[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 5592 Introduced in Senate (IS)]
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118th CONGRESS
2d Session
S. 5592
To amend the Bank Holding Company Act of 1956 to prohibit bank holding
companies from facilitating fossil fuel production from new sources, or
from facilitating transactions that would provide funds for the
construction of new or expanded fossil infrastructure that would drive
such production, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 18 (legislative day, December 16), 2024
Mr. Merkley introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To amend the Bank Holding Company Act of 1956 to prohibit bank holding
companies from facilitating fossil fuel production from new sources, or
from facilitating transactions that would provide funds for the
construction of new or expanded fossil infrastructure that would drive
such production, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Protecting America's Economy from
the Carbon Bubble Act of 2023''.
SEC. 2. PROHIBITION ON FACILITATING FOSSIL FUEL PRODUCTION FROM NEW
SOURCES.
The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is
amended by adding at the end the following:
``SEC. 15. PROHIBITION ON FACILITATING FOSSIL FUEL PRODUCTION FROM NEW
SOURCES.
``(a) Definitions.--In this section--
``(1) the terms `exchange', `issuer', and `security' have
the meanings given those terms in section 3(a) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a));
``(2) the term `financial company' means--
``(A) a bank holding company, savings and loan
holding company, or similar institution;
``(B) a foreign banking organization or company
that is treated as a bank holding company under this
Act;
``(C) an insured depository institution, a thrift
institution, a savings association, an industrial loan
company, or similar institution; or
``(D) any subsidiary, agency, or affiliate of an
entity described in subparagraph (A), (B), or (C);
``(3) the term `fossil fuel' means coal, petroleum, natural
gas, or any derivative of coal, petroleum, or natural gas, that
is used for fuel, including hydrogen combined with any such
derivative;
``(4) the term `fossil infrastructure' means fossil fuel-
related projects, including wells, rail infrastructure,
pipelines, terminals, refineries, and power plants;
``(5) the term `national securities exchange' means an
exchange registered as a national securities exchange in
accordance with section 6 of the Securities Exchange Act of
1934 (15 U.S.C. 78f);
``(6) the term `new sources' means--
``(A) any production in excess of proven developed
producing reserves of fossil fuels, as of the date of
enactment of this section; or
``(B) new or expanded fossil infrastructure that
would facilitate the production described in
subparagraph (A);
``(7) the term `production' means extractive or production
activities that result in fossil fuels being made available for
refining or use; and
``(8) the term `publicly traded entity' means an issuer,
the securities of which are listed on a national securities
exchange.
``(b) Prohibition.--No financial company may facilitate production,
including by--
``(1) making loans to, making investments in, or otherwise
engaging in any activity that is financial in nature, or
incidental to such financial activity, with a fossil fuel
company;
``(2) making loans to, making investments in, or otherwise
engaging in any activity that is financial in nature, or
incidental to such financial activity, for a fossil fuel
project;
``(3) taking compensation to arrange, or facilitate a
transaction that provides funds for, production with respect to
new sources;
``(4) securitizing assets that provide funds for production
with respect to new sources;
``(5) entering into a derivatives transaction designed to
provide funding for, facilitate, or hedge risks from production
with respect to new sources;
``(6) engaging in any activity that is complementary to a
financial activity involving production with respect to new
sources, including financing the international trade of
production with respect to new sources; or
``(7) engaging in any other form of activity defined by
regulators or supervisors of the financial company.
``(c) Compliance Program.--
``(1) In general.--Each financial company shall maintain
policies and procedures reasonably designed to ensure that
relationships with customers or counterparties do not
facilitate production with respect to new sources.
``(2) Attestation.--The chief executive officer of each
financial company shall comply with an attestation for
compliance with this section, subject to such rules as the
Board may prescribe that shall be no less strict than those set
forth under section 351.20(c) of title 12, Code of Federal
Regulations, or any successor regulation.
``(3) Supervision.--The appropriate Federal banking agency
shall supervise the policies and procedures described in this
subsection and the implementation of those policies and
procedures.
``(d) Penalties.--
``(1) Criminal penalty.--
``(A) In general.--Whoever knowingly violates any
provision of this section or, being a company, violates
any regulation or order issued by the Board under this
section, shall be imprisoned not more than 1 year,
fined not more than $1,000,000 per day for each day
during which the violation continues, or both.
``(B) Intent to deceive, defraud, or profit.--
Whoever, with the intent to deceive, defraud, or profit
significantly, knowingly violates any provision of this
section shall be imprisoned not more than 5 years,
fined not more than $5,000,000 per day for each day
during which the violation continues, or both.
``(2) Prohibition on employment.--Any individual who
knowingly violates any provision of this section shall be
banned from future employment with any bank holding company or
issuer or publicly traded entity.
``(3) Civil monetary penalty.--Any financial company that
violates, and any individual who participates in a violation
of, any provision of this section, or any regulation or order
issued under this section, shall forfeit all revenues
associated with such a violation and pay an additional civil
penalty of not more than $25,000 for each day during which the
violation continues.''.
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