[Senate Hearing 115-26]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 115-26


                   NOMINATIONS OF SIGAL P. MANDELKER,
  MIRA RADIELOVIC RICARDEL, MARSHALL BILLINGSLEA, AND HEATH P. TARBERT

=======================================================================

                                 HEARING

                               BEFORE THE
                               
                              COMMITTEE ON
                   BANKING,HOUSING,AND URBAN AFFAIRS
                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                                   ON

                            NOMINATIONS OF:

 Sigal P. Mandelker, of New York, to be Under Secretary for Terrorism 
         and Financial Intelligence, Department of the Treasury

                               __________

  Mira Radielovic Ricardel, of California, to be Under Secretary for 
             Export Administration, Department of Commerce

                               __________

   Marshall Billingslea, of Virginia, to be Assistant Secretary for 
            Terrorist Financing, Department of the Treasury

                               __________

Heath P. Tarbert, of Maryland, to be Assistant Secretary, International 
          Markets and Development, Department of the Treasury

                               __________

                              MAY 16, 2017

                               __________

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                                Affairs
                                
                                
  
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            COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS

                      MIKE CRAPO, Idaho, Chairman

RICHARD C. SHELBY, Alabama           SHERROD BROWN, Ohio
BOB CORKER, Tennessee                JACK REED, Rhode Island
PATRICK J. TOOMEY, Pennsylvania      ROBERT MENENDEZ, New Jersey
DEAN HELLER, Nevada                  JON TESTER, Montana
TIM SCOTT, South Carolina            MARK R. WARNER, Virginia
BEN SASSE, Nebraska                  ELIZABETH WARREN, Massachusetts
TOM COTTON, Arkansas                 HEIDI HEITKAMP, North Dakota
MIKE ROUNDS, South Dakota            JOE DONNELLY, Indiana
DAVID PERDUE, Georgia                BRIAN SCHATZ, Hawaii
THOM TILLIS, North Carolina          CHRIS VAN HOLLEN, Maryland
JOHN KENNEDY, Louisiana              CATHERINE CORTEZ MASTO, Nevada

                     Gregg Richard, Staff Director

                 Mark Powden, Democratic Staff Director

                      Elad Roisman, Chief Counsel

        John O'Hara, Chief Counsel for National Security Policy

              Kristine Johnson, Professional Staff Member

                Graham Steele, Democratic Chief Counsel

            Laura Swanson, Democratic Deputy Staff Director

               Colin McGinnis, Democratic Policy Director

                       Dawn Ratliff, Chief Clerk

                     Cameron Ricker, Hearing Clerk

                      Shelvin Simmons, IT Director

                          Jim Crowell, Editor

                                  (ii)


                            C O N T E N T S

                              ----------                              

                         TUESDAY, MAY 16, 2017

                                                                   Page

Opening statement of Chairman Crapo..............................     1

Opening statements, comments, or prepared statements of:
    Senator Brown................................................     3

                                NOMINEES

Sigal P. Mandelker, of New York, to be Under Secretary for 
  Terrorism and Financial Intelligence, Department of the 
  Treasury.......................................................     5
    Prepared statement...........................................    37
    Biographical sketch of nominee...............................    39
    Responses to written questions of:
        Senator Corker...........................................    84
        Senator Toomey...........................................    85
        Senator Sasse............................................    86
        Senator Menendez.........................................    88
        Senator Warren...........................................    89
        Senator Donnelly.........................................    92
Mira Radielovic Ricardel, of California, to be Under Secretary 
  for Export Administration, Department of Commerce..............     7
    Prepared statement...........................................    52
    Biographical sketch of nominee...............................    53
    Responses to written questions of:
        Chairman Crapo...........................................    93
        Senator Sasse............................................    94
        Senator Perdue...........................................    94
        Senator Warren...........................................    95
        Senator Donnelly.........................................    96
Marshall Billingslea, of Virginia, to be Assistant Secretary for 
  Terrorist Financing, Department of the Treasury................     8
    Prepared statement...........................................    60
    Biographical sketch of nominee...............................    62
    Responses to written questions of:
        Senator Sasse............................................    96
        Senator Warren...........................................    98
Heath P. Tarbert, of Maryland, to be Assistant Secretary, 
  International Markets and Development, Department of the 
  Treasury.......................................................    10
    Prepared statement...........................................    70
    Biographical sketch of nominee...............................    71
    Responses to written questions of:
        Senator Brown............................................   101
        Senator Warren...........................................   101
        Senator Donnelly.........................................   102

              Additional Material Supplied for the Record

Letters submitted in support of the nomination of Sigal P. 
  Mandelker......................................................   104
Letters submitted in support of the nomination of Mira Radielovic 
  Ricardel.......................................................   114
Letter submitted in support of the nomination of Marshall 
  Billingslea....................................................   116

                                 (iii)

 
 NOMINATIONS OF SIGAL P. MANDELKER, OF NEW YORK, TO BE UNDER SECRETARY 
 FOR TERRORISM AND FINANCIAL INTELLIGENCE, DEPARTMENT OF THE TREASURY; 
  MIRA RADIELOVIC RICARDEL, OF CALIFORNIA, TO BE UNDER SECRETARY FOR 
EXPORT ADMINISTRATION, DEPARTMENT OF COMMERCE; MARSHALL BILLINGSLEA, OF 
VIRGINIA, TO BE ASSISTANT SECRETARY FOR TERRORIST FINANCING, DEPARTMENT 
    OF THE TREASURY; HEATH P. TARBERT, OF MARYLAND, TO BE ASSISTANT 
  SECRETARY, INTERNATIONAL MARKETS AND DEVELOPMENT, DEPARTMENT OF THE 
                                TREASURY

                              ----------                              


                         TUESDAY, MAY 16, 2017

                                       U.S. Senate,
          Committee on Banking, Housing, and Urban Affairs,
                                                    Washington, DC.
    The Committee met at 10:03 a.m., in room SD-538, Dirksen 
Senate Office Building, Hon. Mike Crapo, Chairman of the 
Committee, presiding.

            OPENING STATEMENT OF CHAIRMAN MIKE CRAPO

    Chairman Crapo. This hearing will come to order.
    Congratulations to all of you on your nominations to these 
very important offices. I see friends and family behind you, 
and I welcome all of you here as well.
    This morning, we are going to consider four nominations:
    First, Ms. Sigal Mandelker. She is to be the Under 
Secretary of the Treasury for Terrorism and Financial Crimes.
    Second, Ms. Mira Ricardel. Did I get that right, Ricardel?
    Ms. Ricardel. Yes, sir. Thank you.
    Chairman Crapo. Thank you. To be Under Secretary of 
Commerce for Export Administration.
    Third, Mr. Marshall Billingslea, to be Assistant Secretary 
of Treasury for Terrorist Financing.
    And, finally, Mr. Heath Tarbert, to be Assistant Secretary 
of the Treasury for International Markets and Development.
    Again, welcome to all of you.
    Considering the nature of these nominations, especially in 
a time of heightened security in the international arena, we 
need to work together to process your nominations quickly.
    All four of these highly qualified nominees have extensive 
national security experience from their years spent in 
Government, supplemented by an understanding of the 
practicalities and specific commerce and finance requirements 
honed in the private sector.
    Ms. Mandelker's experience in senior law enforcement and 
national security positions equip her with the judgment 
necessary as Under Secretary to lead Treasury's Office of 
Terrorism and Financial Intelligence, the TFI, where she would 
oversee sanctions policy on Iran, Russia, North Korea, Syria, 
and some 25 other programs, including narcotraffickers, nuclear 
proliferators, and the like. Ms. Mandelker would also lead on 
the Nation's anti-money laundering efforts and other illicit 
financial threats.
    As Assistant Secretary, Mr. Billingslea would work with Ms. 
Mandelker to coordinate all elements of the national security 
and law enforcement community to develop and execute TFI 
policies and to conduct outreach strategies to address threats 
to the domestic and international financial system. Mr. 
Billingslea has worked jointly with Treasury elements in the 
past while he served in senior defense positions. This 
experience puts him in an excellent position to leverage these 
and other such relationships in the future.
    Mr. Tarbert has an in-depth knowledge of both international 
and domestic financial markets. He will be a great 
representative for the United States in international 
discussions on matters of financial services regulation and 
open investment. If confirmed, he will manage Treasury 
regulations affecting financial institutions, including 
systemic risk designations. He will also coordinate Treasury 
initiatives on financial education and overseeing the Terrorism 
Risk Insurance Program. And as if that were not enough, a 
critical part of Mr. Tarbert's job, and the reason for which 
his position was created by legislation passed in this 
Committee, is to marshal the procedures and processes of the 
multi-agency, Treasury-led Committee on Foreign Investment in 
the United States, or what we call ``CFIUS'', in a timely 
manner to protect our Nation from hostile foreign investment 
transactions designed to undermine the national security 
interests of the United States.
    Ms. Ricardel has extensive Government and private sector 
leadership experience in the national security arena necessary 
to lead the Commerce Department's Bureau of Industry and 
Security. The core mission of BIS is to ensure that sensitive 
dual-use items do not find their way into the hands of 
dangerous countries, organizations, and individuals in such a 
manner that still ensures the United States retains its 
innovative and productive capacity. Every decision will call 
for a national security, foreign policy, and fundamental 
business decision affecting the bottom line of companies, U.S. 
exports, and American jobs.
    All four of these positions are important to maintaining 
critical United States law enforcement and national security 
interests, while also preserving vibrant financial markets and 
cross-border transactions that can contribute greatly to the 
economic growth of the United States.
    While many people may not have heard of the exact positions 
to which each of you have been nominated, these are critical 
and sensitive national security positions within the United 
States financial system.
    Some have argued that candidates for such positions must be 
able to balance these security interests with supporting an 
environment for flexible and open financial and commercial 
transactions. The United States is not in the business of 
balancing its national security interests against anyone or 
anything; it assures them.
    In that context, you are also charged with preserving the 
integrity of a uniquely American financial and commercial 
environment respected the world over for its access and its 
certainty.
    None of the candidates here will ever wake up in the 
morning asking themselves why they are going to work. There is 
too much at stake in the perennial war on terror and in 
protecting our national interests.
    Thank you very much for accepting these difficult 
challenges and for your service to our country. I urge my 
colleagues to confirm you without delay.
    At this time I would like to ask unanimous consent to enter 
into the record six letters in support of the nominees. Without 
objection.
    Senator Brown.

               STATEMENT OF SENATOR SHERROD BROWN

    Senator Brown. Thank you, Mr. Chairman.
    Today the Banking Committee is meeting to do something it 
rarely or never did over the last 2 years: to assess the 
qualifications of four nominees that the President has put 
forward for key national security roles in the Treasury and 
Commerce Departments. These include:
    Ms. Sigal Mandelker, to be Treasury Under Secretary for 
Terrorism and Financial Crimes. Welcome.
    Mr. Marshall Billingslea, to serve as Treasury Assistant 
Secretary for Terrorist Financing. Welcome to you.
    Mr. Heath Tarbert, to be Treasury Assistant Secretary for 
International Markets. Welcome, Mr. Tarbert.
    And Ms. Mira Ricardel, to serve as Commerce Under Secretary 
for Export Administration. Welcome to the Committee.
    As you will introduce them, Mr. Chairman, I will not spend 
more time on their distinguished backgrounds. I will join you 
in thanking the nominees for their willingness to serve and in 
welcoming them and their family members to our Committee. I am 
pleased we appear to be returning to the Banking Committee's 
long tradition of giving Administration appointees full, fair, 
and prompt consideration. For the last 2 years, this Committee 
slow-walked, and more precisely in many cases stonewalled, the 
President's nominations for key positions in our jurisdiction. 
Perhaps the most reprehensible was Adam Szubin, who testified 
before one of our Subcommittees last week. He was denied a 
Committee vote for many months, then was never considered by 
the Senate--all this despite broad bipartisan support for him 
and the superb work he did in the terrorism and illicit finance 
arena at Treasury for many years. This Committee's dereliction 
of duty during that period was reprehensible.
    Considering the volatile situations in North Korea and 
Syria and Iran, and with non-State actors like ISIS, I am all 
for getting these important national security nominees in 
place. How fast we do so likely depends in part on how quickly 
Treasury satisfies a bipartisan request for certain financial 
information on the Russia investigation by the Intelligence 
Committee. I share Senator Warner's views on this. I hope that 
information is provided without further delay.
    As Under Secretary for Terrorism and Financial Crimes, Ms. 
Mandelker would oversee the Office of Terrorism and Financial 
Intelligence. With 700 employees, this office marshals 
Treasury's intelligence and enforcement functions. Its twin 
aims are to safeguard the financial system against illicit use 
and to combat threats from rogue Nations, terrorist 
facilitators, weapons of mass destruction proliferators, money 
launderers, and drug kingpins. It is also perhaps the most 
important role in the U.S. Government to ensure that economic 
measures like sanctions are applied effectively against our 
adversaries.
    Mr. Billingslea's role alongside Ms. Mandelker will also be 
critical. He has been selected for a position as the head of a 
unit that does outreach across all elements of the national 
security community, including law enforcement, regulatory, 
policy, diplomatic, and intelligence communities, and with the 
private sector and foreign Governments to identify and address 
illicit finance threats within the international finance 
system.
    Mr. Tarbert has been nominated to be Treasury Assistant 
Secretary for International Markets and Development. If 
confirmed, he would be responsible for leading Treasury's 
efforts related to the Committee on Foreign Investment in the 
United States, CFIUS, as well as international financial 
services regulation, trade, development, technical assistance, 
and climate finance. CFIUS continues to play a vital role 
reviewing foreign investments that could threaten our national 
security. We should be concerned when investments come from 
entities with ties to the Chinese Government and State-owned 
enterprises. We have already seen attempts by foreign entities 
to acquire businesses and real estate of senior Administration 
officials.
    In addition, after the financial crisis, as economies 
around the world continue to recover, it is essential that 
Treasury engage with our international counterparts to conduct 
strong financial services oversight. I expect the U.S. will 
continue to pursue strong rules and not support a race to the 
bottom that put the world's financial institutions at risk.
    Finally, as Under Secretary for Export Administration, Ms. 
Ricardel would oversee the Commerce Department's Bureau of 
Industry and Security. BIS is a licensing, regulatory, and 
enforcement agency that works to ensure an effective export 
control and treaty compliance system and promotes U.S. 
technology leadership and a strong industrial base.
    Again, I welcome the nominees to the Committee. I look 
forward to hearing from them. Thank you.
    Chairman Crapo. Thank you very much, Senator Brown.
    And with that, I need to administer an oath, so would each 
of you please stand and raise your right hand? Do you swear or 
affirm that the testimony you are about to give is the truth, 
the whole truth, and nothing but the truth, so help you God?
    Ms. Mandelker. I do.
    Ms. Ricardel. I do.
    Mr. Billingslea. I do.
    Mr. Tarbert. I do.
    Chairman Crapo. And do you agree to appear and testify 
before any duly constituted Committee of the senate?
    Ms. Mandelker. I do.
    Ms. Ricardel. I do.
    Mr. Billingslea. I do.
    Mr. Tarbert. I do.
    Chairman Crapo. Thank you. You may take your seats.
    Your written statements will each be made a part of the 
record, and as I believe you have been informed, I ask you to 
try to keep your oral comments today to 5 minutes. We have a 
lot of Senators, who I also remind to keep their questioning to 
5 minutes.
    And before you begin your statements--we will go in the 
order that you are seated. Before you begin your statements, 
you are welcome to introduce anyone of your family who is here, 
if you would like, and we will start with you, Ms. Mandelker.
    Ms. Mandelker. Thank you, Chairman. I have a number of 
people here, my brother, my father, and my niece.
    Chairman Crapo. Thank you very much. We welcome you here. 
You have got to be very proud.
    Please proceed.
    Ms. Ricardel. Thank you, Mr. Chairman. I am honored to 
introduce my husband, Vincent; my mother, Brigitta; my brother 
and sister-in-law, and my aunt and uncle. And I am so honored 
to have their love and support and have them here today. Thank 
you.
    Chairman Crapo. Thank you.
    Mr. Billingslea.
    Mr. Billingslea. Thank you, Chairman. I am joined by my 
wife, Karen, and my youngest daughter, Elsa, and my oldest 
daughter, Morgan; and my sister, who is in the very back.
    Chairman Crapo. Thank you.
    Mr. Tarbert.
    Mr. Tarbert. Thank you, Mr. Chairman. I am joined by my 
wife, Kate; my 5-year-old son, Ben; my mother, Pat Tarbert; my 
brother, Colin Tarbert; and my sister-in-law, Bonnie Tarbert.
    Chairman Crapo. Well, thank you. And you are each honored 
by your family who are here to support you, and I know that 
they, as I just indicated, are all very proud of you. We 
appreciate, again, your willingness to be of service to your 
country.
    Let us start with the testimony then, and, Ms. Mandelker, 
please proceed.

   STATEMENT OF SIGAL P. MANDELKER, OF NEW YORK, TO BE UNDER 
SECRETARY FOR TERRORISM AND FINANCIAL INTELLIGENCE, DEPARTMENT 
                        OF THE TREASURY

    Ms. Mandelker. Thank you very much. Thank you, Chairman 
Crapo, Ranking Member Brown, and Members of the Committee. It 
is a great honor to appear before you as the President's 
nominee to lead the Office of Terrorism and Financial 
Intelligence. I want to thank the President and the Secretary 
for their trust and confidence in me. I have had the 
opportunity to meet with so many of you over the last few 
weeks, and I want to thank you for the courtesies that you have 
shown me. And I also look forward to working very closely with 
this Committee if I am honored to be confirmed.
    I also want to say I am very grateful for the tremendous 
support of my family and friends, including those who traveled 
to attend this hearing. I want to recognize in particular two 
of my heroes and constant sources of inspiration: my father, 
Gershon Mandelker, who is here today, and my wonderfully lovely 
mother who passed away 12 years ago. Both of them were 
Holocaust survivors who spent part of their childhood hiding 
underground, in the forest, and elsewhere in constant fear for 
their lives as they tried to escape the Nazis. My dad tells one 
story about how he was hiding in a barn. The head of a village, 
a very courageous man, had agreed to hide my dad, my 
grandfather, and several others. And as they were hiding, a 
group of soldiers came to the barn because they wanted to see 
whether or not that was a good place to park their guns and 
their horses. And so my dad hid under a haystack, and he very 
distinctly remembers the soldiers coming in, walking around, 
looking, and then ultimately decided that that is not where 
they were going to put their horses. But he has a vivid memory 
of watching the boots of one of those soldiers. If my dad had 
so much as sneezed in that moment, I can assure you I would not 
be here today, and my dad would not be here proudly sitting 
beside me.
    I grew up hearing about these stories of my parents, their 
stories of survival and how they narrowly avoided death. 
Unfortunately, many members of my family did not survive. Three 
of my grandparents who were either killed or died as a result 
of the Holocaust. But I can say that with this history, my 
parents not only survived, but they went on to pursue 
successful careers in Pittsburgh. They gave us a very normal 
life, and they were incredibly positive role models. They 
raised my brother and me with enormous love and a deep 
appreciation for the opportunities that our great Nation 
provides and the knowledge that we should never take for 
granted our safety, security, and our freedom. I carry this 
legacy, which is an important one, with me always, and as I 
have told some of you, it is really what has motivated me to 
public service, for I think that the opportunity to make a 
difference is incredibly humbling, especially when we consider 
the kinds of threats that we face today.
    After 9/11, like so many other Americans, I wanted nothing 
more than to contribute to the response to this terrible attack 
on our Nation. After finishing my clerkship on the Supreme 
Court, I immediately went to work for the Justice Department in 
August of 2002, where I joined in its counterterrorism and 
national security mission in positions in both the Criminal 
Division and later the Deputy Attorney General's Office. With 
the Nation on high alert for follow-on attacks, I was 
privileged to work as part of the dedicated team that oversaw 
all of the country's counterterrorism and national security 
criminal cases, including those involving the illicit financing 
of terrorism.
    Among other positions that I held in the Government, I was 
also a counselor to the Secretary of Homeland Security, where I 
had a very similar focus. And then in 2006, I returned to the 
Justice Department to be Deputy Assistant Attorney General in 
the Criminal Division, where I supervised four major sections, 
again, touching on the many issues that I will be confronted 
with should I be confirmed, including just by way of example 
cybersecurity, human rights money laundering, among other 
cases. Then in 2009, I joined the private sector, where I 
gained valuable and practical insights into the compliance 
issues that financial institutions and other companies face on 
a regular basis.
    I am particularly honored to be nominated for this 
position, which serves such an important function in our 
national security, foreign policy, and economic apparatus. If 
confirmed, I will strategically and tactically marshal all of 
the tools of the Office of Terrorism and Financial Intelligence 
and will constantly evaluate how to evolve those tools to meet 
new challenges, and to always be proactive, intelligence 
driven, and results oriented. I am also very much looking 
forward to leading the many talented and dedicated career 
professionals in the Office of Terrorism and Financial 
Intelligence. And, of course, I look forward to working both 
closely with this Committee and with the interagency to make 
sure that we are effectively executing those tools in order to 
meet the objectives that we set for ourselves and for the 
country.
    Thank you.
    Chairman Crapo. Thank you, Ms. Mandelker.
    Ms. Ricardel.

  STATEMENT OF MIRA RADIELOVIC RICARDEL, OF CALIFORNIA, TO BE 
   UNDER SECRETARY FOR EXPORT ADMINISTRATION, DEPARTMENT OF 
                            COMMERCE

    Ms. Ricardel. Thank you. Mr. Chairman, Ranking Member 
Senator Brown, Senators of the Committee, it is a distinct 
privilege and truly humbling experience to come before this 
Committee to be considered for Under Secretary of Commerce for 
Export Administration. I am deeply honored to have been 
nominated by President Donald Trump and greatly appreciate the 
confidence that has been placed in me by the President and 
Secretary of Commerce Wilbur Ross.
    When I served as legislative assistant to Republican Leader 
Bob Dole, I did not imagine that the future might hold this 
opportunity, that one day I would not be preparing questions 
but answering them. Perhaps my late father might have thought 
this possible, not only because of his bias toward his 
daughter, but because he was always optimistic about what was 
possible in this great Nation--a view that carried him from 
communist-controlled Croatia via Germany to the United States, 
with little more than optimism in his pockets.
    I wish to thank Senator Bob Dole for teaching me so much 
about leadership, integrity, and fairness. I learned hands-on 
that building bipartisan coalitions is essential to progress 
and reaching agreements. This lesson informed how I approached 
issues as a member of his staff and also how later I approached 
working within the U.S. Government interagency while serving at 
the Department of Defense. The ability to understand and 
balance the equities of U.S. agencies and drive toward 
solutions that strengthen U.S. national security is vital.
    The role of the Under Secretary of Commerce for Export 
Administration is consequential and one in which I will be able 
to leverage my experience and skills if confirmed. The Bureau 
of Industry and Security advances U.S. national security and 
economic objectives by ably managing and ensuring effective 
export control systems, supporting treaty compliance, and 
enforcing sanctions. The Bureau's responsibilities are executed 
in close cooperation with a wide range of departments and 
agencies, including the Departments of Treasury, Justice, 
State, Defense, and Homeland Security.
    The recent announcement by Secretary Ross of record 
criminal and civil penalties against ZTE Corporation is the 
culmination of 6 years of investigation and highlights the 
crucial functions of the Bureau's Office of Export Enforcement. 
Last year, the Bureau's Export Administration office processed 
nearly 33,000 license applications related to dual-use items 
and items that had previously been on the U.S. Munitions List. 
The U.S. retains jurisdiction over re-exports of U.S. origin 
goods abroad; this is an indispensable tool to address the 
potential diversion of items to our adversaries who might use 
them against U.S. military forces abroad or in the development 
of weapons of mass destruction.
    Important also is that the licenses processed by the Bureau 
of Industry and Security enable exports of U.S. goods, and 
these exports mean jobs for American workers. As a former 
employee of an aerospace company, I can appreciate the impact 
of exports on jobs. At the same time, the health of the U.S. 
defense industrial base is imperative, and in that regard, 
under Secretary Ross' initiative, the Bureau of Industry and 
Security has launched two investigations on steel and aluminum 
imports under Section 232 of the Trade Expansion Act. In 
addition, the Bureau regularly conducts studies on other areas 
of the U.S. industrial base.
    Secretary Ross recently said, ``Under President Trump's 
leadership, we will be aggressively enforcing strong trade 
policies with the dual purpose of protecting national security 
and protecting American workers.'' If confirmed, I will act 
vigorously to enforce U.S. export controls, embargoes, and 
sanctions, as well as continuously promote and advance policies 
that support U.S. industries and technologies and the American 
workers who are the foundation of our industrial base.
    Mr. Chairman, Senator Brown, and Senators of this 
Committee, thank you for your consideration of my nomination. I 
would be pleased to answer any questions the Committee may 
have.
    Chairman Crapo. Thank you, Ms. Ricardel.
    Mr. Billingslea.

STATEMENT OF MARSHALL BILLINGSLEA, OF VIRGINIA, TO BE ASSISTANT 
 SECRETARY FOR TERRORIST FINANCING, DEPARTMENT OF THE TREASURY

    Mr. Billingslea. Thank you. Chairman Crapo, Ranking Member 
Brown, and members of the Committee, I am honored to appear 
before you today as the President's nominee for Assistant 
Secretary of the Treasury for Terrorist Financing.
    Senators, at the outset, I thank my family--I introduced my 
wife, Karen, and my two daughters, Morgan and Elsa--for 
supporting my decision to accept the President's nomination. 
These positions require significant family sacrifice, and I 
could not undertake this without their love and their backing.
    Unfortunately, my mother and father could not be here 
today, but I am very happy that my sister, Rachel--who is a 
career Pentagon official--is present. Rachel and her husband, 
Craig, who is a chief warrant officer, have collectively served 
more than 5 years in Afghanistan and Iraq, both together and 
apart during their marriage, helping keep our Nation safe from 
the terrorist threat. They are, in my view, Senators, great 
Americans who have sacrificed much to protect our Nation.
    By way of background, Rachel and I were born and raised in 
Montgomery, Alabama, as your constituents, Senator Shelby. Our 
father, Oliver, is the son of a cotton farmer and was, in fact, 
the first to graduate from college. Our mother, Nancy, Senator 
Brown, hails from Xenia, Ohio, where I am proud to say that 
today we have a very large extended family and do family 
reunions out there when we can. From our parents I learned the 
value of stoicism and hard work, and I am deeply grateful to 
them for the sacrifices that they made over the years that have 
allowed me to be here today.
    I have had the opportunity over the past weeks to meet with 
several Members of the Committee, and I greatly appreciate that 
chance and the opportunity to understand the issues that you 
feel are most important with respect to the Treasury Department 
and terrorist financing. And if confirmed, I look forward to 
working with all Members of the Committee, and with your staff, 
on this crucial national security issue.
    There are four brief points that I would like to stress for 
you this morning with regard to my nomination.
    First is that I understand the criticality of close, 
bipartisan working relationships both within the and with 
Congress. From 1995 to 2001, as the Senior Professional Staff 
Member for National Security Affairs on the Foreign Relations 
Committee, I drafted multiple pieces of sanctions legislation, 
most of which were subsequently enacted into law with 
overwhelming bipartisan support. The focus of these statutes 
was, and remains today, to combat the proliferation of weapons 
of mass destruction and missile systems and to disrupt foreign 
terrorist and trafficking networks.
    Second, I appreciate how important are financial and 
economic tools in the fight against terrorism. After 9/11, I 
served as the Principal Deputy Assistant Secretary for Special 
Operations and Low Intensity Conflict. Disruption of the terror 
network's financing operations featured heavily in our day-to-
day operations and our planning. And, in fact, working very 
closely with multiple Treasury offices, this Committee had not 
yet created the position to which I have been nominated. That 
was done a few years later. I established the first DOD Counter 
Threat Finance cell, with a detailee from Treasury playing a 
critical role.
    Third, ``buy-in'' from friendly Nations is crucial to the 
work of the office. At NATO, from 2003 to 2006, I served as our 
Assistant Secretary General for Defense Investment, and my time 
at NATO taught me the importance of forging close working 
relationships with officials from across the Alliance. Many of 
these officials remain in office today overseas and I believe 
will be in a position to assist the United States in many of 
the various initiatives that are either underway or which need 
to be undertaken.
    Finally, disrupting terrorist finance and illicit trade 
requires working closely with the private sector, as the 
Chairman mentioned in his opening remarks. Since 2009, I have 
served as a managing director at Deloitte, where I lead the 
Federal Business Intelligence Services group. We perform due 
diligence into third parties on behalf of both Federal 
departments agencies--the counterintelligence community, for 
example--but also for commercial clients, and the purpose of 
this is to protect against doing business with entities accused 
of corruption, of narcotics trafficking, of money laundering, 
of child or slave labor activities, or other worrisome matters. 
So I bring close working relationships across the global 
financial services sector, and I will leverage those 
connections to advance our national security agenda.
    In conclusion, Chairman and Ranking Member Brown, I greatly 
appreciate the opportunity afforded by your Committee to appear 
before you today as your consider my nomination. Over the past 
22 years, I have had the privilege of working closely with the 
Department of the Treasury on multiple terrorist financing and 
financial crimes issues, and I believe I bring a unique 
combination of both legislative as well as executive branch and 
private sector experience to the role. If confirmed by the 
Senate, I will work very closely with this Committee to drive 
the policies and actions necessary to disrupt illicit finance 
and terror networks.
    Thank you, sir.
    Chairman Crapo. Thank you, Mr. Billingslea.
    Mr. Tarbert.

  STATEMENT OF HEATH P. TARBERT, OF MARYLAND, TO BE ASSISTANT 
SECRETARY, INTERNATIONAL MARKETS AND DEVELOPMENT, DEPARTMENT OF 
                          THE TREASURY

    Mr. Tarbert. Chairman Crapo, Ranking Member Brown, and 
distinguished Members of the Committee, I am honored to appear 
before you today. I am humbled by the confidence the President 
has shown in me by nominating me to be the next Assistant 
Secretary of the Treasury for International Markets and 
Development.
    I appear before you today with full recognition of the 
serious responsibilities associated with the position. If 
confirmed as Assistant Secretary, I would lead nine of the 
Treasury Department's offices charged with protecting and 
supporting foreign investment in the United States, reducing 
global financial instability, fostering international economic 
development, and managing key global challenges. I believe that 
my professional background and desire to serve our country will 
enable me to perform this role and work to keep our country 
safe and prosperous.
    While growing up in Baltimore, my family emphasized hard 
work, education, and the importance of public service at every 
level of Government. Both of my grandfathers fought in World 
War II--one with the Army in Europe, one with the Navy in the 
Pacific. One of my uncles was a police officer, another a 
firefighter. My father went to night school to become an 
accountant and eventually served as Comptroller of the Maryland 
Port Administration and of the Baltimore County Community 
College System. Although my father passed away after a 
courageous battle with cancer, his commitment to public service 
remains a guiding example for me.
    Each of my adult guests today is or has been a public 
servant. My mother retired as a child support enforcement 
officer, my sister-in-law is a public school teacher, and my 
brother just completed a term as deputy mayor of Baltimore for 
economic and neighborhood development. Finally, my wife, Kate, 
and I met clerking for the U.S. Court of Appeals here in 
Washington. Now a full-time mom to our two young sons, she has 
served in the Justice Department and as a law clerk to the 
Chief Justice of the United States. I have been inspired by 
their dedication to public service as well.
    I myself have had the privilege of serving in all three 
branches of the Federal Government. One of my most enjoyable 
jobs in public service was working as Special Counsel to this 
Committee back in 2009 and 2010. During that period, I had the 
privilege of working closely with Banking Committee staff 
members and legislative assistants on both sides of the aisle 
on a number of important international economic issues. And it 
was especially an honor to serve under your leadership, Senator 
Shelby.
    Since leaving the Banking Committee staff, I have practiced 
as a regulatory compliance lawyer, with a chief focus on 
international markets. In this role, I have assisted public and 
private sector institutions from outside the United States make 
investments in our country that created jobs for working 
Americans and their families. I have also helped financial 
services companies around the world comply with regulatory and 
supervisory measures intended to make them safer and sounder, 
thereby reducing or eliminating the possibility of future 
taxpayer bailouts. In addition, I have designed compliance 
programs aimed at detecting and preventing money laundering and 
terrorist financing.
    If confirmed as Assistant Secretary of the Treasury, I hope 
to work closely with this Committee, others in the Senate and 
House of Representatives, and my colleagues in the 
Administration to carry out my responsibilities.
    Thank you again for the opportunity to appear before you 
today. I am happy to answer any questions you may have.
    Chairman Crapo. Thank you, Mr. Tarbert.
    For my 5 minutes of questioning, I would like to give each 
one of you about a minute to just respond briefly to me about 
what you see as your top one or two priorities in assuming 
office. What would you use your minute for to discuss this? We 
will start with you, Ms. Mandelker.
    Ms. Mandelker. Thank you, Chairman. I will try to fit it in 
in a minute. I will have, of course, many priorities. But first 
and foremost, I want to focus very immediately on the areas 
that pose the greatest threats. That is, of course, North 
Korea, Iran, ISIS, Syria, Russia. I will immediately ask for a 
briefing from the folks in the Intelligence Office that I will 
be supervising so I can understand where we are in intelligence 
in the area of threat finance.
    I will also immediately want to gather all folks from all 
of the components of TFI so I can understand, number one, what 
are we doing in any particular area, what do we propose to the 
interagency, what are our gaps, our vulnerabilities, and how 
can we increase pressure using the wide array of tools, not 
just sanctions, of course--FinCEN has a number of tools. TFFC 
is very engaged internationally. And I will want to put myself 
right in the middle of that so I can lead them in the right way 
and continue to think innovatively and strategically and 
tactically as to how we can further our national security 
interests.
    Chairman Crapo. Thank you.
    Ms. Ricardel.
    Ms. Ricardel. Thank you. Through the use of effective 
export controls and enforcement, we need to be sure that we are 
preventing the export of technology and goods to terrorists and 
stemming the flow of weapons of mass destruction, while at the 
same time protecting U.S. critical technologies and 
competitiveness. I think it is very important as an early step 
to see whether there are sufficient resources allocated to do 
these important functions, to assess whether there are 
potential gaps that could be filled with stricter restrictions, 
for example, on the export of goods, at the same time assessing 
the state of the industrial base, getting up to speed on what 
the internal assessments are currently on critical areas. And I 
look forward to also consulting with the Committee on areas of 
concern, if confirmed, to see what will be on your priority 
list.
    Chairman Crapo. Thank you.
    Mr. Billingslea.
    Mr. Billingslea. Thank you, Mr. Chairman. I was in the 
Pentagon the day they slammed the plane into the building, and 
I think if you had told me at the time that we would today and 
potentially my daughters would be facing the threat of 
terrorism, I am not sure I would have believed you at the time. 
The reason I have agreed to accept this nomination and come 
before you today is because I am absolutely committed. We live 
in a very dangerous world today, and I believe we have to apply 
every potential source of leverage to deal with both terrorist 
threats as well as State sponsors of terrorism, as well as 
Nation States who are engaged in unacceptable behaviors.
    And so I share Ms. Mandelker's priorities, and disrupting 
these networks will be my absolute and unrelenting focus, if 
confirmed.
    Chairman Crapo. Thank you.
    Mr. Tarbert.
    Mr. Tarbert. If confirmed, Mr. Chairman, I believe my top 
priority would be to ensure that the Office of Investment 
Security and the CFIUS process more generally has the resources 
and tools it needs to perform the function that Congress 
intended it to.
    Chairman Crapo. All right. Thank you very much. In fact, 
you all kept within the time limits.
    Senator Brown, I am going to yield a minute back.
    Senator Brown. Thank you, Mr. Chairman.
    Since my time is short, I would appreciate a yes or no 
answer from each of you on a handful of questions. If you would 
like to expand your answer, feel free, but please do it in 
writing, if you would. And remember, you are under oath. I will 
start with you, Ms. Mandelker, and just work my way down.
    Do you commit to reply to every oversight or other letter 
and request for information from me and from all other Members 
of the Banking Committee in a timely manner?
    Ms. Mandelker. Yes, I do.
    Ms. Ricardel. Yes, I do.
    Mr. Billingslea. Yes, sir.
    Mr. Tarbert. Yes.
    Senator Brown. Thank you. Do you commit to alert the 
Committee of any attempt by the White House to interfere with, 
to stall, or to change responses from your Department for 
oversight information that has been requested by Congress? Do 
you commit to alert the Committee of any attempt like that?
    Ms. Mandelker. Well, Senator, I commit to working very 
closely with this Committee, and should any issue like that 
arise, I would think that we would have some consultation.
    Senator Brown. That is not quite a yes.
    Ms. Mandelker. Well, I would, of course, want to consult 
with the Department----
    Senator Brown. If the White House tries to interfere or 
change responses by your Department, would you notify this 
Committee?
    Ms. Mandelker. Well, Senator, I would work very closely 
with this Committee on a wide range of issues. I would want to 
consult with the Secretary in any such case, and I will commit 
to doing that.
    Ms. Ricardel. Senator, I do not anticipate that this kind 
of an issue would come up, that there would be any interference 
in that way. I would execute, if confirmed, my duties within 
the authorities of the Bureau.
    Senator Brown. Mr. Billingslea.
    Mr. Billingslea. Senator, as the Under Secretary nominee 
has indicated, within those parameters, yes, sir.
    Mr. Tarbert. Again, within those parameters, yes, sir.
    Senator Brown. Also, I would appreciate a yes or no on this 
bit more complicated question but one answerable that way. 
Unlike past Administrations that you have worked in, senior 
Government officials in this Administration have not divested 
themselves of many of their assets, some overseas, some with 
international partners, some unclear as to who the ultimate 
beneficial owner of an interest might be. The question is: Do 
you think it would be in the interest of those officials as 
well as the offices you will head to undertake a process to 
ensure that foreign entanglements are benign with respect to 
the laws you will enforce on terrorism, on money laundering, on 
sanctions, on CFIUS, and the like? Ms. Mandelker.
    Ms. Mandelker. Senator, again, I would have to consult with 
the ethics officials at the Department and elsewhere. I do not 
think that we should--I do not have any issues of that sort, 
and I would agree that----
    Senator Brown. But many in the Administration do, correct?
    Ms. Mandelker. I cannot--I cannot----
    Senator Brown. But you know the answer to that.
    Ms. Mandelker. Well, I cannot weigh in on that question. I 
have not seen their financials, of course.
    Senator Brown. But you read a lot. OK.
    Ms. Ricardel. Senator, I can speak for myself. My ethics 
letter reflects that I am going to divest of any assets that I 
have that could pose a conflict of interest, and I do not have 
insights into other people's personal finances.
    Mr. Billingslea. Senator, as my Committee questionnaire 
indicates, I am divesting, including going above and beyond 
what the Office of Government Ethics required.
    Mr. Tarbert. Senator, I plan to fully comply with all 
applicable ethical laws and regulations, and I would assume 
other public officials will as well.
    Senator Brown. I think you know from my question I am not 
challenging or concerned with the ethics of the four of you. I 
am concerned with ethics of others in the Administration that 
you have all read widely about and, frankly, I think perhaps 
made some of you not so certain perhaps that you wanted to sign 
up with this Administration. I will leave it at that.
    Ms. Mandelker, I am sure you have read the papers today. 
Can you tell me if an allied Nation in the Middle East or 
elsewhere shares sensitive intelligence with us on condition 
that they will control the sharing or release of it, and the 
U.S. then shares that information without permission of the 
country that originated it, do you think that would harm our 
future ability to gather similar intelligence from that ally 
and from others because it would undermine their confidence in 
our willingness to protect such information?
    Ms. Mandelker. Senator, that is a difficult question for me 
to answer. I would have to understand the underlying facts and 
circumstances and speak with the individuals who are experts in 
how we do share information with other countries.
    Senator Brown. I am not asking what might have happened in 
the Oval Office when the U.S. President asked the American 
media to leave and stayed there with the old Soviet news agency 
TASS. I am not asking about the specifics because we do not 
know for sure yet exactly what was said. But I am asking if, in 
fact, an allied Nation which shared sensitive intelligence with 
us on the condition that we not share it or release it without 
their approval, if they did it, would that harm our future 
ability to get information and gather similar intelligence from 
that ally or other allies?
    Ms. Mandelker. Again, Senator, in the absence of 
understanding any particular set of facts and circumstances, it 
is difficult for me to answer that question. Of course, we 
should be careful in how we share information with our allies 
and elsewhere, but I cannot answer a hypothetical when I do not 
understand all the complexities that are involved.
    Senator Brown. All right. Thank you.
    Chairman Crapo. Senator Shelby.
    Senator Shelby. Thank you, Mr. Chairman.
    I believe this is a great group, the four of you eminently 
qualified for your jobs here. I have a few questions, and I 
will start with you, Ms. Mandelker. You have been nominated to 
be the Under Secretary for Terrorism and Financial 
Intelligence. That is at Treasury. Tell us and share it with 
the American people who are watching how important the war on 
terrorism--that we win this war, that we contain it and try to 
destroy it and the connection to financial intelligence.
    Ms. Mandelker. Thank you for that question, Senator. It is, 
of course, incredibly important. It is what I dedicated myself 
to when I joined the Justice Department in 2002. I think that 
the Office of Terrorism and Financial Intelligence has 
tremendous tools which have been used very successfully since 
the office was stood up in 2004, and it is one that I would 
dedicate myself to every day.
    Senator Shelby. Ms. Ricardel, you have had great experience 
in the private sector but also starting out with the Majority 
Leader here in the U.S. Senate, Senator Dole. What do you 
believe will be your biggest challenge as Under Secretary of 
Commerce for Export Administration? Will it be protecting 
American business? Or what will it be?
    Ms. Ricardel. Thank you, Senator, and I appreciated the 
opportunity to meet with you the other day. I believe that 
strong national security requires a strong defense industrial 
base. So in a way, I do not see the question as either/or, 
protecting defense business or protecting our national 
security, because we need strong defense capabilities, and that 
is what our defense industry brings us with the right guidance.
    Senator Shelby. Mr. Billingslea, you bring broad experience 
into your nomination as Assistant Secretary of the Treasury for 
Terrorist Financing. Of course, a lot of this overlaps 
financial intelligence and what we do with it. But terrorists 
cannot go very far in today's modern world without financing, 
can they? They have got to have it one or the other. So your 
role has got to be central to our fight against terrorism all 
over the world globally.
    Mr. Billingslea. Thank you, Senator. Yes, I believe very 
strongly in the position that this Committee and the Congress 
has established and its value in supporting the Under 
Secretary, particularly in the diplomatic arena, engaging with 
Nations across the spectrum.
    If I may just very quickly add that we have come a long 
way--I remember the very first time I heard of a hawala and 
tried to understand what that was back 15 years ago. Our 
country has come a very long way in our ability to combat this 
kind of illicit finance.
    Senator Shelby. But the challenge goes on.
    Mr. Billingslea. The challenge goes on.
    Senator Shelby. The terrorists are very resourceful and 
very smart in a lot of ways, are they not?
    Mr. Billingslea. They are thinking--they are very thinking 
and creative people.
    Senator Shelby. And they are thinking in tomorrow's world 
through the Internet and everything that goes with it.
    Mr. Billingslea. Yes, sir.
    Senator Shelby. And that is our challenge.
    Mr. Billingslea. Absolutely, sir.
    Senator Shelby. Mr. Tarbert, you are no stranger to this 
Committee as you worked here before and you did a lot of great 
work. We are glad to have you back. What do you believe is 
going to be your biggest challenge?
    Mr. Tarbert. If confirmed, I think the biggest challenge 
would be really making sure that no investment gets approved as 
part of the CFIUS process that has any unresolved national 
security concerns, so to really make sure that there are no 
unresolved national security concerns before CFIUS certifies it 
to Congress.
    Senator Shelby. How do you balance that with the concerns 
of not exporting things that are so important to our national 
security with ordinary commerce? Isn't that part of the----
    Mr. Tarbert. The test right now focuses solely on national 
security, and so as I read the statute, it does not include 
considerations of commerce. But what I would say is that the 
very fact that CFIUS sits in the Treasury Department--the idea 
is we want to encourage foreign investment, and the only 
exception to that is where there is a national security issue.
    Senator Shelby. Do you believe that the CFIUS statute as 
now written, which we were all involved in on this Committee, 
is sufficient for your work?
    Mr. Tarbert. It is a great question, Senator Shelby. I 
understand there are discussions now about whether that is the 
case. There is also a GAO report due out. So, if confirmed, I 
would obviously want to ensure that the CFIUS process, first of 
all, is doing the job that Congress intended, but, second, 
whether there are any gaps.
    Senator Shelby. Would you work with this Committee on any 
deficiencies that are brought up and maybe we need to address?
    Mr. Tarbert. If confirmed, I absolutely would, Senator.
    Senator Shelby. Thank you, Mr. Chairman.
    Chairman Crapo. Thank you.
    Senator Reed.
    Senator Reed. Thank you very much, Mr. Chairman, and thank 
you all for your willingness to serve.
    I want to follow up with a variation on one of Senator 
Brown's questions, and I will go down the line. Are you aware 
of any formal or informal guidance from the White House that 
urges limiting or not responding to legitimate oversight 
letters from Members of Congress, particularly minority Members 
of Congress? We will begin with Ms. Mandelker.
    Ms. Mandelker. No, Senator, I am not.
    Senator Reed. Ma'am.
    Ms. Ricardel. No, sir, I am not.
    Mr. Billingslea. Senator, I am not.
    Senator Reed. Thank you.
    Mr. Tarbert. No, Senator Reed.
    Senator Reed. Thank you very much.
    Mr. Tarbert, in 2012, the U.S. Joint Economic Security 
Review Commission issued a report that essentially said a lot 
of the investment by Chinese companies is based on strategic 
rather than purely economic interests because of subsidies they 
receive from the Government, because many of them are entities 
of the Government in most respects. If this is the case, and if 
they are doing this, should we look again at our laws with 
respect to evaluating Chinese acquisitions of U.S. interests in 
U.S. companies?
    Mr. Tarbert. I think it is an excellent question, Senator. 
My understanding is that there are discussions now about 
pending legislation as well as a GAO report that is coming out, 
and I think one of the questions that was listed is the one 
that you are addressing.
    I do know that currently as part of the CFIUS process, 
which was required by this Committee in FINSA, State-owned 
enterprises automatically trigger a presumption of an 
investigation. But, if confirmed, I commit to working with this 
Committee to discuss this issue and others.
    Senator Reed. And you would sort of take the material that 
is being developed now and use that to advise us on statutory 
changes that might be necessary or you would use your current 
authority to try to resist these types of acquisitions?
    Mr. Tarbert. If confirmed, I would imagine I would do both.
    Senator Reed. Thank you.
    Ms. Mandelker, China is providing significant support to 
North Korea, and they are doing it through financial means; 
they are doing it through their banking system. How would you 
propose to disrupt this trade, which, if we do not, could lead 
us to a very serious confrontation on the peninsula?
    Ms. Mandelker. Thank you for that question, Senator. I 
share your concerns. I think it is very important to engage 
very proactively with China to curb the support that is going 
to North Korea. I note, of course, that Secretary Tillerson, 
the President, and others in the Administration have engaged in 
a very active dialog with the Chinese, and not just with China 
but also, of course, with other countries. In fact, over the 
weekend there was a call for all countries to enhance their 
sanctions regimes when it comes to curbing the North Korean 
threat.
    I think that we have to be very active in how we track, 
trace, and ultimately interdict illegal assets that are going 
to North Korea. We have to be very active in our enforcement of 
illicit actors that are violating our sanctions. We have to be 
very active in how we track down the intelligence, and we have 
to constantly consider what levers of pressure we are going to 
apply if other countries do not, in fact, abide by our call to 
further isolate North Korea.
    Senator Reed. Thank you very much.
    Ms. Ricardel, there have been changes recently in the items 
that can be sold, basically moving some items from the U.S. 
Munitions List, the State Department's, the Commerce-
administered list. Do you have any comments on those changes 
and any perspective about how you would enforce them?
    Ms. Ricardel. Senator, thank you. I am aware of the things 
that have been moved from the U.S. Munitions List, and my 
understanding is that there is still a vigorous export control 
enforcement process, whether it is on the Munitions List or on 
the Commerce Control List. Certainly, dual-use technologies are 
often challenging, but that is why there are controls not just 
on what the end use is, but also end users.
    Senator Reed. Thank you very much.
    Thank you, Mr. Chairman.
    Chairman Crapo. Thank you.
    Senator Tillis.
    Senator Tillis. Thank you, Mr. Chair. Thank you all for 
being here. I appreciate the three of you that were able to 
come into my office, and I am sorry, Ms. Ricardel, we were not 
able to meet together. But Robert Wilkie speaks very highly of 
you, and his opinion means a lot to me. So I thank you for 
being here and congratulations to the family.
    Ms. Ricardel. Thank you, Senator.
    Senator Tillis. I have a general question, and it relates 
to the current--the person in an acting capacity--we have in 
acting capacity. We are looking to confirm people to move into 
the organization. Can you very quickly down the line describe 
why you think it is problematic to maybe delay the 
confirmations and what that would prevent the head of the 
organizations that you are going to be confirmed to, how that 
would affect the day-to-day operations, either morale or 
execution? Mr. Tarbert, in your particular case, acting on the 
recommendations that come from the GAO? So just down the line 
why you would emphasize the importance of an expedient 
confirmation in your roles?
    Ms. Mandelker. Senator, I know from my prior experience 
having worked in the Government that it is very important to 
have your political appointees confirmed. The authority that 
somebody speaks with once they have been confirmed by the 
Senate is much greater. Your ability to engage in the right way 
with the international community is very much heightened when 
you have a confirmed person in that position. And I think that 
the career professionals within any department are looking for 
direction and leadership, and they want to know what their next 
steps are, where is the office going to be taken under the 
leadership of the new appointee, and it is very important to 
have that person in there as quickly as possible so that they 
can carry on and get to the--I am sure they are all dedicated 
and working very hard, but they can get to the business of 
understanding what the direction is going to be.
    Senator Tillis. Ms. Ricardel.
    Ms. Ricardel. Thank you. I would agree with my colleague's 
assessment on the internal and external aspects of this. Also, 
policymaking tends not to move forward when you have people in 
an acting capacity.
    Senator Tillis. Is it fair to say that we have some open 
switches on policy that we need to move forward on?
    Ms. Ricardel. Yes, sir.
    Senator Tillis. And every day delayed is a delay in policy 
that has probably got bipartisan support?
    Ms. Ricardel. I would agree with that assessment.
    Senator Tillis. Thank you.
    Mr. Billingslea. Senator, on top of that, events are moving 
ahead, and we have a worsening situation in North Korea, to 
name just one flash point, where incoming Administrations are 
in the process of--you know, they always contend with new 
issues, and this Administration is going through a review on a 
variety of issues. To the extent that this Committee trusts our 
judgment, it might be better to have us involved in those 
discussions sooner rather than later.
    Mr. Tarbert. I will not repeat all the things that my 
colleagues said, all of which I think go to your question. 
Specifically with respect to CFIUS, Congress enacted FINSA in 
2007 for the main reason of making sure that there was a 
Senate-confirmed appointee who would certify the transactions 
once approved. So that is an example of where specifically 
Congress had intended there to be a political appointee.
    Senator Tillis. So it sounds like to me consensus that a 
lot of--the threats are increasing every day, and you are going 
to be in very, very important roles that either affect our 
national security or homeland security or our economic 
relationships with other--in a global economy. So this delay, 
it seems to me, would not be healthy for the areas that you are 
being tasked with trying to improve our situation, our safety 
and security. I do not see anyone that wants to question that.
    I want to go to maybe a specific question, and, Heath, this 
is back to you, and it relates to CFIUS. You know, we are in an 
increasingly complex world where we want to attract global 
investment, but sometimes that global investment could wade 
into an area where we have to assess national security 
interests. How do we modernize or how do we get to a point--it 
could be about the data that a global investor may have access 
to. It could be about trade secrets, other things. How do you 
balance that and make sure that we have got a modern view of 
how that works? Because we are in a global data environment and 
economy so----
    Mr. Tarbert. It is an excellent question, Senator. I 
probably do not have a fulsome answer for you now, but I think 
you raise an excellent point, which is that we want to make 
sure for those foreign investments that do not raise actual 
national security issues that they are certified in a fast 
process so we can have foreign investment in the United States 
that creates jobs for American workers and families. Then, of 
course, we want to make sure that for those transactions that 
do raise genuine national security issues, that we take the 
time we need to really evaluate them.
    Senator Tillis. Ms. Ricardel, I was going to ask you a 
similar question, but my time has expired, and I admire the way 
the Chair keeps us on time.
    Chairman Crapo. I appreciate it. Thank you.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman. The nominees we 
are considering today are critical components of our national 
security and foreign policy, particularly in combating 
terrorism and implementing what I consider to be a peaceful 
tool of foreign diplomacy, including sanctions.
    And I would agree with the answer you gave Senator Tillis, 
Ms. Ricardel, in that had we not held up Adam Szubin, that 
being Republicans holding up Adam Szubin, for a critical 
position, there is a difference between someone who is acting 
or someone who has the full authority of the position. And so I 
wish that my colleagues had had the same focus and attention 
and commitment as they seem to have now. But at least it is a 
good moment to move to the understanding of the importance of 
these positions.
    Ms. Mandelker, if you are confirmed, you will oversee a 
wide range of financial tools that the United States 
strategically employs to target the finances, assets, 
laundering office of terrorist networks, dictators, other 
actors who facilitate nefarious activities against U.S. 
interests. I have often been not only the advocate but the 
architect of those sanctions in Iran, Russia, and North Korea. 
And what I want to hear from you is: Are you committed to 
robustly enforcing the law in all of its elements as it relates 
to these sanctions, these different financial consequences that 
we create on actors that are adverse to the national interests 
and security of the United States?
    Ms. Mandelker. Absolutely, Senator. That is one of the 
primary reasons I took on this job, because I am committed to 
robustly enforcing those authorities.
    Senator Menendez. And you will not only be someone who will 
be an implementer of the sanctions that Congress passes into 
law or that the President by Executive action does, but also 
you will be at a table in interagency processes in which there 
will be a role for you to be an advocate. When it is 
appropriate, will you be an advocate when we are looking to 
have a peaceful diplomacy tool against an adversary who defies 
the national interests of the United States? Will you be an 
advocate of using these different tools, sanctions, financial 
limitations, and whatnot, in that context?
    Ms. Mandelker. Yes, Senator, one of my primary roles will 
be to be that advocate within the----
    Senator Menendez. Can you commit to the Committee--the 
Office of Foreign Assets Control, which is an important office 
within the TFI, we have given it an overwhelming amount of work 
to do. They do exceptional work. I do not always agree with 
their decisions, but they do exceptional work. And so the 
question is--I am not sure that anybody has analyzed whether or 
not OFAC actually has the resources to do the work that is 
necessary to make sure that sanctions are enforced, because any 
law without enforcement is meaningless. Will you commit to the 
Committee upon confirmation to go ahead and review and 
understand whether they have the assets? And if they do, that 
is fine. But if they do not, that you will be an advocate for 
increasing their assets in order for us to see the law 
implemented?
    Ms. Mandelker. Yes, I will commit to doing that as well.
    Senator Menendez. Thank you very much.
    Mr. Tarbert, I am seriously concerned about--I want foreign 
investment in the United States, but I am seriously concerned 
when that foreign investment potentially undermines national 
security questions. The reality is with Russia we have seen 
escalated attacks on the United States, particularly in its 
cyberwarfare against the United States. I think that it would 
be naive to approach any potential acquisition, for example, by 
Russia of critical national security infrastructure when they 
have already demonstrated their affinity for executing 
cyberattacks to disrupt energy grids in Ukraine, using the 
Russian oil and gas industry to manipulate prices in Eastern 
European economies. We have seen that they are willing to do 
this in different parts of the world.
    Last year, due to increasing financial pressure as a result 
of Venezuela's financial crisis, PDVSA, the State-owned oil 
company, pledged nearly 50 percent of Citgo shares to Rosneft, 
which is a Russia State-owned oil company, in exchange for a 
loan. Not only do they have that 50 percent potentially if 
PDVSA defaults, the Venezuelan oil company, but they may have 
purchased additional shares on the open market, which puts them 
as a majority shareholder. They own Citgo in the United States 
which has 48 U.S. petroleum product terminals, three refineries 
in Texas, Louisiana, Illinois, nine pipelines throughout the 
country.
    Do you consider that possibility of Russia owning Citgo a 
clear element of what we should be looking at CFIUS to ensure 
that the national interests of the United States are not 
compromised?
    Mr. Tarbert. Senator, I will refrain from discussing any 
particular transaction, but what I would say is that, if 
confirmed, any covered transaction would be examined thoroughly 
for any national security concerns.
    Senator Menendez. Well, is this going to be the possibility 
of an instance of first impression, because we have already a 
foreign company, PDVSA, a Venezuela-owned company, owning 
Citgo. Now you would see the possibility of Russia owning that 
company as a result of a default of the debt obligation. And I 
would hope that if you are to be confirmed, you will make sure 
that we are ensuring that the critical infrastructure of the 
United States does not fall in the hands of a foreign 
Government that has shown its hostility to the United States.
    Mr. Tarbert. If confirmed, I would take all action as 
appropriate to ensure our national security interests are 
protected, including relying upon our intelligence community 
for reports on Nations that have hostile intentions.
    Senator Menendez. Thank you, Mr. Chairman.
    Chairman Crapo. Thank you.
    Senator Kennedy.
    Senator Kennedy. Thank you, Mr. Chairman.
    Thank you all for your service and for your past service. 
You all have very impressive resumes. If you could answer my 
questions in 30 seconds or less, I would be grateful. We only 
have 5 minutes.
    Ms. Mandelker--am I saying that right?
    Ms. Mandelker. Yes.
    Senator Kennedy. Is Iran cheating with respect to our 
nuclear agreement?
    Ms. Mandelker. Well, Senator, as I am sure you know, there 
is an ongoing review that is underway within the Administration 
now to evaluate the JCPOA and our Iran policy. I am not part of 
that process at this point. I would look forward to learning 
more about the answer to your question, should I be confirmed. 
But I do not have--I am not privy to the intelligence today. I 
am very concerned about the activity that we are seeing in 
Iran.
    Senator Kennedy. OK. That was pretty evasive. That is good.
    Do you think the International Atomic Energy Agency is 
doing a good job in terms of transparency and telling us what 
is going on?
    Ms. Mandelker. Again, I am not privy to the intelligence. I 
am not in the Administration----
    Senator Kennedy. I get it. I get it.
    Mr. Billingslea, does President Vladimir Putin have assets 
in the United States?
    Mr. Billingslea. Senator, I do not know that.
    Senator Kennedy. Who would know that in Government, either 
held in his name or in a nominee's name?
    Mr. Billingslea. That certainly is something that I would 
hope the intelligence community is investigating for the 
purpose of understanding where assets are held, not only in the 
United States but potentially in offshore accounts elsewhere in 
the world.
    Senator Kennedy. But let us start with the United States. 
You have had a lot of experience in Government. Do you believe 
that the U.S. Government has that information?
    Mr. Billingslea. I do not know if they have that 
information, Senator.
    Senator Kennedy. I know that, but I am asking you, based on 
your experience, if you think we likely do.
    Mr. Billingslea. I genuinely do not know. It depends on how 
clever he has been at hiding his assets.
    Senator Kennedy. All right. Well, let me ask you this: Tell 
me one more time where that information could be obtained if 
somebody had it.
    Mr. Billingslea. I would direct that question to Senator 
Coats, DNI Coats, the Director of National Intelligence.
    Senator Kennedy. OK. Mr. Tarbert, you have got a fine young 
man here. He has been very good. Can you give me your thoughts 
about Glass-Steagall?
    Mr. Tarbert. My understanding is that the Administration is 
considering a 21st century version of the Glass-Steagall Act. I 
do not have any insight into what that is. I know Members of 
this body have introduced legislation of perhaps a similar 
nature. I do not have any views at this point, but I look----
    Senator Kennedy. You do not have any opinion at all about 
it? You have written extensively. What do you think of----
    Mr. Tarbert. Well, my----
    Senator Kennedy. Good idea or bad idea? I am not asking you 
about the Administration. I am asking you.
    Mr. Tarbert. What I would say is that I believe that 
Federal deposit insurance should not subsidize nonbanking 
activities. Now, that is the current law of the land. It should 
not be controversial. I know there is a debate as to whether it 
has, in fact, been achieved. Glass-Steagall is obviously a 
prophylactic measure to address that, but it is not the only 
measure. So I look forward to seeing--I am not sure in my 
position, if confirmed, I would have any role in domestic 
financial legislation.
    Senator Kennedy. I know, but I have read your resume. You 
have got deep experience in this.
    Ms. Ricardel--am I saying that right?
    Ms. Ricardel. Yes, Senator.
    Senator Kennedy. Could you give me your thoughts, if you 
have any, about the Belt and Road Initiative? Is it going to 
work? Is it worth the money? Is it something that we should be 
concerned about in terms of geopolitical effects?
    Ms. Ricardel. Senator, I have only read some of the news 
reports. I would certainly want to look into it further, if 
confirmed, and see what intelligence we have on what other 
internal information we may have on it.
    Senator Kennedy. Do you know if Vladimir Putin has assets 
in the United States?
    [Laughter.]
    Ms. Ricardel. No, sir, I do not.
    Senator Kennedy. Do you know who I could talk to?
    Ms. Ricardel. I think my colleague directing you to 
Director Coats----
    Senator Kennedy. He was not asked that question----
    Ms. Ricardel. ODNI Director Coats would probably be the 
right place to start.
    Senator Kennedy. All right. Thank you, Mr. Chairman.
    Chairman Crapo. Thank you.
    Senator Tester.
    Senator Warren. He has offered to let me go ahead.
    Chairman Crapo. Senator Warren.
    Senator Warren. Thank you, Senator Tester, and thank you, 
Senator Warner. I appreciate it.
    So there are many questions about disturbing ties between 
the Trump administration and the Russian Government, and thanks 
to pressure from Congress, the Administration is currently 
enforcing sanctions on Russia. But I remain concerned that 
Russian influence could cause President Trump to roll back 
these sanctions.
    Russia's behavior has not changed. In fact, last week, the 
Commander of Cyber Command publicly told the Armed Services 
Committee that he had seen no reduction in Russian 
cyberattacks. We know that Russia hacked into the American and 
French systems to try to influence the outcome of national 
elections. We also know that Russia is still illegally 
occupying Ukraine territory.
    Ms. Mandelker, as far as you know, based on public 
information, is Russia still engaging in cyberattacks and 
violating Ukraine's territory?
    Ms. Mandelker. Well, Senator, ODNI Coats testified about 
that last week.
    Senator Warren. So is your answer yes?
    Ms. Mandelker. According to his testimony, they are still 
engaging in problematic cyberactivity. I, of course, do not 
have access to----
    Senator Warren. So the answer is yes----
    Ms. Mandelker. ----the intelligence myself.
    Senator Warren. OK. The answer is yes?
    Ms. Mandelker. According to ODNI Coats----
    Senator Warren. OK, according to all the information 
available. OK. So let me just ask then, should we roll back our 
existing Russia sanctions without meaningful changes in 
Russia's behavior?
    Ms. Mandelker. No, Senator, I do not think so. Secretary 
Tillerson has spoken to that particular issue, and I----
    Senator Warren. So you will strongly support keeping those 
sanctions in place unless Russia changes its behavior?
    Ms. Mandelker. Yes.
    Senator Warren. Good. If you are confirmed to this job, we 
are going to expect you to be tough on Russia.
    The nuclear deal between the United States, five other 
world powers, and Iran imposed limits on Iran's nuclear program 
and placed it under rigorous monitoring and inspections. Iran 
receives relief from economic sanctions as long as it remains 
in compliance with the agreement.
    Now, Donald Trump threatened to rip up the Iran deal, but 
last month, the Trump administration certified that Iran is 
complying with the nuclear deal, which is required for Iran to 
get sanctions relief and to keep the agreement intact.
    Ms. Mandelker, if confirmed, you are going to be in charge 
of the Iran sanctions enforcement at Treasury. So do you agree 
with the Trump administration's recent conclusion that Iran is 
complying with the nuclear deal?
    Ms. Mandelker. Senator, I would defer to the Secretary of 
State on that. I do not have any reason to doubt it, but, of 
course, I am not in the Administration. I do not have access 
to----
    Senator Warren. OK. But the Secretary of State has said, so 
you would at least presumptively say yes and agree? That is 
what you are telling me?
    Ms. Mandelker. Correct.
    Senator Warren. I just want to make sure.
    So we expect Iran to live up to its commitments in the 
nuclear agreement. My question is: Should the United States do 
the same?
    Ms. Mandelker. Well, Senator, as I think you know, the 
Administration is undertaking a 90-day review of the Iran 
policy and the JCPOA. As a general matter, I think the United 
States should live up to its commitments when it enters into 
international agreements.
    Senator Warren. And is there some reason that you think 
there should be an exception in the case of Iran, if Iran is 
living up to its part of the agreement, that the United States 
should somehow back away from its part of the agreement?
    Ms. Mandelker. Again, that very subject is part of the 90-
day review, but as a general matter, to the extent that we have 
agreements, I think that the United States should live up to 
those agreements.
    Senator Warren. And that would also apply in the case of 
Iran?
    Ms. Mandelker. Yes.
    Senator Warren. All right. Thank you.
    You know, the Iran nuclear deal is not perfect, but it is 
still our only realistic option to peacefully prevent Iran from 
developing a nuclear weapon. If the United States tears up the 
deal, we isolate ourselves instead of Iran, and we empower the 
Iranian hardliners who reject engagement with the West. I 
believe that makes the world less safe instead of more safe.
    Thank you, Mr. Chairman, and thank you again, Senator 
Tester and Senator Warner. And I would note I finished a minute 
early.
    Chairman Crapo. Thank you.
    Senator Cotton.
    Senator Cotton. Ladies and gentlemen, thank you all for 
your testimony today and for your willingness to serve your 
country, once again in many cases, and thank you all to the 
family sitting behind you for supporting your family members 
for going back into Government.
    Ms. Mandelker, Senator Warren was just asking you about 
preserving Russian sanctions. Many of us over the last 2 or 4 
years have advocated for even tougher sanctions against Russia. 
The Obama administration opposed those. Do you think there is 
room to add additional sanctions to Russia if the product 
review that is being undertaken now concludes that that would 
be in the United States' interests?
    Ms. Mandelker. Well, if the policy review that is being 
undertaken comes to that conclusion, of course, as the Under 
Secretary of the Treasury, if confirmed, it would be my 
responsibility to lay out those options. And, of course, there 
is always room for enhanced capabilities.
    Senator Cotton. Enhanced sanctions capabilities that the 
Obama administration refused to pursue for 8 years.
    Ms. Mandelker. Well, I cannot speak to the Obama 
administration, but I can assure you that I will lay out all of 
the potential options on the table.
    Senator Cotton. I can.
    Mr. Tarbert, I want to talk briefly about CFIUS and its 
role. What is its primary purpose, to promote investment into 
this country from abroad or to protect our security?
    Mr. Tarbert. To protect our security.
    Senator Cotton. When the call is close, do you view that 
the tie, so to speak, should go to protecting our security?
    Mr. Tarbert. The test by statute is no unresolved national 
security issues. So if there is a member agency that has a 
problem, then there is no tie. That trumps.
    Senator Cotton. It is an interesting statutory test, isn't 
it, that all issues have to be resolved in favor of protecting 
our security before you get to the actual business case for the 
investment?
    Mr. Tarbert. Yes, and I would say there is not even a 
business case for the investment. It is presumed----
    Senator Cotton. But speaking colloquially.
    Mr. Tarbert. Yes, absolutely.
    Senator Cotton. Is there room or need for reforming the 
CFIUS statute and process?
    Mr. Tarbert. If confirmed, that is something I would like 
to consider and look into. I do not know whether statutory 
changes are warranted or whether it is a matter of regulatory 
change or even just simply a resource issue. But that is an 
issue that I commit to studying, if confirmed.
    Senator Cotton. Ms. Ricardel, you look like you might have 
something to add?
    Ms. Ricardel. No, I do not. I do think it is a very 
important statute, CFIUS. Commerce has an input into the 
process and there is a lot of legislative input and legislation 
regarding new ideas, which, if confirmed, I would look at 
closely.
    Senator Cotton. Thank you. I would simply say that while we 
want to promote investment in this country and there are many, 
many legitimate reasons why foreigners want to invest directly 
into the largest and most dynamic economy in the world, our 
foremost concern obviously has to be the protection of our 
national security.
    Ms. Mandelker, I want to speak in general about the 
offshore wealth protection and management industry. There are 
many countries, or you might call them ``statelets'', 
oftentimes in the Pacific or in the Caribbean or around the 
waters of Europe, that specialize in helping people hide or at 
least obscure the origins of certain kinds of wealth. Many 
times these are used by nefarious people for nefarious 
purposes--dictators and their families who are stealing 
national wealth, oligarchs, criminals, terrorists, deadbeat 
husbands who do not want to reveal assets to the wives they are 
about to divorce. But at the same time, there is a legitimate 
business purpose for American corporations in particular who 
are dealing in the global economy to create corporate entities 
overseas.
    How could we as a Congress balance those two competing 
interests by making sure that American businesses can remain 
competitive in the global market, but at the same time trying 
to get after some of the illicit monies that are being hidden 
in lands that oftentimes have more bank accounts than they have 
residents?
    Ms. Mandelker. Well, Senator, of course, my responsibility 
will be to make sure that we understand who the beneficial 
owners are, how can we identify who the illicit actors are. Of 
course, I would be happy to study that issue further. I think 
it is--you point out that it is an important balance, and I 
would want to review that with not just the Treasury 
Department. It is really a much wider question that would also 
go to the Justice Department and other agencies.
    Senator Cotton. It goes to Treasury and the IRS as well. It 
is a difficult question because American businesses do have 
their legitimate reasons to have dealings in some of these 
overseas territories. But at the same time, I think it is fair 
to say that there are a lot of nefarious characters around the 
world and some Americans here who are hiding assets from 
spouses about to be divorced, for instance, who are able to 
move billions and sometimes even trillions of dollars in 
aggregate around the world. And I think it is something that 
this Congress should address, and it is something that we need 
to address because we do not want them to take advantage of the 
U.S. financial system or to buildup the kind of entrenched 
domestic interests that you have seen now in some Western 
European capitals that influence the policy of those capitals 
toward certain countries. So thank you for that commitment.
    Thank you all again for your testimony and for your 
willingness to serve.
    Chairman Crapo. Thank you.
    And back to you, Senator Tester.
    Senator Tester. Thank you, Mr. Chairman. I appreciate you 
having this hearing today, and I appreciate how you run this 
Committee.
    We have got four appointees here today for important 
positions that appear to be well qualified, and I want to thank 
you for being willing to serve in these capacities. It has 
occurred to me this is not the first time we have had four 
well-qualified people. It may be the first time we have had 
four well qualified, by the way, because usually it is one at a 
time. But it does take me back to a time when I would wonder if 
we would have this hearing at all if we had a different 
President that had just fired the Director of the FBI 
apparently for doing an investigation, maybe another President 
or not, and a President who has just been accused of 
transferring top secret information to a foe of ours. And I 
just wonder if we would be having this hearing at all if it was 
on a different foot.
    But, nonetheless, I appreciate you guys coming forward and 
being willing to serve. I think your positions, as has been 
indicated earlier, are very, very important, and we need to 
take this seriously.
    I am going to start with you, Ms. Mandelker. First of all, 
I want to thank you for telling a little bit about your life 
story and your father's story. I was watching your father as 
you were telling that story, and it was etched on his face what 
was going through his mind, and so I appreciate that very much. 
As the Senator from North Dakota and I were visiting, this is a 
country of immigrants, and you have proven that, both you and 
Ms. Ricardel.
    The Ranking Member asked a question about an allied Nation, 
an ally of ours that had given us sensitive information, and 
that sensitive information was handed over to a foe, whether 
that would impact that ally of ours giving further information. 
I do not know the specifics of that question, but I thought it 
was pretty clear, and I do not think you gave him a clear 
answer, and so I am going to revisit it.
    If an ally of ours gives us sensitive information and that 
sensitive information was transferred to an enemy of ours and 
the ally's, do you think it would impact that ally giving us 
further sensitive information?
    Ms. Mandelker. Senator, I do not know the answer to that 
question. I think it would have to depend on the particular set 
of facts and circumstances. I think----
    Senator Tester. Which is what you said before.
    Ms. Mandelker. I think----
    Senator Tester. The question is: Wouldn't human nature 
dictate that, hell, no, they would not give us information 
again?
    Ms. Mandelker. Again, I think it depends on the 
complexities of the relationship, the type of information that 
you are--that was communicated, the assurances that had been 
given on either side. So it is difficult for me to answer a 
hypothetical without understanding all of the facts and 
circumstances. Of course, I agree that it is very important to 
safeguard the intelligence that we receive.
    Senator Tester. OK. This has not happened to me as a 
Ranking Member, but it has happened to many of our Ranking 
Members, and it is what the Ranking Member of this Committee 
said, that we ask people from the Administration for 
information, and they are either directed by somebody above 
them or they choose not to give information back. This is a 
question for all four of you. If we ask a question, either 
verbally or in writing, will you promise to get back to us?
    Ms. Mandelker. Yes.
    Ms. Ricardel. Yes, sir.
    Mr. Billingslea. Absolutely.
    Mr. Tarbert. Yes.
    Senator Tester. OK. Thank you. Going back on the Russia 
stuff for a second, Ms. Mandelker--and Senator Cotton talked 
about it for a little bit, and Senator Warren talked about it, 
too--it is apparent that Russian officials have been involved 
with Syrian leadership for some time. There have been innocent 
civilians killed in Syria due much, I think, because of that 
relationship. Do you think that that should require further 
sanctions on Russia, that relationship and what Syria has done 
because of that relationship?
    Ms. Mandelker. Well, Senator, I am, of course, just like 
you, very disturbed by what we are seeing in Syria, including 
the news that we heard yesterday. Whether or not we go the 
route of sanctions is a difficult and complex question, and----
    Senator Tester. Wouldn't it be smarter to do that than put 
boots on the ground or drop bombs? Wouldn't that be the smart--
--
    Ms. Mandelker. Well, going the non-kinetic way is obviously 
a more peaceful--is a more peaceful solution, but, again, it is 
difficult for me to address what are our options or what 
decisions we might make in any particular circumstance. 
Sanctions is one very important tool that we have to address 
behavior that we are concerned by. It is not the only tool, and 
we would want to consider it in light of all of the policy 
considerations that----
    Senator Tester. But the sanctions are a tool that you are 
in charge of.
    Ms. Mandelker. That is right, Senator.
    Senator Tester. OK. Let us talk about the U.S. trade 
embargo against Cuba. Do you believe that embargo should be 
lifted?
    Ms. Mandelker. Senator, that is something that I would want 
to study, should I be confirmed, and carefully review within 
the Administration. I know that there is an ongoing policy 
review about Cuba that is----
    Senator Tester. How about exemptions----
    Ms. Mandelker. ----I do not want to prejudge that.
    Senator Tester. Would you agree there should be some 
exemptions? I am taking some of Warner's minute, by the way. Do 
you think there should be exemptions to that trade embargo?
    Ms. Mandelker. Again, it is something that I would commit 
to studying and to reviewing. I do not want to prejudge the 
outcome of that question before I have a chance to look into it 
further.
    Senator Tester. Thank you for being here. You are all 
really good. I would just hope for better answers because you 
guys know what you think. You are smart people. You are a hell 
of a lot smarter than the people up here. OK?
    Thank you very much.
    Chairman Crapo. Senator Warner.
    Senator Warner. I take exception to that.
    [Laughter.]
    Senator Tester. Sorry.
    Senator Warner. Ms. Mandelker, I appreciated the meeting we 
had on May 4th in my office, and as I said at that point, you 
have had some very strong recommendations, people that we 
mutually know. And echoing what Senator Tester said, I think 
your background shows that you are well suited for this 
position in the Administration.
    But as we discussed in my office, Senator Burr and I, in 
our role of leading the Intelligence Committee's Russia 
investigation, sent a letter to Treasury's Terrorism and 
Financial Intelligence Office on April 26th. In that letter we 
requested documentation from FinCEN that will be absolutely 
critical to the Russia investigation. Our asks include things 
like the FinCEN flash notices and the 314(a) requests.
    I know that we have received a preliminary response from 
Treasury that they are ``working on it.'' Well, I got to tell 
you, that is not good enough for an investigation that is so 
critical, that is dominating the news, that is dominating 
Americans' attention, that we are virtually a month later and 
we are getting a ``working on it.''
    So as I told you in my office, I cannot support moving 
forward with your nomination until the questions that Chairman 
Burr and I get a full answer. This investigation, I believe, is 
the most important thing I will ever have taken on in my public 
life, and we are going to need the full cooperation of not just 
Treasury but all aspects of Government if it is appropriate for 
us to look into those areas. And, clearly, the follow-the-money 
route is one of the areas that is critically important.
    Mr. Billingslea, I understand that you were a member of the 
Trump transition team supporting national security. I also 
understand from press reports that you were instrumental in 
preparing Lieutenant General Flynn for a meeting with Russian 
ambassador Kislyak. In those same press reports, there was 
information about your efforts to ensure that General Flynn 
understood the risks of talking to Ambassador Kislyak and that 
you sought classified information about the Ambassador for 
General Flynn to ensure that he was fully aware of the risks he 
was taking.
    Now, I appreciate, again, your background as well. I think 
you are well qualified. I want to simply state for the record 
as well I appreciate the fact that you voluntarily came in and 
talked to Intelligence Committee staff yesterday, and I think 
that was a sign of good faith, and I appreciate your 
willingness to continue to cooperate if there is other 
information we need.
    So I want to ask all four of you, and recognizing that we 
are in this investigation going in areas that, frankly, are 
uncharted territory, we have access to raw intelligence that 
has never been provided before because the potential charges of 
collaboration or collusion between a foreign power and a 
campaign operation and potentially an Administration have never 
been explored before.
    It has taken us some time, but the intelligence community 
has cooperated in those efforts because I think they realize 
how serious it is. And, if anything, the attention and focus 
gets even hotter in light of some of the President's actions 
last week.
    So what I am asking all four of you, but particularly Ms. 
Mandelker and Mr. Billingslea, would be that, should you be 
confirmed, will you cooperate with the requests of the 
Intelligence Committee to provide information that is requested 
and do that in a timely manner and a complete manner?
    Ms. Mandelker. Yes.
    Mr. Billingslea. Yes, Senator.
    Ms. Ricardel. Yes, Senator.
    Mr. Tarbert. Yes, Senator.
    Senator Warner. Well, I think that is very important. You 
know, the sooner we can complete this process, the sooner we 
can either remove the cloud that hangs over this Administration 
or get to the bottom if there are circumstances that some of 
the press reports bear out to be true. And to do that, we are 
going to need everyone's cooperation. This is a really 
important time, a dangerous time, a challenging time. I think 
you have heard from both sides of the aisle real concerns about 
Russia and their attempts not only to intervene in our 
elections, the French elections, and I think you will see it in 
the German elections, their actions in Ukraine. And if there is 
ever a time that we must be vigilant, it is now.
    Thank you, Mr. Chairman.
    Chairman Crapo. Thank you, Senator.
    Senator Cortez Masto.
    Senator Cortez Masto. Thank you, Mr. Chair. And thank you 
to all of you, and let me just say, first of all, thank you for 
taking the time to come visit with me. I really appreciate it. 
And welcome to all of your family who have been sitting here 
now for it seems like days. But we will end soon. Do not worry.
    Let me follow up with some of the questions, and let me 
start with Mr. Tarbert. If confirmed to the position for which 
you are nominated--and we have been talking about this. You 
will be leading the Treasury Department's work related to the 
Committee on Foreign Investment in the United States. As it 
stands now, the public has no idea what President Trump's 
investments consist of because he will not release his tax 
returns, and meanwhile, we are reading in the papers that 
members of the President's extended family are going to China 
looking for investors in various business ventures and playing 
up their connections to the Oval Office.
    If confirmed, could President Trump and his family's vast 
global business entanglements complicate your efforts to lead 
the Treasury's work on the Committee on Foreign Investment in 
the U.S.?
    Mr. Tarbert. I do not believe so. If confirmed, I am 
committed to applying the law, and the law requires that for 
any covered transaction there be no national security concerns.
    Senator Cortez Masto. And how can we be sure about that 
transparency? How does the public know that you are making 
those decisions when it comes to our President and his 
interactions with foreign investments, including his family 
members?
    Mr. Tarbert. The CFIUS process, most of it is obviously 
classified, but FINSA has provisions whereby Congress and this 
Committee in particular can exercise oversight.
    Senator Cortez Masto. So let me ask you this: If it comes 
up that there is that entanglement, are you committed to 
ensuring that the public has a full airing and understanding of 
your decisions when it comes to whether the President's 
involvement or his family's involvement with foreign 
investments and likewise?
    Mr. Tarbert. I am committed to following all applicable 
laws and regulations and being as transparent as I can in 
compliance with those laws and regulations.
    Senator Cortez Masto. OK. Let me follow up on another thing 
we did not get a chance to talk about and I am not sure whether 
you are familiar with or not, which is MoneyGram. If confirmed 
to this position, you will be leading, again, the Committee on 
Foreign Investment, and as someone with a background in law 
enforcement, I know that working with money transfer companies 
is key to identifying, catching, and stopping illicit 
financing.
    If confirmed, how will you evaluate the proposed MoneyGram 
purchase by a company in part owned by Chinese State in terms 
of its impact on U.S. national security?
    Mr. Tarbert. Thank you, Senator. I am going to refrain from 
speaking about any particular case, but the general thrust of 
your question about money transmitters I think is an important 
one and also referencing a State-owned company. Right now, 
under the CFIUS process, a State-owned company automatically 
triggers in the investigation phase. So, if confirmed, I would 
use all available resources to ensure that there are no 
unresolved national security concerns.
    Senator Cortez Masto. OK. And them I am going to follow up 
with some similar line of questioning based on your previous 
experiences, some of the articles that you have written. You 
have written extensively on the Wall Street Reform Act's 
resolution planning provisions, including living wills. These 
documents require large financial companies to document how 
they could fail without harming Main Street. Some want to 
eliminate or weaken the act's provisions in this regard. What 
is your opinion?
    Mr. Tarbert. I think the resolution process--so the living 
wills that you referred to, under Title I, which requires large 
systemically important financial institutions or anyone caught 
under that to present a plan as to how they could be resolved 
under the Bankruptcy Code, I think that, at least from a 
personal standpoint, is a worthwhile exercise.
    Senator Cortez Masto. OK.
    Mr. Tarbert. Now, again, my position is--if confirmed, I 
would be potentially representing the U.S. at the international 
level, so I do not believe I would personally have a role in 
Dodd-Frank or legislation dealing with domestic finance.
    Senator Cortez Masto. Thank you. I appreciate that. And 
thank you again. Good luck to all of you. And I appreciate you 
seriously taking the time to sit and visit with me.
    Chairman Crapo. Senator Heitkamp.
    Senator Heitkamp. Thank you, Mr. Chairman. And thanks to 
all of you for your willingness to serve our country. Many of 
you have incredible resumes--all of you have incredible 
resumes.
    I think that it is not unfair to ask you this question: Who 
is your loyalty to? Once you are confirmed and if you are 
confirmed, who do you serve and who is your loyalty to? We will 
start with Ms. Mandelker.
    Ms. Mandelker. My loyalty is to the American people.
    Ms. Ricardel. My loyalty is also to the American people and 
to the laws that govern this country.
    Mr. Billingslea. Senator, my loyalty is both to the 
American people and to the Constitution.
    Mr. Tarbert. Yes, the Constitution and the American people.
    Senator Heitkamp. It is critically important to remember 
that. Sometimes when you are confirmed and people give you 
positions like this, there may come a time when you are asked 
to do something that is not in the interest of the American 
people, that is not in the interest of our checks and balances 
system in the Constitution, and that will, in fact, jeopardize 
our national security. And I think it is fair to ask that 
question today, and so I want to thank you all for the answer. 
I believe that you are earnest about this. But we all know that 
there is a slippery slope, and little compromises lead to big 
compromises. And it is critically important, hopefully--I do 
not mean to be lecturing here, but that you remember that as 
you serve once you are confirmed.
    I want to talk first, Ms. Mandelker, first off just tell 
you how moving your family's story is and how grateful we are, 
and I think I believe your answer a little bit more as a result 
of the challenges that your family has experienced. But I want 
to talk about a hearing that we had last week. We heard from 
two previous distinguished incumbents of the position that you 
are nominated to about both the value and the limitations of 
secondary sanctions.
    How would you go about thinking whether to apply this 
relatively blunt instrument? And what steps can Treasury take 
to ensure that sanctions advance tailored national security 
instruments without unleashing unintended consequences? And I 
would just tell you I think that when we are looking at this, 
this is going to become a critical piece, and it is very 
important that you be clear on how you see secondary sanctions.
    Ms. Mandelker. Thank you, Senator, for that question, and 
obviously, it is something that I have been thinking about. I 
had the opportunity to watch the testimony last week, which I 
thought was very useful. Both witnesses had excellent ideas, 
and I appreciate their testimony and their counsel.
    Issuing secondary sanctions is a blunt instrument. It is an 
instrument, of course, that worked. It was very impactful when 
it came to how we used it, how the U.S. Government used it in 
Iran. It is something that I think we have to consider 
carefully, but we also have to understand what the secondary 
and tertiary impact might be of using those secondary 
sanctions. It is something that I will look forward to engaging 
in a robust conversation within the interagency. It is going to 
be very important that we have a fulsome understanding of what 
the impact would be, both in executing our national security 
strategy and then in the other impact it might have on the 
economy.
    Senator Heitkamp. Thank you so much.
    Mr. Billingslea, in your testimony you reference the 
importance of buy-in from friendly Nations when ratcheting up 
pressure on terrorist financing. Trust is a huge factor in this 
with everyone concerned. What has been your experience at NATO 
and elsewhere in your career that taught you the importance of 
forging these alliances and building trust? And do you think 
that trust based on tweet is a good way to advance our foreign 
policy interests?
    Mr. Billingslea. Senator, my daughters will tell you I do 
not have a Twitter account. I do not have it on my iPhone.
    You know, as Winston Churchill famously said, you know, the 
only thing worse than fighting with your allies is fighting 
without them. And so it is crucial, it is painstaking. It 
requires that you sometimes control your inner voice when you 
work with allies, but it is essential to bring them along and 
work very closely with them, particularly----
    Senator Heitkamp. Do you think it is important to 
communicate with them in a way that respects them?
    Mr. Billingslea. Absolutely. These are sovereign Nations.
    Senator Heitkamp. So do I, and I think that one of the 
things that we have to be very, very careful in this 
environment is understanding who our allies are and who our 
allies are not. And I think the recent examples of disclosing 
classified information to foes is not a step in the right 
direction, and I hope that if you guys are all confirmed, the 
advice that you provide will be advice that will be heeded by 
the White House.
    Chairman Crapo. Thank you.
    Senator Van Hollen.
    Senator Van Hollen. Thank you, Mr. Chairman. I would like 
to join my colleagues in welcoming all of you. Thank you for 
your testimony. Welcome to your families.
    I do want to associate myself with the remarks of Senator 
Warner with respect to the information that has been requested 
by the Congress of the Treasury Department.
    Ms. Mandelker, I think you are responsible for a lot of the 
areas regarding preventing money laundering, and others will be 
as well. And I wanted to follow up on a line of questioning 
that I think Senator Cotton started with respect to being able 
to figure out the beneficial ownership interests, because we 
know the Russians as well as many others try to use the U.S. 
market to launder money, the Russians especially in the area of 
real estate. And one of the tools that the Obama administration 
developed to try and fight that was FinCEN's geographic 
targeting order, looking at high-risk regions, including South 
Florida, New York. My understanding is the Trump administration 
has extended this effort through August, and my question is: Do 
you believe this is a useful tool? And do you plan, if 
confirmed, to extend this beyond August?
    Ms. Mandelker. I do agree that it is a very useful tool. I 
know both from my experience in Government service and in the 
private sector that understanding who the beneficial owners are 
of any particular entity can be extraordinarily valuable. It is 
something that I will look forward to discussing with the 
career professionals of FinCEN. And I would be happy to get 
back to you. But I think that those tools, the geographic 
targeting orders, can provide us with an enormous amount of 
very valuable information, and I look forward to using it not 
just in this area, but in others as well.
    Senator Van Hollen. Well, thank you. And I do want to say, 
Mr. Chairman and Ranking Member, there are a number of States--
I think there are about three States that have really made a 
specialty of welcoming money that cannot be tracked, and I do 
hope this Committee will begin to look into that issue because 
it is in contradiction, it conflicts with the Federal focus on 
trying to get to the bottom of money laundering.
    My colleague Senator Heitkamp raised the issue of secondary 
sanctions, and you yourself pointed out that they were very 
effective. You said it worked with respect to bringing Iran to 
the negotiating table. Congress worked on that on a bipartisan 
basis. The Obama administration supported those efforts.
    We all know that North Korea has been working to develop an 
intercontinental ballistic missile that can reach the United 
States. We know that they have successfully tested and have a 
number of nuclear weapons. And we have heard, you know, from 
the Trump administration a variety of possible policy 
responses, including talking about potential military action.
    In my view, that is premature until we have exhausted the 
other alternatives, and one of those other alternatives is 
secondary sanctions. The reality is that North Korea GDP runs 
about $30 billion a year, according to most estimates. They do 
have access to international supply chains. Obviously, China is 
the major conduit for their economic activity.
    The House passed legislation on North Korea sanctions. I am 
working with some others on expanding on that idea, including 
secondary sanctions on North Korea. And so my question to you 
is: Do you think that would be an effective way to put more 
pressure on North Korea as a means to address their clearly 
hostile actions that they are taking?
    Ms. Mandelker. Thank you for that question, and I know this 
Committee and other Members of the Congress have showed a lot 
of leadership when it comes to deploying those tools, and I 
would look forward to working with you on that particular 
question. I do not want to confine myself to agreeing to any 
particular option. What I can tell you is that we need to study 
the use of secondary sanctions in this context very carefully 
and closely. That discussion has to be part of the robust 
interagency discussion that I am sure by all accounts is very 
much underway now in the Administration. And what I will commit 
to you is that I will review it very carefully. I will discuss 
it within the interagency, and I would look forward to having 
conversations with this Committee about what options will be 
the most effective in disrupting the North Korea threat, 
because as I said at the outset, that is really going to be at 
the top of my agenda.
    Senator Van Hollen. Well, good, and I think we all share 
your conclusion, at least speaking for myself, your conclusion 
that that effort did work with respect to bringing the Iranians 
to the negotiating table. So I look forward to working with you 
on that, and I thank all of you for your testimony.
    Thank you, Mr. Chairman.
    Chairman Crapo. Thank you.
    Senator Schatz.
    Senator Schatz. Thank you, Mr. Chairman. Thank you all for 
coming here. Thank you to the families for allowing your 
spouses and parents and children to be public servants.
    This is a question for the three Treasury nominees. The 
success of your future work in stopping illicit finance flows 
and keeping dangerous technologies out of the hands of our 
enemies depends on well-crafted diplomacy. But I am extremely 
concerned that vacancies at high levels of the Administration 
are preventing us from successfully crafting a response to 
international threats.
    For example, we do not have any regional Assistant 
Secretaries. None. We also do not have an Assistant Secretary 
for Economic and Business Affairs. This is the person at State 
who works together with Treasury to develop and implement 
economic sanctions. We also do not have an Assistant Secretary 
for International Narcotics and Law Enforcement. This is the 
person who bolsters Treasury's work by helping countries to 
counter illicit narcotics trade and other international crimes.
    These are just a few examples. They are the people 
responsible for crafting and implementing strategies that make 
use of all of our tools of national power, including what 
Treasury is trying to do through sanctions. And these positions 
remain empty--not just not confirmed but no nominees.
    How do you think that these State Department vacancies will 
impact your ability to do your jobs?
    Ms. Mandelker. Senator, I am not familiar with the 
positions at the State Department that remain open. What I can 
tell you, having worked at the Justice Department and 
Department of Homeland Security in the past, and having worked 
closely with the State Department, there are many very talented 
people who are there and regardless----
    Senator Schatz. Let me--excuse me. Does this sound like a 
problem to you?
    Ms. Mandelker. Well, Senator, I am very much in favor of 
nominating and confirming political positions, so I would hope 
that the Congress would move expeditiously in that direction.
    Senator Schatz. And we need to have nominees in order to 
consider them.
    Mr. Billingslea.
    Mr. Billingslea. Yes, Senator, I very much would like to 
have counterparts to work with.
    Mr. Tarbert. I agree as well.
    Senator Schatz. Following up on the line of questioning on 
this side of the dais around loyalty, I am going to be very 
blunt in terms of the interactions you may have had with either 
the Administration or the transition. Did anybody ask you for 
loyalty?
    Ms. Mandelker. No, Senator. That is not a conversation that 
I have had.
    Ms. Ricardel. No, sir.
    Mr. Billingslea. No, Senator.
    Mr. Tarbert. No, Senator.
    Senator Schatz. Following up on the line of questioning of 
the Ranking Member of the Intelligence Committee, I understand 
that it is Treasury professionals that have to get back to the 
Members on the Committee who made the request of FinCEN. But do 
you think that the Congress deserves an expeditious response to 
these requests?
    Ms. Mandelker. Yes.
    Ms. Ricardel. Yes, sir, I do.
    Mr. Billingslea. Yes, sir.
    Mr. Tarbert. Yes.
    Senator Schatz. I will be quick because a lot of the 
questions have been asked, but I just want to put a fine point 
on it. In the context of what is going on, it seems to me that 
people of good will and good faith and loyalty to the 
Constitution and laws of the United States, loyalty to country, 
are being put in impossible positions in this Administration. 
And so I never thought I would have to ask this question, and I 
know the answer that you will all provide, and I believe you in 
this moment. But I want to hear it from you. If there is a 
moment when you have to choose between loyalty to law and the 
country and loyalty to party and the White House, what will you 
choose?
    Ms. Mandelker. Senator, as I have always conducted myself 
in Government service, my loyalty is to the American people and 
to the laws of our country.
    Ms. Ricardel. I will always put laws of the country first.
    Mr. Billingslea. Senator, likewise. My loyalty is to the 
United States Constitution.
    Mr. Tarbert. The Constitution and the American people.
    Senator Schatz. Thank you.
    Chairman Crapo. Do you have anything?
    Senator Brown. Just one comment. Thank you, and thanks to 
all four of you, and again to your families. And, Ms. 
Mandelker, your story of your father was so meaningful, and we 
all were watching him as you were talking, and it was so 
inspiring. Thank you.
    I think that Senator Schatz's question and Senator 
Heitkamp's speak volumes about the situation you are going in. 
We do appreciate your willingness to serve. We do not question 
the ethics of any of you. But I have never sat--I have been in 
this Senate now almost 11 years, and I have never heard the 
kinds of questions that he posed asked with--I have been here 
through Presidents of--three different Presidents, and I was in 
the House with two others, and I think it is really important 
that, as you leave here today, you think about that question. 
And I hope you are not put in that position, but the first 120 
days or so of this President suggests that you might be. And I 
know you take your responsibilities seriously. I know you will, 
and we are counting on you to do the right thing.
    Thank you, Mr. Chairman.
    Chairman Crapo. Thank you, Senator Brown.
    That concludes the questioning and the hearing, with the 
exception of final announcements. Before I do that, though, I 
want to again thank each of you for coming and participating 
today here at the hearing. I thank you for your service and 
your willingness to give more service to the country, and I 
appreciate that.
    For Senators, all follow-on questions need to be submitted 
by Thursday. And for our witnesses, responses to those 
questions are due on Monday. So please respond quickly to the 
questions you get.
    With that, this hearing is adjourned.
    [Whereupon, at 11:50 a.m., the hearing was adjourned.]
    [Prepared statements, biographical sketches of nominees, 
responses to written questions, and additional material 
supplied for the record follow:]
                PREPARED STATEMENT OF SIGAL P. MANDELKER
    To Be Under Secretary for Terrorism and Financial Intelligence, 
                       Department of the Treasury
                              May 16, 2017
    Chairman Crapo, Ranking Member Brown, and Members of the Committee, 
it is a great honor to appear before you as the President's nominee to 
be the Under Secretary to lead the Office of Terrorism and Financial 
Intelligence. I thank the President and the Secretary for their trust 
and confidence in me. I have had the opportunity to meet with many of 
you and your staff over the last few weeks and I want to thank you for 
the courtesies you have extended to me. I look forward to working 
closely with this Committee if I am honored to be confirmed.
    I am grateful for the tremendous support of my family and friends, 
including those who have traveled to attend this hearing. I want to 
recognize in particular two of my heroes and constant sources of 
inspiration, my father, Gershon Mandelker, who is here today, and my 
wonderfully lovely mother, Ester Mandelker, who passed away 12 years 
ago. Both of them were Holocaust survivors who spent part of their 
childhood hiding underground, in the forest, and elsewhere in constant 
fear for their lives as they tried to escape the Nazis. My father tells 
one story about how, when he was around 6 years old, he was hiding with 
my grandfather and others in a barn that belonged to the head of a 
village, a courageous man who agreed to hide them. My father recalls 
that one day, soldiers came into the barn in order to decide whether to 
park their guns and horses there. My father was hiding under a haystack 
as the soldiers walked in, looked around, and then decided not to use 
the barn. My father vividly remembers watching the boots of one of the 
soldiers as he walked by. Had my father so much as sneezed, I would not 
be sitting here before you in this Committee room.
    I grew up hearing about my parents' many courageous stories of 
survival and how they narrowly avoided death. At the same time, I knew 
that so many members of my family did not survive, including three of 
my grandparents who were either killed or died as a result of the 
Holocaust. With this history, my parents not only survived but went on 
to pursue successful careers and served as incredibly positive role 
models. They raised my brother and me with enormous love and a deep 
appreciation for the opportunities that our great Nation provides and 
the knowledge that we should never take for granted our safety, 
security, and freedom. I carry this legacy with me and it has always 
been what has motivated me to public service, for the opportunity to 
make a difference is truly humbling.
    After 9/11, like so many other Americans, I wanted nothing more 
than to contribute to the response to this terrible attack on our 
Nation. After finishing a clerkship, I immediately went to work for the 
Justice Department in August 2002, where I joined in its 
counterterrorism and national security mission in positions in both the 
Criminal Division and later the Deputy Attorney General's Office. With 
the Nation on high alert for follow on attacks, I worked as part of the 
dedicated team that oversaw the Nation's counterterrorism and national 
security criminal cases, including those involving illicit financing of 
terrorism. After then going on to serve as an Assistant United States 
Attorney in the Southern District of New York, I came back to 
Washington to work as a Counselor to the Secretary of Homeland 
Security, where I focused again on counterterrorism, national security, 
law enforcement, and intelligence. In 2006, I returned to the Justice 
Department to be Deputy Assistant Attorney General in the Criminal 
Division, where I supervised four major sections, leading the many 
talented prosecutors and other professionals in those sections, and had 
a portfolio that included ground-breaking and cross-border 
cybersecurity, human rights, money laundering, and other cases that 
involved the intersection of national security and law enforcement. In 
2009, I joined the private sector, where I have gained valuable and 
practical insights into the compliance issues that financial 
institutions and other companies face on a regular basis.
    I am particularly honored to be nominated for this position, which 
serves such an important function in our national security, foreign 
policy, and economic apparatus. If confirmed, I will strategically and 
tactically marshal all of the tools of the Office of Terrorism and 
Financial Intelligence, and will constantly evaluate how to evolve 
those tools to meet new challenges, and to always be proactive, 
intelligence driven, and results oriented. I am looking forward to 
working with and leading the talented and dedicated career 
professionals in the Office of Terrorism and Financial Intelligence. I 
will also work closely both with this Committee and the interagency to 
ensure that we use all of the elements of Government power in the most 
effective way to achieve the objectives we set for ourselves and for 
the country.
    Finally, from my time in the Executive Branch, I know how important 
it is to have a close relationship with Congress. I have thoroughly 
enjoyed my discussions with so many of you and I look forward to doing 
important work together should I be honored to be confirmed.
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             PREPARED STATEMENT OF MIRA RADIELOVIC RICARDEL
To Be Under Secretary for Export Administration, Department of Commerce
                              May 16, 2017
    Mr. Chairman, Ranking Member Senator Brown, Senators of the 
Committee, it is a distinct privilege and truly humbling experience to 
come before this Committee to be considered for Under Secretary of 
Commerce for Export Administration. I am deeply honored to have been 
nominated by President Donald Trump and greatly appreciate the 
confidence that has been placed in me by the President and Secretary of 
Commerce Wilbur Ross.
    When I served as legislative assistant to Republican Leader Bob 
Dole, I did not imagine that the future might hold this opportunity--
that one day I would not be preparing questions, but answering them. 
Perhaps my late father might have thought it possible, not only because 
of bias towards his daughter, but because he was always optimistic 
about what was possible in this great Nation--a view that carried him 
from communist-controlled Croatia via Germany to the United States, 
with little more than optimism in his pockets.
    I wish to thank Senator Bob Dole for teaching me so much about 
leadership, integrity and fairness. I learned hands-on that building 
bipartisan coalitions is essential to progress and reaching agreements. 
This lesson informed how I approached issues as a member of his staff, 
and later how I approached working within the U.S. Government 
interagency while I served in the Department of Defense. The ability to 
understand and balance the equities of U.S. agencies and drive toward 
solutions that strengthen U.S. national security is vital.
    The role of the Under Secretary of Commerce for Export 
Administration is consequential and one in which I will be able to 
leverage my experience and skills if confirmed. The Bureau of Industry 
and Security (BIS) advances U.S. national security and economic 
objectives by ably managing and ensuring effective export control 
systems, supporting treaty compliance, and enforcing sanctions. The 
Bureau's responsibilities are executed in close cooperation with a wide 
range of departments and agencies, including the Departments of 
Treasury, Justice, State, Defense, and Homeland Security.
    The recent announcement by Secretary Ross of record criminal and 
civil penalties against ZTE Corporation is the culmination of 6 years 
of investigation and highlights the crucial function of the Bureau's 
Office of Export Enforcement. Last year, the Bureau's Export 
Administration office processed more than 33,000 license applications 
related to dual use items and items that had been on the U.S. Munitions 
List. The United States retains jurisdiction over re-exports of U.S. 
origin goods abroad; this is an indispensable tool to address the 
potential diversion of items to our adversaries who might use these 
them against U.S. military forces abroad or in the development of 
weapons of mass destruction.
    Important also is that the licenses processed by the Bureau of 
Industry and Security enable exports of U.S. goods and these exports 
mean jobs for American workers. As a former employee of an aerospace 
company, I can appreciate the impact of exports on jobs. At the same 
time, the health of the U.S. defense industrial base is imperative and 
in that regard under Secretary Ross' initiative, the Bureau of Industry 
and Security has launched two investigations on steel and aluminum 
imports under Section 232 of the Trade Expansion Act. In addition, the 
Bureau regularly conducts studies on other areas of the U.S. industrial 
base.
    Secretary Ross recently said, ``Under President Trump's leadership, 
we will be aggressively enforcing strong trade policies with the dual 
purpose of protecting national security and protecting American 
workers.'' If confirmed, I will act vigorously to enforce U.S. export 
controls, embargoes and sanctions, as well as continuously promote and 
advance policies that support U.S. industries and technologies and the 
American workers who are the foundation of our industrial base.
    Mr. Chairman, Senator Brown and Senators of the Committee, thank 
you for your consideration of my nomination. I would be pleased to 
answer any questions the Committee may have.
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               PREPARED STATEMENT OF MARSHALL BILLINGSLEA
 To Be Assistant Secretary for Terrorist Financing, Department of the 
                                Treasury
                              May 16, 2017
    Chairman Crapo, Ranking Member Brown, and Members of the Committee: 
I am honored to appear before you today as the President's nominee for 
Assistant Secretary of the Treasury for Terrorist Financing.
    Senators, at the outset, I thank my family--my wife Karen and my 
two daughters Morgan and Elsa--for supporting my decision to accept 
President's nomination. These positions require significant family 
sacrifice, and I could not undertake this without their love and their 
backing.
    Unfortunately my mother and father could not be here today, but I 
am very happy that my sister Rachel--who is a career Pentagon 
official--is present. Rachel, and her husband Craig, who is a Chief 
Warrant Officer, have collectively served more than 5 years in 
Afghanistan and Iraq--together and apart--helping keep our Nation safe 
from the terrorist threat. They are, in my view, great Americans who 
have sacrificed much to protect our Nation.
    By way of background, Rachel and I were raised in Montgomery 
Alabama, as constituents of Senator Shelby. Our father, Oliver, is the 
son of a cotton farmer and the first to graduate from college in his 
family. Our mother, Nancy, hails from Xenia Ohio, where--Senator 
Brown--I am proud to say that we today have a large extended family. 
From our parents I learned the value of stoicism and hard work, and I 
am deeply grateful to them for the sacrifices they made over the years 
that have allowed me to be here today.
    I have had the opportunity over the past weeks to meet with several 
Members of this Committee, and it has been very helpful to understand 
the issues you feel are most important with respect to the Treasury 
Department and terrorist financing. If confirmed, I look forward to 
working with all Members of the Committee, and your staff, on this 
crucial national security matter.
    There are four brief points that I underscore for the Committee 
this morning:
    First, I understand the criticality of a close, bipartisan working 
relationship with Congress. From 1995-2001, as the Senior Professional 
Staff Member for National Security Affairs on the Foreign Relations 
Committee, I drafted multiple pieces of sanctions legislation, most of 
which were subsequently enacted into law with overwhelming bipartisan 
support. The focus of these statutes was (and remains) to combat the 
proliferation of weapons of mass destruction (WMD) and missile systems, 
and to disrupt foreign terrorist and trafficking networks.
    Second, I appreciate how important are financial and economic tools 
in the fight against terrorism. After 9/11, I served as the Principal 
Deputy Assistant Secretary for Special Operations and Low Intensity 
Conflict (SO/LIC). Disruption of the terror network's financing 
operations featured heavily in both our planning, and in day-to-day 
operations. Working very closely with multiple Treasury offices, I 
established the first DoD Counter Threat Finance cell, with a detailee 
from Treasury playing a central role.
    Third, ``buy in'' from friendly Nations is crucial to the work of 
the Terrorist Financing office. At NATO, from 2003-2006, I served as 
the Assistant Secretary General for Defense Investment. My time at NATO 
taught me the importance of forging close working relationships with 
officials from across the Alliance. While at NATO, I secured Alliance 
agreement to launch more than a dozen counter-terrorism related 
measures, and this experience will greatly assist in the international 
duties of the office to which I have been nominated, if confirmed.
    Finally, disrupting terrorist finance and illicit trade requires 
working closely with the private sector. Since 2009, I have served as 
Managing Director at Deloitte, where I lead the Federal Business 
Intelligence Services (BIS) group. We perform commercial due diligence 
into third parties on behalf of Federal agencies and commercial clients 
to protect against doing business with entities accused of corruption, 
narcotics trafficking, money-laundering, child or slave labor, or other 
worrisome matters. I bring close working relationships across the 
global financial services, technology and telecommunications sectors, 
and will leverage those professional connections to advance our 
national security agenda.
    In conclusion, I appreciate the opportunity afforded by the 
Committee on Banking to appear before you today as your consider my 
nomination. Over the past 22 years, I have had the privilege of working 
closely with the Department of the Treasury on terrorist financing and 
financial crimes in a variety of capacities, and I bring a unique 
combination of legislative, executive branch, and private sector 
experience to the role. If confirmed by the Senate, I will work very 
closely with this Committee to drive policies and actions to disrupt 
illicit finance and terror networks, and to advance our national 
security. I appreciate your time this morning, and look forward your 
questions.
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                 PREPARED STATEMENT OF HEATH P. TARBERT
   To Be Assistant Secretary, International Markets and Development, 
                       Department of the Treasury
                              May 16, 2017
    Chairman Crapo, Ranking Member Brown, and distinguished Members of 
the Committee, I am honored to appear before you today. I am humbled by 
the confidence the President has shown in me by nominating me to be the 
next Assistant Secretary of the Treasury for International Markets and 
Development.
    I appear before you today with full recognition of the serious 
responsibilities associated with this position. If confirmed as 
Assistant Secretary, I would lead nine of the Treasury Department's 
offices charged with protecting and supporting foreign investment in 
the United States, reducing global financial instability, fostering 
international economic development, and managing key global challenges. 
I believe that my professional background and desire to serve our 
country will enable me to perform this role and work to keep our 
country safe and prosperous.
    While growing up in Baltimore, my family emphasized hard work, 
education, and the importance of public service at every level of 
Government. Both of my grandfathers fought in World War II: one with 
the Army in Europe, one with the Navy in the Pacific. One of my uncles 
was a police officer; another a firefighter. My father went to night 
school to become an accountant, and eventually served as Comptroller of 
the Maryland Port Administration and of the Baltimore County Community 
College System. Although my father passed away after a courageous 
battle with cancer, his commitment to public service remains a guiding 
example for me.
    Each of my adult guests today is or has been a public servant. My 
mother retired as a Child Support Enforcement Officer, my sister-in-law 
is a public school teacher, and my brother just completed a term as 
Deputy Mayor of Baltimore for Economic and Neighborhood Development. 
Finally, my wife Kate and I met clerking for the U.S. Court of Appeals 
here in Washington. Now a full-time mom to our two young sons, she has 
served in the Justice Department and as a law clerk to the Chief 
Justice of the United States. I have been inspired by their dedication 
to public service as well.
    I, myself, have had the privilege of serving in all three branches 
of the Federal Government. One of my most enjoyable jobs in public 
service was working as Special Counsel to this Committee in 2009-10. 
During that period, I had the privilege of working closely with Banking 
Committee staff members and legislative directors on both sides of the 
aisle on a number of important international economic issues. It was 
especially an honor to serve under your leadership, Senator Shelby.
    Since leaving the Banking Committee staff, I have practiced as a 
regulatory compliance lawyer, with a chief focus on international 
markets. In this role, I have assisted public and private sector 
institutions from outside the United States make investments in our 
country that created jobs for working Americans and their families. I 
have also helped financial services companies around the world comply 
with regulatory and supervisory measures intended to make them safer 
and sounder, thereby reducing or eliminating the possibility of future 
taxpayer-funded bailouts. In addition, I have designed compliance 
programs aimed at detecting and preventing money laundering and 
terrorist financing.
    If confirmed as Assistant Secretary of the Treasury, I hope to work 
closely with this Committee, others in the Senate and House of 
Representatives, and my colleagues in the Administration to carry out 
my responsibilities.
    Thank you again for the opportunity to appear before you today. I 
am happy to answer any questions you may have.
 [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
 
        RESPONSES TO WRITTEN QUESTIONS OF SENATOR CORKER
                    FROM SIGAL P. MANDELKER

Q.1. Do you believe the current anti-money laundering regime is 
as effective as it could be? If not, would you be open to a 
realignment of incentives and the setting of priorities within 
the regime? Additionally, are there certain areas that you feel 
are ripe for reform?

A.1. I believe that the current U.S. anti-money laundering and 
countering the financing of terrorism (AML/CFT) regime is 
strong. The United States has been a leader in the world, 
including through the Financial Action Task Force (FATF), in 
combatting money laundering and terrorist financing. We have to 
constantly evaluate, however, how to evolve these tools to meet 
new challenges, technologies, and threats.
    If confirmed, one of my top priorities will be to assess 
the effectiveness of our tools and to engage in comprehensive 
discussions within Treasury and with other stakeholders, 
including the law enforcement community, other regulators, the 
Congress, and the private sector, regarding mechanisms to 
improve these safeguards in the U.S. financial system, to 
further enhance transparency, and to assess Treasury's analytic 
and information sharing tools both within the Government and 
with the private sector. I believe that Treasury should be open 
to realigning incentives and setting priorities as threats 
evolve, and as our law enforcement, regulatory, foreign policy, 
and national security priorities shift to meet new and emerging 
challenges. If confirmed, I will carefully assess what areas 
are ripe for reform after engaging in these discussions and 
will look forward to addressing them with you.

Q.2. Financial institutions are withdrawing from customer 
relationships and businesses that are perceived to pose risks 
under the anti-money laundering laws. Do you think this so-
called ``de-risking'' by financial institutions undermines the 
effectiveness of our anti-money laundering regime? If so, has 
past enforcement policy, or other aspects of the current legal 
framework, created incentives to ``de-risk''? Are there 
additional safe harbors or other changes to the legal framework 
that might better align financial institutions' incentives in 
order to avoid that pressure to ``de-risk''?

A.2.In this area, we must advance two complementary objectives: 
safeguarding the financial system from abuse and promoting 
financial inclusion where appropriate. We should continue to 
engage in a robust conversation with financial institutions 
about mechanisms for de-risking that simultaneously promote 
both objectives. If confirmed, I will look forward to 
discussing these issues with public and private sector 
stakeholders in order to maintain an effective AML/CFT 
framework, ensure that the risk-based approach is appropriately 
applied, promote innovation where appropriate in the private 
sector's use of new tools to analyze data, and facilitate a 
clear understanding of both illicit finance risks and U.S. 
legal and regulatory expectations.
    For example, I believe that it is important to consider how 
to share more targeted information and provide dynamic feedback 
to the private sector in order to enhance its ability to engage 
in decision making as it manages risk. Likewise, I believe that 
financial institutions should continually assess how to improve 
their analytic capabilities as part of the risk calculus that 
they undertake.

Q.3. Do you see opportunities to facilitate or otherwise 
encourage financial institutions to voluntarily engage in 
information sharing under the PATRIOT Act? In particular, could 
new regulatory guidance or even legislative changes address 
some of the ambiguities under the relevant provisions of the 
PATRIOT Act or otherwise encourage financial institutions to 
expand their voluntary information sharing?

A.3. Yes, there are opportunities to facilitate greater sharing 
of information under the USA PATRIOT Act. I am encouraged that 
some financial institutions have begun to utilize the 
information-sharing safe harbor provided by the USA PATRIOT 
Act. However, I believe that much more can be accomplished in 
this area. If confirmed, I will consult with the career 
professionals at Treasury and with the private sector regarding 
to what degree we need greater regulatory guidance or, if 
warranted, legislative changes both to address any ambiguities 
and to facilitate information sharing, while being mindful of 
the need to balance such sharing with data privacy equities and 
civil liberties. I look forward to consulting with Congress on 
these issues.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR TOOMEY
                    FROM SIGAL P. MANDELKER

Q.1. Iran and other State sponsors of terrorism have been 
caught laundering billions of dollars through the U.S. 
financial system with the aid of foreign financial 
institutions. Though the money laundering techniques vary, 
their goal is the same--to exploit sanctions law for their own 
benefit. In particular, I worry that Iran and foreign financial 
service providers may have attempted to use creative book-entry 
accounting to violate both the spirit and the clear meaning of 
Iran sanctions.
    Generally speaking, is the processing of a transaction 
involving an Iranian person through the United States permitted 
under current sanctions?

A.1. I share your concern regarding Iranian and foreign 
financial service provider attempts to use creative book-entry 
accounting to violate both the spirit and the clear meaning of 
Iran sanctions. Generally speaking, transactions involving Iran 
or Iranian persons are prohibited through or to the United 
States, unless the transaction is exempt or authorized by OFAC.

Q.2. Assuming a transaction is otherwise prohibited, would any 
book-entry system allow a foreign financial firm to move 
Iranian funds to, though, or within the United States?

A.2. As stated above, transactions involving Iran or Iranian 
persons are prohibited through or to the United States, unless 
the transaction is exempt or authorized by OFAC. If confirmed, 
I am committed to working to ensure that sanctions enforcement 
investigations examine fully the facts and circumstances 
surrounding any book-entry or book-transfer system in light of 
the applicable regulations concerning Iran. I will also 
carefully review this issue and commit to working with your 
office on this important question.

Q.3. Would you be willing to work together with my office and 
the Committee to ensure sanctions State sponsors of terror can 
no longer use those ``book entry'' transactions to evade 
sanctions?

A.3. If confirmed, I am committed to taking strong action 
against attempts to circumvent or evade U.S. sanctions laws--
particularly with respect to transactions processed to, 
through, or within the United States and look forward to 
working with your office and the Committee on this important 
issue. Sanctions against Iran, as in all programs, should be 
implemented and enforced in a way that ensures that there are 
no loopholes that would allow prohibited transactions.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR SASSE
                    FROM SIGAL P. MANDELKER

Q.1. Does Treasury have the necessary resources and 
capabilities to conduct a North Korean leadership asset hunt, 
as the North Koreans are adept at developing shell companies 
and other methods of hiding money?

A.1. I believe that it is vital that Treasury, along with its 
interagency and international partners, pursue all options to 
target the many ways in which North Korea hides its money. As I 
am not in the Administration, I have not had the opportunity to 
review whether Treasury has the necessary resources and 
capabilities to do so. If confirmed, I will carefully review 
this issue. As mentioned in my testimony, the North Korea 
threat will be one of my top priorities.

Q.2. What, if any, are your ideas for innovation in our 
sanctions capabilities? Is there anything we're not doing that 
may be helpful? For example, are there financial analytical 
tools or practices from the private sector that should be 
adopted by the public sector?

A.2. I understand that Treasury has a track record of 
innovation in its use of sanctions as a tool to address foreign 
policy and national security threats. If confirmed, I will work 
with Secretary Mnuchin and other senior leaders in our 
Government to ensure that we are on the cutting edge of 
information analysis in support of our sanctions efforts and 
capabilities. Having spent the last 8 years in the private 
sector, I know that there are tremendous analytical tools 
available within the private sector. If confirmed, I will look 
forward to assessing Treasury's tools and to improving upon 
them, including by consulting with the private sector as 
appropriate.

Q.3. How does the use of sanctions fit within a greater 
strategy? For example, do sanctions have to come after 
diplomatic efforts, or does it sometimes make sense to have 
them work in parallel with diplomatic efforts?

A.3. Sanctions are an important component of the broader 
national security and foreign policy toolkit available to the 
U.S. Government and can be designed to achieve a number of 
objectives. They can, for example, be effectively deployed to 
disrupt the financial and commercial activities of illicit 
actors, such as ISIS and Al Qa'eda, and thus weaken and degrade 
our adversaries by undermining their financial infrastructure. 
When used against a Nation-State adversary, sanctions can 
provide the leverage necessary to reach a diplomatic solution. 
Whether sanctions are deployed before, after, or in parallel 
with diplomatic or other efforts, however, depends on the 
circumstances. Every region, entity, individual, and problem 
presents unique challenges, and we need to make sure that we 
carefully tailor and deploy our tools to address those specific 
challenges.

Q.4. Do you have any recommendations for developing sanctions 
draw-down if a country alters its behavior in response to 
sanctions? How feasible are ``snap back'' sanctions?

A.4. Sanctions are not ends in themselves, but rather tools 
within our foreign policy and national security apparatus that 
are intended to create clear incentives to change behavior. 
When there is evidence that sanctions have achieved their 
intended objectives, the Administration may consider easing or 
lifting them. Typically, when drawing down sanctions or 
providing relief, the U.S. Government relies upon the authority 
granted to it under the International Emergency Economic Powers 
Act (IEEPA), including licensing authority and mechanisms 
specified in relevant sanctions laws, which often include 
waivers to provide tailored sanctions relief appropriate to a 
developing situation.
    Flexibility in the executive branch's authority to 
administer sanctions programs is critical, as it is often 
impossible to predict future developments that may require 
corrective action with respect to any draw-down efforts. When 
implementing a sanctions regime, we should consider how we 
would strategically unwind particular sanctions if we achieve 
our objectives while at the same time tactically use the 
possibility of unwinding as continued leverage. The effective 
use of unwinding tools can force actors to make decisions on a 
continual basis that furthers our strategic interests. While it 
is important to be able to unwind sanctions, we should be very 
careful and generally resistant to lifting sanctions when there 
is no behavioral change.
    Similarly, with respect to ``snap back'' sanctions, we 
should have a comprehensive plan in place regarding the re-
imposition of sanctions, including precise mechanisms and clear 
commitments and resolve from our partners where the sanctions 
are multilateral. The degree to which ``snap back'' sanctions 
are feasible will depend on how effective we are in persuading 
other countries and how committed they are to triggering ``snap 
back'' sanctions where the evidence supports it.

Q.5. When might secondary sanctions be appropriate?

A.5. We face grave national security risks, and secondary 
sanctions can be a powerful and very effective tool to address 
those risks. If confirmed, I will work closely within Treasury 
and with our partners across the U.S. Government, including 
Congress, to evaluate when secondary sanctions should be 
deployed to combat critical national security challenges. Such 
sanctions must be considered as part of a comprehensive 
strategy to curb any particular national security risk that 
includes a careful assessment of the benefits and risks of 
deploying this tool.

Q.6. What might be upcoming challenges related to bitcoin or 
other cryptocurrency, and will you develop a plan to address 
those challenges?

A.6. The emergence of a new generation of virtual currencies 
designed to provide complete transactional anonymity and the 
lack of global regulation and supervision in the virtual 
currency space presents complex challenges to our efforts to 
curb money laundering and terrorist financing. If confirmed, I 
will carefully examine these issues within Treasury, within the 
interagency, and with the private sector, including outside 
experts. We need to be rigorous in our understanding of the 
underlying technologies, assessment of our regulatory 
authorities and the degree to which modifications are necessary 
to promote transparency and protect the U.S. financial system 
from abuse, enforcement against noncompliant actors, and 
engagement with other countries.

Q.7. Does Treasury have the capabilities to track or fight 
against ransomware that uses cryptocurrency, and if not, will 
you commit to push for the development of said capabilities?

A.7. I understand that Treasury leverages its cyberexpertise to 
play an active role in determining how to protect our critical 
infrastructure from illicit cyberactivity, including ransomware 
as well as other business email compromises; deter those that 
engage in such activity; and use available financial data to 
track transactions and recover funds involved in illicit 
cyberactivity. If confirmed, I expect to gain a more detailed 
understanding of Treasury's existing capabilities in this 
space. I will support these efforts at Treasury and will 
promote strengthening capabilities where needed

Q.8. What challenge does block chain pose to future sanctions, 
and does Treasury have the capabilities to meet those 
challenges?

A.8. It is my understanding that block-chain technology itself 
may not inherently be a threat to the effectiveness of 
sanctions or alter or reduce Treasury's enforcement 
jurisdiction, as block-chain technology is merely a distributed 
database system that creates and updates a secure transactional 
ledger. Nonetheless, there are always actors who seek to 
exploit technology for illicit gain. I am committed to 
addressing the threat posed by malign actors who, among other 
things, use services that seek to anonymize their presence, 
including through the use of block-chain based virtual currency 
payments. If confirmed, I will work to ensure that Treasury 
continues to develop expertise internally and fosters dialogue 
with both private industry and financial industry regulatory 
agencies regarding block-chain technology and its use in the 
financial sector.
                                ------                                


               RESPONSES TO WRITTEN QUESTIONS OF
            SENATOR MENENDEZ FROM SIGAL P. MANDELKER

Q.1. In January 2016, the U.S. Patent and Trademark Office 
granted a license to allow Cubaexport to renew an expired 
trademark registration for Havana Club rum. Cubaexport is an 
entity wholly owned by the Cuban Government, and this decision 
reverses a longstanding policy that had denied Havana Club 
rights to Bacardi LLC in the United States. Despite repeated 
inquiries, the Office of Foreign Assets Control has yet to 
provide a satisfactory and legally sound answer for this 
decision which in effect rewards the Castro Government that 
continues to oppress its people and deny them basic human 
rights.
    Previously, when making licensing decisions, OFAC has 
relied upon Section 211, which determines ``whether the 
applicant has obtained the consent of the original owner of the 
stolen mark or the latter's bona fide successor-in-interest to 
register or renew that mark.'' Since Havana Club was illegally 
confiscated from the Jose Arechabala Company (JASA), this 
decision to award the trademark to Cuba raises serious concerns 
about intellectual property policy implications.
    If confirmed, are you planning to uphold OFAC's decision to 
award the trademark to the Cuban Government? Or will you commit 
to reviewing and clarifying why OFAC departed from precedent 
and declined to apply Section 211?

A.1. I am not privy to the details regarding OFAC's decision 
with respect to the Havana Club trademark, and it would not be 
appropriate for me to comment on any specific decision at this 
time. If confirmed, I will review any such decision in light of 
the applicable law.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
                    FROM SIGAL P. MANDELKER

Q.1. Russia--Do you believe that we should increase sanctions 
on Russia for its malicious cyberactivities, intervention in 
Ukraine, and/or support for Assad in Syria? Please explain why 
or why not.

A.1. I share your concerns regarding Russia's cyberactivities, 
intervention in Ukraine, and support for Assad. Sanctions are 
an important part of the United States' tools to address these 
pressing national security issues. If confirmed, I will 
carefully assess the ways in which Treasury's tools can be most 
effectively deployed and will present those options within the 
interagency so that they can be considered as part of the 
Administration's overall strategy to address these threats.

Q.2. Would you oppose legislation that requires Congressional 
review before any rollback of our existing Russia sanctions?

A.2. As the Administration has made clear, U.S. sanctions 
against Russia will remain until Russia reverses the actions 
that triggered those sanctions. If confirmed, I look forward to 
working within the Administration and with Congress to identify 
the best way to hold Russia accountable for its actions and 
encourage it to live up to its commitments. While it would not 
be appropriate for me to comment on any particular piece of 
legislation at this time, if confirmed, I would look forward to 
working with Congress regarding this important issue.

Q.3. ISIS (Islamic State in Iraq and Syria)--Is there anything 
you would do differently than what Treasury is already doing to 
shut off ISIS from the international financial system and from 
other financial networks like money remittance channels and 
currency auctions?

A.3. As I mentioned during my testimony, if confirmed, I will 
focus immediately on the areas that pose the greatest threats, 
including ISIS. Disrupting ISIS's financial underpinnings has 
to be a top priority. If confirmed, I will conduct an 
expeditious review of the intelligence and of Treasury's 
actions thus far to cut off ISIS from the international 
financial system and other financial networks and determine how 
to change, modify, and/or supplement those efforts. For 
example, among other things, I will examine whether there are 
additional individuals or entities that should be designated 
and sanctioned, what related enforcement actions are underway, 
and what more we can initiate as part of the effort to seize 
ISIS's financial support and deter further financing, whether 
our intelligence collection and analytical efforts are 
sufficient or should be enhanced to produce actionable 
intelligence to address ISIS's evolving financial campaign, and 
how we can most effectively work with the Justice Department, 
the State Department, and the Defense Department, among others, 
to coordinate our efforts and most effectively utilize our 
respective authorities. I will also ensure that Treasury 
continues to proactively share and analyze information with 
coalition partners through the Counter-ISIS Finance Group, the 
Egmont Group of Financial Intelligence Units and through other 
appropriate channels, including the private sector as 
appropriate. I understand that Treasury has served as a leader 
in this effort and I believe that it should continue to do so 
and strengthen those relationships.

Q.4. Does Treasury need additional authority from Congress to 
counter ISIS's finances?

A.4. If confirmed, I will undertake an expeditious and thorough 
review of Treasury's actions and authorities to counter ISIS' 
finances, and I look forward to working with Congress on this 
important national security issue.

Q.5. Iran--At this time, are you aware of another realistic 
method, aside from enforcing and complying with the 2015 
nuclear agreement [Joint Comprehensive Plan of Action (JCPOA)], 
to limit Iran's nuclear program and subject it to rigorous 
monitoring and inspections?

A.5. Curtailing Iran's nuclear program and permanently prevent 
the regime from developing nuclear weapons is paramount to our 
national security interests. I understand that the 
Administration is currently undertaking a comprehensive review 
of the United States' Iran policy, including with respect to 
the JCPOA. If confirmed, I would look forward to participating 
in that review and working with the Administration and Congress 
to ensure that a comprehensive strategy is implemented that 
protects the American people and our allies overseas.

Q.6. As far as you know, are there any deficiencies in 
Treasury's currently available tools to counter Iran for its 
non-nuclear activities (ballistic missile development, human 
rights abuses, support for terrorism, etc.)?

A.6. Treasury already has substantial authorities available to 
it to counter Iran's malign, non-nuclear activities, including 
many executive orders and statutes that provide Treasury with 
primary and secondary sanctions authorities and enforcement 
tools. If confirmed, I will work to ensure that the Treasury 
continues to aggressively target Iranian provocative activities 
in ballistic missile development, human rights abuses, and 
support for terrorism, among other areas, consistent with the 
Administration's foreign policy priorities. I will carefully 
review whether there are additional tools that Treasury can 
deploy and, where needed to further target Iran's malign 
activities, I will work with the Administration to put in place 
new authorities using powers granted under the International 
Emergency Economic Powers Act (IEEPA) or other statutory 
authorities. Congress has played a vital leadership role in 
addressing the Iranian threat, and I would look forward to 
working with this Committee and others should Treasury need 
additional authorities not available under existing statutes. I 
believe that we should vigorously enforce those authorities.

Q.7. Iran is still on the Financial Action Task Force (FATF) 
blacklist of countries that are a high-risk of money laundering 
and terrorist financing. Last year Iran made commitments to 
FATF to make structural reforms in these areas. Will you work 
with FATF to pressure Iran to address its money laundering and 
terrorist financing problems?

A.7. Yes. I believe that U.S. leadership with FATF on this 
critical issue is an important component of the U.S. 
Government's efforts to address Iran's ongoing illicit 
behavior, including its continued highly egregious money 
laundering and terrorist financing activities.

Q.8. North Korea--China is North Korea's outlet to the 
financial system. How do we exert pressure on China to get 
North Korea to freeze its nuclear and ballistic missile 
activities, without provoking a Chinese reaction that harms the 
U.S. economy?

A.8. If confirmed, I will carefully and expeditiously study 
this issue, in consultation with other partners in the 
interagency. I understand from public reporting that exerting 
pressure on China to get North Korea to freeze its nuclear and 
ballistic missile activities is a critical part of the 
Administration's strategy. If confirmed, addressing this issue 
and Treasury's role in a comprehensive strategy will be one of 
my highest priorities. I will immediately request an 
intelligence briefing regarding the North Korea threat and an 
assessment of the tools that Treasury has already deployed and 
those that should carefully be considered. We should use all 
available tools directly against North Korea and carefully 
assess and implement ways to effectively persuade China to 
bring enormous economic pressure on North Korea.

Q.9. State Department Budget--Former Acting Under Secretary for 
Terrorism and Financial Crimes, Adam Szubin, testified before a 
Banking subcommittee on May 10 about the need for sanctions to 
be part of a broader diplomatic strategy. Mr. Szubin said, in 
part: ``Massive diplomatic investment and multilateral 
engagement will be needed to marshal a successful effort, and 
it will require enlisting like-minded and resistant 
countries.'' He went on to say ``it would be counterproductive 
in the extreme to deplete our Foreign Service corps at a time 
when we need them so urgently.'' President Trump's budget 
blueprint proposes deep cuts to the State Department. Given 
that diplomacy helps build coalitions with other countries to 
enforce effective sanctions, would gutting the State Department 
make your job easier or harder?

A.9. The State Department plays a vital role in the enforcement 
of our sanctions regime. I have not had the opportunity to 
review the State Department budget or assess what impact, if 
any, it will have on our diplomatic efforts to work with other 
countries to enforce sanctions. However, if confirmed, I look 
forward to working closely with the State Department and others 
to advance the national security and foreign policy priorities 
of the United States. Strong diplomatic engagement plays an 
essential role in making our sanctions as effective as 
possible.
                                ------                                


               RESPONSES TO WRITTEN QUESTIONS OF
            SENATOR DONNELLY FROM SIGAL P. MANDELKER

Q.1. North Korea Sanctions--Last week Senator Sasse and I held 
a subcommittee hearing on how to craft a stronger sanctions 
regime against North Korea. Our witnesses were both tremendous 
experts in this field--Juan Zarate and Adam Szubin, who 
previously held the position for which you have been nominated. 
There is a strong consensus that China is the linchpin to any 
meaningful increase in sanctions against North Korea.
    If confirmed, would you support imposing secondary 
sanctions against Chinese entities that support the North 
Korean regime, particularly those elements that oversee Kim 
Jong Un's nuclear and ballistic missile programs?

A.1. Addressing the threats that we face from North Korea will 
be one of my top priorities. Sanctions are an important 
component of the comprehensive strategy to pressure North Korea 
to curb this increasingly urgent threat and to lean on other 
countries, including most importantly China, to implement and 
enhance existing sanctions against North Korea. I understand 
from public reporting that the Administration has been engaged 
in a productive dialogue with China on this issue and I would 
actively participate in this interagency effort, if confirmed.
    I will also make sure that Treasury presents comprehensive 
options to the interagency discussion, not only with respect to 
sanctions but also the other tools available to the Office of 
Terrorism and Financial Intelligence, including those deployed 
by FinCEN, the Office of Terrorist Financing and Financial 
Crimes, and the Office of Intelligence and Analysis. Before 
committing to any particular recommendation, I will need to 
understand the status of the United States' diplomatic and 
other efforts and how the secondary sanctions option fits 
within our comprehensive strategy. I will be extremely 
committed to making sure that Treasury actively uses its tools 
not only to pressure North Korea, but also to hold accountable 
those that facilitate the North Korean regime through illicit 
financing. If the Administration determines that secondary 
sanctions are appropriate, I will make sure that they are 
enforced vigorously.

Q.2. What factors would weigh into your consideration of 
whether and how to approach secondary sanctions against Chinese 
firms? How would you weigh potential impacts to the U.S. and 
global economies?

A.2. The decision to impose secondary sanctions would involve 
not only the Treasury Department, but also other Departments 
within the interagency, including the State Department. There 
are a number of factors that should be considered in any such 
strategy, including the effectiveness of secondary sanctions to 
the broader goal of containing the Kim regime and its nuclear 
and ballistic missile programs; the additional leverage 
secondary sanctions would provide over and above the United 
States' domestic authorities and U.N. Security Council 
sanctions regime; the bilateral relationship with China; and 
how such sanctions might impact the economy and our key allies 
in the region, such as South Korea and Japan. I would consult 
with other members of the interagency to ensure that the 
appropriate experts have analytically assessed the impact.

Q.3. Russia Sanctions--The position for which you have been 
nominated also serves as a member of the intelligence 
community.
    As you prepare for this role, have you spoken with the 
White House about expanding sanctions against Russia?

A.3. No.

Q.4. Have you spoken with experts at the Treasury Department or 
elsewhere about expanding sanctions against Russia to assess 
options and seek advice?

A.4. I have not spoken with experts at the Treasury Department 
about expanding sanctions against Russia in order to assess 
options and seek such advice. This subject has generally come 
up during my meetings with Members of the Senate Banking 
Committee and I have also reviewed testimony that has been 
presented to the Committee regarding this topic.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF CHAIRMAN CRAPO
                 FROM MIRA RADIELOVIC RICARDEL

Q.1. The previous Administration launched the Export Control 
Reform Initiative in 2010 based on a concept of four 
singularities: merge the commodity control lists into a single 
list; adopt a common IT portal, create a single licensing 
agency and transfer most enforcement efforts to a single 
agency. The four singularity concepts were never achieved 
either because of a shortage of time or the lack of support to 
consider such a far-reaching bureaucratic restructuring.
    However, considerable progress was made with regard to the 
merger of the commodity control lists managed by the State and 
Commerce Departments. In fact, 18 of the 21 categories on 
State's United States Munitions List (USML) were rationalized 
by migrating certain commercial and dual-use products from the 
USML to the Commerce Control List (CCL) maintained by the 
Department of Commerce.
    The three remaining USML categories, I-III, largely 
pertaining to commercial and sporting firearms and ammunition 
products, the least technically complex of all the categories, 
were never rationalized and left untouched. This no doubt 
impacts both small businesses and the Government resources used 
for protecting U.S. national security interests.
    If confirmed, will you commit to having the Commerce 
Department complete the commodity control lists merger prong of 
the Export Control Reform Initiative and finalize the migration 
of Categories I, II, and III so that all 21 USML categories are 
appropriately merged?

A.1. I am aware that 18 out of 21 United States Munitions List 
(USML) categories have been revised and corresponding controls 
established in the Commerce Control List (CCL). I also 
understand that work on regular review and revisions of those 
categories continue. If confirmed, I commit to working closely 
with Secretary Ross and the State Department on these reviews 
and taking the appropriate next steps to address the remaining 
three categories.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR SASSE
                 FROM MIRA RADIELOVIC RICARDEL

Q.1. No U.S. exporter should undergo an unnecessarily 
duplicative licensing regime to sell their goods overseas; 
doing so unnecessarily increases costs and is ultimately passed 
down to Main Street. Accordingly, I'd like to ask about ongoing 
efforts to reform the export control process, particularly 
regarding the possible transfer to the Bureau of Industry 
Security of export licensing responsibility over Categories I-
III of the U.S. Munitions List.
    Do you commit to pushing to complete a review of this 
possible as soon as possible?

A.1. I am aware that 18 out of 21 United States Munitions List 
(USML) categories have been revised and corresponding controls 
established in the Commerce Control List (CCL). I also 
understand that work on regular review and revisions of those 
categories continue. If confirmed, I commit to working closely 
with Secretary Ross and the State Department on these reviews 
and taking the appropriate next steps to address the remaining 
three categories.

Q.2. When do you expect this review to be completed?

A.2. I also commit to working closely with you and your office 
and providing timely updates on this matter.

Q.3. Will you commit to doing everything within your power to 
improve the efficiency of the export review process for 
Categories I-III, while still preventing unlawful possession of 
these weapons?

A.3. I am committed to improving the efficiency of the export 
review process while maintaining strong national security and 
foreign policy objectives, if confirmed.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR PERDUE
                 FROM MIRA RADIELOVIC RICARDEL

Q.1. Ms. Ricardel, the previous Administration implemented the 
Export Control Reform initiative in order to modernize our 
cold-war era export licensing controls. This reform was aimed 
at enhancing our national security and improving the global 
competitiveness of U.S. companies. A key objective in the 
Export Control Reform was to rationalize the control lists and 
pursuant to the authorities granted within the Arms Export 
Control Act, transfer export licensing authority for commercial 
and dual-use items from the State Department Directorate of 
Defense Trade Controls (DTCC) to the Commerce Department--
Bureau of Industry Security (BIS).
    Under the prior Administration, commercial and dual use 
products covered in 18 of the 21 DTCC's categories to the BIS. 
However, 3 of the 21 categories--USML categories I, II, and III 
(commercial and sporting firearms and ammunition products)--
were purposely singled out by the past Administration for 
transparent political reasons and have not realized the 
benefits of the Export Control Reforms Initiative.
    Today, roughly 25 percent of the DDTC's export licensing 
workload now involves Category I products like the single shot 
bolt action 22 caliber rifle used by many Boy Scouts. Many in 
Congress share these same concerns including the submission of 
bipartisan letters from Congress that were recently sent to 
Secretary Ross and Secretary Tillerson urging completion of the 
ECR initiative.
    Will you commit to working on the expeditious completion of 
the transfer of export licensing authority for commercial and 
dual-use items from the DTCC to the BIS?

A.1. I am aware that 18 out of 21 United States Munitions List 
(USML) categories have been revised and corresponding controls 
established in the Commerce Control List (CCL) and understand 
that work on regular review and revisions of those categories 
continue. If confirmed, I commit to working closely with 
Secretary Ross and the State Department on these reviews and 
taking the appropriate next steps to address the remaining 
three categories.

Q.2. Once you are in office, will you please provide me an 
updated estimate on the date by which Commerce Department will 
publish the proposed rule to transfer export licensing of 
commercial and sporting firearms and ammunition products 
currently on the USML categories I, II, and III to the Commerce 
Department from the State Department?

A.2. I also commit to working closely with you and your office 
and providing timely updates on this matter, to include 
notification of planned publication of proposed rules, if 
confirmed.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
                 FROM MIRA RADIELOVIC RICARDEL

Q.1. Chinese firms and investors are increasingly trying to 
acquire U.S. companies, or companies with U.S. assets. Last 
December President Obama blocked a Chinese firm from acquiring 
a German-based semiconductor company with U.S. assets. Are you 
concerned about China's increasing assertiveness in this area, 
and if so, what will you do about it?
    Some public reports have indicated that China may be 
attempting to circumvent CFIUS in order to gain access to 
defense or other critical technology by investing in early 
stage companies or otherwise obscuring the source of capital. 
Is this a concern, and if so, do you believe that changes to 
CFIUS are required?

A.1. I share your concerns regarding China's publicly stated 
goal of becoming a global leader in the semiconductor and 
software technology space. I understand the Department of 
Commerce is currently updating its 2009 assessment of the U.S. 
semiconductor industry and the impact of competitors, such as 
China, on that industry. If confirmed, I commit to work closely 
with Secretary Ross on this important matter, as well as with 
the Department of the Treasury on China's potential 
circumvention of CFIUS, as well as any potential legislative or 
regulatory changes to CFIUS.

Q.2. In your prepared testimony, you observed that ``the health 
of the U.S. defense industrial base is imperative[.]'' Please 
explain in detail how will you advocate for U.S. workers, 
companies, and technologies that support the U.S. defense 
industrial base.

A.2. I am committed to working within the Department of 
Commerce and within the U.S. Government interagency on measures 
that can strengthen the U.S. defense industrial base, if 
confirmed. The Bureau of Industry and Security protects 
critical U.S. technologies that are a vital part of the U.S. 
defense industrial base through both its export licensing and 
export enforcement processes. If confirmed, I will ensure that 
the Bureau's licensing and enforcement efforts are effective, 
to include thorough assessments of end-use and end-users. 
Furthermore, I will reach out to industry and seek input on 
proposed rules, as well as ways in which these processes might 
be improved. In addition, the Bureau regularly conducts in-
depth surveys of specific defense industrial capabilities. The 
information obtained through these surveys--such as identifying 
areas of concern in the supply chain--can be used to develop 
appropriate actions and policy recommendations.
                                ------                                


               RESPONSES TO WRITTEN QUESTIONS OF
         SENATOR DONNELLY FROM MIRA RADIELOVIC RICARDEL

Q.1. If confirmed, you will have an important role in 
protecting the U.S. defense industrial base. Earlier this 
month, you and I discussed the fact that current law explicitly 
prohibits the transfer of excess military equipment to foreign 
countries if doing so would harm U.S. industry and jobs. I'm 
talking about section 2321j of Title 22. I remain concerned 
that the Pentagon and the State Department are attempting to 
circumvent this law and risking critical U.S. manufacturing 
capabilities in the process.
    If confirmed, will you work with Secretary Ross to enforce 
the law and ensure these transfers don't harm American workers?

A.1. If confirmed, I commit to working closely with Secretary 
Ross on the important issue of protecting the U.S. defense 
industrial base and will do so in accordance with section 2321j 
of Title 22.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR SASSE
                   FROM MARSHALL BILLINGSLEA

Q.1. Does Treasury have the necessary resources and 
capabilities to conduct a North Korean leadership asset hunt, 
as the North Koreans are adept at developing shell companies 
and other methods of hiding money?

A.1. If confirmed, I look forward to working with Congress to 
ensure that Treasury has the appropriate resources and 
capabilities to carry out the Administration's policy of 
pressuring North Korea to denuclearize, cease its ballistic 
missile testing, and end its proliferation of deadly 
technology.

Q.2. What, if any, are your ideas for innovation in our 
sanctions capabilities? Is there anything we're not doing that 
may be helpful? For example, are there financial analytical 
tools or practices from the private sector that should be 
adopted by the public sector?

A.2. As a Managing Director at Deloitte leading our Business 
Intelligence Services practice, I work with a wide range of 
analytic tools, data sets, and have developed tactics, 
techniques, and procedures which have repeatedly proven 
themselves in investigation of front and shell companies on 
behalf of the Federal Government, as well as private sector 
clients. If confirmed, I intend to take a close, careful look 
at current Treasury capabilities to ensure that we benefit from 
the best that the private sector has to offer.

Q.3. How does the use of sanctions fit within a greater 
strategy? For example, do sanctions have to come after 
diplomatic efforts, or does it sometimes make sense to have 
them work in parallel with diplomatic efforts?

A.3. While each case is unique, I believe that sanctions 
generally should be part of a broader national strategy to 
advance our interests. Of course, there may be situations where 
sanctions may precede, or set the stage for, diplomatic 
efforts. Moreover, sanctions also can be an important offensive 
tool to degrade and disrupt illicit criminal and terrorist 
networks. If confirmed, I will look forward to working with our 
partners across the Government, including our Congress, to 
deploy these tools effectively in support of our national 
interests.

Q.4. Do you have any recommendations for developing sanctions 
draw-down if a country alters its behavior in response to 
sanctions? How feasible are ``snap back'' sanctions?

A.4. Generally, when winding down a sanctions program or 
providing relief, the U.S. Government utilizes the licensing 
authority under the International Emergency Economic Powers Act 
(IEEPA) or waivers in Congressional legislation to provide 
appropriately tailored sanctions relief. This flexibility in 
our authorities is critical, as it is exceptionally challenging 
to predict how future events may impact ongoing draw-down 
efforts. This flexibility also has the benefit of allowing us 
to quickly remove sanctions relief previously granted via 
license or waiver or to reimpose sanctions even if a particular 
sanctions program has been terminated.

Q.5. When might secondary sanctions be appropriate?

A.5. In the past, secondary sanctions have played a useful role 
as part of a broader strategy to increase pressure on illicit 
actors to change their threatening behavior, but may have 
consequences to financial relationships with the U.S. and 
access to the U.S. financial system. If confirmed, I will 
carefully evaluate whether secondary sanctions would be an 
effective and appropriate tool to combat critical national 
security challenges.

Q.6. What might be upcoming challenges related to bitcoin or 
other cryptocurrency, and will you develop a plan to address 
those challenges?

A.6. Virtual currency payments potentially provide a more 
efficient, cheaper alternative to traditional payment methods 
by avoiding interchange and currency exchange fees, providing 
faster settlement, and reducing counterparty risk. At the same 
time, virtual currency payments present money laundering and 
terrorist financing risks that must be assessed and mitigated, 
especially with respect to anonymity, challenges in tracing 
virtual currency flows, and the lack of regulation and 
supervision in most jurisdictions worldwide. If confirmed, I 
will work to enhance the effectiveness of our regulatory and 
supervisory regime for virtual currency and to urge other 
countries to follow suit. This also is an area where I would 
look forward to working closely with the private sector.

Q.7. Does Treasury have the capabilities to track or fight 
against ransomware that uses cryptocurrency, and if not, will 
you commit to push for the development of said capabilities?

A.7. If confirmed, I look forward to understanding the 
capabilities already possessed by Treasury, and I will commit 
to pushing for the development of any additional capabilities 
needed. I understand that Treasury, as the U.S. Government's 
lead agency charged with protecting the U.S. financial system, 
has a number of authorities designed to defend our critical 
infrastructure from abuse by cybercriminals. If confirmed, I 
expect to gain a more detailed understanding of these 
capabilities to combat the use of virtual currency payments for 
cybercrime, including ransomware attacks. I will also work 
across Treasury, the entire U.S. Government, and with 
international partners to enhance our ability to combat 
cybercrime, including ransomware.

Q.8. What challenge does block chain pose to future sanctions, 
and does Treasury have the capabilities to meet those 
challenges?

A.8. The new generation of cryptocurrencies and more 
sophisticated technologies appear to be able to provide 
anonymity in virtual currency transactions, and therefore may 
present a challenge to future sanctions implementation. If 
confirmed, I expect to gain a more detailed understanding of 
Treasury's existing capabilities to combat the use of virtual 
currency payments, including in the sanctions context, and will 
support efforts to increase capacity to address this issue. I 
look forward to working with the interagency and the 
Intelligence Community on this challenge, and believe that we 
will benefit from private sector insight in this area as well.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
                   FROM MARSHALL BILLINGSLEA

Q.1. Russia--Do you believe that we should increase sanctions 
on Russia for its malicious cyberactivities, intervention in 
Ukraine, and/or support for Assad in Syria? Please explain why 
or why not.

A.1. Countering Russia's malicious cyberactivity, securing a 
diplomatic solution in Ukraine, and achieving peace and 
stability in Syria are some of the greatest challenges our 
Nation now faces. As we have seen, Treasury's sanctions tools 
can play a critical role in advancing our interests in these 
areas. If confirmed, I will work with the rest of the 
Administration and with Congress to identify how these tools 
can continue advancing our interests across a range of areas in 
which Russia is actively working against U.S. interests and 
serving as a destabilizing influence.

Q.2. Would you oppose legislation that requires Congressional 
review before any rollback of our existing Russia sanctions?

A.2. Our sanctions against Russia were imposed in large part to 
provide leverage to reach a diplomatic solution. As the 
Administration has made clear, we will roll back sanctions only 
when Russia fulfills its commitments under the Minsk 
agreements. To achieve this goal, it is essential that the 
Administration have the flexibility and credibility to use this 
leverage in a way that best supports both our own efforts and 
those of our allies. I look forward to working with the 
Congress, if confirmed, to identify the best way to do so with 
an eye towards preserving the diplomatic and negotiating space 
necessary to reach the outcome we seek.

Q.3. ISIS (Islamic State in Iraq and Syria)--Is there anything 
you would do differently than what Treasury is already doing to 
shut off ISIS from the international financial system and from 
other financial networks like money remittance channels and 
currency auctions?

A.3. I certainly will bring my experience in developing 
counterterrorism campaign plans to my role at Treasury, if 
confirmed. I understand that Treasury is working across the 
U.S. Government and with Governments around the world to 
isolate ISIS from the international financial system, and I 
will continue and enhance these efforts. Treasury has worked 
closely with the Government of Iraq to cut off bank branches in 
ISIS-controlled territory in Iraq from the Iraqi and 
international financial systems and to put in place safeguards 
to deny ISIS access to U.S. banknotes.
    If confirmed, under my leadership, Treasury will continue 
its efforts to ensure that ISIS is not able to use banks and 
exchange houses in recently liberated areas of Iraq, and we 
will strengthen our international partnerships to prevent ISIS 
from moving funds to its branches or its global network. I also 
look forward, if confirmed, to examining whether there are 
additional ISIS-affiliated individuals who should be designated 
and sanctioned under appropriate authorities.

Q.4. Does Treasury need additional authority from Congress to 
counter ISIS's finances?

A.4. If confirmed, I look forward to examining this question 
carefully and will work closely with Congress on this matter.

Q.5. Iran--At this time, are you aware of another realistic 
method, aside from enforcing and complying with the 2015 
nuclear agreement [Joint Comprehensive Plan of Action (JCPOA)], 
to limit Iran's nuclear program and subject it to rigorous 
monitoring and inspections?

A.5. The Administration is currently conducting a review of all 
policies related to Iran, including on the benefits and 
drawbacks of the JCPOA. I look forward to participating in this 
review and to working with Treasury's partners in the 
Administration and with Congress on this critical issue if 
confirmed.

Q.6. As far as you know, are there any deficiencies in 
Treasury's currently available tools to counter Iran for its 
non-nuclear activities (ballistic missile development, human 
rights abuses, support for terrorism, etc.)?

A.6. I understand that Treasury is well-armed through both 
legislation and executive orders in terms of tools to counter 
Iran's ballistic missile activity, support for terrorism, and 
human rights abuses among other nefarious activity. Since the 
beginning of the current Administration, Treasury has issued 
three rounds of Iran sanctions, across the above-mentioned 
categories.
    If confirmed, I will act vigorously to ensure that we use 
all available tools to counter Iran's destabilizing activities 
and enlist the support of our international partners to do the 
same. Should I find the need for additional tools and 
authorities, I will not hesitate to work with you to determine 
the best means by which to enhance existing capabilities. 
Having served in the 1990s as a Senate committee staffer who 
drafted several pieces of bipartisan sanctions legislation 
(including on Iran), I appreciate the important role of 
Congress on this matter and look forward to working closely 
together.

Q.7. Iran is still on the Financial Action Task Force (FATF) 
blacklist of countries that are a high-risk of money laundering 
and terrorist financing. Last year Iran made commitments to 
FATF to make structural reforms in these areas. Will you work 
with FATF to pressure Iran to address its money laundering and 
terrorist financing problems?

A.7. Yes.

Q.8. North Korea--China is North Korea's outlet to the 
financial system. How do we exert pressure on China to get 
North Korea to freeze its nuclear and ballistic missile 
activities, without provoking a Chinese reaction that harms the 
U.S. economy?

A.8. This is a crucial question, and if confirmed, I intend to 
study it carefully. In general, I believe that Treasury should 
continue to use all appropriate tools against North Korea and 
to persuade China to bring economic pressure on its neighbor 
and trading partner.

Q.9. State Department Budget--Former Acting Under Secretary for 
Terrorism and Financial Crimes, Adam Szubin, testified before a 
Banking subcommittee on May 10 about the need for sanctions to 
be part of a broader diplomatic strategy. Mr. Szubin said, in 
part: ``Massive diplomatic investment and multilateral 
engagement will be needed to marshal a successful effort, and 
it will require enlisting like-minded and resistant 
countries.'' He went on to say ``it would be counterproductive 
in the extreme to deplete our Foreign Service corps at a time 
when we need them so urgently.'' President Trump's budget 
blueprint proposes deep cuts to the State Department. Given 
that diplomacy helps build coalitions with other countries to 
enforce effective sanctions, would gutting the State Department 
make your job easier or harder?

A.9. I have not examined the budget blueprint. Having served as 
a diplomat during my time as NATO Assistant Secretary General, 
I am supportive of our State Department, and both the Career 
and Foreign Services. Sanctions are often deployed in 
conjunction with other levers of national power, especially 
diplomacy. State Department engagement can amplify Treasury's 
efforts, and if confirmed, I will continue to be an advocate of 
keeping a strong diplomatic posture.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
                     FROM HEATH P. TARBERT

Q.1. If confirmed, you will lead Treasury's role on the 
Committee on Foreign Investments in the United States (CFIUS). 
What kind of national security risks could arise if an 
Administration official's business was acquired in whole or in 
part by a foreign entity?

A.1. An acquisition of a U.S. business by a foreign entity 
potentially could give rise to national security concerns, 
depending upon a number of factors, including but not limited 
to the nature of the particular U.S. business acquired and the 
acquiring foreign entity. The relevant statute and regulations 
require that, before clearing a transaction to proceed, CFIUS 
find that there are no unresolved national security concerns. 
If confirmed, I am committed to ensuring that CFIUS satisfies 
this standard, regardless of who owns the U.S. business at 
issue.

Q.2. Do you believe CFIUS has the resources to thoroughly 
monitor and review foreign acquisitions of U.S. businesses that 
could threaten national security?

A.2. As I stated in my confirmation hearing, if confirmed, my 
first priority will be to ensure that the Office of Investment 
Security within the Treasury Department has the necessary 
resources and tools to function as Congress intended. To the 
extent that additional resources and tools are required, I am 
committed to working within the Department and with all 
relevant parts of the Government to address such needs.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
                     FROM HEATH P. TARBERT

Q.1. Systemic Risk--Do you see cybersecurity at financial 
institutions as a contributor to systemic risk, and if so, what 
should Treasury be doing about it?

A.1. Cybersecurity is a critical issue for the safety and 
soundness of financial institutions and financial stability 
more generally. Potential cyberattacks capable of paralyzing 
systemically important financial institutions and financial 
market utilities such as clearinghouses and payment systems can 
contribute to systemic risk. Furthermore, the nature of 
cyberattacks may make traditional micro- and macro-prudential 
tools (i.e., capital and liquidity buffers) less useful at 
mitigating financial stability threats.
    I am aware that domestic regulators have been working on a 
framework for addressing cybersecurity, and that the Financial 
Stability Oversight Council has highlighted the importance of 
this issue. I also understand that the Office of Critical 
Infrastructure Protection and Compliance Policy within the 
Treasury Department has programs to address cybersecurity 
issues. If confirmed, I would advocate for continued attention 
to cyber resilience within international forums, such as the G7 
and Financial Stability Board--particularly because 
debilitating cyberattacks in certain international financial 
centers could directly impact the stability of the U.S. 
financial system.

Q.2. CFIUS--Chinese firms and investors are increasingly trying 
to acquire U.S. companies, or companies with U.S. assets. Last 
December President Obama blocked a Chinese firm from acquiring 
a German-based semiconductor company with U.S. assets. Are you 
concerned about China's increasing assertiveness in this area, 
and if so, what will you do about it?

A.2. Notwithstanding the significant benefit that the U.S. 
economy derives from foreign direct investment, it is the 
responsibility of the Government to ensure the protection of 
the national security. If confirmed, I will carefully review 
current and potential threats to and vulnerabilities within the 
U.S. semiconductor sector. In carrying out my responsibilities, 
I will work to ensure that no transaction is approved if 
national security concerns remain unresolved.

Q.3. Some public reports have indicated that China may be 
attempting to circumvent CFIUS in order to gain access to 
defense or other critical technology by investing in early-
stage companies or otherwise obscuring the source of capital. 
Is this a concern, and if so, do you believe that changes to 
CFIUS are required?

A.3. I recall that during my visit to your office, we discussed 
public reports of parties deliberately attempting to circumvent 
CFIUS. I am concerned with such reports, although I understand 
that a significant amount of work is being done to examine 
these issues. Should I be confirmed, I am committed to fully 
exploring these questions and to working to ensure that CFIUS 
fulfills its statutory mandate.
                                ------                                


               RESPONSES TO WRITTEN QUESTIONS OF
             SENATOR DONNELLY FROM HEATH P. TARBERT

Q.1. CFIUS--The Committee on Foreign Investment in the United 
States (CFIUS) was established to review transactions involving 
foreign entities that could have significant national security 
implications. Our domestic steel, aluminum, and other metals 
manufacturers are of vital importance to our Nation's critical 
infrastructure and national security. Increased levels of 
foreign imports, often aided by illegal Government subsidies, 
have continued to weaken our domestic manufacturers and provide 
foreign companies greater access to the domestic market.
    If confirmed, you will be responsible for heading 
Treasury's CFIUS efforts. How do you plan to prioritize agency 
resources to ensure transactions are being appropriately 
vetted?

A.1. If confirmed, I will work to ensure that the resources of 
the Treasury Department are prioritized in a manner that 
ensures all transactions are appropriately vetted. In addition, 
I will make it a priority to assess the adequacy of the 
resources available for CFIUS to fulfill its national security 
mandate. To the extent that additional resources and tools are 
required, I am committed to working within the Treasury 
Department and with all relevant parts of the Government to 
address such needs.

Q.2. Do you believe there are areas in which the CFIUS review 
process can be improved to increase its effectiveness or the 
number of transactions reviewed by the Committee, particularly 
those involving manufacturing acquisitions?

A.2. If confirmed, I will consult with the career professionals 
in the Office of Investment Security within the Treasury 
Department and other relevant stakeholders to determine whether 
any aspects of the review process should be adjusted to improve 
the ability of CFIUS to satisfy its national security mandate. 
To the extent that any such adjustments are appropriate, I am 
committed to working within the Treasury Department and with 
all relevant parts of the Government, as applicable to address 
them.
    With respect to national security issues potentially 
arising from the acquisition of domestic manufacturers, I note 
that Section 721 of the Defense Production Act of 1950, as 
amended, directs CFIUS to consider a number of factors, at 
least several of which are directly relevant to our 
manufacturing sector. Those factors include: domestic 
production needed for projected national defense requirements, 
the capability and capacity of domestic industries to meet 
national defense requirements, and the potential national 
security effects on United States critical infrastructure. If 
confirmed, I will work to ensure those factors and all others 
required by law to be considered are appropriately taken into 
account.
              Additional Material Supplied for the Record
  LETTERS SUBMITTED IN SUPPORT OF THE NOMINATION OF SIGAL P. MANDELKER
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   LETTERS SUBMITTED IN SUPPORT OF THE NOMINATION OF MIRA RADIELOVIC 
                                RICARDEL
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 LETTER SUBMITTED IN SUPPORT OF THE NOMINATION OF MARSHALL BILLINGSLEA
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