IB 
Union Calendar No. 269 
118TH CONGRESS 
1ST SESSION H. R. 6365 
[Report No. 118–330] 
To protect against illicit oil shipments, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 13, 2023 
Ms. WATERS introduced the following bill; which was referred to the 
Committee on Financial Services 
DECEMBER 19, 2023 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on November 13, 2023] 
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A BILL 
To protect against illicit oil shipments, and for other 
purposes. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Stopping Illicit Oil 
Shipments Act of 2023’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
(1) When countries are designated under eco-
nomic and trade sanctions by the United States and 
its allies, they are largely excluded from the licit glob-
al financial system, including the movement, sale, 
and profit derived from their oil and gas resources. 
(2) For U.S. persons, American maritime sanc-
tions, including on nations like Iran, Russia, and 
North Korea, restrict the financing of vessels and 
cargo, insurance and re-insurance, companies using 
vessels 
to 
transport 
their 
goods, 
shipowners, 
charterers, and those providing maritime services 
such as classification and certification. 
(3) One method by which Iran and Russia fre-
quently attempt to evade these U.S. sanctions on oil 
is to ‘‘false flag’’, which means to avoid sanctions 
scrutiny by registering a vessel in a permissive coun-
try or by sailing under another country’s flag without 
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communicating this to the country whose flag is being 
used. 
(4) According to Foreign Policy, approximately 
two million barrels of oil from sanctioned countries, 
including Iran and Russia, are transported under 
false flags every day. 
(5) In order to evade a sanctions regime, vessels 
transporting oil and gas resources from sanctioned 
countries must carry insurance policies to allow them 
to dock at a port, unload their goods, or use a port’s 
services, such as refueling. 
(6) The veracity of a vessel’s flag is subject to ex-
amination by port authorities, but verification by the 
port and service providers does not always occur. 
(7) Given the lack of comprehensive checks on the 
veracity of flags, this Act will force a change in be-
havior within the maritime shipping industry by 
limiting the availability of insurance products to 
those not verifying flag registration and providing a 
direct route for the Office of Foreign Assets Control 
(‘‘OFAC’’) to gain possibly actionable information 
that could lead to OFAC enforcement actions as well 
as additional targets for sanctions designations. 
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SEC. 3. MATERIAL MISREPRESENTATION. 
(a) IN GENERAL.—In maritime insurance contracts, 
failure to verify a vessel’s registration shall be deemed a 
material misrepresentation by the policyholder. 
(b) RULEMAKING.—The Undersecretary for Terrorism 
and Financial Crimes shall issue rules to carry out this 
section. 
SEC. 4. IDENTIFICATION OF VESSELS WITH ILLICIT MARI-
TIME INSURANCE. 
(a) IN GENERAL.—The primary insurance regulatory 
authority of a State may report to the Undersecretary for 
Terrorism and Financial Crimes when, in the sole discre-
tion of the primary insurance regulatory authority, the pri-
mary insurance regulatory authority has determined that 
the conditions exist for a maritime insurance contract to 
be voidable pursuant to section 3. 
(b) LIMITATIONS.—With respect to a maritime insur-
ance contract, a report may only be made under subsection 
(a) if the primary insurance regulatory authority— 
(1) establishes that the maritime insurance con-
tract has been issued by an insurer subject to the au-
thority of the primary insurance regulatory author-
ity; 
(2) establishes that the maritime insurance con-
tract satisfies the conditions established by the Under-
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secretary for Terrorism and Financial Crimes to be 
voidable pursuant to section 3; and 
(3) possesses, to the satisfaction of the primary 
insurance regulatory authority, clear and compelling 
credible factual evidence that a policyholder has failed 
to verify the registration of a vessel. 
SEC. 5. REPORT. 
(a) IN GENERAL.—Not later than the end of the 180- 
day period beginning on the date of the enactment of this 
Act, and annually thereafter for 5 years, the Secretary of 
the Treasury shall issue a report to the appropriate commit-
tees of the Congress— 
(1) detailing any reports received by the Under-
secretary for Terrorism and Financial Crimes from a 
primary insurance regulatory authority under section 
4; 
(2) detailing any steps taken by the Secretary of 
the Treasury on the receipt of that information; 
(3) describing of activities taken by the Secretary 
of the Treasury, including meetings and advisories, to 
engage with the maritime community, foreign govern-
ments, and civil society to improve outreach and un-
derstanding of the compliance expectations related to 
maritime sanctions evasion; and 
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(4) describing any proposed improvements to ex-
isting authorities or resources that could be provided 
by Congress. 
(b) EXCEPTION FOR ONGOING INVESTIGATIONS.—The 
Secretary of the Treasury may not include information in 
a report required under subsection (a) related to ongoing 
investigations. 
SEC. 6. REPORT. 
Not later than the end of the 180-day period beginning 
on the date of the enactment of this Act, the Secretary of 
the Treasury shall issue a report to the appropriate commit-
tees of the Congress containing recommendations for receiv-
ing determinations described under section 4 from persons 
other than a primary insurance regulatory authority of a 
State, including establishing a whistleblower program. 
SEC. 7. DEFINITIONS. 
In this Act: 
(1) APPROPRIATE
COMMITTEES
OF
THE
CON-
GRESS.—The term ‘‘appropriate committees of the 
Congress’’ means the Committee on Financial Serv-
ices of the House of Representatives and the Com-
mittee on Banking, Housing, and Urban Affairs of 
the Senate. 
(2) MARITIME INSURANCE.—The term ‘‘maritime 
insurance’’— 
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(A) means insurance coverage for physical 
loss or damage of vessels, cargo, terminals, and 
any transport by which the cargo is transferred, 
acquired, or held between the points of origin 
and the final destination; and 
(B) includes cargo insurance, freight insur-
ance, hull insurance, and protection and indem-
nity. 
(3) REGISTRATION.—The term ‘‘registration’’ 
means the process— 
(A) by which a vessel is formally recognized 
by a country’s maritime authority, resulting in 
the vessel’s inclusion in the national vessel reg-
istry; and 
(B) conferring upon a vessel the nationality 
of the registering state; 
(C) entailing the right to fly the flag of such 
registering state; and 
(D) subjecting a vessel to the responsibility 
to adhere to maritime laws and regulations en-
forced by such registering state. 
(4) STATE.—The term ‘‘State’’ means any of the 
several States, the District of Columbia, a territory of 
the United States, an Indian Tribe, and a jurisdic-
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tion subject to the Compact of Free Association Act of 
2003. 
(5) VESSEL.—The term ‘‘vessel’’ has the meaning 
given such term in section 3 of title 1, United States 
Code. 
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Union Calendar No. 269 
118TH CONGRESS 
1ST SESSION 
H. R. 6365 
[Report No. 118–330] 
A BILL 
To protect against illicit oil shipments, and for 
other purposes. 
DECEMBER 19, 2023 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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