II 

111TH CONGRESS 

1ST SESSION S. 2756 

To establish the Financial Services Systemic Risk Oversight Council, and 

for other purposes. 

IN THE SENATE OF THE UNITED STATES 

NOVEMBER 9, 2009 

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

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To establish the Financial Services Systemic Risk Oversight 

Council, 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 ‘‘Financial Services Sys5 temic Risk Oversight Council Act of 2009’’. 

6 SEC. 2. FINANCIAL SERVICES SYSTEMIC RISK OVERSIGHT 

7 COUNCIL ESTABLISHED. 

8 (a) ESTABLISHMENT.—There is established the Fi9 nancial Services Systemic Risk Oversight Council, which 


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1 shall be an independent establishment, as defined in sec2 tion 104 of title 5, United States Code. 

3 (b) APPOINTMENT.— 

4 (1) IN GENERAL.—The Chairman of the Coun5 cil shall be appointed by the President, by and with 

6 the advice and consent of the Senate, for a term of 

7 6 years. 

8 (2) PROHIBITION.—The Chairman may not 

9 hold any other office for which appointment by the 

10 President and confirmation by the Senate are re11 quired, during service as the Chairman. 

12 (3) PROHIBITION ON POLITICAL CAM13 PAIGNING.—The Chairman may not participate in 

14 Federal election campaign activities. 

15 (c) MEMBERS.— 

16 (1) IN GENERAL.—The members of the Council 

17 shall be— 

18 (A) the Chairman; 

19 (B) the Secretary of the Treasury; 

20 (C) the Chairman of the Board of Gov21 ernors of the Federal Reserve System; 

22 (D) the Comptroller of the Currency, or 

23 any successor thereto; 

24 (E) the Director of the Office of Thrift Su25 pervision, or any successor thereto; 


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1 (F) 1 individual, designated by the Presi2 dent, having expertise and experience in the 

3 protection of consumers of financial products, 

4 subject to paragraph (2)(B); 

5 (G) the Chairman of the Securities and 

6 Exchange Commission; 

7 (H) the Chairman of the Commodity Fu8 tures Trading Commission; 

9 (I) the Chairman of the Federal Deposit 

10 Insurance Corporation; and 

11 (J) 1 individual designated by the Presi12 dent. 

13 (2) TERMS OF DESIGNATED MEMBERS.— 

14 (A) LENGTH OF TERMS.—Each member 

15 designated by the President under subpara16 graph (F) or (J) of paragraph (1) shall serve 

17 for a term of 6 years, except that— 

18 (i) the first individual designated 

19 under paragraph (1)(F) shall serve for a 

20 term of 5 years; and 

21 (ii) the first individual designated 

22 under paragraph (1)(J) shall serve for a 

23 term of 3 years. 

24 (B) SUCCESSIVE TERMS.—No member des25 ignated under subparagraph (A), (F), or (J) of 


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1 paragraph (1) may serve for more than 2 con2 secutive terms. 

3 (C) REMOVAL.—No member designated 

4 under subparagraph (F) or (J) of paragraph 

5 (1) may be removed, except for cause. 

6 (3) SUCCESSION.—If Congress establishes an 

7 agency in the executive branch that acts as a con8 sumer financial protection agency— 

9 (A) the director of such office shall be a 

10 member of the Council; 

11 (B) the individual designated by the Presi12 dent under paragraph (1)(F) shall not be a 

13 member of the Council; and 

14 (C) the limitations under paragraph (2) 

15 shall not apply to the director of such office. 

16 (d) TECHNICAL AND PROFESSIONAL ADVISORY COM17 MITTEES.— 

18 (1) IN GENERAL.—The Council may establish 

19 an advisory, technical, or professional committees to 

20 assist the Council in carrying out the duties of the 

21 Council under this Act. 

22 (2) MEMBERS.—A committee established under 

23 paragraph (1) may include a member of the Council. 

24 (e) MEETINGS.—The Council shall meet— 

25 (1) not less frequently than once each quarter; 


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1 (2) at such time as the Chairman determines is 

2 necessary; and 

3 (3) upon the request of any member of the 

4 Council. 

5 (f) AGENDA.—The Chairman shall prepare an agen6 da for each meeting that shall include any item requested 

7 by a member of the Council. 

8 SEC. 3. DUTIES OF THE COUNCIL AND THE CHAIRMAN. 

9 (a) DUTIES OF THE COUNCIL.—The Council shall— 

10 (1) be the systemic risk regulator for the finan11 cial system of the United States; 

12 (2) advise the President on issues relating to 

13 systemic risk mitigation; 

14 (3) monitor the financial markets and financial 

15 companies to identify and address potential systemic 

16 risk; 

17 (4) evaluate the ability of the financial markets 

18 to function appropriately throughout the failure of 

19 United States financial companies and foreign finan20 cial companies in a way that minimizes systemic 

21 risk; 

22 (5) ensure that each financial institution is ade23 quately supervised and regulated for systemic risk 

24 purposes; 


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1 (6) establish criteria specifying the need for the 

2 assignment of a primary prudential regulator to a fi3 nancial institution which may pose a systemic risk 

4 which are not already subject to Federal prudential 

5 regulation; and 

6 (7) promote the integrity, efficiency, orderli7 ness, and stability of the financial markets, by— 

8 (A) making recommendations to the Fed9 eral financial regulators for the mitigation of 

10 systemic risk; and 

11 (B) establishing minimum, mandatory pru12 dential standards for the mitigation of systemic 

13 risk. 

14 (b) DUTIES OF THE CHAIRMAN.—The Chairman 

15 shall— 

16 (1) coordinate areas of overlapping or joint ju17 risdiction among the Federal financial regulators, by 

18 identifying regulations of the Federal financial regu19 lators that should be amended— 

20 (A) to ensure that financial markets and 

21 financial companies are— 

22 (i) sufficiently regulated by the Fed23 eral financial regulators to mitigate sys24 temic risk; and 


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1 (ii) subject to consistent regulations in 

2 the case of overlapping jurisdiction; 

3 (B) to ensure that comparable financial 

4 products, activities, and institutions receive 

5 comparable regulation and supervision; and 

6 (C) to improve the exchange of information 

7 by the Federal financial regulators; 

8 (2) review the rules, regulations, and regulatory 

9 actions of each Federal financial regulator, as such 

10 rules, regulations, and actions relate to the mitiga11 tion of systemic risk, and provide comments to each 

12 Federal financial regulator relating to such review; 

13 (3) identify any deficiencies in the authority of 

14 a Federal financial regulator that would prevent the 

15 Federal financial regulator from issuing regulations 

16 to mitigate systemic risk; 

17 (4) recommend to the Council any revision to 

18 the rules or regulations of a Federal financial regu19 lator necessary to monitor or prevent systemic risk; 

20 (5) ensure that the Council— 

21 (A) collects and analyzes sufficiently com22 prehensive data relating to financial companies 

23 and financial markets, wherever possible from 

24 existing governmental agencies and sources, to 

25 identify systemic risks; and 


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1 (B) shares such information with the mem2 bers of the Council; 

3 (6) propose minimum prudential standards and 

4 risk management standards for consideration by the 

5 Council; and 

6 (7) provide testimony before Congress that re7 flects his or her own views of systemic risk and its 

8 mitigation through financial regulation and market 

9 structures. 

10 SEC. 4. PRUDENTIAL REGULATION OF NONBANK FINAN11 CIAL COMPANIES. 

12 (a) ASSIGNMENT OF A PRIMARY PRUDENTIAL REGU13 LATOR FOR FINANCIAL COMPANIES.— 

14 (1) DESIGNATION.— 

15 (A) IN GENERAL.—Upon a majority vote 

16 of the members of the Council, the Council 

17 may, by rule or order, assign a primary pruden18 tial regulator to any United States financial 

19 company or foreign financial company for which 

20 the Council determines a primary prudential 

21 regulator is necessary to mitigate systemic risk 

22 related to the financial company. 

23 (B) CRITERIA FOR ASSIGNMENT OF A PRI24 MARY PRUDENTIAL REGULATOR.— 


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1 (i) IN GENERAL.—In making an as2 signment under subparagraph (A), the 

3 Council shall consider— 

4 (I) the amount and nature of the 

5 financial assets of the United States 

6 financial company or the foreign fi7 nancial company; 

8 (II) the amount and type of the 

9 liabilities of the United States finan10 cial company or the foreign financial 

11 company, including the degree of reli12 ance by the United States financial 

13 company or the foreign financial com14 pany on short-term funding; 

15 (III) the extent of the activities 

16 and risk of the United States financial 

17 company or the foreign financial com18 pany that are held off-balance sheet; 

19 (IV) the extent of the trans20 actions and relationships of the 

21 United States financial company or 

22 the foreign financial company with 

23 other major financial companies; 


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1 (V) the importance of the United 

2 States financial company or the for3 eign financial company as— 

4 (aa) a source of credit for 

5 households, businesses, and State 

6 and local governments; and 

7 (bb) a source of liquidity for 

8 the financial system; 

9 (VI) any recommendation of a 

10 member of the Council relating to the 

11 United States financial company or 

12 the foreign financial company; and 

13 (VII) any other factor that the 

14 Council determines is appropriate. 

15 (ii) SPECIFIC CRITERIA FOR FOREIGN

16 FINANCIAL COMPANIES.—In making an as17 signment under subparagraph (A) with re18 spect to a foreign financial company, the 

19 Council shall consider— 

20 (I) only the assets, liabilities, and 

21 activities of the foreign financial com22 pany that are held or conducted in the 

23 United States; and 


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1 (II) the principles of national 

2 treatment and equality of competitive 

3 opportunity. 

4 (C) PROHIBITION RELATING TO FOREIGN

5 FINANCIAL COMPANIES.—The Council may not 

6 assign a primary prudential regulator for a for7 eign financial company if the foreign financial 

8 company does not have substantial assets , li9 abilities, counterparty relationships or oper10 ations in the United States. 

11 (2) EVALUATION AND RECISSION OF ASSIGN12 MENT.— 

13 (A) EVALUATION.—Not less frequently 

14 than annually, the Council shall evaluate each 

15 assignment made under paragraph (1). 

16 (B) TERMINATION.—Subject to paragraph 

17 (3), if the Council determines that a United 

18 States financial company or a foreign financial 

19 company no longer meets the criteria for as20 signment under paragraph (1), the Council 

21 shall, by order, terminate the assignment under 

22 paragraph (1). 

23 (3) NOTICE AND HEARING.— 

24 (A) NOTICE.—The Council shall provide to 

25 a United States financial company or a foreign 


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1 financial company notice of any assignment 

2 that the Council proposes to make under para3 graph (1) or (2)(B) in relation to the United 

4 States financial company or foreign financial 

5 company. 

6 (B) REQUEST FOR HEARING.—Not later 

7 than 30 days after the date of receipt of the no8 tice under subparagraph (A), a United States 

9 financial company or foreign financial company 

10 may make a written request for a written or 

11 oral hearing by the Council to contest the pro12 posed assignment under paragraph (1) or 

13 (2)(B). 

14 (C) TIME AND PLACE OF HEARING.—Upon 

15 receipt of a timely request under subparagraph 

16 (B), the Council shall fix a date that is not 

17 more than 30 days after receipt of the request 

18 and place at which a United States financial 

19 company or foreign financial company may, in 

20 person or through counsel— 

21 (i) submit written materials in rela22 tion to the proposed assignment under 

23 paragraph (1) or (2)(B); or 

24 (ii) at the discretion of the Council, 

25 submit oral testimony and oral argument 


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1 in relation to the proposed assignment 

2 under paragraph (1) or (2)(B). 

3 (D) NOTICE OF DETERMINATION.— 

4 (i) HEARING.—Not later than 60 days 

5 after the date of a hearing under subpara6 graph (C), and upon a majority vote of the 

7 members of the Council, the Council shall 

8 transmit to the United States financial 

9 company or foreign financial company— 

10 (I) notice of the determination of 

11 the Council; and 

12 (II) a statement of the basis for 

13 the determination of the Council. 

14 (ii) NO HEARING.—If a United States 

15 financial company or a foreign financial 

16 company does not make a timely request 

17 under clause (ii), the Council shall notify 

18 the United States financial company or the 

19 foreign financial company, in writing, of 

20 any assignment under paragraph (1) or 

21 (2)(B), not later than 40 days after the 

22 date of receipt of the notice under sub23 paragraph (A). 

24 (E) EMERGENCY WAIVER OR MODIFICA25 TION.— 


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1 (i) IN GENERAL.—The Council may 

2 waive or modify the requirements of this 

3 paragraph with respect to a United States 

4 financial company or a foreign financial 

5 company if the Council determines, by an 

6 affirmative vote of not fewer than 5 mem7 bers (or, if there are fewer than 5 mem8 bers then serving, by a unanimous vote of 

9 all members then serving) that such waiver 

10 or modification is necessary or appropriate 

11 to prevent or mitigate threats posed by the 

12 United States financial company or foreign 

13 financial company to the financial stability 

14 of the United States. 

15 (ii) NOTICE.—The Council shall pro16 vide notice to a United States financial 

17 company or a foreign financial company of 

18 a waiver or modification under clause (i) 

19 as soon as is practicable, and in no case 

20 later than 24 hours after the waiver or 

21 modification is made. 

22 (iii) REQUEST FOR HEARING.—Not 

23 later than 10 days after the date of receipt 

24 of notice under clause (ii), the United 

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1 nancial company may make a written re2 quest for a written or oral hearing by the 

3 Council to contest the waiver or modifica4 tion. 

5 (iv) TIME AND PLACE OF HEARING.— 

6 Upon receipt of a timely request under 

7 clause (iii), the Council shall fix a date 

8 that is not more than 30 days after the 

9 date of receipt of the request and place at 

10 which a United States financial company 

11 or foreign financial company may, in per12 son or through counsel— 

13 (I) submit written materials in 

14 relation to the waiver or modification 

15 under clause (i); or 

16 (II) at the discretion of the 

17 Council, submit oral testimony and 

18 oral argument in relation to the waiv19 er or modification under clause (i). 

20 (v) NOTICE OF DETERMINATION.— 

21 Not later than 30 days after a hearing 

22 under clause (iv), and upon a majority vote 

23 of the members of the Council, the Council 

24 shall transmit to a United States financial 

25 company or a foreign financial company— 


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1 (I) notice of the determination of 

2 the Council in relation to the waiver 

3 or modification; and 

4 (II) a statement of the basis for 

5 the determination of the Council. 

6 (4) CONSULTATION REQUIRED.—If a United 

7 States financial company or a foreign financial com8 pany has 1 or more subsidiaries subject to regula9 tion by a Federal financial regulator, the Council 

10 shall consult with the Federal financial regulator be11 fore making any assignment under paragraph (1) in 

12 relation to the United States financial company or 

13 foreign financial company. 

14 (b) REGISTRATION OF FINANCIAL COMPANIES AS15 SIGNED A PRIMARY PRUDENTIAL REGULATOR.— 

16 (1) REGISTRATION REQUIRED.—Not later than 

17 180 days after the date an assignment is made 

18 under subsection (a)(1), a United States financial 

19 company or a foreign financial company that has 

20 been assigned a primary prudential regulator under 

21 subsection (a)(1) shall register with the Council, 

22 using such forms and providing such information as 

23 the Council may deem necessary or appropriate to 

24 carry out this Act. 


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1 (2) REGULATIONS.—The Council, in consulta2 tion with the appropriate Federal financial regu3 lators, shall issue regulations to carry out this sub4 section. 

5 (c) PRIMARY PRUDENTIAL REGULATOR.—Each pri6 mary prudential regulator shall act as the primary pruden7 tial regulator of the entire financial company, and each 

8 affiliate thereof. 

9 (d) RESOLUTION PLANS FOR CERTAIN FINANCIAL

10 COMPANIES.— 

11 (1) RESOLUTION PLAN REQUIRED.—The Fed12 eral Deposit Insurance Corporation, in consultation 

13 with or at the direction of the Council (upon a ma14 jority vote of the members of the Council) shall re15 quire, by rule, a United States any financial com16 pany or foreign financial company that may pose a 

17 systemic risk to develop a plan for rapid and orderly 

18 resolution that— 

19 (A) is designed to mitigate systemic risk; 

20 and 

21 (B) does not contemplate and is not de22 pendent upon the use of any extraordinary sys23 temic resolution process that requires the ap24 proval of the President. 

25 (2) REVISION OF PLANS.— 


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1 (A) REVISION OF PLANS.—The Federal 

2 Deposit Insurance Corporation may require a 

3 financial company to revise a plan developed 

4 under paragraph (1). 

5 (B) PLAN NOT ESTABLISHED.— 

6 (i) IN GENERAL.—If a plan cannot be 

7 established under this paragraph, the Fed8 eral Deposit Insurance Corporation may 

9 request any Federal financial regulator 

10 with jurisdiction over the financial com11 pany to take such steps as are necessary 

12 for an acceptable plan to be approved. 

13 (ii) DISAGREEMENT BETWEEN FED14 ERAL DEPOSIT INSURANCE CORPORATION

15 AND FEDERAL FINANCIAL REGULATOR.—If 

16 a Federal financial regulator fails to take 

17 the steps requested by the Federal Deposit 

18 Insurance Corporation under clause (i)— 

19 (I) the Federal Deposit Insur20 ance Corporation may submit a plan 

21 for the financial company to the 

22 Council; and 

23 (II) the Council may, upon a ma24 jority vote of the members of the 


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1 Council, require the financial company 

2 to adopt— 

3 (aa) the plan described in 

4 subclause (I); or 

5 (bb) any other plan selected 

6 by the Council. 

7 (3) REGULATIONS.—The Federal Deposit In8 surance Corporation shall issue such regulations as 

9 are necessary to carry out this subsection. 

10 SEC. 5. BACKUP REGULATORY AUTHORITY OF THE COUN11 CIL. 

12 (a) PURPOSES.—The purposes of this section are to 

13 ensure that— 

14 (1) all regulations of the Federal financial regu15 lators that relate to matters over which the Federal 

16 financial regulators have overlapping or joint juris17 diction are consistent; 

18 (2) comparable financial products, activities, 

19 and companies receive comparable regulation and 

20 supervision; and 

21 (3) regulations issued by the Federal financial 

22 regulators are sufficient to prevent and mitigate sys23 temic risk. 

24 (b) COORDINATION OF EXISTING REGULATIONS OF

25 FEDERAL FINANCIAL REGULATORS.— 


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1 (1) JOINT RULEMAKING.—The Chairman may 

2 request that a Federal financial regulator participate 

3 in a joint rulemaking with another Federal financial 

4 regulator to improve coordination among Federal fi5 nancial regulators. 

6 (2) COORDINATION BY COUNCIL.—If a Federal 

7 financial regulator fails to participate in a joint rule8 making under subparagraph (B), upon a majority 

9 vote of the members of the Council, the Council may 

10 issue regulations for the purpose of improving co11 ordination among Federal financial regulators. 

12 (c) MINIMUM PRUDENTIAL STANDARDS AND RISK

13 MANAGEMENT STANDARDS.— 

14 (1) ESTABLISHMENT OF STANDARDS.—In order 

15 to mitigate risks to the United States financial sys16 tem and to address systemic risk, upon a majority 

17 vote of the members of the Council, the Council 

18 shall— 

19 (A) establish minimum prudential stand20 ards for United States financial companies and 

21 foreign financial companies, including— 

22 (i) capital requirements; 

23 (ii) leverage limits; 

24 (iii) liquidity requirements; 

25 (iv) underwriting standards; 


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1 (v) counterparty risk limits; 

2 (vi) restrictions on activities; 

3 (vii) margin requirements; 

4 (viii) compensation standards; and 

5 (ix) any other requirements, stand6 ards, or limits it deems necessary to miti7 gate systemic risk; and 

8 (B) prescribe minimum risk management 

9 standards for United States financial companies 

10 and foreign financial companies to address 

11 issues, including— 

12 (i) the risk management policies and 

13 procedures of United States financial com14 panies or foreign financial companies; 

15 (ii) the ability of United States finan16 cial companies or foreign financial compa17 nies to complete timely clearing and settle18 ment of financial transactions; and 

19 (iii) any other issue that the Council 

20 determines that it is necessary to address 

21 in order to— 

22 (I) promote robust risk manage23 ment by United States financial com24 panies or foreign financial companies; 


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1 (II) promote safety and sound2 ness of United States financial compa3 nies or foreign financial companies; 

4 (III) reduce systemic risk; and 

5 (IV) support the stability of the 

6 United States financial system. 

7 (2) RULE OF CONSTRUCTION RELATING TO

8 CONFLICTING STANDARDS.—A standard established 

9 by the Council under this subsection shall be con10 strued as a minimum standard that may be exceeded 

11 by a standard established by the primary prudential 

12 regulator of a United States financial company, a 

13 foreign financial company, or financial market util14 ity. 

15 (d) INSUFFICIENT REGULATIONS OR FAILURE TO

16 ACT.—The Chairman may issue findings relating to any 

17 regulation of a Federal financial regulator that the Chair18 man determines is not— 

19 (1) sufficient to prevent or mitigate the effects 

20 of systemic risk; or 

21 (2) consistent with regulations issued by the 

22 Council. 

23 (e) CONFLICT BETWEEN REGULATIONS OF THE

24 COUNCIL AND REGULATIONS OF A FEDERAL FINANCIAL

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1 sions of a regulation of the Council and a regulation of 

2 a Federal financial regulator are inconsistent, the provi3 sions of the regulation of the Council shall apply. 

4 SEC. 6. ENFORCEMENT OF REGULATIONS AND ORDERS OF 

5 COUNCIL. 

6 (a) ENFORCEMENT BY APPROPRIATE FEDERAL FI7 NANCIAL AGENCIES.—Subject to subsection (b), the ap8 propriate Federal financial regulator shall enforce the reg9 ulations and orders of the Council. 

10 (b) BACKUP AUTHORITY.— 

11 (1) IN GENERAL.—If the Council determines 

12 that it is necessary to prevent or mitigate systemic 

13 risk, the Council may enforce the regulations and or14 ders of the Council with respect to— 

15 (A) a United States financial company; 

16 (B) a foreign financial company operating 

17 in the United States; or 

18 (C) a financial market utility. 

19 (2) MANNER OF ENFORCEMENT.—In carrying 

20 out this subsection, the Council shall have the pow21 ers and duties of the appropriate Federal banking 

22 agencies under section 8 of the Federal Deposit In23 surance Act (12 U.S.C. 1818), as if— 

24 (A) the United States financial company, 

25 foreign financial company, or financial market 


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1 utility were an insured depository institution, as 

2 defined in section 3 of the Federal Deposit In3 surance Act (12 U.S.C. 1813); and 

4 (B) the Council were the appropriate Fed5 eral banking agency, as defined in section 3 of 

6 the Federal Deposit Insurance Act (12 U.S.C. 

7 1813). 

8 (3) REGULATIONS.—The Council shall, by regu9 lation, establish the conditions under which the 

10 Council will exercise enforcement authority under 

11 this subsection. 

12 SEC. 7. RESOLUTION OF FINANCIAL COMPANIES PRE13 SENTING SYSTEMIC RISK. 

14 (a) RECEIVERSHIP.— 

15 (1) IN GENERAL.—The Council may rec16 ommend to the President that systemic resolution 

17 procedures be used to effect the orderly failure of a 

18 financial company, if a majority of the members of 

19 the Council finds that— 

20 (A) a United States financial company or 

21 Foreign financial company operating in the 

22 United States is in default or in danger of de23 fault; and 

24 (B) the financial company could pose a 

25 systemic risk to the United States. 


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1 (2) DEFAULT OR DANGER OF DEFAULT.—For 

2 purposes of this paragraph, a United States finan3 cial company or foreign financial company is in de4 fault or in danger of default if— 

5 (A) an action under the provisions of title 

6 11, United States Code, has been, or is reason7 ably likely to be commenced with respect to the 

8 financial company; 

9 (B) the financial company is critically 

10 undercapitalized, as such term is defined by the 

11 appropriate regulator; 

12 (C) the financial company has incurred, or 

13 is likely to incur, unavoidable losses that will 

14 deplete all or substantially all of the capital of 

15 the financial company; 

16 (D) the assets of the financial company 

17 are, or are likely to be, less than the obligations 

18 of the financial company to creditors and oth19 ers; or 

20 (E) the financial company is, or is likely to 

21 be, unable to pay the obligations of the finan22 cial company (other than any obligation that is 

23 the subject of a bona fide dispute) in the nor24 mal course of business. 


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1 (3) SYSTEMIC RISK.—In determining whether a 

2 financial company poses a systemic risk for purposes 

3 of this subsection, the Council shall take into ac4 count— 

5 (A) the amount and nature of the financial 

6 assets of the financial company; 

7 (B) the amount and type of the liabilities 

8 of the financial company, including the degree 

9 of reliance by the financial company on short10 term funding; 

11 (C) the extent of the off-balance sheet ex12 posures of the financial company; 

13 (D) the extent of the transactions and re14 lationships of the financial company with other 

15 major financial companies; 

16 (E) the importance of the financial com17 pany as a source of— 

18 (i) credit for individuals, businesses, 

19 and State and local governments; and 

20 (ii) liquidity for the financial system; 

21 and 

22 (F) any other factor that the Council de23 termines is appropriate. 

24 (b) REPORT TO CONGRESS AND THE PRESIDENT.— 

25 Upon making any recommendation to the President that 


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1 systemic resolution procedures be used to effect the or2 derly failure of a financial company, the Council shall 

3 make a report to the President and to Congress explain4 ing— 

5 (1) how and why financial regulation failed to 

6 mitigate the systemic risk posed by the institution 

7 prior to its failure; 

8 (2) why non-systemic resolution procedures 

9 were unsuitable for the financial company subject to 

10 the recommendation; and 

11 (3) what steps are necessary to prevent a recur12 rence of the systemic risk posed by the failing insti13 tution from other sources. 

14 SEC. 8. COLLECTION OF DATA AND INFORMATION BY 

15 COUNCIL. 

16 (a) COLLECTION OF DATA BY COUNCIL.— 

17 (1) DUTY TO COLLECT DATA.—The Council 

18 shall collect and analyze sufficiently comprehensive 

19 data regarding the financial sector in order to un20 derstand and mitigate systemic risks. 

21 (2) POWER TO COLLECT DATA.—The Council 

22 may collect data from any United States financial 

23 company or foreign financial company, whether or 

24 not the financial company is regulated by a member 

25 of the Council, to carry out this section. 


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1 (3) BURDEN MINIMIZATION.—The Council shall 

2 make every effort to utilize data already collected by 

3 other Federal agencies and departments. 

4 (b) SUBMISSION OF DATA AND INFORMATION RE5 QUIRED.—The Federal financial regulators shall, upon re6 quest, submit to the Chairman any data or information 

7 that the Chairman determines is necessary to carry out 

8 this Act. 

9 (c) DIRECTION TO OBTAIN DATA OR INFORMA10 TION.— 

11 (1) IN GENERAL.—The Chairman may, if the 

12 Chairman determines that such action is necessary 

13 to carry out this Act, direct a Federal financial reg14 ulator, consistent with the authorities of such regu15 lator, to require the production of any data or infor16 mation from any entity regarding any activity that 

17 is financial in nature, as determined by the Chair18 man. 

19 (2) COORDINATION BY COUNCIL.—Before di20 recting a Federal financial regulator to require the 

21 production of data or information under paragraph 

22 (1) from an entity regulated a member of the Coun23 cil, the Chairman shall coordinate with members of 

24 the Council to prevent duplicative requests for data 

25 and information. 


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1 (d) SUBMISSIONS BY FEDERAL FINANCIAL REGU2 LATORS.—Any Federal financial regulator in possession of 

3 data or information relevant to preventing systemic risk 

4 shall provide such data or information to the Chairman 

5 in a timely manner. 

6 (e) REQUESTS TO INSURERS FOR DATA AND INFOR7 MATION.—The Chairman may request data and informa8 tion from an insurer regulated by a State or the affiliate 

9 of such insurer relating to any product or activity of the 

10 insurer or affiliate that the Chairman determines is finan11 cial in nature. 

12 (f) DATA AND INFORMATION SHARING.—The Chair13 man, in consultation with the members of the Council— 

14 (1) shall— 

15 (A) establish procedures to share data and 

16 information collected by the Council under this 

17 section with the members of the Council; 

18 (B) develop an electronic process for shar19 ing all information collected by the Council with 

20 the Chairman of the Board of Governors of the 

21 Federal Reserve System on a real-time basis; 

22 and 

23 (C) issue any regulations necessary to 

24 carry out this subsection; and 


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1 (2) may designate the format in which re2 quested data and information must be submitted to 

3 the Council, including any electronic, digital, or 

4 other format that facilitates the use of such data by 

5 the Council in its analysis. 

6 (g) APPLICABLE PRIVILEGES NOT WAIVED.—A Fed7 eral financial regulator, State financial regulator, United 

8 States financial company, foreign financial company oper9 ating in the United States, financial market utility, or 

10 other person shall not be deemed to have waived any privi11 lege otherwise applicable to any data or information by 

12 transferring the data or information to, or permitting that 

13 data or information to be used by— 

14 (1) the Council; 

15 (2) any Federal financial regulator or State fi16 nancial regulator, in any capacity; or 

17 (3) any other agency of the Federal Govern18 ment (as defined in section 6 of title 18, United 

19 States Code). 

20 (h) DISCLOSURE EXEMPTION.—Any information ob21 tained by the Council under this section shall be exempt 

22 from the disclosure requirements under section 552 of title 

23 5, United States Code. 

24 (i) CONSULTATION WITH FOREIGN GOVERN25 MENTS.—Under the supervision of the President, and in 


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1 a manner consistent with section 207 of the Foreign Serv2 ice Act of 1980 (22 U.S.C. 3927), the Chairman, in con3 sultation with the Council, shall regularly consult with the 

4 financial regulatory entities and other appropriate organi5 zations of foreign governments or international organiza6 tions on matters relating to systemic risk to the inter7 national financial system. 

8 (j) SUBPOENAS.— 

9 (1) AUTHORITY.—The Chairman may, for the 

10 purpose of carrying out this section, require by sub11 poena, access to the documents of— 

12 (A) any United States financial company 

13 or foreign financial company; and 

14 (B) any Federal financial regulator. 

15 (2) ISSUANCE AND ENFORCEMENT OF SUB16 POENAS.— 

17 (A) ISSUANCE.—Subpoenas issued under 

18 this section shall— 

19 (i) bear the signature of the Chair20 man; and 

21 (ii) be served by any person or class 

22 of persons designated by the Chairman for 

23 that purpose. 

24 (B) ENFORCEMENT.—In the case of contu25 macy or failure to obey a subpoena issued 


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1 under this section, the United States district 

2 court for the District of Columbia may issue an 

3 order requiring compliance. Any failure to obey 

4 the order of the court may be punished by the 

5 court as a contempt that court. 

6 SEC. 9. REPORTS OF FEDERAL FINANCIAL REGULATORS. 

7 (a) REPORT REQUIRED.—Each Federal financial 

8 regulator shall submit to the Council and to the Com9 mittee on Banking, Housing, and Urban Affairs of the 

10 Senate and the Committee on Financial Services of the 

11 House of Representatives an annual report that con12 tains— 

13 (1) an explanation of how the regulations, ex14 aminations, and enforcement actions of the Federal 

15 financial regulator prevent, reduce, and mitigate the 

16 effects of systemic risk; 

17 (2) an explanation of specific actions taken by 

18 the Federal financial regulator during the preceding 

19 fiscal year in response to any systemic risk under 

20 the jurisdiction of the Federal financial regulator; 

21 (3) information relating to emerging sources of 

22 systemic risk— 

23 (A) within the jurisdiction of the Federal 

24 financial regulator; and 


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1 (B) outside the jurisdiction of the Federal 

2 financial regulator; and 

3 (4) recommendations, if any, for legislative or 

4 regulatory action which could prevent, reduce, or 

5 mitigate emerging systemic risk. 

6 (b) TIMING OF REPORT.—Each Federal financial 

7 regulator shall submit the report required under sub8 section (a)— 

9 (1) at a time that is prior to the first appear10 ance required under section 10(a) of each calendar 

11 year; and 

12 (2) determined by the Chairman, in consulta13 tion with the members of the Council. 

14 SEC. 10. APPEARANCE AT HEARINGS AND REPORT BY 

15 COUNCIL. 

16 (a) APPEARANCES BEFORE CONGRESS.— 

17 (1) IN GENERAL.—The Chairman of the Coun18 cil shall appear before Congress at semi-annual 

19 hearings regarding— 

20 (A) the efforts, activities, objectives and 

21 plans of the Council with respect to— 

22 (i) the conduct of financial regulation; 

23 (ii) the prevention of systemic risk; 

24 and 


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1 (iii) the mitigation of harm from sys2 temic risk; 

3 (B) the development of financial markets; 

4 and 

5 (C) the prospects for the future of finan6 cial regulation of systemic risk. 

7 (2) TIMING OF APPEARANCES; COMMITTEES.— 

8 The Chairman of the Council shall appear— 

9 (A) before the Committee on Banking, 

10 Housing, and Urban Affairs of the Senate— 

11 (i) in July of each odd-numbered cal12 endar year; 

13 (ii) in February of each even-num14 bered calendar year; and 

15 (iii) upon request, after any appear16 ance required under subparagraph (B); 

17 and 

18 (B) before the Committee on Financial 

19 Services of the House of Representatives— 

20 (i) in February of each odd-numbered 

21 calendar year; 

22 (ii) in July of each even-numbered 

23 calendar year; and 

24 (iii) upon request, after any appear25 ance required under subparagraph (A). 


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1 (b) REPORT.—At each appearance required under 

2 subsection (a), the Council shall submit to the Committee 

3 on Banking, Housing, and Urban Affairs of the Senate 

4 and the Committee on Financial Services of the House of 

5 Representatives a written report that contains a descrip6 tion of— 

7 (1) the conduct of financial regulation systemic 

8 risk prevention and mitigation, including actions 

9 taken by Federal financial regulators and the Coun10 cil; 

11 (2) developments in the financial markets; and 

12 (3) prospects for the future, taking into account 

13 past and prospective developments— 

14 (A) relating to the Federal financial regu15 lators, as such developments are described in 

16 the reports of the Federal financial regulators 

17 under section 7; and 

18 (B) outside the United States. 

19 SEC. 11. CIVIL PENALTIES. 

20 (a) IN GENERAL.—Any person who violates this Act 

21 or fails to comply with a rule, regulation, or order of the 

22 Council issued under this Act shall be subject to a civil 

23 penalty in an amount established by the Council and pub24 lished under subsection (b). Each such violation or failure 

25 shall constitute a separate civil offense. 


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1 (b) PUBLICATION.—The Council shall annually pre2 scribe and publish in the Federal Register a schedule of 

3 the maximum authorized civil penalty for any violation of 

4 this Act or any regulatory action of the Council under this 

5 Act. 

6 SEC. 12. FUNDING OF THE COUNCIL. 

7 (a) IN GENERAL.— 

8 (1) DETERMINATION BY CHAIRMAN.—For each 

9 fiscal year, the Chairman shall determine the 

10 amount necessary for the Council to carry out its 

11 duties under this Act. 

12 (2) FUNDING.—The Board of Governors of the 

13 Federal Reserve System shall transfer to the Council 

14 an amount equal to the amount described in para15 graph (1). 

16 (b) REGULATIONS.—The Chairman may issue such 

17 regulations as are necessary to carry out this section. 

18 (c) ANNUAL REPORTS ON COUNCIL OPERATIONS.— 

19 (1) IN GENERAL.—The Council shall annually 

20 submit a full report of its operations, activities, 

21 budget, receipts, and expenditures for the preceding 

22 12-month period. 

23 (2) MANNER OF SUBMISSION.—Such report 

24 shall be submitted to the President of the Senate 

25 and the Speaker of the House of Representatives 


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1 (who shall cause the same to be printed for the in2 formation of Congress) and the President as soon as 

3 practicable after the first day of January each year. 

4 (d) QUARTERLY REPORTS TO THE SECRETARY OF

5 THE TREASURY.— 

6 (1) FINANCIAL OPERATING PLANS AND FORE7 CASTS.—Before the beginning of each fiscal quarter, 

8 the Council shall provide to the Secretary of the 

9 Treasury a copy of the financial operating plans and 

10 forecasts of the Council. 

11 (2) RULE OF CONSTRUCTION.—The require12 ment to provide plans, forecasts, and reports to the 

13 Secretary of the Treasury under this subsection may 

14 not be construed as implying any obligation on the 

15 part of the Council to obtain the consent or approval 

16 of such Secretary with respect to such plans, fore17 casts, and reports. 

18 (e) AUDIT.— 

19 (1) AUDIT REQUIRED.—The Comptroller Gen20 eral shall audit annually the operations and financial 

21 transactions of the Council in accordance with gen22 erally accepted government auditing standards. 

23 (2) ACCESS TO BOOKS AND RECORDS.—All 

24 books, records, accounts, reports, files, and property 

25 belonging to or used by the Council, or by an indeVerDate Nov 24 2008 00:55 Nov 10, 2009 Jkt 089200 PO 00000 Frm 00037 Fmt 6652 Sfmt 6201 E:\BILLS\S2756.IS S2756

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1 pendent certified public accountant retained to audit 

2 the Council’s financial statements, shall be made 

3 available to the Comptroller General. 

4 (3) REPORT.—A report of each audit conducted 

5 under paragraph (1) shall be made by the Comp6 troller General to the Congress not later than six 

7 and one-half months following the close of the last 

8 year covered by such audit. The report to the Con9 gress shall set forth the scope of the audit and shall 

10 include a statement of expenses and information as 

11 may be deemed necessary to inform Congress of the 

12 operations and condition of the Council, together 

13 with such recommendations with respect thereto as 

14 the Comptroller General may deem advisable. The 

15 report shall also show specifically any program, ex16 penditure, or other financial transaction or under17 taking observed in the course of the audit, which, in 

18 the opinion of the Comptroller General, has been 

19 carried on or made without authority of law. A copy 

20 of each report shall be furnished to the President, to 

21 the Secretary of the Treasury, and to the Council at 

22 the time submitted to the Congress. 

23 (4) EMPLOYMENT AUTHORITY.—For the pur24 pose of conducting such audit the Comptroller Gen25 eral is authorized in his discretion to employ by conVerDate Nov 24 2008 00:55 Nov 10, 2009 Jkt 089200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\S2756.IS S2756

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1 tract, without regard to section 3709 of the Revised 

2 Statutes, professional services of firms and organiza3 tions of certified public accountants, with the con4 currence of the Council, for temporary periods or for 

5 special purposes. The Council shall reimburse the 

6 Government Accountability Office for the cost of any 

7 such audit as billed therefor by the Comptroller Gen8 eral, and the Government Accountability Office shall 

9 deposit the sums so reimbursed into the Treasury as 

10 miscellaneous receipts. 

11 SEC. 13. TRANSITIONAL ASSISTANCE FROM FEDERAL 

12 AGENCIES. 

13 (a) MEMBERS OF THE COUNCIL.—On the request of 

14 the Chairman and until such time as the Council has suffi15 cient staff, a member of the Council shall provide to the 

16 permanent staff of the Council and any advisory, tech17 nical, or professional committee established by the Council 

18 such technical assistance, professional support, or other 

19 services as are necessary for the Council to carry out this 

20 Act. 

21 (b) OTHER DEPARTMENTS AND AGENCIES.—Upon 

22 the request of the Council, a Federal department or agen23 cy may provide to the Council, and any advisory, technical, 

24 or professional committee established by the Council, such 

25 services, funds, facilities, staff, and other support services 


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1 as the Federal department or agency may determine advis2 able. 

3 SEC. 14. PERSONNEL MATTERS. 

4 (a) COUNCIL STAFF.— 

5 (1) IN GENERAL.—The Chairman may appoint 

6 and terminate such personnel as may be necessary 

7 to enable to the Council to perform its duties. The 

8 Chairman may establish positions in the excepted 

9 service for employees of the Council. 

10 (2) COMPENSATION.—The Chairman may fix 

11 the compensation of Council personnel without re12 gard to the provisions of chapter 51 and subchapter 

13 III of chapter 53 of title 5, United States Code, re14 lating to classification of positions and General 

15 Schedule pay rates, except that the rate of pay for 

16 such personnel may not exceed the rate payable for 

17 level V of the Executive Schedule under section 5316 

18 of such title. 

19 (3) OTHER PERSONNEL AUTHORITIES.—The 

20 Chairman may exercise any personnel authority of 

21 any of the Federal financial regulators for the pur22 poses of recruiting, hiring, or retention of Council 

23 personnel. 

24 (b) DETAIL OF GOVERNMENT EMPLOYEES.—Any 

25 Federal Government employee may be detailed to the 


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1 Council without reimbursement, and such detail shall be 

2 without interruption or loss of civil service status or privi3 lege. 

4 (c) PROCUREMENT OF TEMPORARY AND INTERMIT5 TENT SERVICES.—The Chairman may procure temporary 

6 and intermittent services under section 3109(b) of title 5, 

7 United States Code, at rates for individuals that do not 

8 exceed the daily equivalent of the annual rate of basic pay 

9 prescribed for level V of the Executive Schedule under sec10 tion 5316 of such title. 

11 SEC. 15. APPLICABILITY OF FEDERAL ADVISORY COM12 MITTEE ACT. 

13 The Federal Advisory Committee Act (5 U.S.C. App. 

14 1 et seq.) shall not apply to the Council, or to any advi15 sory, technical, or professional committee established by 

16 the Council. 

17 SEC. 16. JUDICIAL REVIEW. 

18 Nothing in this Act affects any otherwise available 

19 judicial review of agency action or creates any right or 

20 benefit, substantive or procedural, enforceable at law or 

21 equity by a party against the United States, its agencies 

22 or instrumentalities, its officers or employees, or any other 

23 person. 


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1 SEC. 17. CONFLICTING PROVISIONS TERMINATED. 

2 Executive Order Number 12631, issued by the Presi3 dent on March 18, 1988, may not be enforced on or after 

4 the date of enactment of this Act. 

5 SEC. 18. EXECUTIVE SCHEDULE MATTERS. 

6 Section 5312 of title 5, United States Code, is 

7 amended by adding at the end the following new item: 

8 ‘‘Chairman of the Financial Services Systemic Risk 

9 Oversight Council.’’. 

10 SEC. 19. RULE OF CONSTRUCTION. 

11 Nothing in this Act may be construed to interfere 

12 with the authority of— 

13 (1) the Board of Governors of the Federal Re14 serve System, with respect to monetary policy; 

15 (2) the Securities Exchange Commission to set 

16 or enforce standards for accounting or auditing 

17 practices or auditor independence; or 

18 (3) any Federal financial regulator to establish 

19 and enforce consumer and investor protection regu20 lations. 

21 SEC. 20. TECHNICAL AND CONFORMING AMENDMENTS. 

22 (a) INDEPENDENCE IN CONGRESSIONAL TESTIMONY

23 AND RECOMMENDATIONS.—Section 111 of Public Law 

24 No. 93–495 (12 U.S.C. 250) is amended by inserting ‘‘the 

25 Financial Services Systemic Risk Oversight Council,’’ 

26 after ‘‘the Federal Housing Finance Agency,’’. 


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1 (b) PAPERWORK REDUCTION.—Section 3502(5) of 

2 title 44, United States Code, is amended by inserting ‘‘the 

3 Financial Services Systemic Risk Oversight Council,’’ 

4 after ‘‘the Securities and Exchange Commission,’’. 

5 SEC. 21. DEFINITIONS. 

6 In this Act— 

7 (1) the term ‘‘appropriate Federal financial reg8 ulator’’ means— 

9 (A) the Office of the Comptroller of the 

10 Currency, in the case of a national bank, or a 

11 Federal branch or agency of a foreign bank; 

12 (B) the Board of Governors of the Federal 

13 Reserve System, in the case of— 

14 (i) a State member bank, as defined 

15 in section 3 of the Federal Deposit Insur16 ance Act (12 U.S.C. 1813); 

17 (ii) a branch or agency of a foreign 

18 bank (other than a Federal branch, Fed19 eral agency, or insured State branch of a 

20 foreign bank); 

21 (iii) a commercial lending company 

22 owned or controlled by a foreign bank; 

23 (iv) an organization operating under 

24 section 25 or 25A of the Federal Reserve 

25 Act (12 U.S.C. 601 et seq.); 


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1 (v) a bank holding company, as de2 fined in section 2 of the Bank Holding 

3 Company Act of 1956 (12 U.S.C. 1841); 

4 (vi) an investment bank holding com5 pany, as defined in section 17(i)(5) of the 

6 Securities Exchange Act of 1934 (15 

7 U.S.C. 78q(i)(5)); or 

8 (vii) a United States financial com9 pany, a foreign financial company oper10 ating in the United States, or a financial 

11 market utility over which no other Federal 

12 or State regulatory agency has enforce13 ment authority; 

14 (C) the Federal Deposit Insurance Cor15 poration, in the case of— 

16 (i) a national nonmember bank or a 

17 State nonmember bank, as those terms are 

18 defined in section 3 of the Federal Deposit 

19 Insurance Act (12 U.S.C. 1813), the de20 posits of which are insured by the Federal 

21 Deposit Insurance Corporation; or 

22 (ii) an insured State branch of a for23 eign bank; 

24 (D) the Director of the Office of Thrift 

25 Supervision, in the case of— 


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1 (i) a savings association, as defined in 

2 section 3 of the Federal Deposit Insurance 

3 Act (12 U.S.C. 1813), the deposits of 

4 which are insured by the Federal Deposit 

5 Insurance Corporation; or 

6 (ii) a savings and loan holding com7 pany, as defined in section 3 of the Fed8 eral Deposit Insurance Act (12 U.S.C. 

9 1813); 

10 (E) the National Credit Union Administra11 tion Board, in the case of any insured credit 

12 union, as defined in section 101 of the Federal 

13 Credit Union Act (12 U.S.C. 1752); 

14 (F) the Securities and Exchange Commis15 sion, in the case of— 

16 (i) a United States financial company 

17 or foreign financial company operating in 

18 the United States that is subject to regula19 tion by the Commission; or 

20 (ii) a financial market utility that is 

21 subject to regulation by the Commission 

22 and is not subject to regulation by any 

23 other Federal financial regulator; and 

24 (G) the Commodity Futures Trading Com25 mission, in the case of— 


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1 (i) a United States financial company 

2 or foreign financial company operating in 

3 the United States that is subject to regula4 tion by the Commission; or 

5 (ii) a financial market utility that is 

6 subject to regulation by the Commission 

7 and is not subject to regulation by any 

8 other Federal financial regulator; 

9 (2) the term ‘‘Chairman’’ means the Chairman 

10 of the Financial Services Systemic Risk Oversight 

11 Council appointed under section 4; 

12 (3) the term ‘‘Council’’ means the Financial 

13 Services Systemic Risk Oversight Council established 

14 under section 3; 

15 (4) the terms ‘‘depository institution’’ and ‘‘in16 sured depository institution’’ have the same mean17 ings as in section 3 of the Federal Deposit Insur18 ance Act (12 U.S.C. 1813); 

19 (5) the term ‘‘Federal financial regulator’’ 

20 means— 

21 (A) the Comptroller of the Currency; 

22 (B) the Board of Governors of the Federal 

23 Reserve System; 

24 (C) the Federal Deposit Insurance Cor25 poration; 


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1 (D) the National Credit Union Administra2 tion; 

3 (E) the Securities and Exchange Commis4 sion; 

5 (F) the Public Company Accounting Over6 sight Board; 

7 (G) the Federal Housing Finance Agency; 

8 (H) the Federal Trade Commission; 

9 (I) the Farm Credit Administration; 

10 (J) the Commodity Futures Trading Com11 mission; 

12 (K) the Department of Housing and 

13 Urban Development, in carrying out the duties 

14 of the Secretary of Housing and Urban Devel15 opment under the Real Estate Settlement Pro16 cedures Act of 1974 (12 U.S.C. 2601 et seq.); 

17 (L) the Federal Housing Administration; 

18 and 

19 (M) the Department of Veterans Affairs, 

20 in the case of a guarantee by the Secretary of 

21 Veterans Affairs of an extension of credit, in22 cluding a mortgage loan and a small business 

23 loan; 

24 (6) the term ‘‘activity that is financial in na25 ture’’ means an activity— 


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1 (A) described in section 4(k)(4) of the 

2 Bank Holding Company Act of 1956 (12 

3 U.S.C. 1843(k)(4)); or 

4 (B) that the Board of Governors of the 

5 Federal Reserve System has determined is fi6 nancial in nature under section 4(k) of the 

7 Bank Holding Company Act of 1956; 

8 (7) the term ‘‘foreign financial company’’ 

9 means a bank holding company, as those terms are 

10 defined in section 2 of the Bank Holding Company 

11 Act of 1954 (12 U.S.C. 1841), and any affiliate 

12 thereof, or any other person that— 

13 (A) is incorporated or organized in a coun14 try other than the United States; and 

15 (B) is, directly or indirectly (including 

16 through a branch operating in the United 

17 States), engaged in any activity that is financial 

18 in nature in the United States; 

19 (8) the term ‘‘financial market utility’’ means a 

20 corporation, company, association, firm, partnership, 

21 society, joint stock company, or other legal entity 

22 (other than a natural person) that manages or oper23 ates a multilateral system for the purpose of trans24 ferring, clearing, or settling payments, securities, or 

25 other financial transactions— 


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1 (A) among United States financial compa2 nies or foreign financial companies in the 

3 United States; or 

4 (B) between a United States financial com5 pany, or foreign financial company in the 

6 United States, and the corporation, company, 

7 association, firm, partnership, society, joint 

8 stock company, or other legal entity; 

9 (9) the term ‘‘financial transaction’’ includes a 

10 fund transfer, a securities contract, a contract for 

11 sale of a commodity for future delivery, a forward 

12 contract, a repurchase agreement, a swap agree13 ment, a foreign exchange contract, a financial de14 rivatives contract, and any similar transaction that 

15 the Council determines, by rule or order, to be a fi16 nancial transaction for purposes of this Act; 

17 (10) the term ‘‘payment, clearing, or settlement 

18 activity’’ means an activity carried out by a United 

19 States financial company or a foreign financial com20 pany operating in the United States to facilitate the 

21 completion of a financial transaction, including— 

22 (A) the calculation and communication of 

23 unsettled obligations between counterparties; 

24 (B) the netting of transactions; 


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1 (C) the provision and maintenance of 

2 trade, contract, or instrument information; 

3 (D) the management of risks and activities 

4 associated with continuing obligations; 

5 (E) the transmittal and storage of pay6 ment instructions; 

7 (F) the movement of funds; 

8 (G) the final settlement of obligations; and 

9 (H) other similar functions, as determined 

10 by the Council; 

11 (11) the term ‘‘primary prudential regulator’’ 

12 means a Federal financial regulator designated by 

13 the Council as the primary prudential regulator of a 

14 financial company; 

15 (12) the term ‘‘State’’ means any State, terri16 tory, or possession of the United States, the District 

17 of Columbia, Commonwealth of Puerto Rico, Com18 monwealth of Northern Mariana Islands, Guam, 

19 American Samoa, or the United States Virgin Is20 lands; 

21 (13) the term ‘‘systemic risk’’ means the risk 

22 that the disruption or failure of a United States fi23 nancial company, a foreign financial company oper24 ating in the United States, or a financial market 

25 utility could have a serious adverse effect on the ecoVerDate Nov 24 2008 00:55 Nov 10, 2009 Jkt 089200 PO 00000 Frm 00050 Fmt 6652 Sfmt 6201 E:\BILLS\S2756.IS S2756

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1 nomic conditions in or financial stability of the 

2 United States; and 

3 (14) the term ‘‘United States financial com4 pany’’ means a bank holding company, as that term 

5 is defined in section 2 of the Bank Holding Com6 pany Act of 1954 (12 U.S.C. 1841), or any affiliate 

7 thereof, or any other person that is— 

8 (A) incorporated or organized under the 

9 laws of the United States or any State; and 

10 (B) in whole or in part engaged, directly or 

11 indirectly, in activities that are financial in na12 ture. 

Æ 


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