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115th Congress   }                                     {       Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                     {      115-265

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

 
   RESOLUTION OF INQUIRY DIRECTING THE SECRETARY OF THE TREASURY TO 
PROVIDE CERTAIN DOCUMENTS IN THE SECRETARY'S POSSESSION TO THE HOUSE OF 
REPRESENTATIVES RELATING TO PRESIDENT TRUMP'S FINANCIAL CONNECTIONS TO 
   RUSSIA, CERTAIN ILLEGAL FINANCIAL SCHEMES, AND RELATED INFORMATION

                                _______
                                

   July 28, 2017.--Referred to the House Calendar and ordered to be 
                                printed

                                _______
                                

       Mr. Hensarling, from the Committee on Financial Services, 
                        submitted the following

                             ADVERSE REPORT

                             together with

                             MINORITY VIEWS

                       [To accompany H. Res. 442]

    The Committee on Financial Services, to whom was referred 
the resolution (H. Res. 442) of inquiry directing the Secretary 
of the Treasury to provide certain documents in the Secretary's 
possession to the House of Representatives relating to 
President Trump's financial connections to Russia, certain 
illegal financial schemes, and related information, having 
considered the same, report unfavorably thereon without 
amendment and recommend that the resolution not be agreed to.

                          PURPOSE AND SUMMARY

    On July 13, 2017, Representative Maxine Waters introduced 
H. Res. 442. This resolution of inquiry would direct the 
Secretary of the Treasury ``to provide certain documents in the 
Secretary's possession to the House of Representatives relating 
to President Trump's financial connections to Russia, certain 
illegal financial schemes, and related information.'' This 
resolution of inquiry names the President and several of his 
family members and associates, and applies to any Trump-owned 
entity. The Secretary is directed to furnish to the House of 
Representatives all relevant ``copies of any document, record, 
including any applicable suspicious activity report (``SAR''), 
memo, correspondence, or other communication'' within 14 days 
after the adoption of this resolution. H. Res. 442 does not 
specify the purpose of the inquiry.

                  BACKGROUND AND NEED FOR LEGISLATION

    H. Res. 442 is a resolution of inquiry. The resolution of 
inquiry is a measure infrequently used by the U.S. House of 
Representatives designed to obtain certain factual information 
from the Executive Branch. Clause 7 of Rule XIII of the House 
affords privileged status to a resolution of inquiry. The 
resolution is subject to a motion to discharge if the committee 
to which it was referred does not report the measure within 14 
legislative days of its introduction. Accordingly, the 
Committee on Financial Services considered H. Res. 442 on July 
25, 2017, which is within the 14-day period and reported the 
resolution unfavorably.
    Representative Waters and other Democratic Members of the 
Committee on Financial Services authored a number of letters 
requesting information on President Trump, his associates, and 
businesses potentially linked to him or his associates and 
contacts or relationships with the Russian Federation. The most 
recent letter was sent to Treasury Secretary Mnuchin on May 23, 
2017, and included a request for both documents and records 
similar to the demands made in H. Res. 442. The resolution of 
inquiry expands on the May 23, 2017 letter to include a list of 
specific Trump-affiliated individuals and entities.
    The Department of the Treasury's Financial Crimes 
Enforcement Network (FinCEN) likely maintains the bulk of the 
records envisioned in H. Res. 442. In addition to SARs, the 
resolution likely would include any Currency Transaction Report 
(CTR), Form 8300 (Report of Cash Payments Over $10,000), or 
similar records submitted to FinCEN pursuant to the Bank 
Secrecy Act (BSA). Also encompassed in the resolution likely 
would be any analytic product, email, or memo produced by 
FinCEN or any other component of Treasury relating to the 
subjects named in the resolution. H. Res. 442 explicitly 
requires the Secretary of the Treasury to furnish any requests 
made to FinCEN regarding these subjects by other countries' 
financial intelligence units (FIU), specifically to include the 
FIU of Cyprus.
    In general, BSA records like SARs contain a variety of 
personally-identifiable information (PII) on the subject of the 
record, as well as on any individuals that may be associated 
with the transaction or activity being reported. For example, a 
SAR has several sections:
         Part 1 includes the name and address of the 
        financial institution, the address(es) of the 
        branch(es) where the suspicious activity occurred, and 
        the account number(s) affected by the suspicious 
        activity (whether associated with the suspect or with 
        another party).
         Part 2 includes the full name, address, date 
        of birth, phone number (home and business), occupation, 
        and any identifying document number known (Social 
        Security number, driver's license number, passport 
        number, etc.).
         Part 3 characterizes the suspicious activity, 
        with multiple types of activity possible, including 
        money laundering, bribery, check fraud, loan fraud, 
        counterfeit instruments, debit/credit card fraud, 
        terrorist financing, etc.
         Part 4 lists the point of contact within the 
        filing institution (usually a fraud investigator), 
        should follow-up or further information be required.
         Part 5 is a free-text narrative, where the 
        filing institution describes in its own words the 
        suspicious activity. This section can include a variety 
        of information that the filing institution believes may 
        be of interest to law enforcement and FinCEN, such as a 
        description of the transactions, the reasons why the 
        filing institution believed the activity to be 
        suspicious, and other extraneous details that may be 
        relevant to the SAR. There is no restriction to the 
        type or amount of detail that may be provided in this 
        section, which often results in this being by far the 
        largest section of a given SAR, and often the most 
        useful for investigators.
    In addition to demanding Treasury's information, H. Res. 
442 also directs the Secretary to produce any requests for 
information from foreign FIUs sent to FinCEN under the auspices 
of the charter of the Egmont Group of Financial Intelligence 
Units (Egmont). Under the Egmont charter, dissemination of any 
information or requests for information provided by a foreign 
country to FinCEN must be cleared by the FIU that provided the 
information. Any provision of this information by Treasury 
without prior consent would be a violation of this 
international agreement.
    The variety of Congressional, Executive branch, 
intelligence and law enforcement investigations currently 
underway are well known to the Congress, the Members of the 
Committee on Financial Services and to the American public. In 
particular, the Senate Select Committee on Intelligence (SSCI) 
and the House Permanent Select Committee on Intelligence 
(HPSCI) both are conducting wide-ranging, bipartisan 
investigations into individuals and entities related to Russia. 
Both SSCI and HPSCI also have already requested a wide variety 
of information from the Treasury Department in furtherance of 
their investigations. Additionally, the Federal Bureau of 
Investigation, the National Security Agency, and the Central 
Intelligence Agency are all investigating some aspects of 
President Trump's associates, such as any Russian connections 
to former National Security Advisor Michael Flynn.
    This resolution of inquiry seeks to obtain BSA records, 
which include a wide variety of personal information and it 
would expose an inordinate amount of personal information on 
U.S. citizens to a Committee of Congress that does not 
typically investigate classified matters.
    Furthermore, Ranking Member Waters admitted on MSNBC's 
Morning Joe on May 18, 2017, that there has been no actual 
evidence that President Trump colluded with Russia to impact 
the results of the presidential election.\1\ Thus, for the 
aforementioned reasons the Committee rejects this resolution of 
inquiry and reports it unfavorably to the House.
---------------------------------------------------------------------------
    \1\See ``Maxine Waters admits there is no evidence of Trump 
colluding with Russia,'' May 19, 2017, available at http://
www.theblaze.com/news/2017/05/19/maxine-waters-admits-there-is-no-
evidence-of-trump-colluding-with-russia/.
---------------------------------------------------------------------------

                                HEARINGS

    The Committee held no hearings on H. Res. 442.

                        COMMITTEE CONSIDERATION

    The Committee on Financial Services met in open session on 
July 25, 2017 and ordered H. Res. 442 to be reported 
unfavorably to the House without amendment by a recorded vote 
of 34 yeas to 26 nays (recorded vote no. FC-72), a quorum being 
present.

                            COMMITTEE VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
sole recorded vote was on a motion by Chairman Hensarling to 
report the resolution unfavorably to the House without 
amendment. The motion was agreed to by a recorded vote of 34 
yeas to 26 nays (Record vote no. FC-72), a quorum being 
present. The vote was as follows:

----------------------------------------------------------------------------------------------------------------
                                                                     Ayes             Nays           Present
----------------------------------------------------------------------------------------------------------------
Jeb Hensarling, Texas........................................               X   ...............  ...............
Patrick T. McHenry, North Carolina...........................               X   ...............  ...............
Peter T. King, New York......................................               X   ...............  ...............
Edward R. Royce, California..................................               X   ...............  ...............
Frank D. Lucas, Oklahoma.....................................               X   ...............  ...............
Stevan Pearce, New Mexico....................................               X   ...............  ...............
Bill Posey, Florida..........................................               X   ...............  ...............
Blaine Luetkemeyer, Missouri.................................               X   ...............  ...............
Bill Huizenga, Michigan......................................               X   ...............  ...............
Sean P. Duffy, Wisconsin.....................................               X   ...............  ...............
Steve Stivers, Ohio..........................................               X   ...............  ...............
Randy Hultgren, Illinois.....................................               X   ...............  ...............
Dennis A. Ross, Florida......................................               X   ...............  ...............
Robert Pittenger, North Carolina.............................               X   ...............  ...............
Ann Wagner, Missouri.........................................               X   ...............  ...............
Andy Barr, Kentucky..........................................               X   ...............  ...............
Keith J. Rothfus, Pennsylvania...............................               X   ...............  ...............
Luke Messer, Indiana.........................................               X   ...............  ...............
Scott Tipton, Colorado.......................................               X   ...............  ...............
Roger Williams, Texas........................................               X   ...............  ...............
Bruce Poliquin, Maine........................................               X   ...............  ...............
Mia Love, Utah...............................................               X   ...............  ...............
French Hill, Arkansas........................................               X   ...............  ...............
Tom Emmer, Minnesota.........................................               X   ...............  ...............
Lee M. Zeldin, New York......................................               X   ...............  ...............
Dave A. Trott, Michigan......................................               X   ...............  ...............
Barry Loudermilk, Georgia....................................               X   ...............  ...............
Alexander X. Mooney, West Virginia...........................               X   ...............  ...............
Thomas MacArthur, New Jersey.................................               X   ...............  ...............
Warren Davidson, Ohio........................................               X   ...............  ...............
Ted Budd, North Carolina.....................................               X   ...............  ...............
David Kustoff, Tennessee.....................................               X   ...............  ...............
Claudia Tenney, New York.....................................               X   ...............  ...............
Trey Hollingsworth, Indiana..................................               X   ...............  ...............
Maxine Waters, California....................................  ...............               X   ...............
Carolyn B. Maloney, New York.................................  ...............               X   ...............
Nydia M. Velazquez, New York.................................  ...............               X   ...............
Brad Sherman, California.....................................  ...............               X   ...............
Gregory W. Meeks, New York...................................  ...............               X   ...............
Michael E. Capuano, Massachusetts............................  ...............               X   ...............
Wm. Lacy Clay, Missouri......................................  ...............               X   ...............
Stephen F. Lynch, Massachusetts..............................  ...............               X   ...............
David Scott, Georgia.........................................  ...............               X   ...............
Al Green, Texas..............................................  ...............               X   ...............
Emanuel Cleaver, Missouri....................................  ...............               X   ...............
Gwen Moore, Wisconsin........................................  ...............               X   ...............
Keith Ellison, Minnesota.....................................  ...............               X   ...............
Ed Perlmutter, Colorado......................................  ...............               X   ...............
James A. Himes, Connecticut..................................  ...............               X   ...............
Bill Foster, Illinois........................................  ...............               X   ...............
Daniel T. Kildee, Michigan...................................  ...............               X   ...............
John K. Delaney, Maryland....................................  ...............               X   ...............
Kyrsten Sinema, Arizona......................................  ...............               X   ...............
Joyce Beatty, Ohio...........................................  ...............               X   ...............
Denny Heck, Washington.......................................  ...............               X   ...............
Juan Vargas, California......................................  ...............               X   ...............
Josh Gottheimer, New Jersey..................................  ...............               X   ...............
Vicente Gonzalez, Texas......................................  ...............               X   ...............
Charlie Crist, Florida.......................................  ...............               X   ...............
Ruben J. Kihuen, Nevada......................................  ...............               X   ...............
                                                              --------------------------------------------------
    Total....................................................              34               26   ...............
----------------------------------------------------------------------------------------------------------------

                      COMMITTEE OVERSIGHT FINDINGS

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the findings and recommendations of 
the Committee based on oversight activities under clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
are incorporated in the descriptive portions of this report.

                    PERFORMANCE GOALS AND OBJECTIVES

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill does not authorize funding, so no statement of general 
performance goals and objectives is required.


   NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives is inapplicable.

       COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee advises that the 
Congressional Budget Office did not provide a cost estimate for 
the resolution.

                       FEDERAL MANDATES STATEMENT

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4). The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                  APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of the section 
102(b)(3) of the Congressional Accountability Act.

                         EARMARK IDENTIFICATION

    H. Res. 442 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                    DUPLICATION OF FEDERAL PROGRAMS

    Pursuant to section 3(g)(2) of H. Res. 5, 115th Cong. 
(2017), the Committee states that no provision of H. Res. 442 
establishes or reauthorizes a program of the Federal Government 
known to be duplicative of another Federal program, a program 
that was included in any report from the Government 
Accountability Office to Congress pursuant to section 21 of 
Public Law 111-139, or a program related to a program 
identified in the most recent Catalog of Federal Domestic 
Assistance.

                   DISCLOSURE OF DIRECTED RULEMAKING

    In compliance with Sec. 3(i) of H. Res. 5, 115th Congress 
(2017), the following statement is made concerning directed 
rule makings: The Committee estimates that H. Res. 442 
specifically directs to be completed no specific rule makings 
within the meaning of 5 U.S.C. Sec. 551.

                         ADDITIONAL BACKGROUND

    At least four committees in Congress and several Executive 
Branch agencies are already investigating these issues with the 
same information. Adding yet another committee to the pile is 
duplicative, wasteful, distracting, and unnecessary.
    The Senate Intelligence Committee, the Senate Judiciary 
Committee, the House Intelligence Committee, and the House 
Oversight and Government Reform Committee have all announced 
investigations into various aspects of the relationship of 
President Trump with Russia.
    Additionally, the Federal Bureau of Investigation, the 
National Security Agency, and the Central Intelligence Agency 
are all investigating some aspects of President Trump's 
associates, such as any Russian connections to former National 
Security Advisor Michael Flynn.
    The Department of Justice, on May 18, 2017, appointed 
former FBI Director Robert S. Mueller III as a special counsel 
to investigate any criminal wrongdoing by President Trump or 
his associates related to Russia.
    H. Res. 442 demands that the Treasury Department provide 
the Congress with an incredible amount of very personal and 
private information, including Social Security numbers, bank 
account numbers, drivers' license numbers, and phone numbers 
for anyone even potentially involved in a transaction.

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    H. Res. 442 does not repeal or amend any section of a 
statute. Therefore, the Office of Legislative Counsel did not 
prepare the report contemplated by clause 3(e)(1)(B) of Rule 
XIII of the House of Representatives.

                             MINORITY VIEWS

    H. Res. 442, a Resolution of Inquiry (ROI), directs the 
Secretary of the Treasury, Steven Mnuchin, to provide any 
records from the Department's Financial Crimes Enforcement 
Network (FinCEN) to the Committee that detail President Trump's 
financial ties to Russia, as well as those of his family 
members and associates.
    The nearly constant stream of revelations about President 
Trump's alleged ties to Russian government officials, 
oligarchs, and organized crime leaders raises serious questions 
as to whether these individuals may have financial leverage 
over the President, his immediate family members and his 
associates that ultimately influence whether the Administration 
is acting in the best interests of the American people.
    While President Trump has repeatedly maintained that he has 
no investments in Russia, such declarations appear to belie the 
full truth of his financial arrangements with Russia, as 
indicated by a wide range of press outlets and even President 
Trump's own family members. For example, Trump's son Eric has 
previously stated that ``Russians make up a pretty 
disproportionate cross-section of a lot of [their] assets,'' 
adding that ``[they] see a lot of money pouring in from 
Russia.''
    Additionally, President Trump's biggest lender, and the 
only bank known to continue to lend to him after his 
bankruptcies, is Deutsche Bank. Trump has now reportedly 
amassed a total of approximately $340 million in outstanding 
loans to Deutsche Bank. This significant debt raises concerns, 
not only about the bank's exposure to higher risk given Trump's 
history of defaulting on his debts, but also about conflicts of 
interest, given that President Trump is responsible for 
selecting the federal banking and Justice Department officials 
responsible for overseeing the bank and holding it accountable 
for violating the law. President Trump's extensive ties to the 
bank are also deeply concerning given the Bank's involvement in 
major illegal financial operations involving Russia. The 
President's loans with the bank were also made under reportedly 
``highly suspicious circumstances'' and raise questions as to 
whether the loans were guaranteed in some way by Russia, 
thereby compromising the President.
    Committee Democrats have made repeated attempts to follow 
the Trump money trail and investigate the suspicious financial 
dealings of the President, his immediate family and his 
associates, including their possible involvement in illicit 
Russian financial schemes. Since March, Democrats have written 
four letters--one to Committee Chairman Jeb Hensarling, one to 
Deutsche Bank CEO John Cryan, one to Treasury Secretary Steven 
Mnuchin, and another to Deutsche Bank's external counsel--
requesting their cooperation in exposing the full scope of 
Russian influence on the Trump Administration.
    On March 10th, 2017, Committee Democrats called on Chairman 
Hensarling to use the full range of the Committee's 
investigative powers to examine Deutsche Bank's Russian money-
laundering operation, and assess the integrity of the U.S. 
Department of Justice's ongoing investigation into the scheme, 
given the Trump Administration's conflicts of interest in the 
matter and the revelations of Attorney General Sessions' 
communications with the Russian Ambassador. Chairman Hensarling 
failed to respond.
    On May 23, 2017, Committee Democrats sent a letter to 
Deutsche Bank's Chief Executive Officer John Cryan requesting 
information on two internal reviews the Bank reportedly 
conducted, the first on its 2011 Russian mirror trading 
scandal, and the second on whether the accounts of President 
Donald Trump and his family members held at the Bank had any 
ties to Russia. Deutsche Bank's external counsel responded, 
stating that Deutsche Bank was unable to cooperate with the 
requests, citing privacy concerns.
    On May 23, 2017, Committee Democrats also sent a letter to 
Treasury Secretary Steven Mnuchin requesting that FinCEN 
provide any records to the Committee that detail President 
Trump's financial ties to Russia, as well as those of his 
family members and associates. Secretary Mnuchin failed to 
respond.
    On June 21, 2017, Committee Democrats sent a follow up 
letter to Deutsche Bank's outside counsel regarding the 
lawmakers' request for information related to the accounts of 
President Trump and his family members, including potential 
ties to Russia, as well as information related to the 2011 
Russian mirror trading scheme. In the letter, the lawmakers 
asserted that governing federal privacy statutes invoked by the 
Bank to withhold the information do not prohibit disclosure of 
the information to Congress. Deutsche bank's outside counsel 
ultimately failed to respond to the requests made in the 
letter.
    Given that FinCEN employs a team with expertise in 
financial intelligence who work closely with law enforcement to 
analyze over 200 million suspicious activity reports derived 
from the more than 80,000 financial institutions, and given 
that the Financial Services Committee is responsible for 
examining and overseeing the operations of FinCEN, including 
its ongoing efforts to collect, analyze, and disseminate 
financial intelligence in support of law enforcement agencies' 
investigative work, Democrats introduced the ROI to begin an 
investigation into Trump's financial entanglements with Russia. 
In addition to suspicious activity reports, currency 
transaction reports, currency or monetary instrument reports, 
geographic targeting orders, and foreign bank and financial 
accounts reporting, FinCEN has information sharing arrangements 
with foreign Financial Intelligence Units, which could detect 
the reported types of suspicious Russian financial arrangements 
that extend beyond American borders.
    H. Res. 442 requests information that would shed light on 
all of these matters and allow the Financial Services Committee 
to begin an investigation into the numerous suspicious ties 
among President Trump, his family members, his associates and 
Russia.
    For these reasons, we support H. Res. 442.

                                           Maxine Waters.
                                           Gwen Moore.
                                           Stephen Lynch.
                                           David Scott.
                                           Ed Perlmutter.
                                           Al Green.
                                           Denny Heck.
                                           Keith Ellison.
                                           Bill Foster.
                                           Ruben Kihuen.
                                           Joyce Beatty.
                                           Gregory W. Meeks.
                                           Carolyn B. Maloney.
                                           Nydia M. Velazquez.
                                           Brad Sherman.
                                           Wm. Lacy Clay.
                                           Michael E. Capuano.
                                           Juan Vargas.
                                           Daniel T. Kildee.

                                  [all]