whichever is lower) in a segregated, earmarked
account at the insured depository institution;
(C) contribute to the surplus capital of the
insured depository institution an amount nec-
essary to adequately capitalize the insured de-
pository institution; or
(D) reduce the amount of total assets of
the institution,
until the insured depository institution is adequately
capitalized pursuant to an agreement described in
subsection (c) or otherwise or the diversified finan-
cial services holding company divests control of the
insured depository institution pursuant to subsection
(d).
(2) TREATMENT
OF
CONTRIBUTION.—To the
extent that a contribution to surplus is made pursu-
ant to paragraph (1), the contribution shall be seg-
regated from, and not treated as, capital for any
purpose unless and until the contribution is applied
as a capital contribution pursuant to this section.
(3) INVESTMENT SECURITIES.—For purposes of
this subsection, the term ‘‘investment securities’’
means—
(A) any security which may be held by a
national bank for the bank’s own account pur-
suant to section 5136 of the Revised Statutes
of the United States; and
(B) may include such other liquid assets as
the appropriate Federal banking agency permits
under this paragraph.
(4) DIVIDENDS.—Upon receipt of a notice by a
diversified financial services holding company pursu-
ant to subsection (a) relating to an insured deposi-
tory institution controlled by such company—
(A) the insured depository institution may
not declare or pay a dividend to any share-
holder; and
(B) the diversified financial services hold-
ing company shall immediately return to the in-
stitution any dividend received from the institu-
tion during the 270-day period ending on the
date the written notice is received by the com-
pany.
(c) APPOINTMENT OF CONSERVATOR.—
(1) IN GENERAL.—If—
(A) a diversified financial services holding
company fails to comply with any of the re-
quirements of subsection (b); or
(B) before the end of the 45-day period be-
ginning on the date a diversified financial serv-
ices holding company receives a notice pursuant
to subsection (a) with respect to an insured de-
pository institution controlled by such company,
the company has not—
(i) caused the institution to become
adequately capitalized; or
(ii) entered into an agreement accept-
able to the appropriate Federal banking
agency to cause the institution to become
adequately capitalized within a reasonable
time,
the appropriate Federal banking agency shall ap-
point a conservator for the insured depository insti-
tution in accordance with the provisions of section
11 of the Federal Deposit Insurance Act.
(2) SUSPENSION OF APPOINTMENT.—An appro-
priate Federal banking agency may, in the agency’s
discretion, suspend the appointment of a conservator
under paragraph (1) if—
(A) the diversified financial services hold-
ing company divests, or agrees to divest, control
of the insured depository institution in an or-
derly manner; and
(B) the appropriate Federal banking agen-
cy determines that such divestiture will meet
the requirements of subsection (d).
(3) EXTENSION OF 45-DAY PERIOD.—The ap-
propriate Federal banking agency may, in the agen-
cy’s discretion and for good cause shown, extend the
45-day period described in paragraph (1) if the
agency determines that the condition of the insured
depository institution is not likely to weaken materi-
ally during any such extension.
(d) DIVESTITURE.—
(1) IN GENERAL.—If, before the end of the 90-
day period beginning on the date a diversified finan-
cial services holding company receives a notice pur-
suant to subsection (a) with respect to an insured
depository institution subsidiary, the holding com-
pany has not—
(A) caused the insured depository institu-
tion to become adequately capitalized; or
(B) entered into an agreement acceptable
to the appropriate Federal banking agency to
adequately capitalize the insured depository in-
stitution within a reasonable time,
the appropriate Federal banking agency shall order
the diversified financial services holding company to
divest control of the institution.
(2) EXTENSION OF 90-DAY PERIOD.—The ap-
propriate Federal banking agency may, in the agen-
cy’s discretion and for good cause shown, extend the
90-day period described in paragraph (1) if the
agency determines that the condition of the insured
depository institution is not likely to weaken materi-
ally during any such extension.
(3) ADDITIONAL CAPITAL.—In connection with
any divestiture of an insured depository institution
pursuant to this subsection or subsection (c)(2) by
any diversified financial services holding company
and subject to subsection (e), the appropriate Fed-
eral banking agency shall order such company to
contribute additional capital to such institution or
take any other action described in subsection (b)
with respect to such institution to the extent nec-
essary for the institution to be adequately capitalized
immediately following the consummation of the di-
vestiture.
(4) APPOINTMENT OF CONSERVATOR.—The ap-
propriate Federal banking agency may appoint a
conservator for an insured depository institution in
accordance with section 11 of the Federal Deposit
Insurance Act at any time during the 90-day period
described in paragraph (1) or any extension of such
period.
(e) TERMINATION OF CONSERVATORSHIP; RESCIS-
SION OF DIVESTITURE ORDER.—If, at any time after the
appointment of a conservator under subsection (c) or the
issuance of an order under subsection (d) by an appro-
priate Federal banking agency, the insured depository in-
stitution—
(1) for which the conservator has been ap-
pointed; or
(2) which is the subject of such order,
becomes adequately capitalized, the appropriate Federal
banking agency shall terminate such conservatorship or
rescind such order, as the case may be.
(f) AGGREGATE LIMIT ON REQUIRED CAPITAL INFU-
SIONS; RELATION
TO OTHER LAWS.—The maximum
amount of liability for a diversified financial services hold-
ing company for any capital assistance pursuant to an
order issued under this section by an appropriate Federal
banking agency with respect to any particular insured de-
pository institution subsidiary shall not exceed the
amounts necessary for the institution to become ade-
quately capitalized.
(g) JUDICIAL REVIEW.—
(1) IN GENERAL.—Before the end of the 10-day
period beginning on the date of the appointment of
a conservator by the appropriate Federal banking
agency under this section or the receipt of an order
issued by any such agency under subsection (d) with
respect to an insured depository institution subsidi-
ary of a diversified financial services holding com-
pany, the company may apply to the United States
district court for the judicial district in which the
principal office of the diversified financial services
holding company is located, or the United States
District Court for the District of Columbia, for an
order requiring the removal of the conservator or for
an injunction setting aside, limiting, or suspending
the enforcement, operation, or effectiveness of any
such order issued.
(2) COURT ACTION.—The court may, upon the
merits in any action brought under paragraph (1),
dismiss any such action, direct the removal of the
conservator, or provide any appropriate relief.
(h) CAPITAL OF DIVERSIFIED FINANCIAL SERVICES
HOLDING COMPANY.—No appropriate Federal banking
agency may impose by regulation, order, agreement, or
any other means any requirement pertaining to the capital
of a diversified financial services holding company.
(i) TERMINATION OF AGREEMENTS.—Any agreement
entered into pursuant to this section between a diversified
financial services holding company and an appropriate
Federal banking agency with respect to the capital of an
undercapitalized insured depository institution subsidiary
of such company shall terminate when the institution be-
comes adequately capitalized.
SEC. 7. ADDITIONAL PROVISIONS RELATING TO REGULA-
TION OF INSURED DEPOSITORY INSTITUTION
SUBSIDIARIES.
(a) DIFFERENTIAL
TREATMENT
PROHIBITION.—
Notwithstanding any other Federal law or the law of any
State, no Federal regulatory agency and no State may
take any action pursuant to any law, regulation, order,
or other authority other than this subtitle if the effect of
such action would be—
(1) to differentiate between—
(A) insured depository institutions which
are controlled by diversified financial services
holding companies; and
(B) other insured depository institutions,
in a manner which discriminates against insured de-
pository institutions described in subparagraph (A);
or
(2) to differentiate between—
(A) diversified financial services holding
companies or affiliates of such companies; and
(B) bank holding companies, savings and
loan holding companies, or affiliates of any such
company
in a manner which discriminates against diversified
financial services holding companies and affiliates of
any such company.
(b) RELATION TO STATE LAW.—
(1) IN GENERAL.—No provision of the law or
the constitution of any State, including any State
law relating to State banks, savings association, real
estate, securities, insurance, finance company, retail
or the provision of financial or other services, shall
prevent or impede or shall be interpreted or applied
by any administrative, executive or judicial authority
with the purpose or effect of preventing or imped-
ing—
(A) any insured depository institution, any
affiliate of any such institution, or any rep-
resentative of any such institution or affiliate
from being acquired, owned, or controlled by, or
from being affiliated in any manner with, any
company which is or becomes a diversified fi-
nancial services holding company, or any affili-
ate of such company, because of—
(i) the types of activities engaged in,
directly or indirectly, by such insured de-
pository institution, any affiliate of such
institution, or any representative of any
such institution or affiliate; or
(ii) the types of activities engaged in,
directly or indirectly, by such diversified fi-
nancial services holding company, any affil-
iate of such company, or any representa-
tive of any such company or affiliate;
(B) any company which is or becomes a di-
versified financial services holding company,
any affiliate of any such company, or any rep-
resentative of any such company or affiliate
from acquiring, owning, or controlling, or being
affiliated in any way with, any insured deposi-
tory institution or any affiliate of any such in-
stitution because of—
(i) the types of activities engaged in,
directly or indirectly, by any such company
or affiliate, or any representative of any
such company or affiliate; or
(ii) the types of activities engaged in,
directly or indirectly, by any such insured
depository institution, any affiliate of any
such institution, or any representative of
such institution or affiliate; or
(C) any insured depository institution, any
affiliate of any such institution, or any rep-
resentative of any such institution or affiliate
from—
(i) offering or marketing products or
services of any affiliated diversified finan-
cial services holding company or any affili-
ate of such company; or
(ii) from having the products or serv-
ices of such insured depository institution,
any affiliate of any such institution, or any
representative of any such institution or
affiliate offered or marketed by such diver-
sified financial services holding company,
an affiliate of such company, or by any
representative of such company or affiliate.
(2) RULE OF CONSTRUCTION.—No provision of
paragraph (1) shall be construed as superseding, al-
tering, or otherwise affecting the application of the
laws of any State relating to the examination, super-
vision, or regulation of providers of financial services
or the protection of consumers, or as exempting any
company which is or becomes a diversified financial
services holding company, any affiliate of any such
company, or any representative of any such company
or affiliate, except to the extent that the intent, pur-
pose, or effect of those laws is inconsistent with this
subsection or with the purposes of this Act and then
only to the extent of such inconsistency.
(3) JUDICIAL DETERMINATION.—Any interested
party may institute an action in the United States
District Court for the District of Columbia or any
other appropriate district court of the United States,
including an action for declaratory judgment, as
may be appropriate to determine whether and to
what extent any provision of the constitution or law
of any State is superseded by any provision of this
subsection or to enjoin application of any such provi-
sion.
(c) ACCESS TO STATE COURTS.—
(1) IN GENERAL.—No State may, directly or in-
directly, deny an insured depository institution
which is not located in that State the right to main-
tain or defend in a court in that State any action
which could be maintained or defended under similar
circumstances by a company which—
(A) is not located in that State; and
(B) is not an insured depository institu-
tion.
(2) EXCEPTION FOR CERTAIN INSTITUTIONS.—
Paragraph (1) shall not apply in the case of an in-
sured depository institution described in such para-
graph which establishes or maintains a domestic
branch (as defined in section 3(o) of the Federal De-
posit Insurance Act) in the State referred to in such
paragraph if the laws of such State do not permit
an out-of-State insured depository institution to es-
tablish a domestic branch in such State.
(3) APPLICABILITY OF VARIOUS CONDITIONS.—
If the maintenance or defense of an action in the
courts of a State by a company which is not located
in that State and is not an insured depository insti-
tution is subject to conditions which are applied in
a nondiscriminatory manner to fulfill legitimate
State objectives, the maintenance or defense of such
an action by an insured depository institution de-
scribed in paragraph (1) may be subject to the same
conditions to the extent that the conditions do not
have the effect, directly or indirectly, of denying the
institution the opportunity to maintain or defend
such action.
(d) REPRESENTATIVES.—
(1) IN GENERAL.—No State may, directly or in-
directly, limit or deny the authority of any diversi-
fied financial services holding company or any affili-
ate of such company to utilize or compensate any
representative or other person who is located in that
State and is representing such company or affiliate
in any lawful capacity.
(2) EXCEPTION FOR CERTAIN LAWS APPLIED IN
NONDISCRIMINATORY MANNER.—Paragraph (1) shall
not apply with respect to any licensing, marketing,
compensation, or employment law or requirement of
a State—
(A) which is applied in a nondiscriminatory
manner to fulfill legitimate State regulatory ob-
jectives; and
(B) the intent, purpose, or effect of which
is not inconsistent with the purposes of this
Act.
(3) EXCEPTION FOR CERTAIN ACTIVITIES.—In
the case of any State the laws of which do not per-
mit an out-of-State insured depository institution to
establish a domestic branch (as defined in section
3(o) of the Federal Deposit Insurance Act) in such
State, paragraph (1) shall not apply with respect to
the performance of activities in such State by any
representative or other person described in para-
graph (1) on behalf of an insured depository institu-
tion if the performance of such activities at any loca-
tion within a State other than the main office or any
branch office of such insured depository institution
would constitute, under any Federal law or the law
of the State, the establishment and operation of a
domestic branch in the State.
(e) AFFILIATE AND CONTROL DEFINED.—Notwith-
standing section 3, the following definitions shall apply for
purposes of this section:
(1) AFFILIATE.—The term ‘‘affiliate’’ means a
person that directly or indirectly controls or is con-
trolled by, or is under common control with another
person.
(2) CONTROL.—
(A) IN
GENERAL.—The term ‘‘control’’
means the power, directly or indirectly, to direct
the management or policies of a person.
(B) PRESUMPTION.—A person shall be
presumed to control another person if the per-
son, directly or indirectly, owns, controls, or
holds with power to vote 10 percent or more of
the voting securities of such other person.
SEC. 8. INSIDER LENDING AND TYING PROVISIONS.
(a) APPLICABILITY OF INSIDER LENDING RESTRIC-
TIONS.—A diversified financial services holding company
shall be treated as a bank holding company for purposes
of section 22(h) of the Federal Reserve Act and any regu-
lation prescribed under such section.
(b) TYING.—
(1) IN
GENERAL.—Any diversified financial
services holding company and any subsidiary of such
company shall be subject to the restrictions of sec-
tion 106 of the Bank Holding Company Act Amend-
ments of 1970 in connection with any transaction
involving the products or services of such company
or subsidiary or an insured depository institution af-
filiate of such company, in the same manner such
section would apply if the company or subsidiary
was a bank and the insured depository institution
subsidiary was a subsidiary of the bank holding com-
pany.
(2) SUBSIDIARY
DEFINED.—For purposes of
paragraph (1), the term ‘‘subsidiary’’ has the same
meaning as in section 2(d) of the Bank Holding
Company Act of 1956.
SEC. 9. ENFORCEMENT AND EXAMINATION; PAYMENT SYS-
TEM SERVICES; OVERSIGHT.
(a) ADMINISTRATIVE ENFORCEMENT.—
(1) IN GENERAL.—Compliance with the require-
ments imposed under this Act and regulations pre-
scribed by any appropriate Federal banking agency
shall be enforced by the appropriate Federal banking
agency under section 8 of the Federal Deposit Insur-
ance Act.
(2) ADDITIONAL ENFORCEMENT POWERS.—
(A) VIOLATION OF THIS ACT TREATED AS
VIOLATION OF OTHER ACTS.—For purposes of
applying section 8 of the Federal Deposit Insur-
ance Act with respect to any diversified finan-
cial services holding company or any affiliate of
such company pursuant to paragraph (1), a vio-
lation of a requirement imposed under this Act
shall be deemed to be a violation of a require-
ment imposed under section 8 of the Federal
Deposit Insurance Act.
(B) ENFORCEMENT
AUTHORITY
UNDER
OTHER ACTS.—In addition to any appropriate
Federal banking agency’s powers under section