II 

112TH CONGRESS 

2D SESSION S. 3426 

To amend the Truth in Lending Act to address certain issues related to 

the extension of consumer credit, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 24, 2012 

Mr. MERKLEY (for himself, Mr. UDALL of New Mexico, and Mr. DURBIN) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend the Truth in Lending Act to address certain 

issues related to the extension of consumer credit, and 

for other purposes. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Stopping Abuse and 

5 Fraud in Electronic Lending Act of 2012’’ or the ‘‘SAFE 

6 Lending Act of 2012’’. 

7 SEC. 2. CONSUMER CONTROL OVER BANK ACCOUNTS. 

8 (a) PROHIBITING UNAUTHORIZED REMOTELY CRE9 ATED CHECKS.—Section 905 of the Electronic Fund 


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1 Transfer Act (15 U.S.C. 1693c) is amended by adding at 

2 the end the following: 

3 ‘‘(d) LIMITATIONS ON REMOTELY CREATED

4 CHECKS.— 

5 ‘‘(1) IN GENERAL.—Subject to the limitations 

6 set forth under paragraph (2) and any additional 

7 limitations that the Bureau may establish, by rule, 

8 a remotely created check may only be issued by a 

9 person designated in writing by the consumer, such 

10 designation specifically provided in writing by the 

11 consumer to the insured depository institution at 

12 which the consumer maintains the account from 

13 which the check is to be drawn. 

14 ‘‘(2) ADDITIONAL LIMITATIONS.— 

15 ‘‘(A) IN GENERAL.—An authorization pro16 vided under paragraph (1) may be revoked at 

17 any time by the consumer. 

18 ‘‘(B) CONSUMER FINANCIAL PROTECTION

19 LAWS.—No payment order, including a re20 motely created check, may be issued by any per21 son in response to the exercise of, or attempt to 

22 exercise, any rights by a consumer under any 

23 Federal consumer financial law (as defined in 

24 section 1002(14) of the Consumer Financial 

25 Protection Act of 2010 (12 U.S.C. 5481(14))) 


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1 or any other provision of any law or regulation 

2 within the jurisdiction of the Bureau. 

3 ‘‘(3) REMOTELY CREATED CHECK DEFINED.— 

4 For purposes of this subsection, the term ‘remotely 

5 created check’ means a check (including paper and 

6 electronic checks and any other payment order that 

7 the Bureau, by rule, determines is appropriately cov8 ered by this subsection) that— 

9 ‘‘(A) is not created by the financial institu10 tion that holds the customer account from 

11 which the check is to be paid; and 

12 ‘‘(B) does not bear a signature applied, or 

13 purported to be applied, by the person from 

14 whose account the check is to be paid.’’. 

15 (b) CONSUMER PROTECTIONS FOR CERTAIN ONE16 TIME ELECTRONIC FUND TRANSFERS.—Section 913 of 

17 the Electronic Fund Transfer Act (15 U.S.C. 1693k) is 

18 amended— 

19 (1) by inserting ‘‘(a) IN GENERAL.—’’ before 

20 ‘‘No person’’; 

21 (2) striking ‘‘preauthorized electronic fund 

22 transfers’’ and inserting ‘‘an electronic fund trans23 fer’’; and 

24 (3) by adding at the end the following: 


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1 ‘‘(b) TREATMENT FOR ELECTRONIC FUND TRANS2 FERS IN CREDIT EXTENSIONS.—If a consumer voluntarily 

3 agrees to repay an extension of small-dollar consumer 

4 credit transaction (as defined in section 140B(b) of the 

5 Truth in Lending Act) by means of an electronic fund 

6 transfer, such electronic fund transfer shall be treated as 

7 a preauthorized electronic fund transfer subject to the pro8 tections of this title.’’. 

9 SEC. 3. CONSISTENT APPLICATION OF LAW FOR SMALL10 DOLLAR LENDING. 

11 Chapter 2 of the Truth in Lending Act (15 U.S.C. 

12 1601 et seq.) is amended by adding at the end the fol13 lowing: 

14 ‘‘SEC. 140B. CONSISTENT APPLICATION OF LAW FOR 

15 SMALL-DOLLAR LENDING. 

16 ‘‘(a) IN GENERAL.—Notwithstanding any other pro17 vision of law or any agreement between the parties to a 

18 transaction, and except to the extent that Federal or tribal 

19 law affords greater protection to the consumer, any small20 dollar consumer credit transaction made over the Internet, 

21 telephone, facsimile, mail, electronic mail, or other elec22 tronic communication and any small-dollar consumer cred23 it transaction conducted by an insured depository institu24 tion (as defined in section 3 of the Federal Deposit Insur25 ance Act) shall comply with the laws of the State in which 


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1 the consumer resides with respect to annual percentage 

2 rates, interest, fees, charges, and such other similar or re3 lated matters as the Bureau may, by rule, determine. 

4 ‘‘(b) DEFINITION.—As used in this section, the term 

5 ‘small-dollar consumer credit transaction’ means any 

6 transaction that extends, facilitates, brokers, arranges, or 

7 gathers applications for credit that is— 

8 ‘‘(1) made to a consumer in an amount of not 

9 more than $5,000, or such greater amount as the 

10 Bureau may, by rule, determine, such amount to be 

11 adjusted annually to reflect changes in the Con12 sumer Price Index for all urban consumers published 

13 by the Department of Labor; and 

14 ‘‘(2) extended pursuant to an agreement that 

15 is— 

16 ‘‘(A) other than an open-end credit plan 

17 and is payable in one or more installments of 

18 less than 12 months (or such longer period as 

19 the Bureau may, by rule, determine); 

20 ‘‘(B) an open-end credit plan in which each 

21 advance is fully repayable within a defined time 

22 or in connection with a defined event, or both; 

23 or 

24 ‘‘(C) such other plan as the Bureau deter25 mines, by rule.’’. 


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1 SEC. 4. PROHIBITION ON LEAD GENERATION AND ANONYM2 ITY IN SMALL-DOLLAR CONSUMER CREDIT 

3 TRANSACTIONS. 

4 Chapter 2 of the Truth in Lending Act (15 U.S.C. 

5 1601 et seq.), as amended by this Act, is amended by add6 ing at the end the following: 

7 ‘‘SEC. 140C. PROHIBITION ON LEAD GENERATION AND ANO8 NYMITY IN SMALL-DOLLAR CONSUMER CRED9 IT TRANSACTIONS. 

10 ‘‘(a) IDENTIFICATION INFORMATION.—Any person 

11 engaged in the business of facilitating, brokering, arrang12 ing, gathering applications for, distributing sensitive per13 sonal financial information, or extending credit in connec14 tion with small-dollar consumer credit transactions shall 

15 prominently disclose information by which they may be 

16 contacted or identified, including for service of process and 

17 for identification of the registrant of any domain name 

18 registered or used. 

19 ‘‘(b) PROHIBITION ON LEAD GENERATION IN SMALL20 DOLLAR CONSUMER CREDIT TRANSACTIONS.—No person 

21 may engage in the business of facilitating, brokering, ar22 ranging, gathering applications for, or distributing sen23 sitive personal financial information in connection with 

24 small-dollar consumer credit transactions, unless the per25 son is directly extending the small-dollar consumer credit 

26 to the consumer. 


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1 ‘‘(c) DEFINITIONS.—For purposes of this section— 

2 ‘‘(1) the term ‘sensitive personal financial infor3 mation’ means the consumer’s Social Security num4 ber, financial account number, bank routing number, 

5 bank account number, or any required security or 

6 access code that are immediately necessary to permit 

7 access to the financial account of an individual; and 

8 ‘‘(2) the term ‘small-dollar consumer credit 

9 transaction’ has the same meaning as in section 

10 140B(b). 

11 ‘‘(d) RULE OF CONSTRUCTION.— 

12 ‘‘(1) IN GENERAL.—Nothing in this section 

13 may be interpreted to limit the authority of the Bu14 reau to further restrict activities covered by this sec15 tion. 

16 ‘‘(2) CLARIFICATION.—It shall not be consid17 ered ‘facilitating’ in connection with small-dollar 

18 consumer credit transactions to be engaged solely 

19 in— 

20 ‘‘(A) the provision of a telecommunications 

21 service, or of an Internet access service or 

22 Internet information location tool (as those 

23 terms are defined in section 231 of the Commu24 nications Act of 1934 (47 U.S.C. 231)); or 


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1 ‘‘(B) the transmission, storage, retrieval, 

2 hosting, formatting, or translation (or any com3 bination thereof) of a communication, without 

4 selection or alteration of the content of the 

5 communication, except that deletion of a par6 ticular communication or material made by an7 other person in a manner consistent with sec8 tion 230(c) of the Communications Act of 1934 

9 (47 U.S.C. 230(c)). 

10 ‘‘(e) CIVIL LIABILITY.—Violations of this section 

11 shall be subject to the civil liability provisions of section 

12 130, and any person who violates this section shall be 

13 treated as a creditor for purposes of section 130.’’. 

14 SEC. 5. ENHANCED ENFORCEMENT AUTHORITY AGAINST 

15 CERTAIN INTERNET LENDING. 

16 The Truth in Lending Act (15 U.S.C. 1601 et seq.) 

17 is amended by inserting after section 108 the following: 

18 ‘‘SEC. 108A. ENHANCED ENFORCEMENT AUTHORITY 

19 AGAINST CERTAIN INTERNET LENDING. 

20 ‘‘(a) DEFINITIONS.—In this section, the following 

21 definitions shall apply: 

22 ‘‘(1) COMPLAINANT.—The term ‘complainant’ 

23 means a State attorney general or State or tribal 

24 agency with enforcement authority over prohibited 


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1 activity who files a complaint with the Bureau under 

2 subsection (d). 

3 ‘‘(2) COVERED OFFSHORE PERSON.— 

4 ‘‘(A) IN GENERAL.—The term ‘covered off5 shore person’ means a person (and if such per6 son is not known, the Internet site or other 

7 electronic representation of such person, such 

8 as a telephone number, text message service, or 

9 mobile application) that— 

10 ‘‘(i) conducts business directed to resi11 dents of the United States; 

12 ‘‘(ii) does not have a domain name 

13 that is registered or assigned by a domain 

14 name registrar, domain name registry, or 

15 other domain name registration authority 

16 that is located within a judicial district of 

17 the United States; and 

18 ‘‘(iii) is not operated by an entity that 

19 is located within a judicial district of the 

20 United States. 

21 ‘‘(B) BUSINESS DIRECTED TO RESIDENTS

22 OF THE UNITED STATES.—For purposes of 

23 making a determination under subparagraph 

24 (A)(i), the Bureau may consider, among other 

25 indicators, whether— 


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1 ‘‘(i) the person extends, facilitates, 

2 brokers, arranges, or gathers applications 

3 for credit to persons located in the United 

4 States; 

5 ‘‘(ii) the person has reasonable meas6 ures in place to prevent its services from 

7 being accessed from or delivered to the 

8 United States; and 

9 ‘‘(iii) any prices for goods and services 

10 provided are indicated in the currency of 

11 the United States. 

12 ‘‘(3) COVERED ONSHORE PERSON.—The term 

13 ‘covered onshore person’ means a State government 

14 or an Indian tribe. 

15 ‘‘(4) COVERED PERSON.—The term ‘covered 

16 person’ means a covered offshore person and covered 

17 onshore person. 

18 ‘‘(5) FEDERAL CONSUMER FINANCIAL LAW.— 

19 The term ‘Federal consumer financial law’ has the 

20 same meaning as in section 1002 of the Consumer 

21 Financial Protection Act of 2010 (12 U.S.C. 5481). 

22 ‘‘(6) FINANCIAL TRANSACTION PROVIDER.— 

23 ‘‘(A) IN GENERAL.—Except as provided in 

24 subparagraph (B), the term ‘financial transVerDate Mar 15 2010 04:37 Jul 25, 2012 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S3426.IS S3426

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1 action provider’ has the same meaning as in 

2 section 5362(4) of title 31, United States Code. 

3 ‘‘(B) EXCEPTION.—The term ‘financial 

4 transaction provider’ does not include an Inter5 net service platform or an affiliate of an Inter6 net service platform. 

7 ‘‘(7) INDIAN TRIBE.—The term ‘Indian tribe’ 

8 has the same meaning as in section 4 of the Indian 

9 Self-Determination and Education Assistance Act 

10 (25 U.S.C. 450b). 

11 ‘‘(8) INTERNET SERVICE PLATFORM.—The 

12 term ‘Internet service platform’ means an interactive 

13 digital service the provider of which— 

14 ‘‘(A) does not act merely as a payment 

15 intermediary between a user and a supplier of 

16 goods or services; and 

17 ‘‘(B) provides additional services to facili18 tate interaction between users unrelated to pur19 chases from suppliers of goods and services. 

20 ‘‘(9) INTERNET SITE.—The term ‘Internet site’ 

21 means the collection of digital assets, including links, 

22 indexes, or pointers to digital assets, accessible 

23 through the Internet that are addressed relative to 

24 a common domain name. 


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1 ‘‘(10) OPERATOR.—The term ‘operator’, when 

2 used in connection with an Internet site, includes 

3 any person with authority to operate the Internet 

4 site. 

5 ‘‘(11) OWNER.—The term ‘owner’, when used 

6 in connection with an Internet site, includes any 

7 owner of a majority interest in the Internet site. 

8 ‘‘(12) STATE CONSUMER FINANCIAL LAW.—The 

9 term ‘State consumer financial law’ means a provi10 sion of State law that either constitutes a ‘State 

11 consumer financial law’ as that term is defined in 

12 section 5136C of title LXII of the Revised Statutes 

13 of the United States (12 U.S.C. 21 et seq.), or pro14 hibits unfair or deceptive acts or practices. 

15 ‘‘(b) APPLICABILITY OF SECTION.—It shall be a vio16 lation of this section for a covered person to violate a Fed17 eral, State, or tribal consumer financial law. 

18 ‘‘(c) INVESTIGATION OF VIOLATIONS BY BUREAU.— 

19 ‘‘(1) IN GENERAL.—The Bureau— 

20 ‘‘(A) may investigate any alleged violation 

21 of subsection (b) on its own initiative; and 

22 ‘‘(B) shall— 

23 ‘‘(i) review any alleged violation of 

24 subsection (b) upon receiving a complaint 

25 filed under subsection (d); and 


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1 ‘‘(ii) adjudicate and otherwise inves2 tigate and respond to such complaint, as 

3 appropriate. 

4 ‘‘(2) CONSULTATIONS.—In taking action under 

5 paragraph (1), the Bureau shall, as the Bureau de6 termines appropriate, consult with and seek advice 

7 and information from the Attorney General of the 

8 United States, the Federal Trade Commission, the 

9 International Trade Commission (in any case involv10 ing a covered offshore person), the Bureau of Indian 

11 Affairs (in the case of matters involving an Indian 

12 tribe), federally recognized Indian tribes (in the case 

13 of rulemakings involving Indian tribes), and such 

14 other agencies and officials as the Bureau considers 

15 appropriate. 

16 ‘‘(3) LIMITATION ON INVESTIGATIONS OF DO17 MAIN NAMES; CONSENT TO JURISDICTION.— 

18 ‘‘(A) IN GENERAL.—Subject to subpara19 graphs (B) and (C) and such limitations as the 

20 Bureau may, by rule, determine, the Bureau 

21 shall terminate, or not initiate, an investigation 

22 or adjudication under paragraph (1) with re23 spect to a covered person— 

24 ‘‘(i) if the covered person provides to 

25 the public and to the Bureau— 


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1 ‘‘(I) the name of an individual 

2 authorized to receive process on behalf 

3 of the covered person; 

4 ‘‘(II) an address at which process 

5 may be served; 

6 ‘‘(III) a telephone number at 

7 which the individual described in 

8 clause (i) may be contacted; and 

9 ‘‘(IV) a statement that the cov10 ered person consents to the jurisdic11 tion and venue of the United States 

12 district courts with respect to a viola13 tion of the relevant consumer lending 

14 laws. 

15 ‘‘(B) ACCEPTANCE OF JURISDICTION.—In 

16 the event of the filing of any civil action in the 

17 appropriate United States district court for a 

18 violation of State or tribal consumer lending 

19 laws, the covered person shall accept service 

20 and waive, in a timely manner, any objections 

21 to jurisdiction, as set forth in the statement de22 scribed in subparagraph (A)(iv). 

23 ‘‘(C) INVESTIGATIONS.—Any limitations on 

24 investigations under this paragraph shall not 

25 apply if— 


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1 ‘‘(i) any of the information provided 

2 by the covered person is inaccurate in any 

3 way; or 

4 ‘‘(ii) at any point, the covered person 

5 fails to respond to or abide by any order 

6 or request of the relevant court. 

7 ‘‘(4) RULE OF CONSTRUCTION.—It shall not be 

8 considered a violation of this section to be engaged 

9 solely in— 

10 ‘‘(A) the provision of a telecommunications 

11 service, or of an Internet access service or 

12 Internet information location tool (as those 

13 terms are defined in section 231 of the Commu14 nications Act of 1934 (47 U.S.C. 231)); or 

15 ‘‘(B) the transmission, storage, retrieval, 

16 hosting, formatting, or translation (or any com17 bination thereof) of a communication, without 

18 selection or alteration of the content of the 

19 communication, except that deletion of a par20 ticular communication or material made by an21 other person in a manner consistent with sec22 tion 230(c) of the Communications Act of 1934 

23 (47 U.S.C. 230(c)). 

24 ‘‘(d) COMPLAINTS.— 


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1 ‘‘(1) IN GENERAL.—A complaint alleging, under 

2 oath, that a covered person is in violation of sub3 section (b) may be filed with the Bureau. 

4 ‘‘(2) NOTICE WITH RESPECT TO OFFSHORE

5 PERSONS.— 

6 ‘‘(A) IN GENERAL.—Upon filing a com7 plaint under paragraph (1), if the identity of 

8 the subject covered offshore person is not 

9 known, but the Internet site or other electronic 

10 representation is known, the complainant shall 

11 send a notice of the violation alleged in the 

12 complaint to the registrant of the domain name 

13 of the Internet site (or relevant operator of the 

14 electronic representation) alleged to be operated 

15 or maintained in violation of subsection (b)— 

16 ‘‘(i) at the postal and e-mail addresses 

17 appearing in the applicable publicly acces18 sible database of registrations, if any, to 

19 the extent such addresses are reasonably 

20 available; 

21 ‘‘(ii) via the postal and e-mail ad22 dresses of the registrar, registry, or other 

23 domain name registration authority that 

24 registered or assigned the domain name 

25 (or relevant electronic representation), to 


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1 the extent such addresses are reasonably 

2 available; and 

3 ‘‘(iii) in any other such form as the 

4 Bureau finds necessary. 

5 ‘‘(B) RULE OF CONSTRUCTION.—For pur6 poses of this subsection, the actions described 

7 in this subparagraph shall constitute service of 

8 process. 

9 ‘‘(3) IDENTIFICATION OF, AND NOTICE TO, EN10 TITIES THAT MAY BE REQUIRED TO TAKE ACTION

11 PURSUANT TO THIS SECTION.— 

12 ‘‘(A) IDENTIFICATION.—A complaint filed 

13 under paragraph (1) shall identify any financial 

14 transaction provider that may be required to 

15 take measures described in subsection (g)(2) if 

16 the Bureau issues an order under subsection (f) 

17 with respect to the complaint and the order is 

18 served on the provider or service pursuant to 

19 subsection (g)(1). 

20 ‘‘(B) NOTICE.—Upon filing a complaint 

21 under paragraph (1), the complainant shall pro22 vide notice to any financial transaction provider 

23 identified in the complaint pursuant to subpara24 graph (A) or any amendments to the complaint. 

25 ‘‘(C) INTERVENTION.— 


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1 ‘‘(i) IN GENERAL.—A financial trans2 action provider or identified in a complaint 

3 pursuant to subparagraph (A) may inter4 vene upon timely request filed with the Bu5 reau in— 

6 ‘‘(I) an investigation initiated 

7 under subsection (c) pursuant to the 

8 complaint; or 

9 ‘‘(II) pursuant to subsection 

10 (f)(3), an action to modify, suspend, 

11 or vacate an order issued pursuant to 

12 the complaint. 

13 ‘‘(ii) RULE OF CONSTRUCTION.—Fail14 ure to intervene under clause (i) in an in15 vestigation under subsection (c) does not 

16 preclude a financial transaction provider 

17 notified of the investigation from subse18 quently seeking an order to modify, sus19 pend, or vacate an order issued by the Bu20 reau under subsection (f). 

21 ‘‘(e) DETERMINATIONS.— 

22 ‘‘(1) IN GENERAL.—Unless waived in writing by 

23 the covered person, the Bureau shall determine, with 

24 respect to each investigation initiated under sub25 section (c) and not otherwise terminated subject to 


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1 the provisions of this section, whether the covered 

2 person under investigation is in violation of sub3 section (b). 

4 ‘‘(2) EFFECTIVE DATE.—A determination made 

5 under paragraph (1) shall take effect on the date on 

6 which the Bureau publishes the determination in the 

7 Federal Register. 

8 ‘‘(3) ELECTRONIC SUBMISSION OF INFORMA9 TION AND PROCEEDINGS.—The Bureau may, in 

10 making any determination under this section— 

11 ‘‘(A) allow the submission of information 

12 electronically; and 

13 ‘‘(B) hold hearings electronically or obtain 

14 testimony or other information electronically or 

15 by such means as the Bureau determines allows 

16 participation in proceedings under this section 

17 at as low a cost as possible to participants in 

18 the proceedings. 

19 ‘‘(f) CEASE AND DESIST ORDERS.— 

20 ‘‘(1) IN GENERAL.—If the Bureau determines 

21 under subsection (e) that a covered person is in vio22 lation of subsection (b), in addition to any actions 

23 which the Bureau may otherwise take, the Bureau 

24 may— 


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1 ‘‘(A) issue an order to cease and desist 

2 from the violation of subsection (b) to the cov3 ered person (and if the identity of the subject 

4 covered offshore person is not known, to the 

5 relevant Internet site and to the owner and the 

6 operator of the Internet site or relevant elec7 tronic representation); and 

8 ‘‘(B) cause the order to be served on the 

9 covered person. 

10 ‘‘(2) TEMPORARY AND PRELIMINARY CEASE

11 AND DESIST ORDERS.— 

12 ‘‘(A) PETITION BY COMPLAINANT.—A 

13 complainant may file with the Bureau a peti14 tion, in accordance with this paragraph, for the 

15 issuance of a temporary or preliminary order. 

16 ‘‘(B) OPPORTUNITY TO BE HEARD.— 

17 ‘‘(i) IN GENERAL.—Before issuing a 

18 temporary or preliminary cease and desist 

19 order under this paragraph, the Bureau 

20 shall provide to any person (including any 

21 applicable Internet site or electronic rep22 resentation and the owner and the oper23 ator of such Internet site or electronic rep24 resentation) alleged to be in violation of 

25 subsection (b) an opportunity to be heard 


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1 and to submit relevant information to the 

2 Bureau. 

3 ‘‘(ii) ELECTRONIC SUBMISSION OF IN4 FORMATION AND PROCEEDINGS.—The Bu5 reau may provide an opportunity to be 

6 heard and to submit information under 

7 clause (i) electronically or in such other 

8 manner as the Bureau determines appro9 priate. 

10 ‘‘(C) ISSUANCE OF ORDER.—If, upon re11 ceiving a petition under subparagraph (A) and 

12 after providing an opportunity to be heard 

13 under subparagraph (B), the Bureau deter14 mines that the covered person is in violation of 

15 subsection (b), in addition to any actions which 

16 the Director may otherwise take, the Bureau 

17 may issue a temporary or preliminary cease and 

18 desist order against, and cause the order to be 

19 served on the relevant person pursuant to para20 graph (1). 

21 ‘‘(D) STANDARD FOR RELIEF.—If the Bu22 reau issues a temporary or preliminary cease 

23 and desist order under this paragraph, the 

24 order shall be issued in a manner consistent 

25 with the provisions of rule 65 of the Federal 


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1 Rules of Civil Procedure, or any successor 

2 thereto, relating to preliminary injunctions and 

3 temporary restraining orders. 

4 ‘‘(E) PROCEDURES FOR TEMPORARY

5 CEASE AND DESIST ORDER.— 

6 ‘‘(i) EXPEDITED CONSIDERATION.— 

7 Upon a showing of extraordinary cir8 cumstances by the complainant filing a pe9 tition for a temporary cease and desist 

10 order under subparagraph (A), the Bureau 

11 may make a determination with respect to 

12 the petition on an expedited basis. 

13 ‘‘(ii) EXPIRATION OF ORDER.— 

14 ‘‘(I) IN GENERAL.—Except as 

15 provided in subclause (II), a tem16 porary cease and desist order issued 

17 under this paragraph shall expire at a 

18 time determined by the Bureau that is 

19 not later than 14 days after the 

20 issuance of the order. 

21 ‘‘(II) EXTENSION OF ORDER.— 

22 The Bureau may extend a temporary 

23 cease and desist order issued under 

24 this paragraph for additional periods 

25 of not more than 14 days for good 


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1 cause or with the consent of the entity 

2 against which the order is issued. 

3 ‘‘(F) PROCEDURES FOR PRELIMINARY

4 CEASE AND DESIST ORDER.— 

5 ‘‘(i) IN GENERAL.—Except as pro6 vided in clause (ii), the Bureau shall make 

7 a determination with respect to a petition 

8 for a preliminary cease and desist order 

9 not later than 30 days after the Bureau 

10 publishes notice of the initiation of an in11 vestigation under subsection (c) in the 

12 Federal Register. 

13 ‘‘(ii) EXTENSIONS OF TIME FOR DE14 TERMINATION.—The Bureau may extend 

15 the date by which the Bureau is required 

16 to make a determination under clause (i) 

17 with respect to a petition for a preliminary 

18 cease and desist order for an additional 30 

19 days, if the Bureau— 

20 ‘‘(I) determines that the petition 

21 presents a more complicated case; and 

22 ‘‘(II) publishes in the Federal 

23 Register an explanation of why the 

24 Bureau determined that the case is 

25 more complicated under subclause (I). 


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1 ‘‘(3) MODIFICATION OR REVOCATION OF OR2 DERS.— 

3 ‘‘(A) IN GENERAL.—At any time after the 

4 issuance of an order under this subsection, a 

5 motion to modify, suspend, or vacate the order 

6 may be filed by— 

7 ‘‘(i) any covered person, bound by the 

8 order; 

9 ‘‘(ii) the owner or operator of any 

10 Internet site or electronic representation 

11 subject to the order; 

12 ‘‘(iii) any domain name registrar or 

13 registry that has registered or assigned the 

14 domain name of the Internet site subject 

15 to the order; or 

16 ‘‘(iv) a financial transaction provider 

17 on which a copy of an order has been 

18 served pursuant to paragraph (1) of sub19 section (g) requiring the provider or service 

20 to take action described in paragraph (2) 

21 of that subsection. 

22 ‘‘(B) RELIEF.—The Bureau shall modify, 

23 suspend, or vacate an order, as appropriate, if 

24 the Bureau determines that— 


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1 ‘‘(i) the subject to the order is no 

2 longer, or never was in violation of sub3 section (b); or 

4 ‘‘(ii) the interests of justice require 

5 that the order be modified, suspended, or 

6 vacated. 

7 ‘‘(C) CONSIDERATION.—In making a de8 termination under subparagraph (B), the Bu9 reau may consider whether any domain name of 

10 an Internet site (or the relevant electronic rep11 resentation) subject to the order has expired or 

12 has been re-registered by a different entity. 

13 ‘‘(4) AMENDMENT OF ORDERS.—A complainant 

14 may petition the Bureau to amend an order issued 

15 under this subsection if any relevant Internet site or 

16 electronic representation determined under sub17 section (e) to be in violation of subparagraph (B) is 

18 accessible or has been reconstituted at a different 

19 domain name. 

20 ‘‘(5) OPPORTUNITY TO BE HEARD FOR CERTAIN

21 ENTITIES.—Before the Bureau issues an order 

22 under this subsection or modifies, suspends, vacates, 

23 or amends such an order under paragraph (3) or 

24 (4), a financial transaction provider that intervened 

25 pursuant to subsection (d)(3) in an investigation or 


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1 action relating to the order shall have an oppor2 tunity to be heard before the Bureau with respect to 

3 whether the Bureau should issue the order and the 

4 scope of relief available under the order or whether 

5 the Bureau should modify, suspend, vacate, or 

6 amend the order, as the case may be. 

7 ‘‘(6) EXPIRATION OF ORDERS WITH RESPECT

8 TO INTERNET SITE.—An order issued under this 

9 subsection against an Internet site (or relevant elec10 tronic representation) shall cease to have any force 

11 or effect upon expiration of the registration of the 

12 domain name of the Internet site (or relevant elec13 tronic representation). 

14 ‘‘(g) REQUIRED ACTIONS BASED ON BUREAU OR15 DERS.— 

16 ‘‘(1) IN GENERAL.—If the Bureau reasonably 

17 believes that a financial transaction provider identi18 fied in a complaint pursuant to subsection (d)(3), or 

19 any amendment to the complaint, supplies services 

20 to the covered person that is subject to the order 

21 issued under subsection (f) with respect to the com22 plaint— 

23 ‘‘(A) the Bureau may give permission to 

24 the complainant to serve a copy of the order on 

25 the financial transaction provider; 


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1 ‘‘(B) if the Bureau gives permission to the 

2 complainant under subparagraph (A), the com3 plainant shall file proof of service with the Bu4 reau; and 

5 ‘‘(C) upon receiving a copy of the order 

6 pursuant to subparagraph (A), the financial 

7 transaction provider shall implement the meas8 ures described in paragraph (2). 

9 ‘‘(2) MEASURES TO BE IMPLEMENTED BY FI10 NANCIAL TRANSACTION PROVIDERS.— 

11 ‘‘(A) IN GENERAL.—Subject to subpara12 graph (B), a financial transaction provider 

13 shall, as expeditiously as is reasonable, take 

14 reasonable and technically feasible measures, as 

15 expeditiously as reasonable, designed to prevent 

16 or prohibit the completion of payment trans17 actions by the provider that involve customers 

18 located in the United States and the covered 

19 person (including the relevant Internet site or 

20 electronic representation) subject to the order 

21 issued under subsection (f). 

22 ‘‘(B) LIMITATIONS ON MEASURES.—A fi23 nancial transaction provider may not be re24 quired pursuant to subparagraph (A)— 


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1 ‘‘(i) to implement measures that are 

2 not commercially reasonable; 

3 ‘‘(ii) to modify services or facilities of 

4 the provider to comply with the order 

5 issued under subsection (f); or 

6 ‘‘(iii) to prevent or prohibit the com7 pletion of a payment transaction if the pro8 vider could not reasonably determine in ad9 vance whether the entity was using the 

10 Internet site subject to the order. 

11 ‘‘(3) COMMUNICATION WITH USERS.—A finan12 cial transaction provider required to implement 

13 measures described in paragraph (2) shall determine 

14 how to communicate with the users or customers of 

15 the provider or service, as the case may be, with re16 spect to those measures. 

17 ‘‘(4) RULES OF CONSTRUCTION.— 

18 ‘‘(A) LIMITATION ON OBLIGATIONS.—A fi19 nancial transaction provider required to imple20 ment measures described in paragraph (2) shall 

21 not be required to take measures or actions in 

22 addition to the measures described in para23 graph (2) pursuant to this section or an order 

24 issued under this section. 


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1 ‘‘(B) MANNER OF COMPLIANCE.—A finan2 cial transaction provider required to implement 

3 measures described in paragraph (2) shall be in 

4 compliance with this subsection if the provider 

5 implements the measures described in that 

6 paragraph with respect to accounts of the pro7 vider, as of the date on which a copy of an 

8 order is served under paragraph (1) or, if appli9 cable, the date on which the order is modified 

10 or amended under paragraph (3) or (4) of sub11 section (f). 

12 ‘‘(5) ACTIONS PURSUANT TO BUREAU ORDER.— 

13 ‘‘(A) IMMUNITY FROM CIVIL ACTIONS.—No 

14 cause of action shall lie in any court against a 

15 financial transaction provider on which a copy 

16 of an order is served under paragraph (1), or 

17 against any director, officer, employee, or agent 

18 thereof, other than in an action pursuant to 

19 subsection (h), for— 

20 ‘‘(i) any act reasonably designed to 

21 comply with this subsection or reasonably 

22 arising from the order; or 

23 ‘‘(ii) any act, failure, or inability to 

24 meet the obligations under this subsection 

25 of the provider or service if the provider or 


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1 service, as the case may be, makes a good 

2 faith effort to comply with such obliga3 tions. 

4 ‘‘(B) IMMUNITY FROM LIABILITY.—A fi5 nancial transaction provider on which a copy of 

6 an order is served under paragraph (1), and 

7 any director, officer, employee, or agent thereof, 

8 shall not be liable to any person for any acts 

9 reasonably designed to comply with this sub10 section or reasonably arising from the order, 

11 other than in an action pursuant to subsection 

12 (h). 

13 ‘‘(C) IMMUNITY FROM ACTIONS OF THIRD

14 PARTIES.—An action taken by a third party to 

15 circumvent any measures implemented pursuant 

16 to an order served on a financial transaction 

17 provider under paragraph (1) may not be used 

18 by any person in any claim or cause of action 

19 against the provider or service, as the case may 

20 be, other than in an action pursuant to sub21 section (h). 

22 ‘‘(h) ENFORCEMENT OF ORDERS.— 

23 ‘‘(1) IN GENERAL.—In order to compel compli24 ance with this section, the Bureau and any State At25 torney General (or other appropriate State or tribal 


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1 entity) having enforcement authority over prohibited 

2 activity may bring an action for injunctive relief 

3 against any person subject to an order issued under 

4 subsection (f) or on which such an order is served 

5 under subsection (g) that fails to comply with the 

6 order. 

7 ‘‘(2) RULE OF CONSTRUCTION.—The authority 

8 granted to the Bureau, State, and tribal authorities 

9 under paragraph (1) shall be the sole legal remedy 

10 for enforcing the obligations under subsection (g) of 

11 a financial transaction provider on which an order is 

12 served under paragraph (1) of that subsection. 

13 ‘‘(3) AFFIRMATIVE DEFENSES.—A defendant in 

14 an action commenced under paragraph (1) may es15 tablish an affirmative defense by showing that the 

16 defendant does not have the technical means to com17 ply with this section without incurring an unreason18 able economic burden or that the order is incon19 sistent with this section. That showing shall serve as 

20 a defense only to the extent of the inability of the 

21 defendant to comply or to the extent of the incon22 sistency. 

23 ‘‘(i) SANCTIONS FOR ABUSE OF PROCESS AND DIS24 COVERY.—The Bureau may, by rule, prescribe sanctions 

25 for abuse of process in a manner consistent with the proviVerDate Mar 15 2010 04:37 Jul 25, 2012 Jkt 019200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\S3426.IS S3426

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1 sions of rule 11 and rule 37 of the Federal Rules of Civil 

2 Procedure. 

3 ‘‘(j) IMMUNITY FOR ENFORCEMENT OF ORDERS.— 

4 No cause of action shall lie in any court, no person may 

5 rely on any claim or cause of action, and no liability for 

6 damages to any person shall be granted, against a finan7 cial transaction provider for taking any action pursuant 

8 to subsection (g)(2). 

9 ‘‘(k) SAVINGS CLAUSE.—Nothing in this section, in10 cluding subsection (c), may be construed to limit the au11 thority or jurisdiction of the Bureau, any other Federal 

12 agency, or any State or tribe to review, regulate, inves13 tigate, enforce against, or otherwise restrict activities cov14 ered by this section.’’. 

15 SEC. 6. STUDIES. 

16 Not later than 180 days after enactment of this sec17 tion, the Government Accountability Office (in this section 

18 referred to as the ‘‘GAO’’) shall conduct a study regarding 

19 the availability of capital on reservations of Indian tribes 

20 (as such term is defined in section 4 of the Indian Self21 Determination and Education Assistance Act (25 U.S.C. 

22 450b)) and the impact that small-dollar consumer credit 

23 extended through Internet and non-Internet means to 

24 members of Indian tribes has had on economic opportunity 

25 and wealth for members of Indian tribes. In conducting 


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1 the study, the GAO shall consult, as appropriate, with the 

2 Bureau of Consumer Financial Protection, the Board of 

3 Governors of the Federal Reserve System, the Bureau of 

4 Indian Affairs, federally recognized Indian tribes, and 

5 community development financial institutions operating in 

6 Indian lands. The report shall be presented to the Com7 mittee on Banking, Housing, and Urban Affairs and the 

8 Committee on Indian Affairs of the Senate and the Com9 mittee on Financial Services and the Committee on Nat10 ural Resources of the House of Representatives. 

11 SEC. 7. RULEMAKING. 

12 Not later than 1 year after the date of enactment 

13 of this Act, the Bureau shall adopt any final rules nec14 essary to implement the provisions of this Act and the 

15 amendments made by this Act. 

Æ 


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