Title: Protecting America's Economy from the Carbon Bubble Act of 2020
Policy area: Finance and Financial Sector

Summary:
Protecting America's Economy from the Carbon Bubble Act of 2020
This bill prohibits certain financial companies (including bank holding companies, savings and loan holding companies, and insured depository institutions) from involvement in fossil fuel production. Prohibited activities include
Violators are subject to criminal and civil penalties.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 4835 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 4835

   To prohibit bank holding companies from facilitating fossil fuel 
 production from new sources or new or expanded fossil infrastructure 
       that would drive such production, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

             October 21 (legislative day, October 19), 2020

  Mr. Merkley introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
   To prohibit bank holding companies from facilitating fossil fuel 
 production from new sources or new or expanded fossil infrastructure 
       that would drive such production, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting America's Economy from 
the Carbon Bubble Act of 2020''.

SEC. 2. PROHIBITION ON FACILITATING FOSSIL FUEL PRODUCTION FROM NEW 
              SOURCES.

    The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is 
amended by adding at the end the following:

``SEC. 15. PROHIBITION ON FACILITATING FOSSIL FUEL PRODUCTION FROM NEW 
              SOURCES.

    ``(a) Definitions.--In this section--
            ``(1) the term `financial company' means--
                    ``(A) a bank holding company, savings and loan 
                holding company, or similar institution;
                    ``(B) a foreign banking organization or company 
                that is treated as a bank holding company under this 
                Act;
                    ``(C) an insured depository institution, a thrift 
                institution, a savings association, an industrial loan 
                company, or similar institution; or
                    ``(D) any subsidiary, agency, or affiliate of an 
                entity described in subparagraph (A) or (B);
            ``(2) the term `fossil fuel' means coal, petroleum, natural 
        gas, or any derivative of coal, petroleum, or natural gas that 
        is used for fuel;
            ``(3) the term `fossil infrastructure' means fossil fuel-
        related projects, including wells, rail infrastructure, 
        pipelines, terminals, refineries, and power plants;
            ``(4) the term `new sources' means--
                    ``(A) any production in excess of proven developed 
                producing reserves of fossil fuels as of the date of 
                enactment of this section; or
                    ``(B) new or expanded fossil infrastructure that 
                would facilitate the production described in 
                subparagraph (A); and
            ``(5) the term `production' means extractive or production 
        activities that result in fossil fuels being made available for 
        refining or use.
    ``(b) Prohibition.--No financial company may facilitate fossil fuel 
production, including by--
            ``(1) providing loans to, making investments in, or 
        otherwise engaging in any activity that is financial in nature, 
        or incidental to such financial activity, with a fossil fuel 
        company;
            ``(2) providing loans to, making investments in, or 
        otherwise engaging in any activity that is financial in nature, 
        or incidental to such financial activity, for a fossil fuel 
        project;
            ``(3) taking compensation to arrange or facilitate a 
        transaction that provides funds for fossil fuel production from 
        new sources;
            ``(4) securitizing assets that provide funds for fossil 
        fuel production from new sources;
            ``(5) entering into a derivatives transaction designed to 
        provide funding for, facilitate, or hedge risks from fossil 
        fuel production from new sources;
            ``(6) engaging in any activity that is complementary to a 
        financial activity involving fossil fuel production from new 
        sources, including financing the international trade thereof; 
        or
            ``(7) any other form of activity defined by regulators or 
        supervisors of the financial company.
    ``(c) Penalties.--
            ``(1) Criminal penalty.--
                    ``(A) In general.--Whoever knowingly violates any 
                provision of this section or, being a company, violates 
                any regulation or order issued by the Board under this 
                section, shall be imprisoned not more than 1 year, 
                fined not more than $1,000,000 per day for each day 
                during which the violation continues, or both.
                    ``(B) Intent to deceive, defraud, or profit.--
                Whoever, with the intent to deceive, defraud, or profit 
                significantly, knowingly violates any provision of this 
                section shall be imprisoned not more than 5 years, 
                fined not more than $5,000,000 per day for each day 
                during which the violation continues, or both.
            ``(2) Prohibition on employment.--Any individual who 
        knowingly violates any provision of this section shall be 
        banned from future employment with any bank holding company or 
        publicly traded corporation.
            ``(3) Civil monetary penalty.--Any company that violates, 
        and any individual who participates in a violation of, any 
        provision of this section, or any regulation or order issued 
        pursuant thereto, shall forfeit all revenues associated with 
        such a violation and pay an additional civil penalty of not 
        more than $25,000 for each day during which the violation 
        continues.
    ``(d) Compliance Program.--
            ``(1) In general.--Banking organizations shall maintain 
        policies and procedures reasonably designed to ensure that 
        relationships with customers or counterparties do not 
        facilitate fossil fuel production from new sources.
            ``(2) Attestation.--The chief executive officer of each 
        financial company shall comply with an attestation for 
        compliance with this section, subject to such rules as the 
        Board may prescribe that shall be no less strict than those set 
        forth under section 351.20(c) of title 12, Code of Federal 
        Regulations, or any successor regulation.
            ``(3) Supervision.--The appropriate Federal banking agency 
        shall supervise the policies and procedures described in this 
        subsection and the implementation of those policies and 
        procedures.''.
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