Criminal Correction and Victim Assistance Act of 1996 - Amends the Federal criminal code to repeal provisions prohibiting:  (1) contracting for or hiring out prisoner labor; or (2) knowingly transporting in interstate commerce or from any foreign country into the United States any prisoner-made goods. 
(Sec. 3) Requires the Bureau of Prisons to ensure that:  (1) prisoners under its jurisdiction do not engage in any physical activities designed to increase their physical strength or fighting ability; and (2) all equipment designed for increasing the physical strength or fighting ability of prisoners promptly be removed from Federal correctional facilities and not be introduced into such facilities thereafter except as needed for a medically required program of physical rehabilitation approved by the Director of the Bureau. 
(Sec. 4) Directs the Attorney General to require that:  (1) Federal prisoners who are able to do so work at least 48 hours each week and engage in educational study for at least 12 hours each week; (2) no television viewing be provided to Federal prisoners, except educational programs; and (3) a 25 percent assessment be levied on all wages earned by Federal prisoners, with five percent returned to the prosecuting agency to help reimburse the cost of the prosecution, ten percent set aside for victim restitution, and ten percent placed in the Fund created under this section. 
Establishes in the Treasury the James Wilson, Jr. Fund.  Directs the Attorney General to distribute the money in the Fund equally between:  (1) State and local programs whose primary purpose is to provide training and purchase equipment designed to protect peace officers from personal injury in the line of duty resulting from the criminal acts of third parties; and (2) families of local, State, and Federal peace officers killed in the line of duty. 
(Sec. 5) Amends the Civil Rights of Institutionalized Persons Act to prohibit an adult convicted of a crime who is confined in any correctional facility from bringing a civil action for deprivation of rights until such plain, speedy, and effective administrative remedies as are available are exhausted. 
Directs the court, on its or a party's motion, to dismiss specified actions brought by an adult convicted of a crime and confined in any correctional facility if the court is satisfied that the action fails to state a claim upon which relief can be granted or is frivolous or malicious. 
Repeals a provision of such Act requiring that the minimum standards provide for an advisory role for employees and inmates of a correctional facility in the system for resolution of inmate grievances. 
Amends the Federal judicial code to require:  (1) the court to dismiss a case in a forma pauperis proceeding if the allegation of poverty is untrue or if the action fails to state a claim upon which relief may be granted or is frivolous or malicious, even if partial filing fees have been imposed by the court; (2) a prisoner in a correctional institution who files an affidavit to include a statement of all assets such prisoner possesses; and (3) the court to ask the correctional institution for information relating to the prisoner's assets and to require full or partial payment of filing fees according to the prisoner's ability to pay.
Output: Criminal Correction and Victim Assistance Act of 1996