I

107TH CONGRESS

1ST SESSION H. R. 1057

To amend the Truth in Savings Act to enhance civil liability and other

enforcement, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

MARCH 15, 2001

Mr. LAFALCE (for himself, Mr. GUTIERREZ, Ms. LEE, Mrs. JONES of Ohio,

Mr. CAPUANO, Mr. CLAY, Mr. HINCHEY, and Ms. SCHAKOWSKY) introduced the following bill; which was referred to the Committee on Financial Services

A BILL

To amend the Truth in Savings Act to enhance civil liability

and other enforcement, 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 ‘‘Truth in Savings En5 hancement Act of 2001’’.

6 SEC. 2. IMPROVED ENFORCEMENT AUTHORITY.

7 Section 270 of the Truth in Savings Act (12 U.S.C.

8 4309) is amended by adding at the end the following new

9 subsection:
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1 ‘‘(d) STATE ACTION FOR VIOLATIONS.—

2 ‘‘(1) AUTHORITY OF THE STATES.—In addition

3 to such other remedies as are provided under State

4 law, if the attorney general of a State, or an officer

5 authorized by the State, has reason to believe that

6 any depository institution has violated or is violating

7 this subtitle, the State may—

8 ‘‘(A) bring an action on behalf of the resi9 dents of the State to enjoin such violation in

10 any appropriate United States district court or

11 in any other court of competent jurisdiction;

12 and

13 ‘‘(B) bring an action on behalf of the resi14 dents of the State to enforce compliance with

15 this subtitle, to obtain damages, restitution, or

16 other compensation on behalf of the residents of

17 such State, or to obtain such further and other

18 relief as the court may deem appropriate.

19 ‘‘(2) RIGHTS OF FEDERAL AGENCIES.—

20 ‘‘(A) NOTICE.—The State shall serve prior

21 written notice of any action commenced under

22 paragraph (1) with respect to any depository in23 stitution upon the Federal agency described in

24 subsection (a) with respect to such depository

25 institution and shall provide such agency with a
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1 copy of the complaint unless such prior notice

2 is not feasible, in which case the State shall

3 serve such notice immediately upon instituting

4 such action.

5 ‘‘(B) INTERVENING ACTION.—Any agency

6 described in subsection (a) which receives a no7 tice from a State under subparagraph (A) with

8 respect to any action described in such subpara9 graph shall have the right—

10 ‘‘(i) to move to stay the action, pend11 ing the final disposition of a pending Fed12 eral matter as described in paragraph (4);

13 ‘‘(ii) to intervene in an action under

14 paragraph (1);

15 ‘‘(iii) upon so intervening, to be heard

16 on all matters arising therein;

17 ‘‘(iv) to remove the action to the ap18 propriate United States district court; and

19 ‘‘(v) to file petitions for appeal.

20 ‘‘(3) INVESTIGATORY POWERS.—For purposes

21 of bringing any action under this subsection, nothing

22 in this subsection shall prevent the attorney general,

23 or officers of such State who are authorized by such

24 State to bring such actions, from exercising the pow25 ers conferred on the attorney general or such offi-
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1 cers by the laws of such State to conduct investiga2 tions or to administer oaths or affirmations or to

3 compel the attendance of witnesses or the production

4 of documentary and other evidence.

5 ‘‘(4) LIMITATION ON STATE ACTION WHILE

6 FEDERAL ACTION IS PENDING.—If any Federal

7 agency described in subsection (a) has instituted an

8 enforcement action for a violation of this subtitle, no

9 State may, during the pendency of such action,

10 bring an action under this subsection against any

11 depository institution named in the enforcement ac12 tion for any violation of this subtitle that is alleged

13 in that action.’’.

14 SEC. 3. CIVIL LIABILITY PROVISIONS.

15 (a) CIVIL LIABILITY PROVISION CONTINUED IN EF16 FECT.—

17 (1) IN GENERAL.—Subsection (a) of section

18 2604 of Public Law 104–208 (110 Stat. 3009—

19 470) is amended to read as follows:

20 ‘‘(a) [Repealed]’’.

21 (2) RULE OF CONSTRUCTION.—The enactment

22 of section 2604(a) of Public Law 104–208, as in ef23 fect prior to the repeal of such section by paragraph

24 (1) of this subsection) shall not be construed as af25 fecting the continued application of section 271 of
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1 the Truth in Savings Act (12 U.S.C. 4310) after the

2 end of the 5-year period beginning on the date of the

3 enactment of Public Law 104–208.

4 (b) ADJUSTMENT OF CIVIL LIABILITY AMOUNTS FOR

5 INFLATION.—Paragraph (2) of section 271(a) of the

6 Truth in Savings Act (12 U.S.C. 4310(a)) is amended—

7 (1) in subparagraph (A)—

8 (A) by striking ‘‘$100’’ and inserting

9 ‘‘$200’’; and

10 (B) by striking ‘‘$1,000’’ and inserting

11 ‘‘$5,000’’; and

12 (2) in subparagraph (B)(ii), by striking ‘‘lesser

13 of $500,000 or 1 percent of the net worth of the de14 pository institution involved’’ and inserting ‘‘the

15 greater of—

16 ‘‘(I) the amount determined by

17 multiplying the maximum amount of

18 liability under subparagraph (A) for

19 such failure to comply in an individual

20 action by the number of members in

21 the certified class; or

22 ‘‘(II) the amount equal to 2 per23 cent of the net worth of the depository

24 institution.’’.
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1 (c) STATUTE OF LIMITATIONS.—Subsection (f) of

2 section 271 of the Truth in Savings Act (12 U.S.C.

3 4310(e)) is amended by striking ‘‘within 1 year after the

4 date of the occurrence of the violation involved’’ and in5 serting ‘‘before the end of the 1-year period beginning on

6 the later of—

7 ‘‘(1) the date of the occurrence of the violation

8 involved; or

9 ‘‘(2) the date on which the customer first

10 learned, or reasonably should have learned, based on

11 all the facts and circumstances and information

12 available to the public, of the violation.’’.

13 (d) ACCESS TO COURT PROVISION.—Section 271 of

14 the Truth in Savings Act (12 U.S.C. 4310) is amended

15 by adding at the end the following new subsection:

16 ‘‘(j) AVAILABILITY OF STATUTORY REMEDIES.—

17 ‘‘(1) IN GENERAL.—No provision of any agree18 ment or contract between a consumer and any de19 pository institution, relating to a deposit account,

20 which requires binding arbitration or any other non21 judicial procedure to resolve any controversy or set22 tle any claim arising out of such contract or any

23 transaction covered by the contract, or the refusal to

24 perform the whole or any part of the transaction,

25 shall be enforceable to the extent that the construc-
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1 tion or application of such provision with respect to

2 such controversy, claim, or refusal would deny the

3 consumer the right to bring any action under this

4 section or any other provision of this subtitle for any

5 liability of the depository institution to the consumer

6 under this subtitle.

7 ‘‘(2) RULE OF CONSTRUCTION.—Paragraph (1)

8 shall not be construed as creating any inference that

9 any provision of any contract or agreement described

10 in such paragraph could be construed so as to deny

11 any consumer the right to bring an action under this

12 subtitle absent this subsection.’’.

13 SEC. 4. EFFECT ON STATE LAW.

14 Section 273 of the Truth in Savings Act (12 U.S.C.

15 4312) is amended by adding at the end the following new

16 sentence: ‘‘The Board may not determine that any State

17 law is inconsistent with any provision of this subtitle if

18 the Board determines that the protection such State law

19 affords any consumer is greater than the protection pro20 vided by this subtitle.’’.

21 SEC. 5. EFFECTIVE DATE.

22 The amendments made by this Act to the Truth in

23 Savings Act shall take effect at the end of the 60-day pe24 riod beginning on the date of the enactment of this Act.

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