[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 766 Referred in Senate (RFS)]
<DOC>
114th CONGRESS
2d Session
H. R. 766
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 8, 2016
Received; read twice and referred to the Committee on Banking, Housing,
and Urban Affairs
_______________________________________________________________________
AN ACT
To provide requirements for the appropriate Federal banking agencies
when requesting or ordering a depository institution to terminate a
specific customer account, to provide for additional requirements
related to subpoenas issued under the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989, 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 ``Financial Institution Customer
Protection Act of 2016''.
SEC. 2. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMINATION REQUESTS AND
ORDERS.
(a) Termination Requests or Orders Must Be Material.--
(1) In general.--An appropriate Federal banking agency may
not formally or informally request or order a depository
institution to terminate a specific customer account or group
of customer accounts or to otherwise restrict or discourage a
depository institution from entering into or maintaining a
banking relationship with a specific customer or group of
customers unless--
(A) the agency has a material reason for such
request or order; and
(B) such reason is not based solely on reputation
risk.
(2) Treatment of national security threats.--If an
appropriate Federal banking agency believes a specific customer
or group of customers is, or is acting as a conduit for, an
entity which--
(A) poses a threat to national security;
(B) is involved in terrorist financing;
(C) is an agency of the government of Iran, North
Korea, Syria, or any country listed from time to time
on the State Sponsors of Terrorism list;
(D) is located in, or is subject to the
jurisdiction of, any country specified in subparagraph
(C); or
(E) does business with any entity described in
subparagraph (C) or (D), unless the appropriate Federal
banking agency determines that the customer or group of
customers has used due diligence to avoid doing
business with any entity described in subparagraph (C)
or (D),
such belief shall satisfy the requirement under paragraph (1).
(b) Notice Requirement.--
(1) In general.--If an appropriate Federal banking agency
formally or informally requests or orders a depository
institution to terminate a specific customer account or a group
of customer accounts, the agency shall--
(A) provide such request or order to the
institution in writing; and
(B) accompany such request or order with a written
justification for why such termination is needed,
including any specific laws or regulations the agency
believes are being violated by the customer or group of
customers, if any.
(2) Justification requirement.--A justification described
under paragraph (1)(B) may not be based solely on the
reputation risk to the depository institution.
(c) Customer Notice.--
(1) Notice required.--Except as provided under paragraph
(2), if an appropriate Federal banking agency orders a
depository institution to terminate a specific customer account
or a group of customer accounts, the depository institution
shall inform the customer or customers of the justification for
the customer's account termination described under subsection
(b).
(2) Notice prohibited in cases of national security.--If an
appropriate Federal banking agency requests or orders a
depository institution to terminate a specific customer account
or a group of customer accounts based on a belief that the
customer or customers pose a threat to national security, or
are otherwise described under subsection (a)(2), neither the
depository institution nor the appropriate Federal banking
agency may inform the customer or customers of the
justification for the customer's account termination.
(d) Reporting Requirement.--Each appropriate Federal banking agency
shall issue an annual report to the Congress stating--
(1) the aggregate number of specific customer accounts that
the agency requested or ordered a depository institution to
terminate during the previous year; and
(2) the legal authority on which the agency relied in
making such requests and orders and the frequency on which the
agency relied on each such authority.
(e) Definitions.--For purposes of this section:
(1) Appropriate federal banking agency.--The term
``appropriate Federal banking agency'' means--
(A) the appropriate Federal banking agency, as
defined under section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813); and
(B) the National Credit Union Administration, in
the case of an insured credit union.
(2) Depository institution.--The term ``depository
institution'' means--
(A) a depository institution, as defined under
section 3 of the Federal Deposit Insurance Act (12
U.S.C. 1813); and
(B) an insured credit union.
SEC. 3. AMENDMENTS TO THE FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND
ENFORCEMENT ACT OF 1989.
Section 951 of the Financial Institutions Reform, Recovery, and
Enforcement Act of 1989 (12 U.S.C. 1833a) is amended--
(1) in subsection (c)(2), by striking ``affecting a
federally insured financial institution'' and inserting
``against a federally insured financial institution or by a
federally insured financial institution against an unaffiliated
third person''; and
(2) in subsection (g)--
(A) in the header, by striking ``Subpoenas'' and
inserting ``Investigations''; and
(B) by amending paragraph (1)(C) to read as
follows:
``(C) summon witnesses and require the production
of any books, papers, correspondence, memoranda, or
other records which the Attorney General deems relevant
or material to the inquiry, if the Attorney General--
``(i) requests a court order from a court
of competent jurisdiction for such actions and
offers specific and articulable facts showing
that there are reasonable grounds to believe
that the information or testimony sought is
relevant and material for conducting an
investigation under this section; or
``(ii) either personally or through
delegation no lower than the Deputy Attorney
General, issues and signs a subpoena for such
actions and such subpoena is supported by
specific and articulable facts showing that
there are reasonable grounds to believe that
the information or testimony sought is relevant
for conducting an investigation under this
section.''.
Passed the House of Representatives February 4, 2016.
Attest:
KAREN L. HAAS,
Clerk.