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under this title, in the United States district court 
for the judicial district in which the regulated entity 
has its principal place of business, or in the United 
States District Court for the District of Columbia, 
and the Director may be served with process in the 
manner prescribed by the Federal Rules of Civil 
Procedure. 
‘‘SEC. 1313A. PRUDENTIAL MANAGEMENT AND OPERATIONS 
STANDARDS. 
‘‘(a) STANDARDS.—The Director shall establish 
standards, by regulation, guideline, or order, for each reg-
ulated entity relating to— 
‘‘(1) adequacy of internal controls and informa-
tion systems, including information security and pri-
vacy policies and practices, taking into account the 
nature and scale of business operations; 
‘‘(2) independence and adequacy of internal 
audit systems; 
‘‘(3) management of credit and counterparty 
risk, including systems to identify concentrations of 
credit risk and prudential limits to restrict exposure 
of the regulated entity to a single counterparty or 
groups of related counterparties; 
‘‘(4) management of interest rate risk exposure; 
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‘‘(5) management of market risk, including 
standards that provide for systems that accurately 
measure, monitor, and control market risks and, as 
warranted, that establish limitations on market risk; 
‘‘(6) adequacy and maintenance of liquidity and 
reserves; 
‘‘(7) management of any asset and investment 
portfolio; 
‘‘(8) investments and acquisitions by a regu-
lated entity, to ensure that they are consistent with 
the purposes of this Act and the authorizing stat-
utes; 
‘‘(9) maintenance of adequate records, in ac-
cordance with consistent accounting policies and 
practices that enable the Director to evaluate the fi-
nancial condition of the regulated entity; 
‘‘(10) issuance of subordinated debt by that 
particular regulated entity, as the Director considers 
necessary; 
‘‘(11) overall risk management processes, in-
cluding adequacy of oversight by senior management 
and the board of directors and of processes and poli-
cies to identify, measure, monitor, and control mate-
rial risks, including reputational risks, and for ade-
quate, well-tested business resumption plans for all 
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major systems with remote site facilities to protect 
against disruptive events; and 
‘‘(12) such other operational and management 
standards as the Director determines to be appro-
priate. 
‘‘(b) FAILURE TO MEET STANDARDS.— 
‘‘(1) PLAN REQUIREMENT.— 
‘‘(A) IN GENERAL.—If the Director deter-
mines that a regulated entity fails to meet any 
standard established under subsection (a)— 
‘‘(i) if such standard is established by 
regulation, the Director shall require the 
regulated entity to submit an acceptable 
plan to the Director within the time al-
lowed under subparagraph (C); and 
‘‘(ii) if such standard is established by 
guideline, the Director may require the 
regulated entity to submit a plan described 
in clause (i). 
‘‘(B) 
CONTENTS.—Any 
plan 
required 
under subparagraph (A) shall specify the ac-
tions that the regulated entity will take to cor-
rect the deficiency. If the regulated entity is 
undercapitalized, the plan may be a part of the 
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capital restoration plan for the regulated entity 
under section 1369C. 
‘‘(C) DEADLINES
FOR
SUBMISSION
AND 
REVIEW.—The Director shall by regulation es-
tablish deadlines that— 
‘‘(i) provide the regulated entities with 
reasonable time to submit plans required 
under subparagraph (A), and generally re-
quire a regulated entity to submit a plan 
not later than 30 days after the Director 
determines that the entity fails to meet 
any standard established under subsection 
(a); and 
‘‘(ii) require the Director to act on 
plans expeditiously, and generally not later 
than 30 days after the plan is submitted. 
‘‘(2) REQUIRED ORDER UPON FAILURE TO SUB-
MIT OR IMPLEMENT PLAN.—If a regulated entity 
fails to submit an acceptable plan within the time al-
lowed under paragraph (1)(C), or fails in any mate-
rial respect to implement a plan accepted by the Di-
rector, the following shall apply: 
‘‘(A) REQUIRED
CORRECTION
OF
DEFI-
CIENCY.—The Director shall, by order, require 
the regulated entity to correct the deficiency. 
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‘‘(B) OTHER
AUTHORITY.—The Director 
may, by order, take one or more of the fol-
lowing actions until the deficiency is corrected: 
‘‘(i) Prohibit the regulated entity from 
permitting its average total assets (as such 
term is defined in section 1316(b)) during 
any calendar quarter to exceed its average 
total assets during the preceding calendar 
quarter, or restrict the rate at which the 
average total assets of the entity may in-
crease from one calendar quarter to an-
other. 
‘‘(ii) Require the regulated entity— 
‘‘(I) in the case of an enterprise, 
to increase its ratio of core capital to 
assets. 
‘‘(II) in the case of a Federal 
home loan bank, to increase its ratio 
of total capital (as such term is de-
fined in section 6(a)(5) of the Federal 
Home Loan Bank Act (12 U.S.C. 
1426(a)(5)) to assets. 
‘‘(iii) Require the regulated entity to 
take any other action that the Director de-
termines will better carry out the purposes 
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of this section than any of the actions de-
scribed in this subparagraph. 
‘‘(3) MANDATORY
RESTRICTIONS.—In com-
plying with paragraph (2), the Director shall take 
one or more of the actions described in clauses (i) 
through (iii) of paragraph (2)(B) if— 
‘‘(A) the Director determines that the reg-
ulated entity fails to meet any standard pre-
scribed under subsection (a); 
‘‘(B) the regulated entity has not corrected 
the deficiency; and 
‘‘(C) during the 18-month period before 
the date on which the regulated entity first 
failed to meet the standard, the entity under-
went extraordinary growth, as defined by the 
Director. 
‘‘(c) OTHER ENFORCEMENT AUTHORITY NOT AF-
FECTED.—The authority of the Director under this sec-
tion is in addition to any other authority of the Director.’’. 
(b) INDEPENDENCE IN CONGRESSIONAL TESTIMONY 
AND RECOMMENDATIONS.—Section 111 of Public Law 
93–495 (12 U.S.C. 250) is amended by striking ‘‘the Fed-
eral Housing Finance Board’’ and inserting ‘‘the Director 
of the Federal Housing Finance Agency’’. 
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