general.--No appraisal management company may perform 
    services related to a federally related transaction in a State 
    after the date that is 36 months after the date on which the 
    regulations required to be prescribed under subsection (a) are 
    prescribed in final form unless such company is registered with 
    such State or subject to oversight by a Federal financial 
    institutions regulatory agency.
        ``(2) Extension of effective date.--Subject to the approval of 
    the Council, the Appraisal Subcommittee may extend by an additional 
    12 months the requirements for the registration and supervision of 
    appraisal management companies if it makes a written finding that a 
    State has made substantial progress in establishing a State 
    appraisal management company registration and supervision system 
    that appears to conform with the provisions of this title.''.
        (3) State appraiser certifying and licensing agency 
    authority.--Section 1117 of the Financial Institutions Reform, 
    Recovery, and Enforcement Act of 1989 (12 U.S.C. 3346) is amended 
    by adding at the end the following: ``The duties of such agency may 
    additionally include the registration and supervision of appraisal 
    management companies and the addition of information about the 
    appraisal management company to the national registry.''.
        (4) Appraisal management company definition.--Section 1121 of 
    the Financial Institutions Reform, Recovery, and Enforcement Act of 
    1989 (12 U.S.C. 3350) is amended by adding at the end the 
    following:
        ``(11) Appraisal management company.--The term `appraisal 
    management company' means, in connection with valuing properties 
    collateralizing mortgage loans or mortgages incorporated into a 
    securitization, any external third party authorized either by a 
    creditor of a consumer credit transaction secured by a consumer's 
    principal dwelling or by an underwriter of or other principal in 
    the secondary mortgage markets, that oversees a network or panel of 
    more than 15 certified or licensed appraisers in a State or 25 or 
    more nationally within a given year--
            ``(A) to recruit, select, and retain appraisers;
            ``(B) to contract with licensed and certified appraisers to 
        perform appraisal assignments;
            ``(C) to manage the process of having an appraisal 
        performed, including providing administrative duties such as 
        receiving appraisal orders and appraisal reports, submitting 
        completed appraisal reports to creditors and underwriters, 
        collecting fees from creditors and underwriters for services 
        provided, and reimbursing appraisers for services performed; or
            ``(D) to review and verify the work of appraisers.''.
    (g) State Agency Reporting Requirement.--Section 1109(a) of the 
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 
(12 U.S.C. 3338(a)) is amended--
        (1) by striking ``and'' after the semicolon in paragraph (1);
        (2) by redesignating paragraph (2) as paragraph (4); and
        (3) by inserting after paragraph (1) the following new 
    paragraphs:
        ``(2) transmit reports on the issuance and renewal of licenses 
    and certifications, sanctions, disciplinary actions, license and 
    certification revocations, and license and certification 
    suspensions on a timely basis to the national registry of the 
    Appraisal Subcommittee;
        ``(3) transmit reports on a timely basis of supervisory 
    activities involving appraisal management companies or other third-
    party providers of appraisals and appraisal management services, 
    including investigations initiated and disciplinary actions taken; 
    and''.
    (h) Registry Fees Modified.--
        (1) In general.--Section 1109(a) of the Financial Institutions 
    Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3338(a)) 
    is amended--
            (A) by amending paragraph (4) (as modified by section 
        1473(g)) to read as follows:
        ``(4) collect--
            ``(A) from such individuals who perform or seek to perform 
        appraisals in federally related transactions, an annual 
        registry fee of not more than $40, such fees to be transmitted 
        by the State agencies to the Council on an annual basis; and
            ``(B) from an appraisal management company that either has 
        registered with a State appraiser certifying and licensing 
        agency in accordance with this title or operates as a 
        subsidiary of a federally regulated financial institution, an 
        annual registry fee of--
                ``(i) in the case of such a company that has been in 
            existence for more than a year, $25 multiplied by the 
            number of appraisers working for or contracting with such 
            company in such State during the previous year, but where 
            such $25 amount may be adjusted, up to a maximum of $50, at 
            the discretion of the Appraisal Subcommittee, if necessary 
            to carry out the Subcommittee's functions under this title; 
            and
                ``(ii) in the case of such a company that has not been 
            in existence for more than a year, $25 multiplied by an 
            appropriate number to be determined by the Appraisal 
            Subcommittee, and where such number will be used for 
            determining the fee of all such companies that were not in 
            existence for more than a year, but where such $25 amount 
            may be adjusted, up to a maximum of $50, at the discretion 
            of the Appraisal Subcommittee, if necessary to carry out 
            the Subcommittee's functions under this title.''; and
            (B) by amending the matter following paragraph (4), as 
        redesignated, to read as follows:
``Subject to the approval of the Council, the Appraisal Subcommittee 
may adjust the dollar amount of registry fees under paragraph (4)(A), 
up to a maximum of $80 per annum, as necessary to carry out its 
functions under this title. The Appraisal Subcommittee shall consider 
at least once every 5 years whether to adjust the dollar amount of the 
registry fees to account for inflation. In implementing any change in 
registry fees, the Appraisal Subcommittee shall provide flexibility to 
the States for multi-year certifications and licenses already in place, 
as well as a transition period to implement the changes in registry 
fees. In establishing the amount of the annual registry fee for an 
appraisal management company, the Appraisal Subcommittee shall have the 
discretion to impose a minimum annual registry fee for an appraisal 
management company to protect against the under reporting of the number 
of appraisers working for or contracted by the appraisal management 
company.''.
        (2) Incremental revenues.--Incremental revenues collected 
    pursuant to the increases required by this subsection shall be 
    placed in a separate account at the United States Treasury, 
    entitled the ``Appraisal Subcommittee Account''.
    (i) Grants and Reports.--Section 1109(b) of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3338(b)) is amended--
        (1) by striking ``and'' after the semicolon in paragraph (3);
        (2) by striking the period at the end of paragraph (4) and 
    inserting a semicolon;
        (3) by adding at the end the following new paragraphs:
        ``(5) to make grants to State appraiser certifying and 
    licensing agencies, in accordance with policies to be developed by 
    the Appraisal Subcommittee, to support the efforts of such agencies 
    to comply with this title, including--
            ``(A) the complaint process, complaint investigations, and 
        appraiser enforcement activities of such agencies; and
            ``(B) the submission of data on State licensed and 
        certified appraisers and appraisal management companies to the 
        National appraisal registry, including information affirming 
        that the appraiser or appraisal management company meets the 
        required qualification criteria and formal and informal 
        disciplinary actions; and
        ``(6) to report to all State appraiser certifying and licensing 
    agencies when a license or certification is surrendered, revoked, 
    or suspended.''.
Obligations authorized under this subsection may not exceed 75 percent 
of the fiscal year total of incremental increase in fees collected and 
deposited in the ``Appraisal Subcommittee Account'' pursuant to 
subsection (h).
    (j) Criteria.--Section 1116 of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3345) is amended--
        (1) in subsection (c), by inserting ``whose criteria for the 
    licensing of a real estate appraiser currently meet or exceed the 
    minimum criteria issued by the Appraisal Qualifications Board of 
    The Appraisal Foundation for the licensing of real estate 
    appraisers'' before the period at the end; and
        (2) by striking subsection (e) and inserting the following new 
    subsection:
    ``(e) Minimum Qualification Requirements.--Any requirements 
established for individuals in the position of `Trainee Appraiser' and 
`Supervisory Appraiser' shall meet or exceed the minimum qualification 
requirements of the Appraiser Qualifications Board of The Appraisal 
Foundation. The Appraisal Subcommittee shall have the authority to 
enforce these requirements.''.
    (k) Monitoring of State Appraiser Certifying and Licensing 
Agencies.--Section 1118 of the Financial Institutions Reform, Recovery, 
and Enforcement Act of 1989 (12 U.S.C. 3347) is amended--
        (1) by amending subsection (a) to read as follows:
    ``(a) In General.--The Appraisal Subcommittee shall monitor each 
State appraiser certifying and licensing agency for the purposes of 
determining whether such agency--
        ``(1) has policies, practices, funding, staffing, and 
    procedures that are consistent with this title;
        ``(2) processes complaints and completes investigations in a 
    reasonable time period;
        ``(3) appropriately disciplines sanctioned appraisers and 
    appraisal management companies;
        ``(4) maintains an effective regulatory program; and
        ``(5) reports complaints and disciplinary actions on a timely 
    basis to the national registries on appraisers and appraisal 
    management companies maintained by the Appraisal Subcommittee.
The Appraisal Subcommittee shall have the authority to remove a State 
licensed or certified appraiser or a registered appraisal management 
company from a national registry on an interim basis, not to exceed 90 
days, pending State agency action on licensing, certification, 
registration, and disciplinary proceedings. The Appraisal Subcommittee 
and all agencies, instrumentalities, and Federally recognized entities 
under this title shall not recognize appraiser certifications and 
licenses from States whose appraisal policies, practices, funding, 
staffing, or procedures are found to be inconsistent with this title. 
The Appraisal Subcommittee shall have the authority to impose 
sanctions, as described in this section, against a State agency that 
fails to have an effective appraiser regulatory program. In determining 
whether such a program is effective, the Appraisal Subcommittee shall 
include an analysis of the licensing and certification of appraisers, 
the registration of appraisal management companies, the issuance of 
temporary licenses and certifications for appraisers, the receiving and 
tracking of submitted complaints against appraisers and appraisal 
management companies, the investigation of complaints, and enforcement 
actions against appraisers and appraisal management companies. The 
Appraisal Subcommittee shall have the authority to impose interim 
actions and suspensions against a State agency as an alternative to, or 
in advance of, the derecognition of a State agency.''.
        (2) in subsection (b)(2), by inserting after ``authority'' the 
    following: ``or sufficient funding''.
    (l) Reciprocity.--Subsection (b) of section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351(b)) is amended to read as follows:
    ``(b) Reciprocity.--Notwithstanding any other provisions of this 
title, a federally related transaction shall not be appraised by a 
certified or licensed appraiser unless the State appraiser certifying 
or licensing agency of the State certifying or licensing such appraiser 
has in place a policy of issuing a reciprocal certification or license 
for an individual from another State when--
        ``(1) the appraiser licensing and certification program of such 
    other State is in compliance with the provisions of this title; and
        ``(2) the appraiser holds a valid certification from a State 
    whose requirements for certification or licensing meet or exceed 
    the licensure standards established by the State where an 
    individual seeks appraisal licensure.''.
    (m) Consideration of Professional Appraisal Designations.--Section 
1122(d) of the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3351(d)) is amended by striking ``shall not 
exclude'' and all that follows through the end of the subsection and 
inserting the following: ``may include education achieved, experience, 
sample appraisals, and references from prior clients. Membership in a 
nationally recognized professional appraisal organization may be a 
criteria considered, though lack of membership therein shall not be the 
sole bar against consideration for an assignment under these 
criteria.''.
    (n) Appraiser Independence.--Section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351) is amended by adding at the end the following new subsection:
    ``(g) Appraiser Independence Monitoring.--The Appraisal 
Subcommittee shall monitor each State appraiser certifying and 
licensing agency for the purpose of determining whether such agency's 
policies, practices, and procedures are consistent with the purposes of 
maintaining appraiser independence and whether such State has adopted 
and maintains effective laws, regulations, and policies aimed at 
maintaining appraiser independence.''.
    (o) Appraiser Education.--Section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351) is amended by inserting after subsection (g) (as added by 
subsection (l) of this section) the following new subsection:
    ``(h) Approved Education.--The Appraisal Subcommittee shall 
encourage the States to accept courses approved by the Appraiser 
Qualification Board's Course Approval Program.''.
    (p) Appraisal Complaint Hotline.--Section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351), as amended by this section, is amended by adding at the end the 
following new subsection:
    ``(i) Appraisal Complaint National Hotline.--If, 6 months after the 
date of the enactment of this subsection, the Appraisal Subcommittee 
determines that no national hotline exists to receive complaints of 
non-compliance with appraisal independence standards and Uniform 
Standards of Professional Appraisal Practice, including complaints from 
appraisers, individuals, or other entities concerning the improper 
influencing or attempted improper influencing of appraisers or the 
appraisal process, the Appraisal Subcommittee shall establish and 
operate such a national hotline, which shall include a toll-free 
telephone number and an email address. If the Appraisal Subcommittee 
operates such a national hotline, the Appraisal Subcommittee shall 
refer complaints for further action to appropriate governmental bodies, 
including a State appraiser certifying and licensing agency, a 
financial institution regulator, or other appropriate legal 
authorities. For complaints referred to State appraiser certifying and 
licensing agencies or to Federal regulators, the Appraisal Subcommittee 
shall have the authority to follow up such complaint referrals in order 
to determine the status of the resolution of the complaint.''.
    (q) Automated Valuation Models.--Title XI of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3331 et seq.), as amended by this section, is amended by adding at the 
end the following new section (and amending the table of contents 
accordingly):
``SEC. 1125. AUTOMATED VALUATION MODELS USED TO ESTIMATE COLLATERAL 
VALUE FOR MORTGAGE LENDING PURPOSES.
    ``(a) In General.--Automated valuation models shall adhere to 
quality control standards designed to--
        ``(1) ensure a high level of confidence in the estimates 
    produced by automated valuation models;
        ``(2) protect against the manipulation of data;
        ``(3) seek to avoid conflicts of interest;
        ``(4) require random sample testing and reviews; and
        ``(5) account for any other such factor that the agencies 
    listed in subsection (b) determine to be appropriate.
    ``(b) Adoption of Regulations.--The Board, the Comptroller of the 
Currency, the Federal Deposit Insurance Corporation, the National 
Credit Union Administration Board, the Federal Housing Finance Agency, 
and the Bureau of Consumer Financial Protection, in consultation with 
the staff of the Appraisal Subcommittee and the Appraisal Standards 
Board of the Appraisal Foundation, shall promulgate regulations to 
implement the quality control standards required under this section.
    ``(c) Enforcement.--Compliance with regulations issued under this 
subsection shall be enforced by--
        ``(1) with respect to a financial institution, or subsidiary 
    owned and controlled by a financial institution and regulated by a 
    Federal financial institution regulatory agency, the Federal 
    financial institution regulatory agency that acts as the primary 
    Federal supervisor of such financial institution or subsidiary; and
        ``(2) with respect to other participants in the market for 
    appraisals of 1-to-4 unit single family residential real estate, 
    the Federal Trade Commission, the Bureau of Consumer Financial 
    Protection, and a State attorney general.
    ``(d) Automated Valuation Model Defined.--For purposes of this 
section, the term `automated valuation model' means any computerized 
model used by mortgage originators and secondary market issuers to 
determine the collateral worth of a mortgage secured by a consumer's 
principal dwelling.''.
    (r) Broker Price Opinions.--Title XI of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.), 
as amended by this section, is amended by adding at the end the 
following new section (and amending the table of contents accordingly):
``SEC. 1126. BROKER PRICE OPINIONS.
    ``(a) General Prohibition.--In conjunction with the purchase of a 
consumer's principal dwelling, broker price opinions may not be used as 
the primary basis to determine the value of a piece of property for the 
purpose of a loan origination of a residential mortgage loan secured by 
such piece of property.
    ``(b) Broker Price Opinion Defined.--For purposes of this section, 
the term `broker price opinion' means an estimate prepared by a real 
estate broker, agent, or sales person that details the probable selling 
price of a particular piece of real estate property and provides a 
varying level of detail about the property's condition, market, and 
neighborhood, and information on comparable sales, but does not include 
an automated valuation model, as defined in section 1125(c).''.
    (s) Amendments to Appraisal Subcommittee.--Section 1011 of the 
Federal Financial Institutions Examination Council Act of 1978 (12 
U.S.C. 3310) is amended--
        (1) in the first sentence, by adding before the period the 
    following: ``, the Bureau of Consumer Financial Protection, and the 
    Federal Housing Finance Agency''; and
        (2) by inserting at the end the following: ``At all times at 
    least one member of the Appraisal Subcommittee shall have 
    demonstrated knowledge and competence through licensure, 
    certification, or professional designation within the appraisal 
    profession.''.
    (t) Technical Corrections.--
        (1) Section 1119(a)(2) of the Financial Institutions Reform, 
    Recovery, and Enforcement Act of 1989 (12 U.S.C. 3348(a)(2)) is 
    amended by striking ``council,'' and inserting ``Council,''.
        (2) Section 1121(6) of the Financial Institutions Reform, 
    Recovery, and Enforcement Act of 1989 (12 U.S.C. 3350(6)) is 
    amended by striking ``Corporations,'' and inserting 
    ``Corporation,''.
        (3) Section 1121(8) of the Financial Institutions Reform, 
    Recovery, and Enforcement Act of 1989 (12 U.S.C. 3350(8)) is 
    amended by striking ``council'' and inserting ``Council''.
        (4) Section 1122 of the Financial Institutions Reform, 
    Recovery, and Enforcement Act of 1989 (12 U.S.C. 3351) is amended--
            (A) in subsection (a)(1) by moving the left margin of 
        subparagraphs (A), (B), and (C) 2 ems to the right; and
            (B) in subsection (c)--
                (i) by striking ``Federal Financial Institutions 
            Examination Council'' and inserting ``Financial 
            Institutions Examination Council''; and
                (ii) by striking ``the council's functions'' and 
            inserting ``the Council's functions''.
SEC. 1474. EQUAL CREDIT OPPORTUNITY ACT AMENDMENT.
    Subsection (e) of section 701 of the Equal Credit Opportunity Act 
(15 U.S.C. 1691) is amended to read as follows:
    ``(e) Copies Furnished to Applicants.--
        ``(1) In general.--Each creditor shall furnish to an applicant 
    a copy of any and all written appraisals and valuations developed 
    in connection with the applicant's application for a loan that is 
    secured or would have been secured by a first lien on a dwelling 
    promptly upon completion, but in no case later than 3 days prior to 
    the closing of the loan, whether the creditor grants or denies the 
    applicant's request for credit or the application is incomplete or 
    withdrawn.
        ``(2) Waiver.--The applicant may waive the 3 day requirement 
    provided for in paragraph (1), except where otherwise required in 
    law.
        ``(3) Reimbursement.--The applicant may be required to pay a 
    reasonable fee to reimburse the creditor for the cost of the 
    appraisal, except where otherwise required in law.
        ``(4) Free copy.--Notwithstanding paragraph (3), the creditor 
    shall provide a copy of each written appraisal or valuation at no 
    additional cost to the applicant.
        ``(5) Notification to applicants.--At the time of application, 
    the creditor shall notify an applicant in writing of the right to 
    receive a copy of each written appraisal and valuation under this 
    subsection.
        ``(6) Valuation defined.--For purposes of this subsection, the 
    term `valuation' shall include any estimate of the value of a 
    dwelling developed in connection with a creditor's decision to 
    provide credit, including those values developed pursuant to a 
    policy of a government sponsored enterprise or by an automated 
    valuation model, a broker price opinion, or other methodology or 
    mechanism.''.
SEC. 1475. REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974 AMENDMENT 
RELATING TO CERTAIN APPRAISAL FEES.
    Section 4 of the Real Estate Settlement Procedures Act of 1974 is 
amended by adding at the end the following new subsection:
    ``(c) The standard form described in subsection (a) may include, in 
the case of an appraisal coordinated by an appraisal management company 
(as such term is defined in section 1121(11) of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3350(11))), a clear disclosure of--
        ``(1) the fee paid directly to the appraiser by such company; 
    and
        ``(2) the administration fee charged by such company.''.
SEC. 1476. GAO STUDY ON THE EFFECTIVENESS AND IMPACT OF VARIOUS 
APPRAISAL METHODS, VALUATION MODELS AND DISTRIBUTIONS CHANNELS, AND ON 
THE HOME VALUATION CODE OF CONDUCT AND THE APPRAISAL SUBCOMMITTEE.
    (a) In General.--The Government Accountability Office shall conduct 
a study on--
        (1) the effectiveness and impact of--
            (A) appraisal methods, including the cost approach, the 
        comparative sales approach, the income approach, and others 
        that may be available;
            (B) appraisal valuation models, including licensed and 
        certified appraisals, broker-priced opinions, and automated 
        valuation models; and
            (C) appraisal distribution channels, including appraisal 
        management companies, independent appraisal operations within 
        mortgage originators, and fee-for-service appraisers;
        (2) the Home Valuation Code of Conduct; and
        (3) the Appraisal Subcommittee's functions pursuant to title XI 
    of the Financial Institutions Reform, Recovery, and Enforcement Act 
    of 1989.
    (b) Study.--Not later than--
        (1) 12 months after the date of enactment of this Act, the 
    Government Accountability Office shall submit a study to the 
    Committee on Banking, Housing, and Urban Affairs of the Senate and 
    the Committee on Financial Services of the House of 
    Representatives; and
        (2) 90 days after the date of enactment of this Act, the 
    Government Accountability Office shall provide a report on the 
    status of the study and any preliminary findings to the Committee 
    on Banking, Housing, and Urban Affairs of the Senate and the 
    Committee on Financial Services of the House of Representatives.
    (c) Content of Study.--The study required by this section shall 
include an examination of the following:
        (1) Appraisal approaches, valuation models, and distribution 
    channels.--
            (A) The prevalence, alone or in combination, of certain 
        appraisal approaches, models, and channels in purchase-money 
        and refinance mortgage transactions.
            (B) The accuracy of these approaches, models, and channels 
        in assessing the property as collateral.
            (C) Whether and how these approaches, models, and channels 
        contributed to price speculation during the previous cycle.
            (D) The costs to consumers of these approaches, models, and 
        channels.
            (E) The disclosure of fees to consumers in the appraisal 
        process.
            (F) To what extent the usage of these approaches, models, 
        and channels may be influenced by a conflict of interest 
        between the mortgage lender and the appraiser and the mechanism 
        by which the lender selects and compensates the appraiser.
            (G) The suitability of these approaches, models, and 
        channels in rural versus urban areas.
        (2) Home valuation code of conduct (hvcc).--
            (A) How the HVCC affects mortgage lenders' selection of 
        appraisers.
            (B) How the HVCC affects State regulation of appraisers and 
        appraisal distribution channels.
            (C) How the HVCC affects the quality and cost of appraisals 
        and the length of time to obtain an appraisal.
            (D) How the HVCC affects mortgage brokers, small 
        businesses, and consumers.
    (d) Additional Study Required.--
        (1) In general.--Not later than 18 months after the date of 
    enactment of this Act, the Government Accountability Office shall 
    submit a study to the Committee on Banking, Housing, and Urban 
    Affairs of the Senate and the Committee on Financial Services of 
    the House of Representatives.
        (2) Content of additional study.--The study required under 
    paragraph (1) shall include--
            (A) an examination of--
                (i) the Appraisal Subcommittee's ability to monitor and 
            enforce State and Federal certification requirements and 
            standards, including by providing a summary with a 
            statistical breakdown of enforcement actions taken during 
            the last 10 years;
                (ii) whether existing Federal financial institutions 
            regulatory agency exemptions on appraisals for federally 
            related transactions needs to be revised; and
                (iii) whether new means of data collection, such as the 
            establishment of a national repository, would benefit the 
            Appraisal Subcommittee's ability to perform its functions; 
            and
            (B) recommendations from this examination for 
        administrative and legislative action at the Federal and State 
        level.

            Subtitle G--Mortgage Resolution and Modification

SEC. 1481. MULTIFAMILY MORTGAGE RESOLUTION PROGRAM.
    (a) Establishment.--The Secretary of Housing and Urban Development 
shall develop a program under this subsection to ensure the protection 
of current and future tenants and at-risk multifamily properties, where 
feasible, based on criteria that may include--
        (1) creating sustainable financing of such properties, that may 
    take into consideration such factors as--
            (A) the rental income generated by such properties; and
            (B) the preservation of adequate operating reserves;
        (2) maintaining the level of Federal, State, and city subsidies 
    in effect as of the date of the enactment of this Act;
        (3) providing funds for rehabilitation; and
        (4) facilitating the transfer of such properties, when 
    appropriate and with the agreement of owners, to responsible new 
    owners and ensuring affordability of such properties.
    (b) Coordination.--The Secretary of Housing and Urban Development 
may, in carrying out the program developed under this section, 
coordinate with the Secretary of the Treasury, the Federal Deposit 
Insurance Corporation, the Board of Governors of the Federal Reserve 
System, the Federal Housing Finance Agency, and any other Federal 
Government agency that the Secretary considers appropriate.
    (c) Definition.--For purposes of this section, the term 
``multifamily properties'' means a residential structure that consists 
of 5 or more dwelling units.
    (d) Prevention of Qualification for Criminal Applicants.--
        (1) In general.--No person shall be eligible to begin receiving 
    assistance from the Making Home Affordable Program authorized under 
    the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5201 et 
    seq.), or any other mortgage assistance program authorized or 
    funded by that Act, on or after 60 days after the date of the 
    enactment of this Act, if such person, in connection with a 
    mortgage or real estate transaction, has been convicted, within the 
    last 10 years, of any one of the following:
            (A) Felony larceny, theft, fraud, or forgery.
            (B) Money laundering.
            (C) Tax evasion.
        (2) Procedures.--The Secretary shall establish procedures to 
    ensure compliance with this subsection.
        (3) Report.--The Secretary 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 
    regarding the implementation of this provision. The report shall 
    also describe the steps taken to implement this subsection.
SEC. 1482. HOME AFFORDABLE MODIFICATION PROGRAM GUIDELINES.
    (a) Net Present Value Input Data.--The Secretary of the Treasury 
(in this section referred to as the ``Secretary'') shall revise the 
supplemental directives and other guidelines for the Home Affordable 
Modification Program of the Making Home Affordable initiative of the 
Secretary of the Treasury, authorized under the Emergency Economic 
Stabilization Act of 2008 (Public Law 110-343), to require each 
mortgage servicer participating in such program to provide each 
borrower under a mortgage whose request for a mortgage modification 
under the Program is denied with all borrower-related and mortgage-
related input data used in any net present value (NPV) analyses 
performed in connection with the subject mortgage. Such input data 
shall be provided to the borrower at the time of such denial.
    (b) Web-based Site for NPV Calculator and Application.--
        (1) NPV calculator.--In carrying out the Home Affordable 
    Modification Program, the Secretary shall establish and maintain a 
    site on the World Wide Web that provides a calculator for net 
    present value analyses of a mortgage, based on the Secretary's 
    methodology for calculating such value, that mortgagors can use to 
    enter information regarding their own mortgages and that provides a 
    determination after entering such information regarding a mortgage 
    of whether such mortgage would be accepted or rejected for 
    modification under the Program, using such methodology.
        (2) Disclosure.--Such Web site shall also prominently disclose 
    that each mortgage servicer participating in such Program may use a 
    method for calculating net present value of a mortgage that is 
    different than the method used by such calculator.
        (3) Application.--The Secretary shall make a reasonable effort 
    to include on such World Wide Web site a method for homeowners to 
    apply for a mortgage modification under the Home Affordable 
    Modification Program.
    (c) Public Availability of NPV Methodology, Computer Model, and 
Variables.--The Secretary shall make publicly available, including by 
posting on a World Wide Web site of the Secretary--
        (1) the Secretary's methodology and computer model, including 
    all formulae used in such computer model, used for calculating net 
    present value of a mortgage that is used by the calculator 
    established pursuant to subsection (b); and
        (2) all non-proprietary variables used in such net present 
    value analysis.
SEC. 1483. PUBLIC AVAILABILITY OF INFORMATION OF MAKING HOME AFFORDABLE 
PROGRAM.
    (a) Revisions to Program Guidelines.--The Secretary of the Treasury 
(in this section referred to as the ``Secretary'') shall revise the 
guidelines for the Home Affordable Modification Program of the Making 
Home Affordable initiative of the Secretary of the Treasury, authorized 
under the Emergency Economic Stabilization Act of 2008 (Public Law 110-
343), to provide that the data being collected by the Secretary from 
each mortgage servicer and lender participating in the Program is made 
public in accordance with subsection (b).
    (b) Public Availability.--Data shall be made available according to 
the following guidelines:
        (1) Not more than 14 days after each monthly deadline for 
    submission of data by mortgage servicers and lenders participating 
    in the Program, reports shall be made publicly available by means 
    of a World Wide Web site of the Secretary, and by submitting a 
    report to the Congress, that shall includes the following 
    information:
            (A) The number of requests for mortgage modifications under 
        the Program that the servicer or lender has received.
            (B) The number of requests for mortgage modifications under 
        the Program that the servicer or lender has processed.
            (C) The number of requests for mortgage modifications under 
        the Program that the servicer or lender has approved.
            (D) The number of requests for mortgage modifications under 
        the Program that the servicer or lender has denied.
        (2) Not more than 60 days after each monthly deadline for 
    submission of data by mortgage servicers and lenders participating 
    in the Program, the Secretary shall make data tables available to 
    the public at the individual record level. The Secretary shall 
    issue regulations prescribing--
            (A) the procedures for disclosing such data to the public; 
        and
            (B) such deletions as the Secretary may determine to be 
        appropriate to protect any privacy interest of any mortgage 
        modification applicant, including the deletion or alteration of 
        the applicant's name and identification number.
SEC. 1484. PROTECTING TENANTS AT FORECLOSURE EXTENSION AND 
CLARIFICATION.
    The Protecting Tenants at Foreclosure Act is amended--
        (1) in section 702 (12 U.S.C. 5220 note)--
            (A) in subsection (a)(2), by striking ``, as of the date of 
        such notice of foreclosure''; and
            (B) in subsection (c), by inserting after the period the 
        following: ``For purposes of this section, the date of a notice 
        of foreclosure shall be deemed to be the date on which complete 
        title to a property is transferred to a successor entity or 
        person as a result of an order of a court or pursuant to 
        provisions in a mortgage, deed of trust, or security deed.''; 
        and
        (2) in section 704 (12 U.S.C. 5201 note), by striking ``2012'' 
    and inserting ``2014''.

                  Subtitle H--Miscellaneous Provisions

SEC. 1491. SENSE OF CONGRESS REGARDING THE IMPORTANCE OF GOVERNMENT-
SPONSORED ENTERPRISES REFORM TO ENHANCE THE PROTECTION, LIMITATION, AND 
REGULATION OF THE TERMS OF RESIDENTIAL MORTGAGE CREDIT.
    (a) Findings.--The Congress finds as follows:
        (1) The Government-sponsored enterprises, Federal National 
    Mortgage Association (Fannie Mae) and the Federal Home Loan 
    Mortgage Corporation (Freddie Mac), were chartered by Congress to 
    ensure a reliable and affordable supply of mortgage funding, but 
    enjoy a dual legal status as privately owned corporations with 
    Government mandated affordable housing goals.
        (2) In 1996, the Department of Housing and Urban Development 
    required that 42 percent of Fannie Mae's and Freddie Mac's mortgage 
    financing should go to borrowers with income levels below the 
    median for a given area.
        (3) In 2004, the Department of Housing and Urban Development 
    revised those goals, increasing them to 56 percent of their overall 
    mortgage purchases by 2008, and additionally mandated that 12 
    percent of all mortgage purchases by Fannie Mae and Freddie Mac be 
    ``special affordable'' loans made to borrowers with incomes less 
    than 60 percent of an area's median income, a target that 
    ultimately increased to 28 percent for 2008.
        (4) To help fulfill those mandated affordable housing goals, in 
    1995 the Department of Housing and Urban Development authorized 
    Fannie Mae and Freddie Mac to purchase subprime securities that 
    included loans made to low-income borrowers.
        (5) After this authorization to purchase subprime securities, 
    subprime and near-prime loans increased from 9 percent of 
    securitized mortgages in 2001 to 40 percent in 2006, while the 
    market share of conventional mortgages dropped from 78.8 percent in 
    2003 to 50.1 percent by 2007 with a corresponding increase in 
    subprime and Alt-A loans from 10.1 percent to 32.7 percent over the 
    same period.
        (6) In 2004 alone, Fannie Mae and Freddie Mac purchased 
    $175,000,000,000 in subprime mortgage securities, which accounted 
    for 44 percent of the market that year, and from 2005 through 2007, 
    Fannie Mae and Freddie Mac purchased approximately 
    $1,000,000,000,000 in subprime and Alt-A loans, while Fannie Mae's 
    acquisitions of mortgages with less than 10 percent down payments 
    almost tripled.
        (7) According to data from the Federal Housing Finance Agency 
    (FHFA) for the fourth quarter of 2008, Fannie Mae and Freddie Mac 
    own or guarantee 75 percent of all newly originated mortgages, and 
    Fannie Mae and Freddie Mac currently own 13.3 percent of 
    outstanding mortgage debt in the United States and have issued 
    mortgage-backed securities for 31.0 percent of the residential debt 
    market, a combined total of 44.3 percent of outstanding mortgage 
    debt in the United States.
        (8) On September 7, 2008, the FHFA placed Fannie Mae and 
    Freddie Mac into conservatorship, with the Treasury Department 
    subsequently agreeing to purchase at least $200,000,000,000 of 
    preferred stock from each enterprise in exchange for warrants for 
    the purchase of 79.9 percent of each enterprise's common stock.
        (9) The conservatorship for Fannie Mae and Freddie Mac has 
    potentially exposed taxpayers to upwards of $5,300,000,000,000 
    worth of risk.
        (10) The hybrid public-private status of Fannie Mae and Freddie 
    Mac is untenable and must be resolved to assure that consumers are 
    offered and receive residential mortgage loans on terms that 
    reasonably reflect their ability to repay the loans and that are 
    understandable and not unfair, deceptive, or abusive.
    (b) Sense of the Congress.--It is the sense of the Congress that 
efforts to enhance by the protection, limitation, and regulation of the 
terms of residential mortgage credit and the practices related to such 
credit would be incomplete without enactment of meaningful structural 
reforms of Fannie Mae and Freddie Mac.
SEC. 1492. GAO STUDY REPORT ON GOVERNMENT EFFORTS TO COMBAT MORTGAGE 
FORECLOSURE RESCUE SCAMS AND LOAN MODIFICATION FRAUD.
    (a) Study.--The Comptroller General of the United States shall 
conduct a study of the current inter-agency efforts of the Secretary of 
the Treasury, the Secretary of Housing and Urban Development, the 
Attorney General, and the Federal Trade Commission to crackdown on 
mortgage foreclosure rescue scams and loan modification fraud in order 
to advise the Congress to the risks and vulnerabilities of emerging 
schemes in the loan modification arena.
    (b) Report.--
        (1) In general.--The Comptroller General shall submit a report 
    to the Congress on the study conducted under subsection (a) 
    containing such recommendations for legislative and administrative 
    actions as the Comptroller General may determine to be appropriate 
    in addition to the recommendations required under paragraph (2).
        (2) Specific topics.--The report made under paragraph (1) shall 
    include--
            (A) an evaluation of the effectiveness of the inter-agency 
        task force current efforts to combat mortgage foreclosure 
        rescue scams and loan modification fraud scams;
            (B) specific recommendations on agency or legislative 
        action that are essential to properly protect homeowners from 
        mortgage foreclosure rescue scams and loan modification fraud 
        scams; and
            (C) the adequacy of financial resources that the Federal 
        Government is allocating to--
                (i) crackdown on loan modification and foreclosure 
            rescue scams; and
                (ii) the education of homeowners about fraudulent scams 
            relating to loan modification and foreclosure rescues.
SEC. 1493. REPORTING OF MORTGAGE DATA BY STATE.
    (a) In General.--Section 104(a) of the Helping Families Save Their 
Homes Act of 2009 (division A of Public Law 111-22) is amended--
        (1) in paragraph (2), by striking ``resulting'' and inserting 
    ``in each State that result'';
        (2) in paragraph (3), by inserting ``each State for'' after 
    ``modifications in''; and
        (3) in paragraph (4), by inserting ``in each State'' after 
    ``total number of loans''.
    (b) Conforming Amendment.--Section 104(b)(1)(A) of such Act is 
amended by adding at the end the following sentence: ``Not later than 
60 days after the date of the enactment of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act, the Comptroller of the Currency and 
the Director of the Office of Thrift Supervision shall update such 
requirements to reflect amendments made to this section by such Act.''.
SEC. 1494. STUDY OF EFFECT OF DRYWALL PRESENCE ON FORECLOSURES.
    (a) Study.--The Secretary of Housing and Urban Development, in 
consultation with the Secretary of the Treasury, shall conduct a study 
of the effect on residential mortgage loan foreclosures of--
        (1) the presence in residential structures subject to such 
    mortgage loans of drywall that was imported from China during the 
    period beginning with 2004 and ending at the end of 2007; and
        (2) the availability of property insurance for residential 
    structures in which such drywall is present.
    (b) Report.--Not later than the expiration of the 120-day period 
beginning on the date of the enactment of this Act, the Secretary of 
Housing and Urban Development shall submit to the Congress a report on 
the study conducted under subsection (a) containing its findings, 
conclusions, and recommendations.
SEC. 1495. DEFINITION.
    For purposes of this title, the term ``designated transfer date'' 
means the date established under section 1062 of this Act.
SEC. 1496. EMERGENCY MORTGAGE RELIEF.
    (a) Emergency Homeowners' Relief Fund.--Effective October 1, 2010, 
and notwithstanding any other provision of law, there is hereby made 
available to the Secretary of Housing and Urban Development such sums 
as are necessary to provide $1,000,000,000 in assistance through the 
Emergency Homeowners' Relief Fund, which such Secretary shall establish 
pursuant to section 107 of the Emergency Housing Act of 1975 (12 U.S.C. 
2706), as such Act is amended by this section, for use for emergency 
mortgage assistance in accordance with title I of such Act.
    (b) Reauthorization of Emergency Mortgage Relief Program.--Title I 
of the Emergency Housing Act of 1975 is amended--
        (1) in section 103 (12 U.S.C. 2702)--
            (A) in paragraph (2)--
                (i) by striking ``have indicated'' and all that follows 
            through ``regulation of the holder'' and insert ``have 
            certified'';
                (ii) by striking ``(such as the volume of delinquent 
            loans in its portfolio)''; and
                (iii) by striking ``, except that such statement'' and 
            all that follows through ``purposes of this title''; and
            (B) in paragraph (4), by inserting ``or medical 
        conditions'' after ``adverse economic conditions'';
        (2) in section 104 (12 U.S.C. 2703)--
            (A) in subsection (b), by striking ``, but such 
        assistance'' and all that follows through the period at the end 
        and inserting the following: ``. The amount of assistance 
        provided to a homeowner under this title shall be an amount 
        that the Secretary determines is reasonably necessary to 
        supplement such amount as the homeowner is capable of 
        contributing toward such mortgage payment, except that the 
        aggregate amount of such assistance provided for any homeowner 
        shall not exceed $50,000.'';
            (B) in subsection (d), by striking ``interest on a loan or 
        advance'' and all that follows through the end of the 
        subsection and inserting the following: ``(1) the rate of 
        interest on any loan or advance of credit insured under this 
        title shall be fixed for the life of the loan or advance of 
        credit and shall not exceed the rate of interest that is 
        generally charged for mortgages on single-family housing 
        insured by the Secretary of Housing and Urban Development under 
        title II of the National Housing Act at the time such loan or 
        advance of credit is made, and (2) no interest shall be charged 
        on interest which is deferred on a loan or advance of credit 
        made under this title. In establishing rates, terms and 
        conditions for loans or advances of credit made under this 
        title, the Secretary shall take into account a homeowner's 
        ability to repay such loan or advance of credit.''; and
            (C) in subsection (e), by inserting after the period at the 
        end of the first sentence the following: ``Any eligible 
        homeowner who receives a grant or an advance of credit under 
        this title may repay the loan in full, without penalty, by lump 
        sum or by installment payments at any time before the loan 
        becomes due and payable.'';
        (3) in section 105 (12 U.S.C. 2704)--
            (A) by striking subsection (b);
            (B) in subsection (e)--
                (i) by inserting ``and emergency mortgage relief 
            payments made under section 106'' after ``insured under 
            this section''; and
                (ii) by striking ``$1,500,000,000 at any one time'' and 
            inserting ``$3,000,000,000'';
            (C) by redesignating subsections (c), (d), and (e) as 
        subsections (b), (c), and (d), respectively; and
            (D) by adding at the end the following new subsection:
    ``(e) The Secretary shall establish underwriting guidelines or 
procedures to allocate amounts made available for loans and advances 
insured under this section and for emergency relief payments made under 
section 106 based on the likelihood that a mortgagor will be able to 
resume mortgage payments, pursuant to the requirement under section 
103(5).'';
        (4) in section 107--
            (A) by striking ``(a)''; and
            (B) by striking subsection (b);
        (5) in section 108 (12 U.S.C. 2707), by adding at the end the 
    following new subsection:
    ``(d) Coverage of Existing Programs.--The Secretary shall allow 
funds to be administered by a State that has an existing program that 
is determined by the Secretary to provide substantially similar 
assistance to homeowners. After such determination is made such State 
shall not be required to modify such program to comply with the 
provisions of this title.'';
        (6) in section 109 (12 U.S.C. 2708)--
            (A) in the section heading, by striking ``authorization 
        and'';
            (B) by striking subsection (a);
            (C) by striking ``(b)''; and
            (D) by striking ``1977'' and inserting ``2011'';
        (7) by striking sections 110, 111, and 113 (12 U.S.C. 2709, 
    2710, 2712); and
        (8) by redesignating section 112 (12 U.S.C. 2711) as section 
    110.
SEC. 1497. ADDITIONAL ASSISTANCE FOR NEIGHBORHOOD STABILIZATION 
PROGRAM.
    (a) In General.--Effective October 1, 2010, out of funds in the 
Treasury not otherwise appropriated, there is hereby made available to 
the Secretary of Housing and Urban Development $1,000,000,000, and the 
Secretary of Housing and Urban Development shall use such amounts for 
assistance to States and units of general local government for the 
redevelopment of abandoned and foreclosed homes, in accordance with the 
same provisions applicable under the second undesignated paragraph 
under the heading ``Community Planning and Development--Community 
Development Fund'' in title XII of division A of the American Recovery 
and Reinvestment Act of 2009 (Public Law 111-5; 123 Stat. 217) to 
amounts made available under such second undesignated paragraph, except 
as follows:
        (1) Notwithstanding the matter of such second undesignated 
    paragraph that precedes the first proviso, amounts made available 
    by this section shall remain available until expended.
        (2) The 3rd, 4th, 5th, 6th, 7th, and 15th provisos of such 
    second undesignated paragraph shall not apply to amounts made 
    available by this section.
        (3) Amounts made available by this section shall be allocated 
    based on a funding formula for such amounts established by the 
    Secretary in accordance with section 2301(b) of the Housing and 
    Economic Recovery Act of 2008 (42 U.S.C. 5301 note), except that--
            (A) notwithstanding paragraph (2) of such section 2301(b), 
        the formula shall be established not later than 30 days after 
        the date of the enactment of this Act;
            (B) notwithstanding such section 2301(b), each State shall 
        receive, at a minimum, not less than 0.5 percent of funds made 
        available under this section;
            (C) the Secretary may establish a minimum grant amount for 
        direct allocations to units of general local government located 
        within a State, which shall not exceed $1,000,000;
            (D) each State and local government receiving grant amounts 
        shall establish procedures to create preferences for the 
        development of affordable rental housing for properties 
        assisted with amounts made available by this section; and
            (E) the Secretary may use not more than 2 percent of the 
        funds made available under this section for technical 
        assistance to grantees.
        (4) Paragraph (1) of section 2301(c) of the Housing and 
    Economic Recovery Act of 2008 shall not apply to amounts made 
    available by this section.
        (5) The fourth proviso from the end of such second undesignated 
    paragraph shall be applied to amounts made available by this 
    section by substituting ``2013'' for ``2012''.
        (6) Notwithstanding section 2301(a) of the Housing and Economic 
    Recovery Act of 2008, the term ``State'' means any State, as 
    defined in section 102 of the Housing and Community Development Act 
    of 1974 (42 U.S.C. 5302), and the District of Columbia, for 
    purposes of this section and this title, as applied to amounts made 
    available by this section.
        (7)(A) None of the amounts made available by this section shall 
    be distributed to--
            (i) any organization which has been convicted for a 
        violation under Federal law relating to an election for Federal 
        office; or
            (ii) any organization which employs applicable individuals.
        (B) In this paragraph, the term ``applicable individual'' means 
    an individual who--
            (i) is--
                (I) employed by the organization in a permanent or 
            temporary capacity;
                (II) contracted or retained by the organization; or
                (III) acting on behalf of, or with the express or 
            apparent authority of, the organization; and
            (ii) has been convicted for a violation under Federal law 
        relating to an election for Federal office.
        (8) An eligible entity receiving a grant under this section 
    shall, to the maximum extent feasible, provide for the hiring of 
    employees who reside in the vicinity, as such term is defined by 
    the Secretary, of projects funded under this section or contract 
    with small businesses that are owned and operated by persons 
    residing in the vicinity of such projects.
    (b) Additional Amendments.--
        (1) Section 2301.--Section 2301(f)(3)(A)(ii) of the Housing and 
    Economic Recovery Act of 2008 (42 U.S.C. 5301(f)(3)(A)(ii))--
            (A) is amended by striking ``for the purchase and 
        redevelopment of abandoned and foreclosed upon homes or 
        residential properties that will be used''; and
            (B) shall apply with respect to any unexpended or 
        unobligated balances, including recaptured and reallocated 
        funds made available under this Act, section 2301 of the 
        Housing and Economic Recovery Act of 2008 (42 U.S.C. 5301), and 
        the heading ``Community Planning and Development--Community 
        Development Fund'' in title XII of division A of the American 
        Recovery and Reinvestment Act of 2009 (Public Law 111-5; 123 
        Stat. 217).
        (2) Notice of foreclosure.--For any amounts made available 
    under this section, under division B, title III of the Housing and 
    Economic Recovery Act of 2008 (42 U.S.C. 5301), or under the 
    heading ``Community Planning and Development--Community Development 
    Fund'' in title XII of division A of the American Recovery and 
    Reinvestment Act of 2009 (Public Law 111-5; 123 Stat. 217), the 
    date of a notice of foreclosure shall be deemed to be the date on 
    which complete title to a property is transferred to a successor 
    entity or person as a result of an order of a court or pursuant to 
    provisions in a mortgage, deed of trust, or security deed.
SEC. 1498. LEGAL ASSISTANCE FOR FORECLOSURE-RELATED ISSUES.
    (a) Establishment.--The Secretary of Housing and Urban Development 
(hereafter in this section referred to as the ``Secretary'') shall 
establish a program for making grants for providing a full range of 
foreclosure legal assistance to low- and moderate-income homeowners and 
tenants related to home ownership preservation, home foreclosure 
prevention, and tenancy associated with home foreclosure.
    (b) Competitive Allocation.--The Secretary shall allocate amounts 
made available for grants under this section to State and local legal 
organizations on the basis of a competitive process. For purposes of 
this subsection ``State and local legal organizations'' are those State 
and local organizations whose primary business or mission is to provide 
legal assistance.
    (c) Priority to Certain Areas.--In allocating amounts in accordance 
with subsection (b), the Secretary shall give priority consideration to 
State and local legal organizations that are operating in the 125 
metropolitan statistical areas (as that term is defined by the Director 
of the Office of Management and Budget) with the highest home 
foreclosure rates.
    (d) Legal Assistance.--
        (1) In general.--Any State or local legal organization that 
    receives financial assistance pursuant to this section may use such 
    amounts only to assist--
            (A) homeowners of owner-occupied homes with mortgages in 
        default, in danger of default, or subject to or at risk of 
        foreclosure; and
            (B) tenants at risk of or subject to eviction as a result 
        of foreclosure of the property in which such tenant resides.
        (2) Commence use within 90 days.--Any State or local legal 
    organization that receives financial assistance pursuant to this 
    section shall begin using any financial assistance received under 
    this section within 90 days after receipt of the assistance.
        (3) Prohibition on class actions.--No funds provided to a State 
    or local legal organization under this section may be used to 
    support any class action litigation.
        (4) Limitation on legal assistance.--Legal assistance funded 
    with amounts provided under this section shall be limited to 
    mortgage-related default, eviction, or foreclosure proceedings, 
    without regard to whether such foreclosure is judicial or 
    nonjudicial.
        (5) Effective date.--Notwithstanding any other provision of 
    this Act, this subsection shall take effect on the date of the 
    enactment of this Act.
    (e) Limitation on Distribution of Assistance.--
        (1) In general.--None of the amounts made available under this 
    section shall be distributed to--
            (A) any organization which has been convicted for a 
        violation under Federal law relating to an election for Federal 
        office; or
            (B) any organization which employs applicable individuals.
        (2) Definition of applicable individuals.--In this subsection, 
    the term ``applicable individual'' means an individual who--
            (A) is--
                (i) employed by the organization in a permanent or 
            temporary capacity;
                (ii) contracted or retained by the organization; or
                (iii) acting on behalf of, or with the express or 
            apparent authority of, the organization; and
            (B) has been convicted for a violation under Federal law 
        relating to an election for Federal office.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary $35,000,000 for each of fiscal years 2011 
through 2012 for grants under this section.

                   TITLE XV--MISCELLANEOUS PROVISIONS

SEC. 1501. RESTRICTIONS ON USE OF UNITED STATES FUNDS FOR FOREIGN 
GOVERNMENTS; PROTECTION OF AMERICAN TAXPAYERS.
    The Bretton Woods Agreements Act (22 U.S.C. 286 et seq.) is amended 
by adding at the end the following:
  ``SEC. 68. RESTRICTIONS ON USE OF UNITED STATES FUNDS FOR FOREIGN 
      GOVERNMENTS; PROTECTION OF AMERICAN TAXPAYERS.
    ``(a) In General.--The Secretary of the Treasury shall instruct the 
United States Executive Director at the International Monetary Fund--
        ``(1) to evaluate, prior to consideration by the Board of 
    Executive Directors of the Fund , any proposal submitted to the 
    Board for the Fund to make a loan to a country if--
            ``(A) the amount of the public debt of the country exceeds 
        the gross domestic product of the country as of the most recent 
        year for which such information is available; and
            ``(B) the country is not eligible for assistance from the 
        International Development Association.
        ``(2) Opposition to loans unlikely to be repaid in full.--If 
    any such evaluation indicates that the proposed loan is not likely 
    to be repaid in full, the Secretary of the Treasury shall instruct 
    the United States Executive Director at the Fund to use the voice 
    and vote of the United States to oppose the proposal.
    ``(b) Reports to Congress.--Within 30 days after the Board of 
Executive Directors of the Fund approves a proposal described in 
subsection (a), and annually thereafter by June 30, for the duration of 
any program approved under such proposals, the Secretary of the 
Treasury shall report in writing to the Committee on Financial Services 
of the House of Representatives and the Committee on Foreign Relations 
and the Committee on Banking, Housing, and Urban Affairs of the Senate 
assessing the likelihood that loans made pursuant to such proposals 
will be repaid in full, including--
        ``(1) the borrowing country's current debt status, including, 
    to the extent possible, its maturity structure, whether it has 
    fixed or floating rates, whether it is indexed, and by whom it is 
    held;
        ``(2) the borrowing country's external and internal 
    vulnerabilities that could potentially affect its ability to repay; 
    and
        ``(3) the borrowing country's debt management strategy.''.
SEC. 1502. CONFLICT MINERALS.
    (a) Sense of Congress on Exploitation and Trade of Conflict 
Minerals Originating in the Democratic Republic of the Congo.--It is 
the sense of Congress that the exploitation and trade of conflict 
minerals originating in the Democratic Republic of the Congo is helping 
to finance conflict characterized by extreme levels of violence in the 
eastern Democratic Republic of the Congo, particularly sexual- and 
gender-based violence, and contributing to an emergency humanitarian 
situation therein, warranting the provisions of section 13(p) of the 
Securities Exchange Act of 1934, as added by subsection (b).
    (b) Disclosure Relating to Conflict Minerals Originating in the 
Democratic Republic of the Congo.--Section 13 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m), as amended by this Act, is 
amended by adding at the end the following new subsection:
    ``(p) Disclosures Relating to Conflict Minerals Originating in the 
Democratic Republic of the Congo.--
        ``(1) Regulations.--
            ``(A) In general.--Not later than 270 days after the date 
        of the enactment of this subsection, the Commission shall 
        promulgate regulations requiring any person described in 
        paragraph (2) to disclose annually, beginning with the person's 
        first full fiscal year that begins after the date of 
        promulgation of such regulations, whether conflict minerals 
        that are necessary as described in paragraph (2)(B), in the 
        year for which such reporting is required, did originate in the 
        Democratic Republic of the Congo or an adjoining country and, 
        in cases in which such conflict minerals did originate in any 
        such country, submit to the Commission a report that includes, 
        with respect to the period covered by the report--
                ``(i) a description of the measures taken by the person 
            to exercise due diligence on the source and chain of 
            custody of such minerals, which measures shall include an 
            independent private sector audit of such report submitted 
            through the Commission that is conducted in accordance with 
            standards established by the Comptroller General of the 
            United States, in accordance with rules promulgated by the 
            Commission, in consultation with the Secretary of State; 
            and
                ``(ii) a description of the products manufactured or 
            contracted to be manufactured that are not DRC conflict 
            free (`DRC conflict free' is defined to mean the products 
            that do not contain minerals that directly or indirectly 
            finance or benefit armed groups in the Democratic Republic 
            of the Congo or an adjoining country), the entity that 
            conducted the independent private sector audit in 
            accordance with clause (i), the facilities used to process 
            the conflict minerals, the country of origin of the 
            conflict minerals, and the efforts to determine the mine or 
            location of origin with the greatest possible specificity.
            ``(B) Certification.--The person submitting a report under 
        subparagraph (A) shall certify the audit described in clause 
        (i) of such subparagraph that is included in such report. Such 
        a certified audit shall constitute a critical component of due 
        diligence in establishing the source and chain of custody of 
        such minerals.
            ``(C) Unreliable determination.--If a report required to be 
        submitted by a person under subparagraph (A) relies on a 
        determination of an independent private sector audit, as 
        described under subparagraph (A)(i), or other due diligence 
        processes previously determined by the Commission to be 
        unreliable, the report shall not satisfy the requirements of 
        the regulations promulgated under subparagraph (A)(i).
            ``(D) DRC conflict free.--For purposes of this paragraph, a 
        product may be labeled as `DRC conflict free' if the product 
        does not contain conflict minerals that directly or indirectly 
        finance or benefit armed groups in the Democratic Republic of 
        the Congo or an adjoining country.
            ``(E) Information available to the public.--Each person 
        described under paragraph (2) shall make available to the 
        public on the Internet website of such person the information 
        disclosed by such person under subparagraph (A).
        ``(2) Person described.--A person is described in this 
    paragraph if--
            ``(A) the person is required to file reports with the 
        Commission pursuant to paragraph (1)(A); and
            ``(B) conflict minerals are necessary to the functionality 
        or production of a product manufactured by such person.
        ``(3) Revisions and waivers.--The Commission shall revise or 
    temporarily waive the requirements described in paragraph (1) if 
    the President transmits to the Commission a determination that--
            ``(A) such revision or waiver is in the national security 
        interest of the United States and the President includes the 
        reasons therefor; and
            ``(B) establishes a date, not later than 2 years after the 
        initial publication of such exemption, on which such exemption 
        shall expire.
        ``(4) Termination of disclosure requirements.--The requirements 
    of paragraph (1) shall terminate on the date on which the President 
    determines and certifies to the appropriate congressional 
    committees, but in no case earlier than the date that is one day 
    after the end of the 5-year period beginning on the date of the 
    enactment of this subsection, that no armed groups continue to be 
    directly involved and benefitting from commercial activity 
    involving conflict minerals.
        ``(5) Definitions.--For purposes of this subsection, the terms 
    `adjoining country', `appropriate congressional committees', `armed 
    group', and `conflict mineral' have the meaning given those terms 
    under section 1502 of the Dodd-Frank Wall Street Reform and 
    Consumer Protection Act.''.
    (c) Strategy and Map to Address Linkages Between Conflict Minerals 
and Armed Groups.--
        (1) Strategy.--
            (A) In general.--Not later than 180 days after the date of 
        the enactment of this Act, the Secretary of State, in 
        consultation with the Administrator of the United States Agency 
        for International Development, shall submit to the appropriate 
        congressional committees a strategy to address the linkages 
        between human rights abuses, armed groups, mining of conflict 
        minerals, and commercial products.
            (B) Contents.--The strategy required by subparagraph (A) 
        shall include the following:
                (i) A plan to promote peace and security in the 
            Democratic Republic of the Congo by supporting efforts of 
            the Government of the Democratic Republic of the Congo, 
            including the Ministry of Mines and other relevant 
            agencies, adjoining countries, and the international 
            community, in particular the United Nations Group of 
            Experts on the Democratic Republic of Congo, to--

                    (I) monitor and stop commercial activities 
                involving the natural resources of the Democratic 
                Republic of the Congo that contribute to the activities 
                of armed groups and human rights violations in the 
                Democratic Republic of the Congo; and
                    (II) develop stronger governance and economic 
                institutions that can facilitate and improve 
                transparency in the cross-border trade involving the 
                natural resources of the Democratic Republic of the 
                Congo to reduce exploitation by armed groups and 
                promote local and regional development.

                (ii) A plan to provide guidance to commercial entities 
            seeking to exercise due diligence on and formalize the 
            origin and chain of custody of conflict minerals used in 
            their products and on their suppliers to ensure that 
            conflict minerals used in the products of such suppliers do 
            not directly or indirectly finance armed conflict or result 
            in labor or human rights violations.
                (iii) A description of punitive measures that could be 
            taken against individuals or entities whose commercial 
            activities are supporting armed groups and human rights 
            violations in the Democratic Republic of the Congo.
        (2) Map.--
            (A) In general.--Not later than 180 days after the date of 
        the enactment of this Act, the Secretary of State shall, in 
        accordance with the recommendation of the United Nations Group 
        of Experts on the Democratic Republic of the Congo in their 
        December 2008 report--
                (i) produce a map of mineral-rich zones, trade routes, 
            and areas under the control of armed groups in the 
            Democratic Republic of the Congo and adjoining countries 
            based on data from multiple sources, including--

                    (I) the United Nations Group of Experts on the 
                Democratic Republic of the Congo;
                    (II) the Government of the Democratic Republic of 
                the Congo, the governments of adjoining countries, and 
                the governments of other Member States of the United 
                Nations; and
                    (III) local and international nongovernmental 
                organizations;

                (ii) make such map available to the public; and
                (iii) provide to the appropriate congressional 
            committees an explanatory note describing the sources of 
            information from which such map is based and the 
            identification, where possible, of the armed groups or 
            other forces in control of the mines depicted.
            (B) Designation.--The map required under subparagraph (A) 
        shall be known as the ``Conflict Minerals Map'', and mines 
        located in areas under the control of armed groups in the 
        Democratic Republic of the Congo and adjoining countries, as 
        depicted on such Conflict Minerals Map, shall be known as 
        ``Conflict Zone Mines''.
            (C) Updates.--The Secretary of State shall update the map 
        required under subparagraph (A) not less frequently than once 
        every 180 days until the date on which the disclosure 
        requirements under paragraph (1) of section 13(p) of the 
        Securities Exchange Act of 1934, as added by subsection (b), 
        terminate in accordance with the provisions of paragraph (4) of 
        such section 13(p).
            (D) Publication in federal register.--The Secretary of 
        State shall add minerals to the list of minerals in the 
        definition of conflict minerals under section 1502, as 
        appropriate. The Secretary shall publish in the Federal 
        Register notice of intent to declare a mineral as a conflict 
        mineral included in such definition not later than one year 
        before such declaration.
    (d) Reports.--
        (1) Baseline report.--Not later than 1 year after the date of 
    the enactment of this Act and annually thereafter until the 
    termination of the disclosure requirements under section 13(p) of 
    the Securities Exchange Act of 1934, the Comptroller General of the 
    United States shall submit to appropriate congressional committees 
    a report that includes an assessment of the rate of sexual- and 
    gender-based violence in war-torn areas of the Democratic Republic 
    of the Congo and adjoining countries.
        (2) Regular report on effectiveness.--Not later than 2 years 
    after the date of the enactment of this Act and annually 
    thereafter, the Comptroller General of the United States shall 
    submit to the appropriate congressional committees a report that 
    includes the following:
            (A) An assessment of the effectiveness of section 13(p) of 
        the Securities Exchange Act of 1934, as added by subsection 
        (b), in promoting peace and security in the Democratic Republic 
        of the Congo and adjoining countries.
            (B) A description of issues encountered by the Securities 
        and Exchange Commission in carrying out the provisions of such 
        section 13(p).
            (C)(i) A general review of persons described in clause (ii) 
        and whether information is publicly available about--
                (I) the use of conflict minerals by such persons; and
                (II) whether such conflict minerals originate from the 
            Democratic Republic of the Congo or an adjoining country.
            (ii) A person is described in this clause if--
                (I) the person is not required to file reports with the 
            Securities and Exchange Commission pursuant to section 
            13(p)(1)(A) of the Securities Exchange Act of 1934, as 
            added by subsection (b); and
                (II) conflict minerals are necessary to the 
            functionality or production of a product manufactured by 
            such person.
        (3) Report on private sector auditing.--Not later than 30 
    months after the date of the enactment of this Act, and annually 
    thereafter, the Secretary of Commerce shall submit to the 
    appropriate congressional committees a report that includes the 
    following:
            (A) An assessment of the accuracy of the independent 
        private sector audits and other due diligence processes 
        described under section 13(p) of the Securities Exchange Act of 
        1934.
            (B) Recommendations for the processes used to carry out 
        such audits, including ways to--
                (i) improve the accuracy of such audits; and
                (ii) establish standards of best practices.
            (C) A listing of all known conflict mineral processing 
        facilities worldwide.
    (e) Definitions.--For purposes of this section:
        (1) Adjoining country.--The term ``adjoining country'', with 
    respect to the Democratic Republic of the Congo, means a country 
    that shares an internationally recognized border with the 
    Democratic Republic of the Congo.
        (2) Appropriate congressional committees.--The term 
    ``appropriate congressional committees'' means--
            (A) the Committee on Appropriations, the Committee on 
        Foreign Affairs, the Committee on Ways and Means, and the 
        Committee on Financial Services of the House of 
        Representatives; and
            (B) the Committee on Appropriations, the Committee on 
        Foreign Relations, the Committee on Finance, and the Committee 
        on Banking, Housing, and Urban Affairs of the Senate.
        (3) Armed group.--The term ``armed group'' means an armed group 
    that is identified as perpetrators of serious human rights abuses 
    in the annual Country Reports on Human Rights Practices under 
    sections 116(d) and 502B(b) of the Foreign Assistance Act of 1961 
    (22 U.S.C. 2151n(d) and 2304(b)) relating to the Democratic 
    Republic of the Congo or an adjoining country.
        (4) Conflict mineral.--The term ``conflict mineral'' means--
            (A) columbite-tantalite (coltan), cassiterite, gold, 
        wolframite, or their derivatives; or
            (B) any other mineral or its derivatives determined by the 
        Secretary of State to be financing conflict in the Democratic 
        Republic of the Congo or an adjoining country.
        (5) Under the control of armed groups.--The term ``under the 
    control of armed groups'' means areas within the Democratic 
    Republic of the Congo or adjoining countries in which armed 
    groups--
            (A) physically control mines or force labor of civilians to 
        mine, transport, or sell conflict minerals;
            (B) tax, extort, or control any part of trade routes for 
        conflict minerals, including the entire trade route from a 
        Conflict Zone Mine to the point of export from the Democratic 
        Republic of the Congo or an adjoining country; or
            (C) tax, extort, or control trading facilities, in whole or 
        in part, including the point of export from the Democratic 
        Republic of the Congo or an adjoining country.
SEC. 1503. REPORTING REQUIREMENTS REGARDING COAL OR OTHER MINE SAFETY.
    (a) Reporting Mine Safety Information.--Each issuer that is 
required to file reports pursuant to section 13(a) or 15(d) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78m, 78o) and that is an 
operator, or that has a subsidiary that is an operator, of a coal or 
other mine shall include, in each periodic report filed with the 
Commission under the securities laws on or after the date of enactment 
of this Act, the following information for the time period covered by 
such report:
        (1) For each coal or other mine of which the issuer or a 
    subsidiary of the issuer is an operator--
            (A) the total number of violations of mandatory health or 
        safety standards that could significantly and substantially 
        contribute to the cause and effect of a coal or other mine 
        safety or health hazard under section 104 of the Federal Mine 
        Safety and Health Act of 1977 (30 U.S.C. 814) for which the 
        operator received a citation from the Mine Safety and Health 
        Administration;
            (B) the total number of orders issued under section 104(b) 
        of such Act (30 U.S.C. 814(b));
            (C) the total number of citations and orders for 
        unwarrantable failure of the mine operator to comply with 
        mandatory health or safety standards under section 104(d) of 
        such Act (30 U.S.C. 814(d));
            (D) the total number of flagrant violations under section 
        110(b)(2) of such Act (30 U.S.C. 820(b)(2));
            (E) the total number of imminent danger orders issued under 
        section 107(a) of such Act (30 U.S.C. 817(a));
            (F) the total dollar value of proposed assessments from the 
        Mine Safety and Health Administration under such Act (30 U.S.C. 
        801 et seq.); and
            (G) the total number of mining-related fatalities.
        (2) A list of such coal or other mines, of which the issuer or 
    a subsidiary of the issuer is an operator, that receive written 
    notice from the Mine Safety and Health Administration of--
            (A) a pattern of violations of mandatory health or safety 
        standards that are of such nature as could have significantly 
        and substantially contributed to the cause and effect of coal 
        or other mine health or safety hazards under section 104(e) of 
        such Act (30 U.S.C. 814(e)); or
            (B) the potential to have such a pattern.
        (3) Any pending legal action before the Federal Mine Safety and 
    Health Review Commission involving such coal or other mine.
    (b) Reporting Shutdowns and Patterns of Violations.--Beginning on 
and after the date of enactment of this Act, each issuer that is an 
operator, or that has a subsidiary that is an operator, of a coal or 
other mine shall file a current report with the Commission on Form 8-K 
(or any successor form) disclosing the following regarding each coal or 
other mine of which the issuer or subsidiary is an operator:
        (1) The receipt of an imminent danger order issued under 
    section 107(a) of the Federal Mine Safety and Health Act of 1977 
    (30 U.S.C. 817(a)).
        (2) The receipt of written notice from the Mine Safety and 
    Health Administration that the coal or other mine has--
            (A) a pattern of violations of mandatory health or safety 
        standards that are of such nature as could have significantly 
        and substantially contributed to the cause and effect of coal 
        or other mine health or safety hazards under section 104(e) of 
        such Act (30 U.S.C. 814(e)); or
            (B) the potential to have such a pattern.
    (c) Rule of Construction.--Nothing in this section shall be 
construed to affect any obligation of a person to make a disclosure 
under any other applicable law in effect before, on, or after the date 
of enactment of this Act.
    (d) Commission Authority.--
        (1) Enforcement.--A violation by any person of this section, or 
    any rule or regulation of the Commission issued under this section, 
    shall be treated for all purposes in the same manner as a violation 
    of the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or 
    the rules and regulations issued thereunder, consistent with the 
    provisions of this section, and any such person shall be subject to 
    the same penalties, and to the same extent, as for a violation of 
    such Act or the rules or regulations issued thereunder.
        (2) Rules and regulations.--The Commission is authorized to 
    issue such rules or regulations as are necessary or appropriate for 
    the protection of investors and to carry out the purposes of this 
    section.
    (e) Definitions.--In this section--
        (1) the terms ``issuer'' and ``securities laws'' have the 
    meaning given the terms in section 3 of the Securities Exchange Act 
    of 1934 (15 U.S.C. 78c);
        (2) the term ``coal or other mine'' means a coal or other mine, 
    as defined in section 3 of the Federal Mine Safety and Health Act 
    of 1977 (30 U.S.C. 802), that is subject to the provisions of such 
    Act (30 U.S.C. 801 et seq.); and
        (3) the term ``operator'' has the meaning given the term in 
    section 3 of the Federal Mine Safety and Health Act of 1977 (30 
    U.S.C. 802).
    (f) Effective Date.--This section shall take effect on the day that 
is 30 days after the date of enactment of this Act.
SEC. 1504. DISCLOSURE OF PAYMENTS BY RESOURCE EXTRACTION ISSUERS.
    Section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m), 
as amended by this Act, is amended by adding at the end the following:
    ``(q) Disclosure of Payments by Resource Extraction Issuers.--
        ``(1) Definitions.--In this subsection--
            ``(A) the term `commercial development of oil, natural gas, 
        or minerals' includes exploration, extraction, processing, 
        export, and other significant actions relating to oil, natural 
        gas, or minerals, or the acquisition of a license for any such 
        activity, as determined by the Commission;
            ``(B) the term `foreign government' means a foreign 
        government, a department, agency, or instrumentality of a 
        foreign government, or a company owned by a foreign government, 
        as determined by the Commission;
            ``(C) the term `payment'--
                ``(i) means a payment that is--

                    ``(I) made to further the commercial development of 
                oil, natural gas, or minerals; and
                    ``(II) not de minimis; and

                ``(ii) includes taxes, royalties, fees (including 
            license fees), production entitlements, bonuses, and other 
            material benefits, that the Commission, consistent with the 
            guidelines of the Extractive Industries Transparency 
            Initiative (to the extent practicable), determines are part 
            of the commonly recognized revenue stream for the 
            commercial development of oil, natural gas, or minerals;
            ``(D) the term `resource extraction issuer' means an issuer 
        that--
                ``(i) is required to file an annual report with the 
            Commission; and
                ``(ii) engages in the commercial development of oil, 
            natural gas, or minerals;
            ``(E) the term `interactive data format' means an 
        electronic data format in which pieces of information are 
        identified using an interactive data standard; and
            ``(F) the term `interactive data standard' means 
        standardized list of electronic tags that mark information 
        included in the annual report of a resource extraction issuer.
        ``(2) Disclosure.--
            ``(A) Information required.--Not later than 270 days after 
        the date of enactment of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act, the Commission shall issue final rules 
        that require each resource extraction issuer to include in an 
        annual report of the resource extraction issuer information 
        relating to any payment made by the resource extraction issuer, 
        a subsidiary of the resource extraction issuer, or an entity 
        under the control of the resource extraction issuer to a 
        foreign government or the Federal Government for the purpose of 
        the commercial development of oil, natural gas, or minerals, 
        including--
                ``(i) the type and total amount of such payments made 
            for each project of the resource extraction issuer relating 
            to the commercial development of oil, natural gas, or 
            minerals; and
                ``(ii) the type and total amount of such payments made 
            to each government.
            ``(B) Consultation in rulemaking.--In issuing rules under 
        subparagraph (A), the Commission may consult with any agency or 
        entity that the Commission determines is relevant.
            ``(C) Interactive data format.--The rules issued under 
        subparagraph (A) shall require that the information included in 
        the annual report of a resource extraction issuer be submitted 
        in an interactive data format.
            ``(D) Interactive data standard.--
                ``(i) In general.--The rules issued under subparagraph 
            (A) shall establish an interactive data standard for the 
            information included in the annual report of a resource 
            extraction issuer.
                ``(ii) Electronic tags.--The interactive data standard 
            shall include electronic tags that identify, for any 
            payments made by a resource extraction issuer to a foreign 
            government or the Federal Government--

                    ``(I) the total amounts of the payments, by 
                category;
                    ``(II) the currency used to make the payments;
                    ``(III) the financial period in which the payments 
                were made;
                    ``(IV) the business segment of the resource 
                extraction issuer that made the payments;
                    ``(V) the government that received the payments, 
                and the country in which the government is located;
                    ``(VI) the project of the resource extraction 
                issuer to which the payments relate; and
                    ``(VII) such other information as the Commission 
                may determine is necessary or appropriate in the public 
                interest or for the protection of investors.

            ``(E) International transparency efforts.--To the extent 
        practicable, the rules issued under subparagraph (A) shall 
        support the commitment of the Federal Government to 
        international transparency promotion efforts relating to the 
        commercial development of oil, natural gas, or minerals.
            ``(F) Effective date.--With respect to each resource 
        extraction issuer, the final rules issued under subparagraph 
        (A) shall take effect on the date on which the resource 
        extraction issuer is required to submit an annual report 
        relating to the fiscal year of the resource extraction issuer 
        that ends not earlier than 1 year after the date on which the 
        Commission issues final rules under subparagraph (A).
        ``(3) Public availability of information.--
            ``(A) In general.--To the extent practicable, the 
        Commission shall make available online, to the public, a 
        compilation of the information required to be submitted under 
        the rules issued under paragraph (2)(A).
            ``(B) Other information.--Nothing in this paragraph shall 
        require the Commission to make available online information 
        other than the information required to be submitted under the 
        rules issued under paragraph (2)(A).
        ``(4) Authorization of appropriations.--There are authorized to 
    be appropriated to the Commission such sums as may be necessary to 
    carry out this subsection.''.
SEC. 1505. STUDY BY THE COMPTROLLER GENERAL.
    (a) In General.--Not later than 1 year after the date of enactment 
of this Act, the Comptroller General of the United States shall issue a 
report assessing the relative independence, effectiveness, and 
expertise of presidentially appointed inspectors general and inspectors 
general of designated Federal entities, as such term is defined under 
section 8G of the Inspector General Act of 1978, and the effects on 
independence of the amendments to the Inspector General Act of 1978 
made by this Act.
    (b) Report.--The report required by subsection (a) shall be issued 
to the Committees on Financial Services and Oversight and Government 
Reform of the House of Representatives and the Committees on Banking, 
Housing, and Urban Affairs and Homeland Security and Governmental 
Affairs of the Senate.
SEC. 1506. STUDY ON CORE DEPOSITS AND BROKERED DEPOSITS.
    (a) Study.--The Corporation shall conduct a study to evaluate--
        (1) the definition of core deposits for the purpose of 
    calculating the insurance premiums of banks;
        (2) the potential impact on the Deposit Insurance Fund of 
    revising the definitions of brokered deposits and core deposits to 
    better distinguish between them;
        (3) an assessment of the differences between core deposits and 
    brokered deposits and their role in the economy and banking sector 
    of the United States;
        (4) the potential stimulative effect on local economies of 
    redefining core deposits; and
        (5) the competitive parity between large institutions and 
    community banks that could result from redefining core deposits.
    (b) Report to Congress.--Not later than 1 year after the date of 
enactment of this Act, the Corporation shall submit to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives a report on the 
results of the study under subsection (a) that includes legislative 
recommendations, if any, to address concerns arising in connection with 
the definitions of core deposits and brokered deposits.

                   TITLE XVI--SECTION 1256 CONTRACTS

SEC. 1601. CERTAIN SWAPS, ETC., NOT TREATED AS SECTION 1256 CONTRACTS.
    (a) In General.--Subsection (b) of section 1256 of the Internal 
Revenue Code of 1986 is amended--
        (1) by redesignating paragraphs (1) through (5) as 
    subparagraphs (A) through (E), respectively, and by indenting such 
    subparagraphs (as so redesignated) accordingly,
        (2) by striking ``For purposes of'' and inserting the 
    following:
        ``(1) In general.--For purposes of'', and
        (3) by striking the last sentence and inserting the following 
    new paragraph:
        ``(2) Exceptions.--The term `section 1256 contract' shall not 
    include--
            ``(A) any securities futures contract or option on such a 
        contract unless such contract or option is a dealer securities 
        futures contract, or
            ``(B) any interest rate swap, currency swap, basis swap, 
        interest rate cap, interest rate floor, commodity swap, equity 
        swap, equity index swap, credit default swap, or similar 
        agreement.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.
```