IIB 

114TH CONGRESS 

2D SESSION H. R. 4992 

IN THE SENATE OF THE UNITED STATES 

JULY 14, 2016 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

AN ACT 

To codify regulations relating to transfers of funds involving 

Iran, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘United States Finan3 cial System Protection Act of 2016’’. 

4 SEC. 2. FINDINGS, SENSE OF CONGRESS, AND STATEMENT 

5 OF POLICY. 

6 (a) FINDINGS.—Congress finds the following: 

7 (1) On November 8, 2011, the Department of 

8 the Treasury identified the Islamic Republic of Iran 

9 as a jurisdiction of primary money laundering con10 cern pursuant to section 5318A of title 31, United 

11 States Code, including Iran’s Central Bank, private 

12 Iranian banks, branches, and subsidiaries of Iranian 

13 banks operating outside of Iran as posing illicit fi14 nance risks for the global financial system. 

15 (2) On November 6, 2008, the Department of 

16 the Treasury announced that it was revoking the 

17 ‘‘U-turn’’ license for Iran, stating that ‘‘as a mem18 ber of the Financial Action Task Force (FATF), the 

19 United States today fulfilled its obligation to 

20 strengthen measures to protect the financial sector 

21 from the risks posed to the international financial 

22 system by Iran’’. 

23 (3) On February 19, 2016, the Financial Ac24 tion Task Force (FATF), the global standard set25 ting body for anti-money laundering and combating 

26 the financing of terrorism which has determined that 


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1 Iran is a ‘‘non-cooperating country or territory’’ in 

2 the fight against money laundering and terror fi3 nancing since 2008, stated that, ‘‘the FATF re4 mains particularly and exceptionally concerned about 

5 Iran’s failure to address the risk of terrorist financ6 ing and the serious threat this poses to the integrity 

7 of the international financial system’’. 

8 (4) United States and foreign businesses oper9 ating or seeking to operate in Iran run significant 

10 risks, as corruption in Iran is endemic, with Trans11 parency International ranking Iran 130 out of 168 

12 countries. 

13 (b) SENSE OF CONGRESS.—It is the sense of Con14 gress that the entire financial sector of Iran, including 

15 Iran’s Central Bank, private Iranian banks and branches, 

16 and subsidiaries of Iranian banks operating outside of 

17 Iran, poses illicit finance risks for the global financial sys18 tem due to its proliferation, support for terrorism, and 

19 other illicit conduct. 

20 (c) STATEMENT OF POLICY.—It shall be the policy 

21 of the United States to— 

22 (1) deny Iran access to funds denominated in 

23 United States dollars, including through any off24 shore United States dollar clearing system for transVerDate Sep 11 2014 00:23 Jul 16, 2016 Jkt 059060 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4992.RFS H4992

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1 actions involving the Government of Iran or an Ira2 nian person; and 

3 (2) deny Iran access to United States dollars 

4 through any offshore United States dollar clearing 

5 system conducted or overseen by a foreign govern6 ment or a foreign financial institution for trans7 actions involving the Government of Iran or an Ira8 nian person. 

9 SEC. 3. CODIFICATION OF REGULATIONS RELATING TO 

10 TRANSFERS OF FUNDS INVOLVING IRAN; 

11 CLARIFICATION OF APPLICATION OF REGU12 LATIONS TO FOREIGN DEPOSITORY INSTITU13 TIONS AND FOREIGN REGISTERED BROKERS 

14 AND DEALERS. 

15 (a) CODIFICATION OF REGULATIONS.—Section 

16 560.516 of title 31, Code of Federal Regulations, as in 

17 effect on January 1, 2016, shall apply with respect to 

18 transfers of funds to or from Iran, or for the direct or 

19 indirect benefit of an Iranian person or the Government 

20 of Iran, for the period beginning on or after January 1, 

21 2016, and ending on the date on which the President 

22 makes the certification to the appropriate congressional 

23 committees under section 401(a) of the Comprehensive 

24 Iran Sanctions, Accountability, and Divestment Act of 

25 2010 (22 U.S.C. 8551(a)). 


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1 (b) CLARIFICATION OF APPLICATION OF REGULA2 TIONS TO FOREIGN FINANCIAL INSTITUTIONS AND FOR3 EIGN REGISTERED BROKERS AND DEALERS.— 

4 (1) FOREIGN FINANCIAL INSTITUTIONS.—Sub5 section (a) of section 560.516 of title 31, Code of 

6 Federal Regulations, as in effect on January 1, 

7 2016, shall apply with respect to foreign financial 

8 institutions to the same extent and in the same 

9 manner as such subsection applies with respect to 

10 United States depository institutions if the funds 

11 that are to be transferred as described in such sub12 section are funds that are denominated in United 

13 States dollars. 

14 (2) FOREIGN REGISTERED BROKERS AND DEAL15 ERS.—Subsection (b) of section 560.516 of title 31, 

16 Code of Federal Regulations, as in effect on January 

17 1, 2016, shall apply with respect to foreign reg18 istered brokers or dealers in securities to the same 

19 extent and in the same manner as such subsection 

20 applies with respect to United States registered bro21 kers or dealers in securities if the funds that are to 

22 be transferred as described in such subsection are 

23 funds that are denominated in United States dollars. 

24 (3) SUSPENSION.—The President may suspend 

25 the application of paragraph (1) with respect to a 


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1 foreign financial institution or the application of 

2 paragraph (2) with respect to a foreign registered 

3 broker or dealer in securities for a period not to ex4 ceed 60 days, and the President may renew the sus5 pension of the application of paragraph (1) or para6 graph (2), respectively, for additional periods of not 

7 more than 60 days, on and after the date on which 

8 the President certifies to the appropriate congres9 sional committees that during the preceding 60-day 

10 period the Government of Iran is in compliance with 

11 the criteria described in section 401(a)(1) of the 

12 Comprehensive Iran Sanctions, Accountability, and 

13 Divestment Act of 2010 (22 U.S.C. 8551(a)(1)). 

14 (c) LICENSING RESTRICTIONS.— 

15 (1) IN GENERAL.—Except as provided in para16 graph (2), the President may not issue any license 

17 under the International Emergency Economic Pow18 ers Act (50 U.S.C. 1701 et seq.) or provide other 

19 guidance, including executive actions, rules, regula20 tions, frequently asked questions, written commu21 nications, or any other commitments, that permits— 

22 (A) a United States depository institution 

23 or United States registered broker or dealer in 

24 securities— 


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1 (i) to conduct an offshore United 

2 States dollar clearing system for trans3 actions involving or for the benefit of the 

4 Government of Iran or an Iranian person, 

5 including to process transfers of funds to 

6 or from Iran under section 560.516 of title 

7 31, Code of Federal Regulations, as in ef8 fect on January 1, 2016; or 

9 (ii) to provide United States dollars 

10 for any offshore United States dollar clear11 ing system conducted or overseen by a for12 eign government or a foreign financial in13 stitution for transactions involving or for 

14 the benefit of the Government of Iran or 

15 an Iranian person, including to process 

16 transfers of funds to or from Iran under 

17 section 560.516 of title 31, Code of Fed18 eral Regulations, as in effect on January 

19 1, 2016; or 

20 (B) a foreign financial institution or for21 eign registered broker or dealer in securities— 

22 (i) to conduct an offshore United 

23 States dollar clearing system for trans24 actions involving or for the benefit of the 

25 Government of Iran or an Iranian person, 


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1 including to process transfers of funds to 

2 or from Iran under section 560.516 of title 

3 31, Code of Federal Regulations, as in ef4 fect on January 1, 2016, and as applied 

5 under subsection (b); or 

6 (ii) to provide United States dollars 

7 for any offshore United States dollar clear8 ing system conducted or overseen by a for9 eign government or a foreign financial in10 stitution for transactions involving or for 

11 the benefit of the Government of Iran or 

12 an Iranian person, including to process 

13 transfers of funds to or from Iran under 

14 section 560.516 of title 31, Code of Fed15 eral Regulations, as in effect on January 

16 1, 2016, and as applied under subsection 

17 (b). 

18 (2) EXCEPTION FOR HUMANITARIAN PUR19 POSES.—The President may, on a case-by-case 

20 basis, issue a license described in paragraph (1) to 

21 authorize the activities described in clause (i) or (ii) 

22 of paragraph (1)(A) or the activities described in 

23 clause (i) or (ii) of paragraph (1)(B) if— 

24 (A) such activities relate solely to— 


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1 (i) the provision of agricultural com2 modities, food, medicine, or medical devices 

3 to Iran; or 

4 (ii) the provision of humanitarian as5 sistance to the people of Iran; and 

6 (B) the President submits to the appro7 priate congressional committees a copy of the li8 cense. 

9 (d) DEFINITIONS.—In this section: 

10 (1) APPROPRIATE CONGRESSIONAL COMMIT11 TEES.—The term ‘‘appropriate congressional com12 mittees’’ means— 

13 (A) the Committee on Foreign Affairs and 

14 the Committee on Financial Services of the 

15 House of Representatives; and 

16 (B) the Committee on Foreign Relations 

17 and the Committee on Banking, Housing, and 

18 Urban Affairs of the Senate. 

19 (2) FOREIGN FINANCIAL INSTITUTION.—The 

20 term ‘‘foreign financial institution’’ has the meaning 

21 given such term in section 1010.605 of title 31, 

22 Code of Federal Regulations, as in effect on January 

23 1, 2016. 

24 (3) IRAN.—The term ‘‘Iran’’ has the meaning 

25 given the term in section 561.329 of title 31, Code 


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1 of Federal Regulations, as in effect on January 1, 

2 2016. 

3 (4) IRANIAN PERSON.—The term ‘‘Iranian per4 son’’ means a person or entity (as such terms are 

5 defined in section 560.305 of title 31, Code of Fed6 eral Regulations, as in effect on January 1, 2016) 

7 that— 

8 (A) is organized under the laws of Iran or 

9 any jurisdiction within Iran (including foreign 

10 branches); or 

11 (B) is a person in Iran. 

12 (5) TRANSFER OF FUNDS.—The term ‘‘transfer 

13 of funds’’— 

14 (A) has the meaning given the term ‘‘funds 

15 transfer’’ in section 1010.100 of title 31, Code 

16 of Federal Regulations, as in effect on January 

17 1, 2016; and 

18 (B) includes a transfer of funds or other 

19 property for the benefit of an Iranian financial 

20 institution that is made between accounts of the 

21 same financial institution even if that Iranian 

22 financial institution is not the direct recipient 

23 of the transfer. 

24 (6) UNITED STATES DEPOSITORY INSTITU25 TION.—The term ‘‘United States depository instituVerDate Sep 11 2014 00:23 Jul 16, 2016 Jkt 059060 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H4992.RFS H4992

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1 tion’’ has the meaning given such term in section 

2 560.319 of title 31, Code of Federal Regulations, as 

3 in effect on January 1, 2016. 

4 (7) UNITED STATES REGISTERED BROKER OR

5 DEALER IN SECURITIES.—The term ‘‘United States 

6 registered broker or dealers in securities’’ has the 

7 meaning given such term in section 560.321 of title 

8 31, Code of Federal Regulations, as in effect on 

9 January 1, 2016. 

10 SEC. 4. CERTIFICATION REQUIREMENT FOR REMOVAL OF 

11 DESIGNATION OF IRAN AS A JURISDICTION 

12 OF PRIMARY MONEY LAUNDERING CONCERN. 

13 (a) IN GENERAL.—The President may not rescind a 

14 preliminary draft rule or final rule (as in effect on the 

15 day before the date of the enactment of this Act) that pro16 vides for the designation of Iran as a jurisdiction of pri17 mary money laundering concern pursuant to section 

18 5318A of title 31, United States Code, unless the Presi19 dent submits to the appropriate congressional committees 

20 a certification described in subsection (b) with respect to 

21 Iran. 

22 (b) CERTIFICATION.—The President may rescind a 

23 preliminary draft rule or final rule described in subsection 

24 (a) if the President submits to the appropriate congres25 sional committees a certification that the Government of 


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1 Iran is no longer engaged in support for terrorism, pursuit 

2 of weapons of mass destruction, and any illicit and decep3 tive financial activities. 

4 (c) FORM.—The certification described in subsection 

5 (b) shall be submitted in unclassified form, but may con6 tain a classified annex. 

7 (d) DEFINITION.—In this section, the term ‘‘appro8 priate congressional committees’’ means— 

9 (1) the Committee on Foreign Affairs and the 

10 Committee on Financial Services of the House of 

11 Representatives; and 

12 (2) the Committee on Banking, Housing, and 

13 Urban Affairs of the Senate. 

Passed the House of Representatives July 14, 2016. 

Attest: KAREN L. HAAS, 

Clerk. 


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