Date: 2016-02-04
Speaker: MAXINE WATERS (democrat)
Chamber: H
State: California

Mr. Chairman. I yield myself such time as I may consume. Mr. Chairman and Members. if you listen carefully to my colleague on the opposite side of the aisle. Mr. LUETKEMEYER. you would think that the major point of this bill is the Choke Point controversy. Considerable time was spent by my colleague on the opposite side of the aisle talking about Choke Point. Well. I do not want that discussion to obscure the real problem with this very bad legislation. H.R. 766 eliminates core provisions of the Financial Institutions Reform. Recovery. and Enforcement Act. or FIRREA. that the Justice Department has used to investigate and prosecute bank fraud. This is what this discussion should be about: bank fraud. FIRREA has proven to be the Justice Departments most effective tool for holding Wall Street accountable. We hear a lot of talk about Wall Street. We went through 2008 and the subprime meltdown. the bailout. and all of that. Most of the Members on both sides of the aisle agree that we had to rein in the practices of Wall Street. Here we have a bill today that would basically protect them and take away the very tool that is used in order to make them accountable. After using FIRREA to secure historic settlements against Wall Street. including a $7 billion settlement against Citibank. a $5 billion settlement against Goldman Sachs. a $13 billion settlement against JPMorgan Chase. and a historic $16 billion settlement against Bank of America. now H.R. 766 seeks to stifle the Justice Departments investigative powers over financial fraud. In fact. there are still ongoing settlement negotiations with banks like Wells Fargo and Goldman Sachs that were announced just this week. Without investigatory powers and an extended statute of limitations granted to the Justice Department by FIRREA. it would be impossible for us to identify and rectify the fraudulent activity that set us up for a crisis 10 years ago. Apparently. H.R. 766 supporters believe that actually holding banks accountable for fraud was too much of a burden for them. replacing our system of too big to jail with one where our biggest banks are now too frail to fine. H.R. 766 also invites the next crisis by imposing burdensome requirementslisten to thisimposing burdensome requirements on the Justice Departments ability to investigate bank fraud. allowing fraud schemes to continue at the expense of consumers and the financial system. The Justice Departments ability to identify and rout out fraud would be critical in averting future crises. and H.R. 766 would be a free pass to banks that make their money by breaking the law. That would include banks like Plaza. Commerce West. and Four Oaks. all of which knowingly aided fraudsters. despite the many red flags raised by their financial activities. At Commerce West in particular. the bank admitted fraud for failing to file suspicious activity reports with regulators even after the banks own employees determined that one of their customers was routinely submitting fraudulent checks to the bank. According to the Justice Departments complaint. the bank also failed to heed the warning of other banks that pointed out to Commerce West that some of their customers were fraudulent businesses. Furthermore. H.R. 766s account closure provisions are a solution in search of a problem as regulators are now forcing financial institutions to close customer accounts. Every Federal banking regulator has been clear. except for rare cases involving national security or systemic risks. The responsibility for closing accounts is a decision for financial institutions. Some financial institutions are simply deciding that they would rather lose a customer than invest in the resources needed to ensure that our financial system is not being used for money laundering or other criminal activity. In order to protect our economy from the next financial crisis. regulators have to have the necessary tools to prevent fraud and protect consumers. Americans are still reeling from the effects of the financial crisis. We should be in the business of seeking ways to continue to hold banks more accountable for their misconduct. not rolling back the Federal Governments most effective tool for protecting consumers. investors. and taxpayers from bank fraud. Banks that break the law dont deserve getoutofjailfree cards. The administration will veto H.R. 766. I urge my Democratic colleagues to oppose H.R. 766. I just want to say that. despite yesterday when we had five bills that had been rolled into one that I warned our Members of Congress about because of what they literally did. particularly in terms of allowing corporations to not have to disclose information about the stock that they were giving to their employees. and I talked about how bad that was. This is worse. This is worse because we are able to call names and to point out banks because we have the information. It is real. We are able to point out how the Justice Department has been affected in making these banks accountable. So why in the world would we want to take away the Justice Departments tool that is FIRREA? Why would we want to prevent the Justice Department from going after these banks who know they are dealing with crooks and fraudsters? I would ask for a "no" vote on this bill. I reserve the balance of my time.