May 14, 2019 - Issue: Vol. 165, No. 80 — Daily Edition116th Congress (2019 - 2020) - 1st Session

[Pages H3764-H3767]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 KLEPTOCRACY ASSET RECOVERY REWARDS ACT

  Ms. WATERS. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 389) to authorize the Secretary of the Treasury to pay 
rewards under an asset recovery rewards program to help identify and 
recover stolen assets linked to foreign government corruption and the 
proceeds of such corruption hidden behind complex financial structures 
in the United States and abroad, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                                H.R. 389

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       The Act may be cited as the ``Kleptocracy Asset Recovery 
     Rewards Act''.

     SEC. 2. FINDINGS; SENSE OF CONGRESS.

       (a) Findings.--Congress finds the following:
       (1) The Stolen Asset Recovery Initiative (StAR), a World 
     Bank and United Nations anti-money-laundering effort, 
     estimates that between $20 billion to $40 billion has been 
     lost to developing countries annually through corruption.
       (2) In 2014, more than $480 million in corruption proceeds 
     hidden in bank accounts around the world by former Nigerian 
     dictator Sani Abacha and his co-conspirators was forfeited 
     through efforts by the Department of Justice.
       (3) In 2010, the Department of Justice established the 
     Kleptocracy Asset Recovery Initiative, to work in partnership 
     with Federal law enforcement agencies to forfeit the proceeds 
     of foreign official corruption and, where appropriate, return 
     those proceeds to benefit the people harmed by these acts of 
     corruption and abuse of office.
       (4) Of the $20 billion to $40 billion lost by developing 
     countries annually through corruption, only about $5 billion 
     has been repatriated in the last 15 years.
       (5) Governments weakened by corruption and loss of assets 
     due to corruption have

[[Page H3765]]

     fewer resources to devote to the fight against terrorism and 
     fewer resources to devote to building strong financial, law 
     enforcement, and judicial institutions to aid in the fight 
     against the financing of terrorism.
       (6) The United States has a number of effective programs to 
     reward individuals who provide valuable information that 
     assist in the identification, arrest, and conviction of 
     criminal actors and their associates, as well as seizure and 
     forfeiture of illicitly derived assets and the proceeds of 
     criminal activity.
       (7) The Internal Revenue Service has the Whistleblower 
     Program, which pays awards to individuals who provide 
     specific and credible information to the IRS if the 
     information results in the collection of taxes, penalties, 
     interest or other amounts from noncompliant taxpayers.
       (8) The Department of State administers rewards programs on 
     international terrorism, illegal narcotics, and transnational 
     organized crime with the goal of bringing perpetrators to 
     justice.
       (9) None of these existing rewards programs specifically 
     provide monetary incentives for identifying and recovering 
     stolen assets linked solely to foreign government corruption, 
     as opposed to criminal prosecutions or civil or criminal 
     forfeitures.
       (10) The recovery of stolen assets linked to foreign 
     government corruption and the proceeds of such corruption may 
     not always involve a BSA violation or lead to a forfeiture 
     action. In such cases there would be no ability to pay 
     rewards under existing Treasury Department authorities.
       (11) Foreign government corruption can take many forms but 
     typically entails government officials stealing, 
     misappropriating, or illegally diverting assets and funds 
     from their own government treasuries to enrich their personal 
     wealth directly through embezzlement or bribes to allow 
     government resources to be expended in ways that are not 
     transparent and may not either be necessary or be the result 
     of open competition. Corruption also includes situations 
     where public officials take bribes to allow government 
     resources to be expended in ways which are not transparent 
     and may not be necessary or the result of open competition. 
     These corrupt officials often use the United States and 
     international financial system to hide their stolen assets 
     and the proceeds of corruption.
       (12) The individuals who come forward to expose foreign 
     governmental corruption and kleptocracy often do so at great 
     risk to their own safety and that of their immediate family 
     members and face retaliation from persons who exercise 
     foreign political or governmental power. Monetary rewards can 
     provide a necessary incentive to expose such corruption and 
     provide a financial means to provide for their well-being and 
     avoid retribution.
       (b) Sense of Congress.--It is the sense of Congress that a 
     Department of the Treasury stolen asset recovery rewards 
     program to help identify and recover stolen assets linked to 
     foreign government corruption and the proceeds of such 
     corruption hidden behind complex financial structures is 
     needed in order to--
       (1) intensify the global fight against corruption; and
       (2) serve United States efforts to identify and recover 
     such stolen assets, forfeit proceeds of such corruption, and, 
     where appropriate and feasible, return the stolen assets or 
     proceeds thereof to the country harmed by the acts of 
     corruption.

     SEC. 3. IN GENERAL.

       (a) Department of the Treasury Kleptocracy Asset Recovery 
     Rewards Program.--Chapter 97 of title 31, United States Code, 
     is amended by adding at the end the following:

     ``Sec. 9706. Department of the Treasury Kleptocracy Asset 
       Recovery Rewards Program

       ``(a) Establishment.--
       ``(1) In general.--There is established in the Department 
     of the Treasury a program to be known as the `Kleptocracy 
     Asset Recovery Rewards Program' for the payment of rewards to 
     carry out the purposes of this section.
       ``(2) Purpose.--The rewards program shall be designed to 
     support U.S. Government programs and investigations aimed at 
     restraining, seizing, forfeiting, or repatriating stolen 
     assets linked to foreign government corruption and the 
     proceeds of such corruption.
       ``(3) Implementation.--The rewards program shall be 
     administered by, and at the sole discretion of, the Secretary 
     of the Treasury, in consultation, as appropriate, with the 
     Secretary of State, the Attorney General, and the heads of 
     such other departments and agencies as the Secretary may find 
     appropriate.
       ``(b) Rewards Authorized.--In the sole discretion of the 
     Secretary and in consultation, as appropriate, with the heads 
     of other relevant Federal departments or agencies, the 
     Secretary may pay a reward to any individual, or to any 
     nonprofit humanitarian organization designated by such 
     individual, if that individual furnishes information leading 
     to--
       ``(1) the restraining or seizure of stolen assets in an 
     account at a U.S. financial institution (including a U.S. 
     branch of a foreign financial institution), that come within 
     the United States, or that come within the possession or 
     control of any United States person;
       ``(2) the forfeiture of stolen assets in an account at a 
     U.S. financial institution (including a U.S. branch of a 
     foreign financial institution), that come within the United 
     States, or that come within the possession or control of any 
     United States person; or
       ``(3) where appropriate, the repatriation of stolen assets 
     in an account at a U.S. financial institution (including a 
     U.S. branch of a foreign financial institution), that come 
     within the United States, or that come within the possession 
     or control of any United States person.
       ``(c) Coordination.--
       ``(1) Procedures.--To ensure that the payment of rewards 
     pursuant to this section does not duplicate or interfere with 
     any other payment authorized by the Department of Justice or 
     other Federal law enforcement agencies for the obtaining of 
     information or other evidence, the Secretary of the Treasury, 
     in consultation with the Secretary of State, the Attorney 
     General, and the heads of such other agencies as the 
     Secretary may find appropriate, shall establish procedures 
     for the offering, administration, and payment of rewards 
     under this section, including procedures for--
       ``(A) identifying actions with respect to which rewards 
     will be offered;
       ``(B) the receipt and analysis of data; and
       ``(C) the payment of rewards and approval of such payments.
       ``(2) Prior approval of the attorney general required.--
     Before making a reward under this section in a matter over 
     which there is Federal criminal jurisdiction, the Secretary 
     of the Treasury shall obtain the written concurrence of the 
     Attorney General.
       ``(d) Payment of Rewards.--
       ``(1) Authorization of appropriations.--For the purpose of 
     paying rewards pursuant to this section, there is authorized 
     to be appropriated--
       ``(A) $450,000 for fiscal year 2020; and
       ``(B) for each fiscal year, any amount recovered in stolen 
     assets described under subsection (b) that the Secretary 
     determines is necessary to carry out this program consistent 
     with this section.
       ``(2) Limitation on annual payments.--Except as provided 
     under paragraph (3), the total amount of rewards paid 
     pursuant to this section may not exceed $25,000,000 in any 
     calendar year.
       ``(3) Presidential authority.--The President may waive the 
     limitation under paragraph (2) with respect to a calendar 
     year if the President provides written notice of such waiver 
     to the appropriate committees of the Congress at least 30 
     days before any payment in excess of such limitation is made 
     pursuant to this section.
       ``(4) Payments to be made first from stolen asset 
     amounts.--In paying any reward under this section, the 
     Secretary shall, to the extent possible, make such reward 
     payment--
       ``(A) first, from appropriated funds authorized under 
     paragraph (1)(B); and
       ``(B) second, from appropriated funds authorized under 
     paragraph (1)(A).
       ``(e) Limitations.--
       ``(1) Submission of information.--No award may be made 
     under this section based on information submitted to the 
     Secretary unless such information is submitted under penalty 
     of perjury.
       ``(2) Maximum amount.--No reward paid under this section 
     may exceed $5,000,000, unless the Secretary--
       ``(A) personally authorizes such greater amount in writing;
       ``(B) determines that offer or payment of a reward of a 
     greater amount is necessary due to the exceptional nature of 
     the case; and
       ``(C) notifies the appropriate committees of the Congress 
     of such determination.
       ``(3) Approval.--
       ``(A) In general.--No reward amount may be paid under this 
     section without the written approval of the Secretary.
       ``(B) Delegation.--The Secretary may not delegate the 
     approval required under subparagraph (A) to anyone other than 
     an Under Secretary of the Department of the Treasury.
       ``(4) Protection measures.--If the Secretary determines 
     that the identity of the recipient of a reward or of the 
     members of the recipient's immediate family must be 
     protected, the Secretary shall take such measures in 
     connection with the payment of the reward as the Secretary 
     considers necessary to effect such protection.
       ``(5) Forms of reward payment.--The Secretary may make a 
     reward under this section in the form of a monetary payment.
       ``(f) Ineligibility, Reduction in, or Denial of Reward.--
       ``(1) Officer and employees.--An officer or employee of any 
     entity of Federal, State, or local government or of a foreign 
     government who, while in the performance of official duties, 
     furnishes information described under subsection (b) shall 
     not be eligible for a reward under this section.
       ``(2) Participating individuals.--If the claim for a reward 
     is brought by an individual who the Secretary has a 
     reasonable basis to believe knowingly planned, initiated, 
     directly participated in, or facilitated the actions that led 
     to assets of a foreign state or governmental entity being 
     stolen, misappropriated, or illegally diverted or to the 
     payment of bribes or other foreign governmental corruption, 
     the Secretary shall appropriately reduce, and may deny, such 
     award. If such individual is convicted of criminal conduct 
     arising from the role described in the preceding sentence, 
     the Secretary shall deny or may seek to recover any reward, 
     as the case may be.
       ``(g) Report.--

[[Page H3766]]

       ``(1) In general.--Within 180 days of the enactment of this 
     section, and annually thereafter for 5 years, the Secretary 
     shall issue a report to the appropriate committees of the 
     Congress--
       ``(A) detailing to the greatest extent possible the amount, 
     location, and ownership or beneficial ownership of any stolen 
     assets that, on or after the date of the enactment of this 
     section, come within the United States or that come within 
     the possession or control of any United States person;
       ``(B) discussing efforts being undertaken to identify more 
     such stolen assets and their owners or beneficial owners; and
       ``(C) including a discussion of the interactions of the 
     Department of the Treasury with the international financial 
     institutions (as defined in section 1701(c)(2) of the 
     International Financial Institutions Act) to identify the 
     amount, location, and ownership, or beneficial ownership, of 
     stolen assets held in financial institutions outside the 
     United States.
       ``(2) Exception for ongoing investigations.--The report 
     issued under paragraph (1) shall not include information 
     related to ongoing investigations.
       ``(h) Definitions.--For purposes of this section:
       ``(1) Appropriate committees of the congress.--The term 
     `appropriate committees of the Congress' means the Committee 
     on Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate.
       ``(2) Financial asset.--The term `financial asset' means 
     any funds, investments, or ownership interests, as defined by 
     the Secretary, that on or after the date of the enactment of 
     this section come within the United States or that come 
     within the possession or control of any United States person.
       ``(3) Foreign government corruption.--The term `foreign 
     government corruption' includes bribery of a foreign public 
     official, or the misappropriation, theft, or embezzlement of 
     public funds or property by or for the benefit of a foreign 
     public official.
       ``(4) Foreign public official.--The term `foreign public 
     official' includes any person who occupies a public office by 
     virtue of having been elected, appointed, or employed, 
     including any military, civilian, special, honorary, 
     temporary, or uncompensated official.
       ``(5) Immediate family member.--The term `immediate family 
     member', with respect to an individual, has the meaning given 
     the term `member of the immediate family' under section 36(k) 
     of the State Department Basic Authorities Act of 1956 (22 
     U.S.C. 2708(k)).
       ``(6) Rewards program.--The term `rewards program' means 
     the program established in subsection (a)(1) of this section.
       ``(7) Secretary.--The term `Secretary' means the Secretary 
     of the Treasury.
       ``(8) Stolen assets.--The term `stolen assets' means 
     financial assets within the jurisdiction of the United 
     States, constituting, derived from, or traceable to, any 
     proceeds obtained directly or indirectly from foreign 
     government corruption.''.
       (b) Report on Disposition of Recovered Assets.--Within 360 
     days of the enactment of this Act, the Secretary of the 
     Treasury shall issue a report to the appropriate committees 
     of Congress (as defined under section 9706(h) of title 31, 
     United States Code) describing policy choices and 
     recommendations for disposition of stolen assets recovered 
     pursuant to section 9706 of title 31, United States Code.
       (c) Table of Contents Amendment.--The table of contents for 
     chapter 97 of title 31, United States Code, is amended by 
     adding at the end the following:

``9706. Department of the Treasury Kleptocracy Asset Recovery Rewards 
              Program.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
California (Ms. Waters) and the gentleman from Ohio (Mr. Stivers) each 
will control 20 minutes.
  The Chair recognizes the gentlewoman from California.


                             General Leave

  Ms. WATERS. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on this legislation and to insert extraneous material thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from California?
  There was no objection.
  Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, H.R. 389, the Kleptocracy Asset Recovery Rewards Act 
offered by Representatives Lynch and Budd, will help the United States 
Government identify and recover assets that corrupt foreign government 
officials have stolen from their countries. The act does this through a 
Treasury-based rewards program that incentivizes individuals to notify 
the U.S. Government of the location of stolen assets that are linked to 
foreign government corruption. These assets may be bank accounts as 
well as luxury items, such as mansions, jewelry, jet planes, and 
artwork.
  Law enforcement already works hard to find these stolen assets. Since 
2010, the United States has fought in courts to freeze, forfeit, and 
ultimately recover more than $3.2 billion in assets linked to foreign 
corruption to be returned to the victims of these financial crimes.
  There are several recent examples of corrupt foreign funds making 
their way to the United States. The multibillion-dollar 1MDB scandal 
involving Goldman Sachs defrauded the people of Malaysia. To date, the 
FBI has identified $1.7 billion of the proceeds of that crime, which 
went to purchase a yacht, museum-quality paintings, and real estate. In 
fact, the government returned $57 million of recovered stolen funds to 
Malaysia following a settlement over the rights to the 2013 film, ``The 
Wolf of Wall Street,'' which was financed using corrupt 1MDB funds.
  Similarly, the United States helped to recover over $30 million from 
the sale of real estate, a Ferrari, and rare music memorabilia, which 
were purchased by Equatorial Guinea's President Obiang and his son with 
corrupt funds.
  H.R. 389 would direct the Treasury to pay whistleblowers rewards from 
the recovered assets for helping to uncover assets like these. 
Encouraging and incentivizing whistlblowers would strip the bad actors 
of the ill-gotten gains and help victims and their countries recover 
from the devastating effects of corruption.
  So, Mr. Speaker, I want to thank Mr. Lynch and Mr. Budd for 
introducing this bill to help the U.S. punish kleptocrats. For these 
reasons, I urge my colleagues to support H.R. 389.
  Mr. Speaker, I reserve the balance of my time.
  Mr. STIVERS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of H.R. 389, the Kleptocracy Asset 
Recovery Rewards Act, and I want to thank the gentleman from 
Massachusetts (Mr. Lynch) as well as the gentleman from North Carolina 
(Mr. Budd) for their hard work on this important piece of bipartisan 
legislation.
  H.R. 389 would authorize the Treasury Department to offer rewards for 
information leading to the recovery of assets stolen through foreign 
government corruption.
  Mr. Speaker, in the past, the United States has focused on fighting 
such corruption with traditional tools such as sanctions, technical 
assistance, and oversight of international financial institutions, but 
the bill gives Treasury an additional tool to expose corrupt foreign 
officials.
  I, again, would like to thank my colleagues across the aisle, 
especially Chairwoman Waters, for her hard work on this bill and 
allowing us to work together in a bipartisan fashion to refine this 
legislation as it made its way to the floor.
  One piece of the bill that has gotten better that I still think could 
use an additional tweak is the bill does not allow anyone to receive a 
payment if they are part of the corrupt activity, but it does not 
require Treasury to fully investigate every potential claimant to make 
sure that they are not. So while that has gotten better--there is 
better language in the bill now--I think that, hopefully, this can 
continue to be perfected as we move forward. I support the bill, but I 
do think that provision could get better.
  The minority did make several proposals to strengthen the bill, which 
were accepted by the majority. I am grateful to the gentleman from 
Massachusetts for partnering with us, as well as the gentleman from 
North Carolina, and for their hard work on the bill.
  Mr. Speaker, I look forward to voting for H.R. 389. I urge my 
colleagues to support it, and I reserve the balance of my time.

                                 (1715)

  Ms. WATERS. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Massachusetts (Mr. Lynch), the sponsor of this 
legislation and a member of the Financial Services Committee.
  Mr. LYNCH. Mr. Speaker, I thank the gentlewoman for her leadership on 
the committee and on this issue and for yielding me this time.
  The opportunity that we have today here to present the Kleptocracy 
Asset Recovery Rewards Act is a very important moment.

[[Page H3767]]

  I also want to thank my colleagues, the gentleman from North Carolina 
(Mr. Budd) and also the gentleman from Tennessee (Mr. Cohen), who have 
also contributed hard work in developing and cosponsoring this 
legislation.
  Foreign dictators who rob the treasuries of developing nations, where 
independent judiciaries are rare, and the rule of law is often weak, is 
not a new problem; but, unfortunately, it is a growing problem.
  It is now estimated that more than $1 trillion is lost to bribes and 
official corruption around the world each year. A significant portion 
of those illicit proceeds are used to support organized crime and 
terrorist organizations, further destabilizing the social institutions 
where this corruption occurs, often in developing countries who can 
least afford it.
  This undermines the local rule of law and contributes to the regional 
insecurity and instabilities in neighboring countries.
  Governments that are weakened by corruption have fewer resources to 
provide basic services, to establish a stable business climate, and to 
create jobs. They also have fewer resources to devote to building 
strong law enforcement and judicial institutions to combat exploitation 
by terrorists and criminal organizations.
  It is a sad fact that today much of this stolen money ends up here, 
in bank accounts right here in the United States.
  H.R. 389 fights back against the spreading influence of this 
corruption. The Kleptocracy Asset Recovery Rewards Act establishes a 
rewards program to incentivize individuals to notify law enforcement 
and authorities of assets stolen from foreign treasuries and illegally 
transferred to the United States.
  Now, I appreciate the gentleman's concerns about making sure that bad 
actors don't participate in this incentive program.
  This program replicates the incentives that have been utilized by the 
United States Department of Justice and the FBI for decades to take 
down criminal drug cartels with the help of paid informants.
  While the United States has many effective programs to reward 
individuals who provide valuable information toward curbing criminal 
behavior, none of our programs currently have been designed to take aim 
at recovering stolen assets linked to foreign government kleptocracy.
  Kleptocracy by foreign leaders can drain the hope and faith of 
struggling peoples around the globe who strive for social justice and 
equal rights.
  This bill recognizes that foreign corruption takes many forms and 
that individuals who come forward to expose corruption often do so at 
great personal peril to themselves and to their families.
  So, as transnational criminal enterprises persist, and terrorists 
adapt to the different mechanisms that we use, we must provide law 
enforcement with fresh tools to address these emerging threats.
  H.R. 389 does exactly that.
  Mr. Speaker, I want to thank, again, the chairwoman for her 
cooperation and leadership. I thank my colleagues on the other side, 
especially Mr. Budd, for his work on this bill as well. I thank my 
colleagues on both sides of the aisle for working with me on this 
legislation.
  Mr. Speaker, I urge a ``yes'' vote.
  Mr. STIVERS. Mr. Speaker, H.R. 389 will give the Treasury an 
additional tool to fight corrupt foreign governments. There has been a 
lot of work done on this bill. It is a good bill. I urge my colleagues 
to support it, and I yield back the balance of my time.
  Ms. WATERS. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, I am very pleased that Mr. Lynch and Mr. Budd have 
presented this bipartisan bill to the House. We must not allow the 
United States financial system to be a haven for stolen assets that 
rightly belong to others.
  By incentivizing individuals to come forward with information about 
where these stolen assets are hidden, we ensure the financial security 
of our system and can help send back recovered assets to where they 
belong.
  Mr. Speaker, I urge my colleagues to join me in supporting this 
important piece of legislation, and I yield back the balance of my 
time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentlewoman from California (Ms. Waters) that the House suspend the 
rules and pass the bill, H.R. 389, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________