Isolating ISIS Act

Bill: 113-hr-5431
Sponsor: full_name: Rep. Fitzpatrick, Michael G. [R-PA-8]
Introduced: 2014-09-10
Policy area: International Affairs
Subjects: Bank accounts, deposits, capital

Congressional oversight

Currency

Foreign and international banking

Fraud offenses and financial crimes

Iraq

Middle East

Sanctions

Syria

Terrorism

Trade restrictions

War and emergency powers
Latest action: action_date: 2014-09-10
text: Referred to the Committee on Foreign Affairs, and in addition to the Committees on Oversight and Government Reform, and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

Summaries:
action_date: 2014-09-10
action_desc: Introduced in House
text: Isolating ISIS Act - Directs the Secretary of the Treasury to prohibit, or impose strict conditions on, the opening or maintaining in the United States of a correspondent account or a payable-through account by a foreign financial institution that knowingly: <ul> <li>facilitates a transaction for the Islamic State of Iraq and Syria (ISIS); </li> <li>facilitates a transaction of a person designated for acting on behalf of or at the direction of, or owned or controlled by, ISIS; </li> <li>engages in money laundering to carry out such an activity; </li> <li>facilitates a transaction or provides financial services to carry out such an activity; or</li> <li>facilitates such an activity, conspires to facilitate or participate in such an activity, or is owned or controlled by a foreign financial institution that knowingly engages in such an activity. </li> </ul> <p>Applies specified penalties under the International Emergency Economic Powers Act for violations of this Act. </p> <p>Authorizes the Secretary to waive the application of a prohibition for up to 180 days (with renewable 180-day waivers) if in U.S. national security interests, and with congressional notification. </p> <p>Directs the Secretary to identify to Congress every 180 days each foreign central bank that carries out a prohibited activity. </p> <p>Directs the President to transmit to Congress a list of, and impose specified sanctions against, any person who knowingly engages in a transaction with a foreign person that transfers or receives, or facilitates the transfer or receipt of, any goods or services to or from ISIS. </p> <p>States that the President shall not be required to include a person on this list if: (1) that person is no longer engaging in or has taken significant steps toward stopping sanctioned activities, and (2) the President has received reliable assurances that such person will not knowingly engage in any new sanctioned activity. </p> <p>States that nothing in this Act shall apply to authorized U.S. intelligence activities.</p>

tv_txt: I 113th CONGRESS 2d Session H. R. 5431 IN THE HOUSE OF REPRESENTATIVES September 10, 2014 Mr. Fitzpatrick introduced the following bill; which was referred to the Committee on Foreign Affairs , and in addition to the Committees on Oversight and Government Reform and Financial Services , for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To impose sanctions on foreign financial institutions that engage in certain transactions with the Islamic State of Iraq and Syria, and for other purposes.

1. Short title This Act may be cited as the Isolating ISIS Act . 2. Sanctions with respect to foreign financial institutions that engage in certain transactions (a) Prohibitions and conditions with respect to certain accounts held by foreign financial institutions (1) In general Not later than 120 days after the date of the enactment of this Act, the Secretary of the Treasury, in consultation with the Secretary of State and the heads of other applicable Federal departments and agencies, shall prohibit, or impose strict conditions on, the opening or maintaining in the United States of a correspondent account or a payable-through account by a foreign financial institution that the Secretary of the Treasury determines, on or after the date of the enactment of this Act, engages in an activity described in paragraph (2). (2) Activities described A foreign financial institution engages in an activity described in this paragraph if the foreign financial institution— (A) knowingly facilitates a transaction or transactions for the Islamic State of Iraq and Syria; (B) knowingly facilitates a transaction or transactions of a person designated for acting on behalf of or at the direction of, or owned or controlled by, the Islamic State of Iraq and Syria; (C) knowingly engages in money laundering to carry out an activity described in subparagraph (A) or (B); (D) knowingly facilitates a transaction or transactions or provides financial services to carry out an activity described in subparagraph (A), (B), or (C), including— (i) facilitating a transaction or transactions; or (ii) providing financial services that involve a transaction of any goods; or (E) (i) knowingly facilitates, or participates or assists in, an activity described in subparagraph (A), (B), (C), or (D), including by acting on behalf of, at the direction of, or as an intermediary for, or otherwise assisting, another person with respect to the activity described in any such subparagraph; (ii) knowingly attempts or conspires to facilitate or participate in an activity described in subparagraph (A), (B), (C), or (D); or (iii) is owned or controlled by a foreign financial institution that the Secretary finds knowingly engages in an activity described in subparagraph (A), (B), (C), or (D). (3) 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 the prohibition or strict conditions referred to in paragraph (1) of this subsection to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206. (4) Regulations The Secretary of the Treasury shall prescribe and implement regulations to carry out this subsection. (b) Waiver (1) In general The Secretary of the Treasury, in consultation with the Secretary of State and the heads of other applicable Federal departments and agencies, may waive, on a case-by-case basis, the application of a prohibition or condition imposed with respect to a foreign financial institution pursuant to subsection (a) for a period of not more than 180 days, and may renew that waiver for additional periods of not more than 180 days, on and after the date that the Secretary of the Treasury, in consultation with the Secretary of State— (A) determines that such a waiver is in the national security interests of the United States; and (B) submits to the appropriate congressional committees a report describing the reasons for the determination. (2) Form The report required by subparagraph (1) shall be submitted in unclassified form, but may contain a classified annex. (c) Provisions relating to foreign financial institutions (1) Report Not later than 45 days after the date of the enactment of this Act and every 180 days thereafter, the Secretary of the Treasury shall submit to the appropriate congressional committees a report that— (A) identifies each foreign central bank that the Secretary determines engages in one or more activities described in subsection (a)(2)(D); and (B) provides a detailed description of each such activity. (2) Special rule to allow for termination of sanctionable activity The Secretary of the Treasury shall not be required to apply sanctions to a foreign financial institution described in subsection (a) if the Secretary of the Treasury, in consultation with the Secretary of State and the heads of other applicable Federal departments and agencies, certifies in writing to the appropriate congressional committees that— (A) the foreign financial institution— (i) is no longer engaging in an activity described in subsection (a)(2); or (ii) has taken and is continuing to take significant verifiable steps toward terminating the activity described in subsection (a)(2); and (B) the Secretary has received reliable assurances from the government with primary jurisdiction over the foreign financial institution that the foreign financial institution will not engage in any activity described in subsection (a)(2) in the future. (d) Definitions (1) In general In this section: (A) Account; correspondent account; payable-through account The terms account , correspondent account , and payable-through account have the meanings given those terms in section 5318A of title 31, United States Code. (B) Financial institution The term financial institution means a financial institution specified in subparagraph (A), (B), (C), (D), (E), (F), (G), (H), (I), (J), (K), (M), (N), (P), (R), (T), (Y), or (Z) of section 5312(a)(2) of title 31, United States Code. (C) Foreign financial institution The term foreign financial institution has the meaning of such term in section 1010.605 of title 31, Code of Federal Regulations, and includes a foreign central bank. (D) Money laundering The term money laundering means any of the activities described in paragraph (1), (2), or (3) of section 1956(a) of title 18, United States Code, with respect to which penalties may be imposed pursuant to such section. (2) Other definitions The Secretary of the Treasury may further define the terms used in this section in the regulations prescribed under this section. 3. Imposition of sanctions with respect to United States persons that engage in transactions with certain foreign persons (a) In General The President shall impose sanctions in accordance with subsection (c) with respect to each person on the list required by subsection (b). (b) List (1) In general Not later than 90 days after the date of the enactment of this Act, the President shall submit to the appropriate congressional committees a list of United States persons that the President determines have knowingly engaged in an activity described in paragraph (2) on or after such date of enactment. (2) Activity described (A) In general A person engages in an activity described in this paragraph if the person knowingly engages in a transaction or transactions with a foreign person that transfers or receives, or facilitates the transfer or receipt of, any goods or services to or from the Islamic State of Iraq and Syria. (B) Applicability to contracts and other agreements A person engages in an activity described in subparagraph (A) without regard to whether the activity is carried out pursuant to a contract or other agreement entered into before, on, or after the date of the enactment of this Act. (3) Special rule to allow for termination of sanctionable activity The President shall not be required to include a person on the list required by paragraph (1) if the President certifies in writing to the appropriate congressional committees that— (A) the person is no longer engaging in, or has taken significant verifiable steps toward stopping, the activity described in paragraph (2) for which the President would otherwise have included the person on the list; and (B) the President has received reliable assurances that the person will not knowingly engage in any activity described in paragraph (2) in the future. (4) Updates of list The President shall submit to the appropriate congressional committees an updated list under paragraph (1) as new information becomes available. (5) Form of report; public availability (A) Form The list required by paragraph (1) shall be submitted in unclassified form but may contain a classified annex. (B) Public availability The unclassified portion of the list required by paragraph (1) shall be made available to the public and posted on the websites of the Department of the Treasury and the Department of State. (c) Application of Sanctions (1) In general The President shall impose sanctions described in paragraph (2) with respect to a person on the list required by subsection (b). (2) Sanctions The sanctions described in this paragraph are the following: (A) No assistance may be provided to the person under the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.) or the Arms Export Control Act ( 22 U.S.C. 2751 et seq. ). (B) The United States Government may not procure, or enter into any contract for the procurement of, any goods or services from the person. (C) The President may impose additional sanctions, as appropriate, with respect to the person in accordance with the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.). (d) Definitions In this section: (1) Foreign person The term foreign person means— (A) an individual who is not a United States person or an alien lawfully admitted for permanent residence into the United States; or (B) a corporation, partnership, or other nongovernmental entity which is not a United States person. (2) Person (A) In general The term person means— (i) a natural person; (ii) a corporation, business association, partnership, society, trust, financial institution, insurer, underwriter, guarantor, and any other business organization, any other nongovernmental entity, organization, or group, and any governmental entity operating as a business enterprise; and (iii) any successor to any entity described in clause (ii). (B) Application to governmental entities The term person does not include a government or governmental entity that is not operating as a business enterprise. (3) United states person The term United States person means— (A) a natural person who is a citizen of the United States or who owes permanent allegiance to the United States; and (B) a corporation or other legal entity which is organized under the laws of the United States, any State or territory thereof, or the District of Columbia, if natural persons described in subparagraph (A) own, directly or indirectly, more than 50 percent of the outstanding capital stock or other beneficial interest in such legal entity. 4. Regulatory authority (a) In general Not later than 90 days after the date of the enactment of this Act, the President shall promulgate regulations as necessary for the implementation of this Act. (b) Notification to Congress Not later than 10 days before the promulgation of regulations under subsection (a), the President shall notify the appropriate congressional committees of such proposed regulations. 5. Termination This Act shall cease to be in effect beginning 30 days after the date on which the President certifies to Congress that the Islamic State of Iraq and Syria— (1) is no longer designated as a foreign terrorist organization pursuant to section 219 of the Immigration and Nationality Act ( 8 U.S.C. 1189 ); (2) is no longer listed in the Annex to Executive Order No. 13224 (September 23, 2001; relating to blocking property and prohibiting transactions with persons who commit, threaten to commit, or support terrorism); and (3) poses no significant threat to United States national security, interests, or allies. 6. Rule of construction Nothing in this Act shall apply to the authorized intelligence activities of the United States. 7. Definitions In this Act: (1) Appropriate congressional committees The term appropriate congressional committees means— (A) the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives; and (B) the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate. (2) Islamic State of Iraq and Syria The term Islamic State of Iraq and Syria includes— (A) any person— (i) the property of or interests in property of which are blocked pursuant to the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq. ); and (ii) who is identified on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Asset Control of the Department of the Treasury as an agent, instrumentality, or affiliate of the Islamic State of Iraq and Syria; and (B) the entity designated by the Secretary of State as a foreign terrorist organization pursuant to section 219 of the Immigration and Nationality Act ( 8 U.S.C. 1189 ).