II 115th CONGRESS 1st Session S. 1595 IN THE SENATE OF THE UNITED STATES July 20, 2017 Mr. Rubio (for himself and Mrs. Shaheen ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Hizballah International Financing Prevention Act of 2015 to impose additional sanctions with respect to Hizballah, and for other purposes.

1. Short title; table of contents (a) Short title This Act may be cited as the Hizballah International Financing Prevention Amendments Act of 2017 . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. TITLE I—Prevention of access by Hizballah to international financial and other institutions Sec. 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah. Sec. 102. Modification of report with respect to financial institutions that engage in certain transactions. Sec. 103. Sanctions against agencies and instrumentalities of foreign states that support Hizballah. TITLE II—Narcotics trafficking and significant transnational criminal activities of Hizballah Sec. 201. Blocking of property of Hizballah. Sec. 202. Report on racketeering activities engaged in by Hizballah. Sec. 203. Modification of report on activities of foreign governments to disrupt global logistics networks and fundraising, financing, and money laundering activities of Hizballah. Sec. 204. Report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations. TITLE III—General provisions Sec. 301. Regulatory authority. Sec. 302. Exceptions. Sec. 303. Rule of construction. I Prevention of access by Hizballah to international financial and other institutions 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah (a) In general Section 101 of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended to read as follows: 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah (a) In general The President shall impose the sanctions described in subsection (b) with respect to any foreign person that the President determines knowingly assists, sponsors, or provides significant financial, material, or technological support for— (1) Bayt al-Mal, Jihad al-Bina, the Islamic Resistance Support Association, or any successor or affiliate thereof; (2) al-Manar TV, al Nour Radio, or the Lebanese Media Group, or any successor or affiliate thereof; (3) a foreign person determined by the President to be engaged in fundraising or recruitment activities for Hizballah; or (4) a foreign person owned or controlled by a foreign person described in paragraph (1), (2), or (3). (b) Sanctions described (1) In general The sanctions described in this subsection are the following: (A) Asset blocking The exercise of all powers granted to the President by the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq.) (except that the requirements of section 202 of such Act ( 50 U.S.C. 1701 ) shall not apply) to the extent necessary to block and prohibit all transactions in all property and interests in property of a foreign person determined by the President to be subject to subsection (a) if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person. (B) Aliens ineligible for visas, admission, or parole (i) Visas, admission, or parole An alien who the President determines is subject to subsection (a) is— (I) inadmissible to the United States; (II) ineligible to receive a visa or other documentation to enter the United States; and (III) otherwise ineligible to be admitted or paroled into the United States or to receive any other benefit under the Immigration and Nationality Act ( 8 U.S.C. 1101 et seq.). (ii) Current visas revoked (I) In general The issuing consular officer, the Secretary of State, or the Secretary of Homeland Security shall revoke any visa or other entry documentation issued to an alien who the President determines is subject to subsection (a), regardless of when issued. (II) Effect of revocation A revocation under subclause (I) shall take effect immediately and shall automatically cancel any other valid visa or entry documentation that is in the possession of the alien. (2) Penalties The penalties provided for in subsections (b) and (c) of section 206 of the International Emergency Economic Powers Act ( 50 U.S.C. 1705 ) shall apply to a person that violates, attempts to violate, conspires to violate, or causes a violation of regulations prescribed under paragraph (1)(A) to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206. (c) Implementation The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act ( 50 U.S.C. 1702 and 1704) to carry out this section. (d) Procedures for judicial review of classified information (1) In general If a finding under this section, or a prohibition, condition, or penalty imposed as a result of any such finding, is based on classified information (as defined in section 1(a) of the Classified Information Procedures Act (18 U.S.C. App.)) and a court reviews the finding or the imposition of the prohibition, condition, or penalty, the President may submit such information to the court ex parte and in camera. (2) Rule of construction Nothing in this subsection shall be construed to confer or imply any right to judicial review of any finding under this section or any prohibition, condition, or penalty imposed as a result of any such finding. (e) Waiver (1) In general The President may, for periods not to exceed 180 days, waive the imposition of sanctions under this section if the President certifies to the appropriate congressional committees that such waiver is in the national security interests of the United States. (2) Consultation (A) Before waiver issued Before a waiver under paragraph (1) takes effect with respect to a foreign person, the President shall notify and brief the appropriate congressional committees on the status of the involvement of the foreign person in activities described in subsection (a). (B) After waiver issued Not later than 90 days after the issuance of a waiver under paragraph (1) with respect to a foreign person, and every 120 days thereafter while the waiver remains in effect, the President shall brief the appropriate congressional committees on the status of the involvement of the foreign person in activities described in subsection (a). (f) Report Not later than 90 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017 , and every 180 days thereafter, the President shall submit to the appropriate congressional committees a report that lists the foreign persons that the President has credible evidence knowingly assists, sponsors, or provides significant financial, material, or technological support for the foreign persons described in paragraph (1), (2), (3), or (4) of subsection (a). (g) Definitions In this section: (1) Admitted; alien The terms admitted and alien have meanings given those terms in section 101 of the Immigration and Nationality Act ( 8 U.S.C. 1101 ). (2) Appropriate congressional committees The term appropriate congressional committees means— (A) the Committee on Foreign Affairs, the Committee on Ways and Means, the Committee on the Judiciary, and the Committee on Financial Services of the House of Representatives; and (B) the Committee on Foreign Relations, the Committee on Finance, the Committee on Banking, Housing, and Urban Affairs, and the Committee on the Judiciary of the Senate. (3) Entity The term entity means a partnership, association, corporation, or other organization, group, or subgroup. (4) Hizballah The term Hizballah has the meaning given such term in section 102(f). (5) Person The term person means an individual or entity. (6) United States person The term United States person means a United States citizen, permanent resident alien, entity organized under the laws of the United States (including foreign branches), or a person in the United States. . (b) Clerical amendment The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by striking the item relating to section 101 and inserting the following new item: Sec. 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah. . 102. Modification of report with respect to financial institutions that engage in certain transactions Subsection (d) of section 102 of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended to read as follows: (d) Report on financial institutions organized under the laws of state sponsors of terrorism (1) In general Not later than 90 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017 , and every 180 days thereafter, the President shall submit to the appropriate congressional committees a report that— (A) identifies each foreign financial institution described in paragraph (2) that the President determines engages in one or more activities described in subsection (a)(2); (B) provides a detailed description of each such activity; and (C) contains a determination with respect to each such foreign financial institution that is identified under subparagraph (A) as engaging in one or more activities described in subsection (a)(2) as to whether such foreign financial institution is in violation of Executive Order 13224 ( 50 U.S.C. 1701 note; relating to blocking property and prohibiting transactions with persons who commit, threaten to commit, or support terrorism) by reason of engaging in one or more such activities. (2) Foreign financial institution described (A) In general A foreign financial institution described in this paragraph is a foreign financial institution— (i) that, wherever located, is— (I) organized under the laws of a state sponsor of terrorism or any jurisdiction within a state sponsor of terrorism; (II) owned or controlled by the government of a state sponsor of terrorism; (III) located in the territory of a state sponsor of terrorism; or (IV) owned or controlled by a foreign financial institution described in subclause (I), (II), or (III); and (ii) the capitalization of which exceeds $10,000,000. (B) State sponsor of terrorism In this paragraph, the term state sponsor of terrorism means a country the government of which the Secretary of State has determined is a government that has repeatedly provided support for acts of international terrorism for purposes of— (i) section 6(j) of the Export Administration Act of 1979 ( 50 U.S.C. 4605(j) ) (as continued in effect pursuant to the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq.)); (ii) section 620A of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2371 ); (iii) section 40 of the Arms Export Control Act ( 22 U.S.C. 2780 ); or (iv) any other provision of law. . 103. Sanctions against agencies and instrumentalities of foreign states that support Hizballah (a) In general Title I of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended by adding at the end the following: 103. Sanctions against agencies and instrumentalities of foreign states that support Hizballah (a) In general Not later than 120 days after the date of the enactment of this section, and as appropriate thereafter, the President shall block and prohibit all transactions in all property and interests in property of any agency or instrumentality of a foreign state described in subsection (b) if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person. (b) Agency or instrumentality of a foreign state described An agency or instrumentality of a foreign state described in this subsection is an agency or instrumentality of a foreign state that the President determines knowingly and materially assists, sponsors, or provides significant financial, material, or technological support for, goods or services to or in support of, or arms or related material to— (1) Hizballah; (2) an entity owned or controlled by Hizballah; or (3) an entity that the President determines has acted or purported to act for or on behalf of Hizballah. (c) Penalties The penalties provided for in subsections (b) and (c) of section 206 of the International Emergency Economic Powers Act ( 50 U.S.C. 1705 ) shall apply to a person that violates, attempts to violate, conspires to violate, or causes a violation of regulations prescribed under subsection (a) to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206. (d) Implementation The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act ( 50 U.S.C. 1702 and 1704) to carry out this section. (e) Procedures for judicial review of classified information (1) In general If a finding under this section, or a prohibition, condition, or penalty imposed as a result of any such finding, is based on classified information (as defined in section 1(a) of the Classified Information Procedures Act (18 U.S.C. App.)) and a court reviews the finding or the imposition of the prohibition, condition, or penalty, the President may submit such information to the court ex parte and in camera. (2) Rule of construction Nothing in this subsection shall be construed to confer or imply any right to judicial review of any finding under this section or any prohibition, condition, or penalty imposed as a result of any such finding. (f) Waiver (1) In general The President may, for periods not to exceed 180 days, waive the imposition of sanctions under this section with respect to an agency or instrumentality of a foreign state if the President certifies to the appropriate congressional committees that such waiver is in the national security interests of the United States. (2) Consultation (A) Before waiver issued Before a waiver under paragraph (1) takes effect with respect to an agency or instrumentality of a foreign state, the President shall notify and brief the appropriate congressional committees on the status of the involvement of the agency or instrumentality in activities described in subsection (b). (B) After waiver issued Not later than 90 days after the issuance of a waiver under paragraph (1) with respect to an agency or instrumentality of a foreign state, and every 120 days thereafter while the waiver remains in effect, the President shall brief the appropriate congressional committees on the status of the involvement of the agency or instrumentality in activities described in subsection (b). (g) Definitions In this section: (1) Agency or instrumentality of a foreign state; foreign state The terms agency or instrumentality of a foreign state and foreign state have the meanings given those terms in section 1603 of title 28, United States Code. (2) Appropriate congressional committees The term appropriate congressional committees means— (A) the Committee on Foreign Affairs, the Committee on Financial Services, the Committee on Ways and Means, and the Committee on the Judiciary of the House of Representatives; and (B) the Committee on Foreign Relations, the Committee on Banking, Housing, and Urban Affairs, and the Committee on the Judiciary of the Senate. (3) Arms or related material The term arms or related material means— (A) nuclear, biological, chemical, or radiological weapons or materials or components of such weapons; (B) ballistic or cruise missile weapons or materials or components of such weapons; (C) destabilizing numbers and types of advanced conventional weapons; (D) defense articles or defense services, as those terms are defined in paragraphs (3) and (4), respectively, of section 47 of the Arms Export Control Act ( 22 U.S.C. 2794 ); (E) defense information, as that term is defined in section 644 of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2403 ); or (F) items designated by the President for purposes of the United States Munitions List under section 38(a)(1) of the Arms Export Control Act ( 22 U.S.C. 2778(a)(1) ). (4) Hizballah The term Hizballah has the meaning given that term in section 102(f). . (b) Clerical amendment The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by inserting after the item relating to section 102 the following new item: Sec. 103. Sanctions against agencies and instrumentalities of foreign states that support Hizballah. . II Narcotics trafficking and significant transnational criminal activities of Hizballah 201. Blocking of property of Hizballah (a) In general Section 201 of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended to read as follows: 201. Blocking of property of Hizballah (a) Findings Congress finds that Hizballah conducts narcotics trafficking and significant transnational criminal activities. (b) Blocking of property Not later than 120 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017 , and as appropriate thereafter, the President shall block and prohibit all transactions in all property and interests in property of Hizballah if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person. (c) Penalties The penalties provided for in subsections (b) and (c) of section 206 of the International Emergency Economic Powers Act ( 50 U.S.C. 1705 ) shall apply to a person that violates, attempts to violate, conspires to violate, or causes a violation of regulations prescribed under subsection (b) to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206. (d) Implementation The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act ( 50 U.S.C. 1702 and 1704) to carry out this section. (e) Procedures for judicial review of classified information (1) In general If a finding under this section, or a prohibition, condition, or penalty imposed as a result of any such finding, is based on classified information (as defined in section 1(a) of the Classified Information Procedures Act (18 U.S.C. App.)) and a court reviews the finding or the imposition of the prohibition, condition, or penalty, the President may submit such information to the court ex parte and in camera. (2) Rule of construction Nothing in this subsection shall be construed to confer or imply any right to judicial review of any finding under this section or any prohibition, condition, or penalty imposed as a result of any such finding. (f) Waiver The President may, for periods not to exceed 180 days, waive the imposition of sanctions under this section if the President certifies to the appropriate congressional committees that such waiver is in the national security interests of the United States. (g) Definition In this section, the term Hizballah has the meaning given that term in section 102(f). . (b) Clerical amendments The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended— (1) by striking the item relating to title II and inserting the following: Title II—Imposition of sanctions with respect to Hizballah and reports relating to narcotics trafficking and significant transnational criminal activities of Hizballah ; and (2) by striking the item relating to section 201 and inserting the following: Sec. 201. Blocking of property of Hizballah. . 202. Report on racketeering activities engaged in by Hizballah (a) In general Section 202 of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended to read as follows: 202. Report on racketeering activities engaged in by Hizballah (a) In general Not later than 120 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017 , and annually thereafter for the following 5 years, the President shall submit to the appropriate congressional committees a report on the following: (1) Activities that Hizballah, and agents and affiliates of Hizballah, have engaged in that are racketeering activities. (2) The extent to which Hizballah, and agents and affiliates of Hizballah, engage in a pattern of such racketeering activities. (b) Form of report Each report required under subsection (a) shall be submitted in an unclassified form but may contain a classified annex. (c) Definitions In this section: (1) Appropriate congressional committees The term appropriate congressional committees means— (A) the Committee on the Judiciary, the Committee on Foreign Affairs, and the Committee on Financial Services of the House of Representatives; and (B) the Committee on the Judiciary, the Committee on Foreign Relations, and the Committee on Banking, Housing, and Urban Affairs of the Senate. (2) Hizballah The term Hizballah has the meaning given that term in section 102(f). (3) Racketeering activity The term racketeering activity has the meaning given that term in section 1961(1) of title 18, United States Code. . (b) Clerical amendment The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by striking the item relating to section 202 and inserting the following: Sec. 202. Report on racketeering activities engaged in by Hizballah. . 203. Modification of report on activities of foreign governments to disrupt global logistics networks and fundraising, financing, and money laundering activities of Hizballah (a) In general Section 204 of the Hizballah International Financing Prevention Act of 2015 ( Public Law 114–102 ; 50 U.S.C. 1701 note) is amended— (1) in subsection (a)(1)— (A) in the matter preceding subparagraph (A), by striking this Act and inserting the Hizballah International Financing Prevention Amendments Act of 2017 , and annually thereafter for the following 5 years ; (B) in subparagraph (D)(ii)(II), by striking and at the end; (C) in subparagraph (E), by striking and free-trade zones. and inserting free-trade zones, business partnerships and joint ventures, and other investments in small and medium-sized enterprises; ; and (D) by adding at the end the following: (F) a list of provinces, municipalities, and local governments outside of Lebanon that expressly consent to, or with knowledge allow, tolerate, or disregard the use of their territory by Hizballah to carry out terrorist activities, including training, financing, and recruitment; (G) a description of the total aggregate revenues and remittances that Hizballah receives from the global logistics networks of Hizballah, including— (i) a list of Hizballah's sources of revenue, including sources of revenue based on illicit activity, revenues from Iran, charities, and other business activities; and (ii) a list of Hizballah's expenditures, including expenditures for ongoing military operations, social networks, and external operations; and (H) a survey of national and transnational legal measures available to target Hizballah's financial networks. ; (2) by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; (3) by inserting after subsection (a) the following: (b) Enhanced due diligence (1) In general The President shall prescribe, as necessary, enhanced due diligence policies, procedures, and controls for United States financial institutions, and foreign financial institutions maintaining correspondent accounts or payable-through accounts with United States financial institutions, that provide significant financial services for persons and entities operating in a jurisdiction included in the list required under subsection (a)(1)(F) if the President certifies and reports to the appropriate congressional committees that it is in the national security interest of the United States to do so. (2) Definitions In this subsection, the terms correspondent account and payable-through account have the meanings given those terms in section 5318A of title 31, United States Code. ; and (4) in subsection (c), as redesignated by paragraph (2) by adding before the period at the end the following: and on any requirements for enhanced due diligence prescribed under subsection (b) . (b) Report on estimated net worth of senior Hizballah members (1) In general Not later than 180 days after the date of the enactment of this Act, and not less frequently than annually thereafter for the following 2 years, the Secretary of the Treasury shall submit to the appropriate congressional committees a report that contains— (A) the estimated total net worth of each individual described in paragraph (2); and (B) a description of how funds of each individual described in paragraph (2) were acquired, and how such funds have been used or employed. (2) Individuals described The individuals described in this paragraph are the following: (A) The Secretary General of Hizballah. (B) Members of the Hizballah Politburo. (C) Any other individual that the President determines is a senior foreign political figure of Hizballah. (3) Form of report; public availability (A) Form The report required under paragraph (1) shall be submitted in unclassified form but may contain a classified annex. (B) Public availability The unclassified portion of the report required under paragraph (1) shall be made available to the public and posted on the website of the Department of the Treasury in precompressed, easily downloadable versions that are made available in all appropriate formats. (4) Sources of information In preparing the report required under paragraph (1), the Secretary of the Treasury may use any credible publication, database, or web-based resource, and any credible information compiled by any government agency, nongovernmental organization, or other entity provided to or made available to the Secretary. (5) Definitions In this subsection: (A) Appropriate congressional committees The term appropriate congressional committees means— (i) the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives; and (ii) the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate. (B) Funds The term funds means— (i) cash; (ii) equity; (iii) any other intangible asset the value of which is derived from a contractual claim, including bank deposits, bonds, stocks, a security (as defined in section 2(a) of the Securities Act of 1933 ( 15 U.S.C. 77b(a) )), or a security or an equity security (as those terms are defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) )); and (iv) anything else of value that the Secretary of the Treasury determines to be appropriate. (C) Senior foreign political figure The term senior foreign political figure has the meaning given that term in section 1010.605 of title 31, Code of Federal Regulations (or any successor regulation). 204. Report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations (a) In general Not later than 180 days after the date of the enactment of this Act, the President shall submit to the appropriate congressional committees a report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations to finance their operations, as described in the report submitted to Congress in December 2015 by the Department of State, the Department of Justice, the Department of the Treasury, the Department of Homeland Security, and the Department of Health and Human Services entitled, The Global Illicit Trade in Tobacco: A Threat to National Security. . (b) Matters To be addressed The report required by subsection (a) shall include the following: (1) A description of the steps to be taken by Federal agencies to combat the illicit tobacco trafficking networks used by Hizballah, other foreign terrorist organizations, and other illicit actors. (2) A description of the steps to be taken to engage State and local law enforcement authorities in efforts to combat illicit tobacco trafficking networks operating within the United States. (3) A description of the steps to be taken to engage foreign government law enforcement and intelligence authorities in efforts to combat illicit tobacco trafficking networks operating outside the United States. (4) Recommendations for legislative or administrative action needed to address the threat of illicit tobacco trafficking networks. (c) Appropriate congressional committees defined In this section, the term appropriate congressional committees means— (1) the Committee on Foreign Affairs, the Committee on Armed Services, the Committee on Homeland Security, the Committee on the Judiciary, the Committee on Financial Services, and the Committee on Ways and Means of the House of Representatives; and (2) the Committee on Foreign Relations, the Committee on Armed Services, the Committee on Homeland Security and Governmental Affairs, the Committee on the Judiciary, the Committee on Banking, Housing, and Urban Affairs, and the Committee on Finance of the Senate. III General provisions 301. Regulatory authority (a) In general The President shall, not later than 180 days after the date of the enactment of this Act, prescribe regulations as necessary for the implementation of this Act and the amendments made by this Act. (b) Notification to Congress Not later than 10 days before the prescription of regulations under subsection (a), the President shall notify the appropriate congressional committees regarding the proposed regulations and the provisions of this Act and the amendments made by this Act that the regulations are implementing. (c) Appropriate congressional committees defined In this section, the term appropriate congressional committees means— (1) the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives; and (2) the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate. 302. Exceptions This Act and the amendments made by this Act shall not apply to the following: (1) Any authorized intelligence, law enforcement, or national security activities of the United States. (2) Any transaction necessary to comply with United States obligations under— (A) the Agreement between the United Nations and the United States of America regarding the Headquarters of the United Nations, signed at Lake Success June 26, 1947, and entered into force November 21, 1947; (B) the Convention on Consular Relations, done at Vienna April 24, 1963, and entered into force March 19, 1967; or (C) any other international treaty. 303. Rule of construction Nothing in this Act or an amendment made by this Act shall be construed to limit the authority of the President under the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq.) or any other provision of law.