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INTERNET GAMING INFORMATION
US HOUSE OF REPRESENTATIVES BILL HR3004






PASSED LEGISLATION WITH I-GAMING CLAUSES REMOVED
Provided to  START CASINO . COM   courtesy of the US House of Representatives

107th CONGRESS

1st Session

H. R. 3004

To combat the financing of terrorism and other financial crimes, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

October 3, 2001

Mr. OXLEY (for himself, Mr. LAFALCE, Mr. LEACH, Mrs. MALONEY of New York, Mrs. ROUKEMA, Mr. BENTSEN, Ms. HOOLEY of Oregon, Mr. BEREUTER, Mr. BAKER, Mr. BACHUS, Mr. KING, Mrs. KELLY, Mr. GILLMOR, Mr. CANTOR, Mr. RILEY, Mr. LATOURETTE, Mr. GREEN of Wisconsin, and Mr. GRUCCI) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on the Judiciary, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned


A BILL

To combat the financing of terrorism and other financial crimes, 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; TABLE OF CONTENTS.

    (a) SHORT TITLE- This Act may be cited as the `Financial Anti-Terrorism Act of 2001'.

    (b) TABLE OF CONTENTS- The table of contents for this Act is as follows:

      Sec. 1. Short title; table of contents.

TITLE I--STRENGTHENING LAW ENFORCEMENT

      Sec. 101. Bulk cash smuggling into or out of the United States.

      Sec. 102. Forfeiture in currency reporting cases.

      Sec. 103. Interstate currency couriers.

      Sec. 104. Illegal money transmitting businesses.

      Sec. 105. Long-arm jurisdiction over foreign money launderers.

      Sec. 106. Laundering money through a foreign bank.

      Sec. 107. Specified unlawful activity for money laundering.

      Sec. 108. Laundering the proceeds of terrorism.

      Sec. 109. Violations of reporting requirements for nonfinancial trades and business.

      Sec. 110. Proceeds of foreign crimes.

      Sec. 111. Transfer of reporting requirements from section 6050I of the Internal Revenue Code of 1986 to title 31, United States Code.

      Sec. 112. Penalties for violations of geographic targeting orders and certain record keeping requirements.

      Sec. 113. Exclusion of aliens involved in money laundering.

      Sec. 114. Standing to contest forfeiture of funds deposited into foreign bank that has a correspondent account in the United States.

      Sec. 115. Subpoenas for records regarding funds in correspondent bank accounts.

      Sec. 116. Financial crimes enforcement network.

      Sec. 117. Customs service border searches.

      Sec. 118. Prohibition on false statements to financial institutions concerning the identity of a customer.

      Sec. 119. Verification of identification.

TITLE II--PUBLIC-PRIVATE COOPERATION

      Sec. 201. Establishment of highly secure website.

      Sec. 202. Report on improvements in data access.

      Sec. 203. Reports to the financial services industry on suspicious financial activities.

      Sec. 204. Efficient use of currency transaction report system.

      Sec. 205. Public-Private Task Force on Terrorist Financing Issues.

      Sec. 206. Deadline for suspicious activity reporting requirements for registered brokers and dealers.

      Sec. 207. Amendments relating to reporting of suspicious activities.

      Sec. 208. Authorization to include suspicions of illegal activity in written employment references.

TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

      Sec. 301. Special measures for jurisdictions, financial institutions, or international transactions of primary money laundering concern.

      Sec. 302. International cooperation in investigations of money laundering, financial crimes, and the finances of terrorist groups.

      Sec. 303. Prohibition on acceptance of any bank instrument for unlawful Internet gambling.

      Sec. 304. Internet gambling in or through foreign jurisdictions.

TITLE IV--CURRENCY PROTECTION

      Sec. 401. Counterfeiting domestic currency and obligations.

      Sec. 402. Counterfeiting foreign currency and obligations.

      Sec. 403. Production of documents.

      Sec. 404. Reimbursement.

TITLE I--STRENGTHENING LAW ENFORCEMENT

SEC. 101. BULK CASH SMUGGLING INTO OR OUT OF THE UNITED STATES.

    (a) ENACTMENT OF BULK CASH SMUGGLING OFFENSE- Subchapter II of chapter 53 of title 31, United States Code, is amended by adding at the end the following:

`Sec. 5331. Bulk cash smuggling into or out of the United States

    `(a) CRIMINAL OFFENSE-

      `(1) IN GENERAL- Whoever, with the intent to evade a currency reporting requirement under section 5316, knowingly conceals more than $10,000 in currency or other monetary instruments on the person of such individual or in any conveyance, article of luggage, merchandise, or other container, and transports or transfers or attempts to transport or transfer such currency or monetary instruments from a place within the United States to a place outside of the United States, or from a place outside the United States to a place within the United States, shall be guilty of a currency smuggling offense and subject to punishment pursuant to subsection (b).

      `(2) CONCEALMENT ON PERSON- For purposes of this section, the concealment of currency on the person of any individual includes concealment in any article of clothing worn by the individual or in any luggage, backpack, or other container worn or carried by such individual.

    `(b) PENALTY-

      `(1) TERM OF IMPRISONMENT- A person convicted of a currency smuggling offense under subsection (a), or a conspiracy to commit such offense, shall be imprisoned for not more than 5 years.

      `(2) FORFEITURE- In addition, the court, in imposing sentence under paragraph (1), shall order that the defendant forfeit to the United States, any

property, real or personal, involved in the offense, and any property traceable to such property, subject to subsection (d) of this section.

      `(3) PROCEDURE- The seizure, restraint, and forfeiture of property under this section shall be governed by section 413 of the Controlled Substances Act.

      `(4) PERSONAL MONEY JUDGMENT- If the property subject to forfeiture under paragraph (2) is unavailable, and the defendant has insufficient substitute property that may be forfeited pursuant to section 413(p) of the Controlled Substances Act, the court shall enter a personal money judgment against the defendant for the amount that would be subject to forfeiture.

    `(c) CIVIL FORFEITURE-

      `(1) IN GENERAL- Any property involved in a violation of subsection (a), or a conspiracy to commit such violation, and any property traceable to such violation or conspiracy, may be seized and, subject to subsection (d) of this section, forfeited to the United States.

      `(2) PROCEDURE- The seizure and forfeiture shall be governed by the procedures governing civil forfeitures in money laundering cases pursuant to section 981(a)(1)(A) of title 18, United States Code.

      `(3) TREATMENT OF CERTAIN PROPERTY AS INVOLVED IN THE OFFENSE- For purposes of this subsection and subsection (b), any currency or other monetary instrument that is concealed or intended to be concealed in violation of subsection (a) or a conspiracy to commit such violation, any article, container, or conveyance used, or intended to be used, to conceal or transport the currency or other monetary instrument, and any other property used, or intended to be used, to facilitate the offense, shall be considered property involved in the offense.

    `(d) PROPORTIONALITY OF FORFEITURE-

      `(1) IN GENERAL- Upon a showing by the property owner by a preponderance of the evidence that the currency or monetary instruments involved in the offense giving rise to the forfeiture were derived from a legitimate source, and were intended for a lawful purpose, the court shall reduce the forfeiture to the maximum amount that is not grossly disproportional to the gravity of the offense.

      `(2) FACTORS TO BE CONSIDERED- In determining the amount of the forfeiture, the court shall consider all aggravating and mitigating facts and circumstances that have a bearing on the gravity of the offense, including the following:

        `(A) The value of the currency or other monetary instruments involved in the offense.

        `(B) Efforts by the person committing the offense to structure currency transactions, conceal property, or otherwise obstruct justice.

        `(C) Whether the offense is part of a pattern of repeated violations of Federal law.'.

    (b) CONFORMING AMENDMENT- The table of sections for subchapter II of chapter 53 of title 31, United States Code, is amended by inserting after the item relating to section 5330, the following new item:

      `5331. Bulk cash smuggling into or out of the United States.'.

SEC. 102. FORFEITURE IN CURRENCY REPORTING CASES.

    (a) IN GENERAL- Subsection (c) of section 5317 of title 31, United States Code, is amended to read as follows:

    `(c) FORFEITURE-

      `(1) IN GENERAL- The court in imposing sentence for any violation of section 5313, 5316, or 5324, or any conspiracy to commit such violation, shall order the defendant to forfeit all property, real or personal, involved in the offense and any property traceable thereto.

      `(2) PROCEDURE- Forfeitures under this subsection shall be governed by the procedures established in section 413 of the Controlled Substances Act and the guidelines established in paragraph (4).

      `(3) CIVIL FORFEITURE- Any property involved in a violation of section 5313, 5316, or 5324, or any conspiracy to commit any such violation, and any property traceable to any such violation or conspiracy, may be seized and, subject to paragraph (4), forfeited to the United States in accordance with the procedures governing civil forfeitures in money laundering cases pursuant to section 981(a)(1)(A) of title 18, United States Code.

      `(4) PROPORTIONALITY OF FORFEITURE-

        `(A) IN GENERAL- Upon a showing by the property owner by a preponderance of the evidence that any currency or monetary instruments involved in the offense giving rise to the forfeiture were derived from a legitimate source, and were intended for a lawful purpose, the court shall reduce the forfeiture to the maximum amount that is not grossly disproportional to the gravity of the offense.

        `(B) FACTORS TO BE CONSIDERED- In determining the amount of the forfeiture, the court shall consider all aggravating and mitigating facts and circumstances that have a bearing on the gravity of the offense, including the following:

          `(i) The value of the currency or other monetary instruments involved in the offense.

          `(ii) Efforts by the person committing the offense to structure currency transactions, conceal property, or otherwise obstruct justice.

          `(iii) Whether the offense is part of a pattern of repeated violations of Federal law.'.

    (b) CONFORMING AMENDMENTS- (1) Section 981(a)(1)(A) of title 18, United States Code, is amended by striking `of section 5313(a) or 5324(a) of title 31, or'.

    (2) Section 982(a)(1) of title 18, United States Code, is amended by striking `of 5313(a), 5316, or 5324 of title 31, or'.

SEC. 103. INTERSTATE CURRENCY COURIERS.

    Section 1957 of title 18, United States Code, is amended by adding at the end the following new subsection:

    `(g) Any person who conceals more than $10,000 in currency on his or her person, in any vehicle, in any compartment or container within any vehicle, or in any container placed in a common carrier, and transports, attempts to transport, or conspires to transport such currency in interstate commerce on any public road or highway or on any bus, train, airplane, vessel, or other common carrier, knowing that the currency was derived from some form of unlawful activity, or knowing that the currency was intended to be used to promote some form of unlawful activity, shall be punished as provided in subsection (b). The defendant's knowledge may be established by proof that the defendant was willfully blind to the source or intended use of the currency. For purposes of this subsection, the concealment of currency on the person of any individual includes concealment in any article of clothing worn by the individual or in any luggage, backpack, or other container worn or carried by such individual.'.

SEC. 104. ILLEGAL MONEY TRANSMITTING BUSINESSES.

    (a) SCIENTER REQUIREMENT FOR SECTION 1960 VIOLATION- Section 1960(b)(1)(A) of title 18, United States Code, is amended by inserting `, whether or not the defendant knew the operation was so punishable' before the semicolon at the end.

    (b) SEIZURE OF ILLEGALLY TRANSMITTED FUNDS- Section 981(a)(1)(A) of title 18, United States Code, is amended by striking `or 1957' and inserting `, 1957 or 1960'.

SEC. 105. LONG-ARM JURISDICTION OVER FOREIGN MONEY LAUNDERERS.

    Section 1956(b) of title 18, United States Code, is amended--

      (1) by striking `(b) Whoever' and inserting `(b)(1) Whoever';

      (2) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively;

      (3) by striking `subsection (a)(1) or (a)(3),' and inserting `subsection (a)(1) or (a)(3)(2) or section 1957,'; and

      (4) by adding at the end the following new paragraph:

      `(2) For purposes of adjudicating an action filed or enforcing a penalty ordered under this section, the district courts shall have jurisdiction over any foreign person, including any financial institution authorized under the laws of a foreign country, against whom the action is brought, if--

        `(A) service of process upon such foreign person is made under the Federal Rules of Civil Procedure or the laws of the country where the foreign person is found; and

        `(B) the foreign person--

          `(i) commits an offense under subsection (a) involving a financial transaction that occurs in whole or in part in the United States;

          `(ii) converts to such person's own use property in which the United States has an ownership interest by virtue of the entry of an order of forfeiture by a court of the United States; or

          `(iii) is a financial institution that maintains a correspondent bank account at a financial institution in the United States.

      `(3) The court may issue a pretrial restraining order or take any other action necessary to ensure that any bank account or other property held by the defendant in the United States is available to satisfy a judgment under this section.'.

SEC. 106. LAUNDERING MONEY THROUGH A FOREIGN BANK.

    Section 1956(c)(6) of title 18, United States Code, is amended to read as follows:

      `(6) the term `financial institution' includes any financial institution described in section 5312(a)(2) of title 31, United States Code, or the regulations promulgated thereunder, as well as any foreign bank, as defined in paragraph (7) of section 1(b) of the International Banking Act of 1978 (12 U.S.C. 3101(7)).'.

SEC. 107. SPECIFIED UNLAWFUL ACTIVITY FOR MONEY LAUNDERING.

    (a) IN GENERAL- Section 1956(c)(7) of title 18, United States Code, is amended--

      (1) in subparagraph (B)--

        (A) so that clause (ii) reads as follows:

          `(ii) any act or acts constituting a crime of violence, as defined in Section 16 of this title;'; and

        (B) by inserting after clause (iii) the following:

          `(iv) fraud or any scheme to defraud committed against an individual or entity (other than a foreign government or government entity) provided such conduct would constitute a fraud or scheme to defraud under the laws of the United States or its constituent parts if committed in the United States;

          `(v) fraud or any scheme to defraud against a foreign government or foreign government entity, if such conduct would constitute a violation of this title if it were committed in interstate commerce in the United States and against the United States Government or a United States governmental entity;

          `(vi) bribery of a public official, or the misappropriation, theft, or embezzlement of public funds by or for the benefit of a public official;

          `(vii) smuggling or export control violations involving munitions listed in the United States Munitions List or technologies with military applications as defined in the Commerce Control List of the Export Administration Regulations; or

          `(viii) an offense with respect to which the United States would be obligated by a multilateral treaty either to extradite the alleged offender or to submit the case for prosecution, if the offender were found within the territory of the United States.'; and

      (2) in subparagraph (D)--

        (A) by inserting `section 541 (relating to goods falsely classified),' before `section 542';

        (B) by inserting `section 922(1) (relating to the unlawful importation of firearms), section 924(n) (relating to firearms trafficking),' before `section 956';

        (C) by inserting `section 1030 (relating to computer fraud and abuse),' before `1032';

        (D) by inserting `any felony violation of the Foreign Agents Registration Act of 1938, as amended,' before `or any felony violation of the Foreign Corrupt Practices Act'; and

        (E) by striking `fraud in the sale of securities' and inserting `fraud in the purchase or sale of securities'.

SEC. 108. LAUNDERING THE PROCEEDS OF TERRORISM.

    Section 1956(c)(7)(D) of title 18, United States Code, is amended by inserting `or 2339B' after `2339A'.

SEC. 109. VIOLATIONS OF REPORTING REQUIREMENTS FOR NONFINANCIAL TRADES AND BUSINESS.

    (a) CIVIL FORFEITURE- Section 981(a)(1)(A) of title 18, United States Code, is amended--

      (1) by inserting `section 6050I of the Internal Revenue Code of 1986, or' after `in violation of'; and

      (2) by striking `or 5324(a)' and inserting `, 5324(a), or 5332'.

    (b) CRIMINAL FORFEITURE- Section 982(a)(1) of title 18, United States Code, is amended--

      (1) by inserting `section 6050I of the Internal Revenue Code of 1986, or' after `in violation of'; and

      (2) by striking `or 5324' and inserting `, 5324, or 5332'.

SEC. 110. PROCEEDS OF FOREIGN CRIMES.

    Section 981(a)(1)(B) of title 18, United States Code, is amended to read as follows:

        `(B) Any property, real or personal, within the jurisdiction of the United States, constituting, derived from, or traceable to, any proceeds obtained directly or indirectly from an offense against a foreign nation, or any property used to facilitate such offense, if--

          `(i) the offense involves the manufacture, importation, sale, or distribution of a controlled substance (as such term is defined for the purposes of the Controlled Substances Act), or any other conduct described in section 1956(c)(7)(B),

          `(ii) the offense would be punishable within the jurisdiction of the foreign nation by death or imprisonment for a term exceeding one year, and

          `(iii) the offense would be punishable under the laws of the United States by imprisonment for a term exceeding one year if the act or activity constituting the offense had occurred within the jurisdiction of the United States.'.

SEC. 111. TRANSFER OF REPORTING REQUIREMENTS FROM SECTION 6050I OF THE INTERNAL REVENUE CODE OF 1986 TO TITLE 31, UNITED STATES CODE.

    (a) REENACTMENT OF SECTION 6050I- Subchapter II of chapter 53 of title 31, United States Code, is amended by inserting after section 5331 (as added by section 101 of this title) the following new section:

`SEC. 5332. REPORTS RELATING TO COINS AND CURRENCY RECEIVED IN NONFINANCIAL TRADE OR BUSINESS.

    `(a) Coin and Currency Receipts of More Than $10,000- Any person--

      `(1) who is engaged in a trade or business; and

      `(2) who, in the course of such trade or business, receives more than $10,000 in coins or currency in 1 transaction (or 2 or more related transactions),

    shall file a report described in subsection (b) with respect to such transaction (or related transactions) at such time as the Secretary may by regulations prescribe.

    `(b) FORM AND MANNER OF REPORTS- A report is described in this subsection if such report--

      `(1) is in such form as the Secretary may prescribe;

      `(2) contains--

        `(A) the name, address, and taxpayer identification number of the person from whom the coins or currency was received;

        `(B) the amount of coins or currency received;

        `(C) the date and nature of the transaction; and

        `(D) such other information as the Secretary may prescribe.

    `(c) EXCEPTIONS-

      `(1) AMOUNTS RECEIVED BY FINANCIAL INSTITUTIONS- Subsection (a) shall not apply to amounts received in a transaction reported under section 5313 and regulations prescribed under such section.

      `(2) TRANSACTIONS OCCURRING OUTSIDE THE UNITED STATES- Except to the extent provided in regulations prescribed by the Secretary, subsection (a) shall not apply to any transaction if the entire transaction occurs outside the United States.

    `(d) CURRENCY INCLUDES FOREIGN CURRENCY AND CERTAIN MONETARY INSTRUMENTS-

      `(1) IN GENERAL- For purposes of this section, the term `currency' includes--

        `(A) foreign currency; and

        `(B) to the extent provided in regulations prescribed by the Secretary, any monetary instrument (whether or not in bearer form) with a face amount of not more than $10,000.

      `(2) SCOPE OF APPLICATION- Paragraph (1)(B) shall not apply to any check drawn on the account of the writer in a financial institution referred to in subparagraph (A), (B), (C), (D), (E), (F), (G), (J), (K), (R), or (S) of section 5312(a)(2).

    `(e) COINS OR CURRENCY RECEIVED BY CRIMINAL COURT CLERKS-

      `(1) IN GENERAL- Every clerk of a Federal or State criminal court who receives more than $10,000 in coins or currency as bail for any individual charged with a specified criminal offense shall file a report described in paragraph (2) (at such time as the Secretary may by regulations prescribe) with respect to the receipt of such bail.

      `(2) REPORT- A report is described in this paragraph if such report--

        `(A) is in such form as the Secretary may prescribe; and

        `(B) contains--

          `(i) the name, address, and taxpayer identification number of--

            `(I) the individual charged with the specified criminal offense; and

            `(II) each person posting the bail (other than a person licensed as a bail bondsman);

          `(ii) the amount of coins or currency received;

          `(iii) the date the coins or currency was received; and

          `(iv) such other information as the Secretary may prescribe.

      `(3) SPECIFIED CRIMINAL OFFENSE- For purposes of this subsection, the term `specified criminal offense' means--

        `(A) any Federal criminal offense involving a controlled substance;

        `(B) racketeering (as defined in section 1951, 1952, or 1955 of title 18, United States Code);

        `(C) money laundering (as defined in section 1956, 1957 or 1960 of such title); and

        `(D) any State criminal offense substantially similar to an offense described in subparagraph (A), (B), or (C).

      `(4) INFORMATION TO FEDERAL PROSECUTORS- Each clerk required to include in a report under paragraph (1) the information described in paragraph (2)(B) with respect to an individual described in paragraph (2)(B)(i)(I) shall furnish (at such time as the Secretary may by regulations prescribe) a written statement showing such information to the United States Attorney for the jurisdiction in which such individual resides and the jurisdiction in which the specified criminal offense occurred.

      `(5) INFORMATION TO PAYORS OF BAIL- Each clerk required to file a report under paragraph (1) shall furnish (at such time as the Secretary may by regulations prescribe) to each person whose name is required to be set forth in such report by reason of paragraph (2)(B)(i)(II) a written statement showing--

        `(A) the name and address of the clerk's office required to file the report; and

        `(B) the aggregate amount of coins and currency described in paragraph (1) received by such clerk.'.

    (b) PROHIBITION ON STRUCTURING TRANSACTIONS-

      (1) IN GENERAL- Section 5324 of title 31, United States Code, is amended--

        (A) by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; and

        (B) by inserting after subsection (a) the following new subsection:

    `(b) DOMESTIC COIN AND CURRENCY TRANSACTIONS INVOLVING NONFINANCIAL TRADES OR BUSINESSES- No person shall for the purpose of evading the report requirements of section 5332 or any regulation prescribed under such section--

      `(1) cause or attempt to cause a nonfinancial trade or business to fail to file a report required under section 5332 or any regulation prescribed under such section;

      `(2) cause or attempt to cause a nonfinancial trade or business to file a report required under section 5332 or any regulation prescribed under such section that contains a material omission or misstatement of fact; or

      `(3) structure or assist in structuring, or attempt to structure or assist in structuring, any transaction with 1 or more nonfinancial trades or businesses.'.

      (2) TECHNICAL AND CONFORMING AMENDMENTS-

        (A) The heading for subsection (a) of section 5324 of title 31, United States Code, is amended by inserting `INVOLVING FINANCIAL INSTITUTIONS' after `TRANSACTIONS'.

        (B) Section 5317(c) of title 31, United States Code, is amended by striking `5324(b)' and inserting `5324(c)'.

    (c) DEFINITION OF NONFINANCIAL TRADE OR BUSINESS-

      (1) IN GENERAL- Section 5312(a) of title 31, United States Code, is amended--

        (A) by redesignating paragraphs (4) and (5) as paragraphs (5) and (6), respectively; and

        (B) by inserting after paragraph (3) the following new paragraph:

      `(4) NONFINANCIAL TRADE OR BUSINESS- The term `nonfinancial trade or business' means any trade or business other than a financial institution that is subject to the reporting requirements of section 5313 and regulations prescribed under such section.'.

      (2) TECHNICAL AND CONFORMING AMENDMENTS-

        (A) Section 5312(a)(3)(C) of title 31, United States Code, is amended by striking `section 5316,' and inserting `sections 5332 and 5316,'.

        (B) Subsections (a) through (f) of section 5318 of title 31, United States Code, and sections 5321, 5326, and 5328 of such title are each amended--

          (i) by inserting `or nonfinancial trade or business' after `financial institution' each place such term appears; and

          (ii) by inserting `or nonfinancial trades or businesses' after `financial institutions' each place such term appears.

        (C) Section 981(a)(1)(A) of title 18, United States Code, is amended by striking `5313(a) or 5324(a) of title 31,' and inserting

`5313(a) or 5332 of title 31, or subsection (a) or (b) of section 5324 of such title,'.

        (D) Section 982(a)(1) of title 18, United States Code, is amended by inserting `5332,' after `5313(a),'.

    (d) REPEAL OF DUPLICATE PROVISION- Section 6050I of the Internal Revenue Code of 1986 is hereby repealed.

    (e) CLERICAL AMENDMENTS- The tables of sections for chapter 53 of title 31, United States Code, is amended by inserting after the item relating to section 5331 (as added by section 101 of this title) the following new item:

      `5332. Reports relating to coins and currency received in nonfinancial trade or business.'.

      (2) INTERNAL REVENUE CODE OF 1986-

        (A) The table of sections for subpart B of part III of subchapter A of chapter 61 of the Internal Revenue Code of 1986 is amended by striking the item relating to section 6050I.

        (B)(i) Subsection (l) of section 6103 of such Code is amended by striking paragraph (15).

          (ii) Subparagraph (A) of section 6103(p)(3) of such Code is amended by striking `(15),'.

          (iii) Paragraph (4) of section 6103(p) of such Code is amended by striking in the material preceding subparagraph (A) `(12)' and all that follows through `(16)' and inserting `(12), or (16)'.

          (iv) Clause (ii) of section 6103(p)(4)(F) of such Code is amended by striking `(14), or (15)' and inserting `or (14)'.

        (C) Paragraph (2) of section 6721(e) of such Code is amended--

          (i) in subparagraph (A) by striking `6050I,' and by adding `or' at the end,

          (ii) by striking `or' at the end of subparagraph (B) and inserting `and', and

          (iii) by striking subparagraph (C).

        (D) Subparagraph (B) of section 6724(d)(1) of such Code is amended by striking clause (iv) and by redesignating the succeeding clauses accordingly.

        (E) Paragraph (2) of section 6724(d) of such Code is amended by striking subparagraph (K) and by redesignating the succeeding subparagraphs accordingly.

        (F) Section 7203 of such Code is amended by striking the last sentence.

    (f) REGULATIONS; EFFECTIVE DATE-

      (1) REGULATIONS- Regulations which the Secretary of the Treasury determines are necessary to implement this section shall be published in final form before the end of the 6-month period beginning on the date of the enactment of this Act.

      (2) EFFECTIVE DATE- The amendments made by this section shall take effect immediately upon enactment, except that the reporting obligations mandated by Title 26, United States Code, Section 6050I shall not be repealed until the regulations mandated by Title 31, United States Code, Section 5332 become effective.

SEC. 112. PENALTIES FOR VIOLATIONS OF GEOGRAPHIC TARGETING ORDERS AND CERTAIN RECORD KEEPING REQUIREMENTS.

    (a) CIVIL PENALTY FOR VIOLATION OF TARGETING ORDER- Section 5321(a)(1) of title 31, United States Code, is amended--

      (1) by inserting `or order issued' after `subchapter or a regulation prescribed'; and

      (2) by inserting `, or willfully violating a regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508,' after `section 5314 and 5315)'.

    (b) CRIMINAL PENALTIES FOR VIOLATION OF TARGETING ORDER-

    Section 5322 of title 31, United States Code, is amended--

      (1) in subsection (a)--

        (A) by inserting `or order issued' after `willfully violating this subchapter or a regulation prescribed'; and

        (B) by inserting `or willfully violating a regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508,' after `under section 5315 or 5324),';

      (2) in subsection (b)--

        (A) by inserting `or order issued' after `willfully violating this subchapter or a regulation prescribed'; and

        (B) by inserting `willfully violating a regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508,' after `under section 5315 or 5324),';

    (c) STRUCTURING TRANSACTIONS TO EVADE TARGETING ORDER OR CERTAIN RECORD KEEPING REQUIREMENTS- Section 5324(a) of title 31, United States Code, is amended--

      (1) by inserting a comma after `shall';

      (2) by striking `section--' and inserting `section, the reporting requirements imposed by any order issued under section 5326, or the record keeping requirements imposed by any regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508--'; and

      (3) in paragraphs (1) and (2), by inserting `, to file a report required by any order issued under section 5326, or to maintain a record required pursuant to any regulation prescribed under section 21 of the Federal Deposit Insurance Act or section 123 of Public Law 91-508' after `regulation prescribed under any such section' each place that term appears.

    (d) INCREASE IN CIVIL PENALTIES FOR VIOLATION OF CERTAIN RECORD KEEPING REQUIREMENTS-

      (1) FEDERAL DEPOSIT INSURANCE ACT- Section 21(j)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1829b(j)(1)) is amended by striking `$10,000' and inserting `the greater of--

        `(A) the amount (not to exceed $100,000) involved in the transaction (if any) with respect to which the violation occurred; or

        `(B) $25,000'.

      (2) PUBLIC LAW 91-508- Section 125(a) of Public Law 91-508 (12 U.S.C. 1955(a)) is amended by striking `$10,000' and inserting `the greater of--

      `(1) the amount (not to exceed $100,000) involved in the transaction (if any) with respect to which the violation occurred; or

      `(2) $25,000'.

    (e) CRIMINAL PENALTIES FOR VIOLATION OF CERTAIN RECORD KEEPING REQUIREMENTS-

      (1) SECTION 126- Section 126 of Public Law 91-508 (12 U.S.C. 1956) is amended to read as follows:

`SEC. 126. CRIMINAL PENALTY.

    `A person that willfully violates this chapter, section 21 of the Federal Deposit Insurance Act, or a regulation prescribed under this chapter or that section 21, shall be fined not more than $250,000, or imprisoned for not more than 5 years, or both.'.

      (2) SECTION 127- Section 127 of Public Law 91-508 (12 U.S.C. 1957) is amended to read as follows:

`SEC. 127. ADDITIONAL CRIMINAL PENALTY IN CERTAIN CASES.

    `A person that willfully violates this chapter, section 21 of the Federal Deposit Insurance Act, or a regulation prescribed under this chapter or that section 21, while violating another law of the United States or as part of a pattern of any illegal activity involving more than $100,000 in a 12-month period, shall be fined not more than $500,000, imprisoned for not more than 10 years, or both.'.

SEC. 113. EXCLUSION OF ALIENS INVOLVED IN MONEY LAUNDERING.

    (a) IN GENERAL- Section 212 of the Immigration and Nationality Act of 1952, as amended (8 U.S.C. 1182), is amended in subsection (a)(2)--

      (1) by redesignating subparagraphs (D), (E) and (F) as subparagraphs (F), (G) and (I), respectively; and

      (2) by inserting after subparagraph (C) new subparagraphs (D) and (E) to read as follows:

        `(D) MONEY LAUNDERING ACTIVITIES- Any alien who the consular officer or the Attorney General knows or has reason to believe--

          `(i) is or has been engaged in activities which if engaged in within the United States would constitute a violation of the money laundering provisions section 1956 or 1957 of title 18, United States Code, or has knowingly assisted, abetted, or conspired or colluded with others in any such illicit activity; or

          `(ii) is the spouse, son or daughter of an alien inadmissible under clause (i), has, within the previous 5 years, obtained any financial or other benefit from such illicit activity of that alien, and knew or reasonably should have known that the financial or other benefit was the product of such illicit activity, is inadmissible.

    (b) CONFORMING AMENDMENT- Section 212(h)(1)(A)(i) of the Immigration and Nationality Act of 1952, as amended (8 U.S.C. 1182), is amended by striking `(D)(i) or (D)(ii)' and inserting `(E)(i) or (E)(ii)'.

SEC. 114. STANDING TO CONTEST FORFEITURE OF FUNDS DEPOSITED INTO FOREIGN BANK THAT HAS A CORRESPONDENT ACCOUNT IN THE UNITED STATES.

    Section 981 of title 18, United States Code, is amended by adding the following after the last subsection:

    `(k) CORRESPONDENT BANK ACCOUNTS-

      `(1) For the purpose of a forfeiture under this section or under the Controlled Substances Act, if funds are deposited into a dollar-denominated bank account in a foreign financial institution, and that foreign financial institution has a correspondent account with a financial institution in the United States, the funds deposited into the foreign financial institution (the respondent bank) shall be deemed to have been deposited into the correspondent account in the United States, and any restraining order, seizure warrant, or arrest warrant in rem regarding such funds may be served on the correspondent bank, and funds in the correspondent account up to the value of the funds deposited into the dollar-denominated account in the foreign financial institution may be seized, arrested or restrained.

      `(2) In the circumstances where paragraph (1) applies, if a forfeiture action is brought against the funds that are seized, arrested, or restrained, it shall not be necessary for the government to establish that such funds are directly traceable to the funds that were deposited into the respondent bank, nor shall it be necessary for the Government to rely on the application of Section 984 of this title.

      `(3) If a forfeiture action is instituted against funds seized, arrested or restrained pursuant to paragraph (1), the owner of the funds, as that term is defined in paragraph (4), may contest the forfeiture by filing a claim pursuant to section 983 of this title.

      `(4) For purposes of this subsection--

        `(A) except as provided in (C), the `owner of the funds' is the `owner,' as that term is defined in Section 983(d)(6), whose funds were deposited into the respondent bank;

        `(B) If the respondent bank received the funds that are subject to forfeiture from another respondent bank, the `owner of the funds' is the `owner' whose funds were deposited into the first respondent bank, and each intermediary financial institution shall be deemed a respondent bank;

        `(C) the respondent bank may be considered the `owner of the funds' only if--

          `(i) the basis for the forfeiture action is wrongdoing committed by the respondent bank, or

          `(ii) the respondent bank establishes, by a preponderance of the evidence, that prior to the seizure or arrest of the funds, the respondent bank discharged all or part its obligation to the owner of the funds, in which case the respondent bank will be deemed the owner of the funds to the extent that such obligation was satisfied.

        `(D) In cases where (C) applies, only the respondent bank may be considered to be the `owner of the funds.'

      `(5) `In this section, `correspondent account' has the same meaning as the term `interbank account' as defined in 18 U.S.C. ` 984(c)(2)(B).'

SEC. 115. SUBPOENAS FOR RECORDS REGARDING FUNDS IN CORRESPONDENT BANK ACCOUNTS.

    (a) IN GENERAL- Chapter 53 of title 31, United States Code, is amended by inserting after section 5332 (as added by this title) the following new section:

`SEC. 5333. SUBPOENAS FOR RECORDS.

    `(a) DESIGNATION BY FOREIGN FINANCIAL INSTITUTION OF AGENT- Any foreign financial institution that has a correspondent bank account at a financial institution in the United States shall designate a person residing in the United States as a person authorized to accept a subpoena for bank records or other legal process served on the foreign financial institution.

    `(b) MAINTENANCE OF RECORDS BY DOMESTIC FINANCIAL INSTITUTION-

      `(1) IN GENERAL- Any domestic financial institution that maintains a correspondent bank account for a foreign financial institution shall maintain records regarding the names and addresses of the owners of the foreign financial institution, and the name and address of the person who may be served with a subpoena for records regarding any funds transferred to or from the correspondent account.

      `(2) PROVISION TO LAW ENFORCEMENT AGENCY- A domestic financial institution shall provide names and addresses maintained under paragraph (1) to a Government authority (as defined in section 1101(3) of the Right to Financial Privacy Act of 1978) within 7 days of the receipt of a request, in writing, for such records.

    `(c) ADMINISTRATIVE SUBPOENA-

      `(1) IN GENERAL- The Attorney General may issue an administrative subpoena for records relating to the deposit of any funds into a dollar-denominated account in a foreign financial institution that maintains a correspondent account at a domestic financial institution.

      `(2) MANNER OF ISSUANCE- Any subpoena issued by the Attorney General under paragraph (1) shall be issued in the manner described in section 3486 of this title, and may be served on the representative designated by the foreign financial institution pursuant to subsection (a) to accept legal process in the United States, or in a foreign country pursuant to any mutual legal assistance treaty, multilateral agreement, or other request for international law enforcement assistance.

    `(d) CORRESPONDENT ACCOUNT DEFINED- For purposes of this section, the term `correspondent account' has the same meaning as the term `interbank account' as such term is defined in section 984(c)(2)(B) of title 18, United States Code.'.

    (b) CLERICAL AMENDMENTS- The table of sections for chapter 53 of title 31, United States Code, is amended by inserting after the item relating to section 5332 (as added by this title) the following new item:

      `5333. Subpoenas for records.'.

    (c) EFFECTIVE DATE- Section 5333(a) of title 31, United States Code (as added by subsection (a) of this section), shall apply after the end of the 30-day period beginning on the date of the enactment of this Act.

    (d) REQUESTS FOR RECORDS- Section 3486(a)(1) of title 18, United States Code, is amended by striking `, or (II) a Federal offense involving the sexual exploitation or abuse of children,' and inserting `, (II) a Federal offense involving the sexual exploitation or abuse of children, or (III) a money laundering offense in violation of section 1956, 1957 or 1960 of this title,'.

SEC. 116. FINANCIAL CRIMES ENFORCEMENT NETWORK.

    (a) IN GENERAL- Subchapter I of chapter 3 of title 31, United States Code, is amended--

      (1) by redesignating section 310 as section 311; and

      (2) by inserting after section 309 the following new section:

`Sec. 310. Financial crimes enforcement network

    `(a) IN GENERAL- The Financial Crimes Enforcement Network established by order of the Secretary of the Treasury (Treasury Order Numbered 105-08) on April 25, 1990, shall be a bureau in the Department of the Treasury.

    `(b) DIRECTOR-

      `(1) APPOINTMENT- The head of the Financial Crimes Enforcement Network shall be the Director who shall be appointed by the President, by and with the consent of the Senate, to a term of 4 years.

      `(2) DUTIES AND POWERS- The duties and powers of the Director are as follows:

        `(A) Advise and make recommendations on matters relating to financial intelligence and other financial criminal activity to the Under Secretary for Enforcement.

        `(B) Maintain a government-wide data access service, with access, in accordance with applicable legal requirements, to the following:

          `(i) Information collected by the Department of the Treasury, including report information filed under subchapters II and III of chapter 53 of this title (such as reports on cash transactions, foreign financial agency transactions and relationships, foreign currency transactions, exporting and importing monetary instruments, and suspicious activities), chapter 2 of

Public Law 91-508, section 21 of the Federal Deposit Insurance Act and section 6050I of the Internal Revenue Code of 1986.

          `(ii) Information regarding national and international currency flows.

          `(iii) Other records and data maintained by other Federal, State, local, and foreign agencies, including financial and other records developed in specific cases.

          `(iv) other privately and publicly available information.

        `(C) Analyze and disseminate the available data in accordance with applicable legal requirements and policies and guidelines established by the Secretary of the Treasury and the Under Secretary for Enforcement to--

          `(i) identify possible criminal targets to appropriate Federal, State, local, and foreign law enforcement agencies;

          `(ii) support ongoing criminal financial investigations and prosecutions and related proceedings, including civil and criminal tax and forfeiture proceedings;

          `(iii) identify possible instances of noncompliance with subchapters II and III of chapter 53 of this title, chapter 2 of Public Law 91-508, and section 21 of the Federal Deposit Insurance Act to Federal agencies with statutory responsibility for enforcing compliance with such provisions;

          `(iv) evaluate and recommend possible uses of special currency reporting requirements under section 5326; and

          `(v) determine emerging trends and methods in money laundering and other financial crimes.

        `(D) Establish and maintain a financial crimes communications center to furnish law enforcement authorities with intelligence information related to emerging or ongoing investigations and undercover operations.

        `(E) Furnish research, analytical, and informational services to financial institutions, appropriate Federal regulatory agencies with regard to financial institutions, and appropriate Federal, State, local, and foreign law enforcement authorities, in accordance with policies and guidelines established by the Secretary of the Treasury or the Under Secretary of the Treasury for Enforcement, in the interest of detection, prevention, and prosecution of money laundering and other financial crimes.

        `(F) Establish and maintain a special unit dedicated to combatting the use of informal, nonbank networks and payment and barter system mechanisms that permit the transfer of funds or the equivalent of funds without records and without compliance with criminal and tax laws.

        `(G) Such other duties and powers as the Secretary of the Treasury may delegate or prescribe.

    `(c) REQUIREMENTS RELATING TO MAINTENANCE AND `USER FRIENDLY' USE OF DATA BANKS- The Secretary of the Treasury shall establish and maintain operating procedures with respect to the government-wide data access service and the financial crimes communications center maintained by the Financial Crimes Enforcement Network which provide--

      `(1) for the coordinated and efficient entry of information into, and withdrawal of information from, the data maintenance system maintained by the Network, including--

        `(A) the submission of reports in electronic format, whenever possible;

        `(B) the cataloguing of information in a manner that facilitates rapid retrieval by law enforcement personnel of meaningful data in a `user friendly' manner; and

        `(C) a procedure that provides for a prompt initial review of suspicious activity reports and other reports, or such other means as the Secretary my provide, to identify information that warrants immediate action;

      `(2) in accordance with section 552a of title 5 and the Right to Financial Privacy Act of 1978, appropriate standards and guidelines for determining--

        `(A) who is to be given access to the information maintained by the Network;

        `(B) what limits are to be imposed on the use of such information; and

        `(C) how information about activities or relationships which involve or are closely associated with the exercise of constitutional rights is to be screened out of the data maintenance system; and

      `(3) the prompt verification of the accuracy and completeness of information maintained by the Network and the prompt deletion or correction of inaccurate or incomplete information.

    `(d) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated for the Financial Crimes Enforcement Network such sums as may be necessary for fiscal years 2002 and 2003.'.

    (b) CLERICAL AMENDMENT- The table of sections for subchapter I of chapter 3 of title 31, United States Code, is amended--

      (1) by redesignating the item relating to section 310 as section 311; and

      (2) by inserting after the item relating to section 309 the following new item:

      `310. Financial crimes enforcement network.'.

SEC. 117. CUSTOMS SERVICE BORDER SEARCHES.

    Section 5317(b) of title 31, United States Code, is amended to read as follows:

    `(b) SEARCHES AT BORDER-

      `(1) IN GENERAL- For purposes of ensuring compliance with the laws enforced by the United States Customs Service, a customs officer may stop and search, at the border and without a search warrant, any vehicle, vessel, aircraft, or other conveyance, any envelope or other container, and any person entering or departing from the United States.

      `(2) INTERNATIONAL SHIPMENTS OF MAIL- With respect to shipments of international mail (within the meaning of section 3741 of title 39) that are exported or imported by the United States Postal Service, the Customs Service and other appropriate Federal agencies shall, subject to paragraph (3), apply the customs laws of the United States and all other laws relating to the importation or exportation of such shipments in the same manner to both shipments by the Postal Service and similar shipments by private companies.

      `(3) SAFEGUARDS- No provision of this subsection shall be construed as authorizing any customs officer or any other person to read, copy, or seize any correspondence unless--

        `(A) a search warrant has been issued pursuant to Rule 41 of the Federal Rules of Civil Procedure which permits such correspondence to be read, copied, or seized; or

        `(B) the author or sender of the correspondence has given written consent for any such action.'.

SEC. 118. PROHIBITION ON FALSE STATEMENTS TO FINANCIAL INSTITUTIONS CONCERNING THE IDENTITY OF A CUSTOMER.

    (a) IN GENERAL- Chapter 47 of title 18, United States Code, is amended by inserting after section 1007 the following:

`Sec. 1008. False statements concerning the identity of customers of financial institutions

    `(a) IN GENERAL- Whoever knowingly in any manner--

      `(1) falsifies, conceals, or covers up, or attempts to falsify, conceal, or cover up, the identity of any person in connection with any transaction with a financial institution;

      `(2) makes, or attempts to make, any materially false, fraudulent, or fictitious statement or representation of the identity of any person in connection with a transaction with a financial institution;

      `(3) makes or uses, or attempts to make or use, any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry concerning the identity of any person in connection with a transaction with a financial institution; or

      `(4) uses or presents, or attempts to use or present, in connection with a transaction with a financial institution, an identification document or means of identification the possession of which is a violation of section 1028;

    shall be fined under this title, imprisoned not more than 5 years, or both.

    `(b) DEFINITIONS- In this section, the following definitions shall apply:

      `(1) FINANCIAL INSTITUTION- The term `financial institution'--

        `(A) has the same meaning as in section 20; and

        `(B) in addition, has the same meaning as in section 5312(a)(2) of title 31, United States Code.

      `(2) IDENTIFICATION DOCUMENT- The term `identification document' has the same meaning as in section 1028(d).

      `(3) MEANS OF IDENTIFICATION- The term `means of identification' has the same meaning as in section 1028(d).'.

    (b) TECHNICAL AND CONFORMING AMENDMENTS-

      (1) TITLE 18, UNITED STATES CODE- Section 1956(c)(7)(D) of title 18, United States Code, is amended by striking `1014 (relating to fraudulent loan' and inserting `section 1008 (relating to false statements concerning the identity of customers of financial institutions), section 1014 (relating to fraudulent loan'.

      (2) TABLE OF SECTIONS- The table of sections for chapter 47 of title 18, United States Code, is amended by inserting after the item relating to section 1007 the following:

      `1008. False statements concerning the identity of customers of financial institutions.'.

SEC. 119. VERIFICATION OF IDENTIFICATION.

    Section 5318 of title 31, United States Code, is amended by adding at the end the following new subsection:

    `(i) IDENTIFICATION AND VERIFICATION OF ACCOUNTHOLDERS- The Secretary of the Treasury shall prescribe regulations requiring financial institutions to obtain and maintain the names, addresses, and other forms of identification of all persons who open or maintain an account at the institution, including any beneficial owner of any such account. The regulations shall include a requirement that financial institutions shall verify the identity of all such persons and maintain records of the information used to verify such identification.'.

TITLE II--PUBLIC-PRIVATE COOPERATION

SEC. 201. ESTABLISHMENT OF HIGHLY SECURE WEBSITE.

    (a) IN GENERAL- The Secretary of the Treasury shall establish a highly secure website in the Financial Crimes Enforcement Network that--

      (1) allows financial institutions to file suspicious activities reports through the Internet; and

      (2) provides financial institutions with alerts and other information regarding suspicious activities that warrant immediate and enhanced scrutiny.

    (b) EXPEDITED DEVELOPMENT- The Secretary of the Treasury shall take such action as may be necessary to ensure that the website required under subsection (a) is fully operational before the end of the 6-month period beginning on the date of the enactment of this Act.

SEC. 202. REPORT ON IMPROVEMENTS IN DATA ACCESS.

    Before the end of the 4-month period beginning on the date of the enactment of this Act, the Secretary of the Treasury shall report to the Congress on the progress made since such date of enactment in meeting the requirements of section 310(c) of title 31, United States Code (as added by this Act) to maintain the data collection and analysis system of the Financial Crimes Enforcement Network in a manner that allows the submission of reports in electronic format and the rapid retrieval by law enforcement personnel of meaningful data in a `user friendly' manner.

SEC. 203. REPORTS TO THE FINANCIAL SERVICES INDUSTRY ON SUSPICIOUS FINANCIAL ACTIVITIES.

    At least once each calendar quarter, the Secretary of the Treasury shall--

      (1) publish a report containing a detailed analysis identifying patterns of suspicious activity and other investigative insights derived from suspicious activity reports and investigations conducted by Federal, to the extent appropriate; and

      (2) distribute such report to financial institutions (as defined in section 5312 of title 31, United States Code).

SEC. 204. EFFICIENT USE OF CURRENCY TRANSACTION REPORT SYSTEM.

    (a) FINDINGS- The Congress finds the following:

      (1) The Congress established the currency transaction reporting requirements in 1970 because the Congress found then that such reports have a high degree of usefulness in criminal, tax, and regulatory investigations and proceedings and the usefulness of such reports has only increased in the years since the requirements were established.

      (2) In 1994, in response to reports and testimony that excess amounts of currency transaction reports were interfering with effective law enforcement, the Congress reformed the currency transaction report exemption requirements to provide--

        (A) mandatory exemptions for certain reports that had little usefulness for law enforcement, such as cash transfers between depository institutions and cash deposits from government agencies; and

        (B) discretionary authority for the Secretary of the Treasury to provide exemptions, subject to criteria and guidelines established by the Secretary, for financial institutions with regard to regular business customers that maintain accounts at an institution into which frequent cash deposits are made.

      (3) Today there is evidence that some financial institutions are not utilizing the exemption system, or are filing reports even if there is an exemption in effect, with the result that the volume of currency transaction reports is once again interfering with effective law enforcement.

    (b) STUDY AND REPORT-

      (1) STUDY REQUIRED- The Secretary of the Treasury shall conduct a study of--

        (A) the possible expansion of the statutory exemption system in effect under 5313 of title 31, United States Code;

        (B) methods for improving financial institution utilization of the statutory exemption provisions as a way of reducing the submission of currency transaction reports that have little or no value for law enforcement purposes, including improvements in the systems in effect at financial institutions for regular review of the exemption procedures used at the institution and the training of personnel in its effective use; and

        (C) the feasibility and advisability of establishing sanctions for financial institutions that routinely engage in filing currency transaction reports that have little or no value for law enforcement purposes without regard to the statutory exemptions available with respect to such reports.

      (2) REPORT REQUIRED- The Secretary of the Treasury shall submit a report to the Congress before the end of the 90-day period beginning on the

date of the enactment of this Act containing the findings and conclusions of the Secretary with regard to the study required under subsection (a) and such recommendations for legislative or administrative action as the Secretary determines to be appropriate.

SEC. 205. PUBLIC-PRIVATE TASK FORCE ON TERRORIST FINANCING ISSUES.

    Section 1564 of the Annunzio-Wylie Anti-Money Laundering Act (31 U.S.C. 5313 note) is amended by adding at the end the following new subsection:

    `(d) TERRORIST FINANCING ISSUES- The Secretary of the Treasury shall provide, either within the Bank Secrecy Act Advisory Group, or as a subcommittee or other adjunct of the Advisory Group, for a task force of representatives from agencies and officers represented on the Advisory Group and representatives of financial institutions, private organizations that represent the financial services industry, and other interested parties to focus on--

      `(1) issues specifically related to the finances of terrorist groups, the means terrorist groups use to transfer funds around the world and within the United States, and the extent to which financial institutions in the United States are unwittingly involved in such finances and the extent to which such institutions are at risk as a result; and

      `(2) means of facilitating the identification of accounts and transactions involving terrorist groups and facilitating the exchange of information concerning such accounts and transactions between financial institutions and law enforcement organizations.'.

SEC. 206. DEADLINE FOR SUSPICIOUS ACTIVITY REPORTING REQUIREMENTS FOR REGISTERED BROKERS AND DEALERS.

    The Secretary of the Treasury shall publish regulations in the Federal Register before January 1, 2002, requiring brokers and dealers registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934 to submit suspicious activity reports under section 5318(g) of title 31, United States Code.

SEC. 207. AMENDMENTS RELATING TO REPORTING OF SUSPICIOUS ACTIVITIES.

    (a) AMENDMENT RELATING TO CIVIL LIABILITY IMMUNITY FOR DISCLOSURES- Section 5318(g)(3) of title 31, United States Code, is amended to read as follows:

      `(3) LIABILITY FOR DISCLOSURES-

        `(A) IN GENERAL- Any financial institution that makes a voluntary disclosure of any possible violation of law or regulation to a government agency or makes a disclosure pursuant to this subsection or any other authority, and

any director, officer, employee, or agent of such institution who makes, or requires another to make any such disclosure, shall not be liable to any person under any law or regulation of the United States, any constitution, law, or regulation of any State or political subdivision of any State, or under any contract or other legally enforceable agreement (including any arbitration agreement), for such disclosure or for any failure to provide notice of such disclosure to the person who is the subject of such disclosure or any other person identified in the disclosure.

        `(B) RULE OF CONSTRUCTION- Subparagraph (A) shall not be construed as creating--

          `(i) any inference that the term `person', as used in such subparagraph, may be construed more broadly than its ordinary usage so to include any government or agency of government; or

          `(ii) any immunity against, or otherwise affecting, any civil or criminal action brought by any government or agency of government to enforce any constitution, law, or regulation of such government or agency.'.

    (b) PROHIBITION ON NOTIFICATION OF DISCLOSURES- Section 5318(g)(2) of title 31, United States Code, is amended to read as follows:

      `(2) NOTIFICATION PROHIBITED-

        `(A) IN GENERAL- If a financial institution or any director, officer, employee, or agent of any financial institution, voluntarily or pursuant to this section or any other authority, reports a suspicious transaction to a government agency--

          `(i) the financial institution, director, officer, employee, or agent may not notify any person involved in the transaction that the transaction has been reported; and

          `(ii) no officer or employee of the Federal Government or of any State, local, tribal, or territorial government within the United States, who has any knowledge that such report was made may disclose to any person involved in the transaction that the transaction has been reported other than

as necessary to fulfill the official duties of such officer or employee.

        `(B) DISCLOSURES IN CERTAIN EMPLOYMENT REFERENCES- Notwithstanding the application of subparagraph (A) in any other context, subparagraph (A) shall not be construed as prohibiting any financial institution, or any director, officer, employee, or agent of such institution, from including, in a written employment reference that is provided in accordance with section 18(v) of the Federal Deposit Insurance Act in response to a request from another financial institution or a written termination notice or employment reference that is provided in accordance with the rules of the self-regulatory organizations registered with the Securities and Exchange Commission, information that was included in a report to which subparagraph (A) applies, but such written employment reference may not disclose that such information was also included in any such report or that such report was made.'.

SEC. 208. AUTHORIZATION TO INCLUDE SUSPICIONS OF ILLEGAL ACTIVITY IN WRITTEN EMPLOYMENT REFERENCES.

    Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is amended by adding at the end the following new subsection:

    `(w) WRITTEN EMPLOYMENT REFERENCES MAY CONTAIN SUSPICIONS OF INVOLVEMENT IN ILLEGAL ACTIVITY-

      `(1) IN GENERAL- Notwithstanding any other provision of law, any insured depository institution, and any director, officer, employee, or agent of such institution, may disclose in any written employment reference relating to a current or former institution-affiliated party of such institution which is provided to another insured depository institution in response to a request from such other institution, information concerning the possible involvement of such institution-affiliated party in potentially unlawful activity.

      `(2) DEFINITION- For purposes of this subsection, the term `insured depository institution' includes any uninsured branch or agency of a foreign bank.'.

TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

SEC. 301. SPECIAL MEASURES FOR JURISDICTIONS, FINANCIAL INSTITUTIONS, OR INTERNATIONAL TRANSACTIONS OF PRIMARY MONEY LAUNDERING CONCERN.

    (a) IN GENERAL- Subchapter II of chapter 53 of title 31, United States Code, is amended by inserting after section 5318 the following new section:

`Sec. 5318A. Special measures for jurisdictions, financial institutions, or international transactions of primary money laundering concern

    `(a) INTERNATIONAL COUNTER-MONEY LAUNDERING REQUIREMENTS-

      `(1) IN GENERAL- The Secretary may require domestic financial institutions and domestic financial agencies to take 1 or more of the special measures described in subsection (b) if the Secretary finds that reasonable grounds exist for concluding that a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States is of primary money laundering concern, in accordance with subsection (d).

      `(2) FORM OF REQUIREMENT- The special measures described in subsection (b) may be imposed by regulation, order, or otherwise as permitted by law, and in such sequence or combination, as the Secretary shall determine.

      `(3) PROCESS FOR SELECTING SPECIAL MEASURES-

        `(A) CONSULTATION- In selecting which special measure or measures to take under this subsection, the Secretary shall consult with the Chairman of the Board of Governors of the Federal Reserve System and, in the Secretary's sole discretion, such other agencies and interested parties as the Secretary may find to be appropriate.

        `(B) FACTORS- The Secretary also shall consider--

          `(i) whether similar action has been or is being taken by other nations or multilateral groups;

          `(ii) whether the imposition of any particular special measure would create a significant competitive disadvantage,

including any undue cost or burden associated with compliance, for financial institutions organized or licensed in the United States; and

          `(iii) the extent to which the action would have a significant adverse systemic impact on the international payment, clearance and settlement system, or on legitimate business activities involving the particular jurisdiction, institution, or class of transactions.

      `(4) NO LIMITATION ON OTHER AUTHORITY- This section shall not be construed as superseding or otherwise restricting any other authority granted to the Secretary, or to any other agency, by this subchapter or otherwise.

    `(b) SPECIAL MEASURES- The special measures referred to in subsection (a), with respect to a jurisdiction outside the United States, financial institution operating outside the United States, or class of transaction within, or involving, a jurisdiction outside the United States, are as follows:

      `(1) RECORDKEEPING AND REPORTING OF CERTAIN FINANCIAL TRANSACTIONS-

        `(A) IN GENERAL- The Secretary may require any domestic financial institution or domestic financial agency to maintain records, file reports, or both, concerning the aggregate amount of transactions, or concerning each transaction, with respect to a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States, if the Secretary finds any such jurisdiction, institution, or class of transactions to be of primary money laundering concern.

        `(B) FORM OF RECORDS AND REPORTS- Such records and reports shall be made and retained at such time, in such manner, and for such period of time, as the Secretary shall determine, and shall include such information as the Secretary may determine, including--

          `(i) the identity and address of the participants in a transaction or relationship, including the identity of the originator of any funds transfer;

          `(ii) the legal capacity in which a participant in any transaction is acting;

          `(iii) information concerning the beneficial ownership of the funds involved in any transaction, in accordance with steps the Secretary has determined to be reasonable and practicable to obtain and retain such information; and

          `(iv) a description of any transaction.

      `(2) INFORMATION RELATING TO BENEFICIAL OWNERSHIP- In addition to any other requirement under any other law, the Secretary may require any domestic financial institution or domestic financial agency to take such steps as the Secretary may determine to be reasonable and practicable to obtain and retain information concerning the beneficial ownership of any account opened or maintained in the United States by a foreign person (other than a foreign entity whose shares are subject to public reporting requirements or are listed and traded on a regulated exchange or trading market), or a representative of such a foreign person, that involves a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States, if the Secretary finds any such jurisdiction, institution, or transaction to be of primary money laundering concern.

      `(3) INFORMATION RELATING TO CERTAIN PAYABLE-THROUGH ACCOUNTS- If the Secretary finds a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States to be of primary money laundering concern, the Secretary may require any domestic financial institution or domestic financial agency that opens or maintains a payable-through account in the United States for a foreign financial institution involving any such jurisdiction or any such financial institution operating outside the United States, or a payable-through account through which any such transaction may be conducted, as a condition of opening or maintaining such account, to--

        `(A) identify each customer (and representative of such customer) of such financial institution who is permitted to use, or whose transactions are routed through, such payable-through account; and

        `(B) obtain, with respect to each such customer (and each such representative), the same

information that the depository institution obtains in the ordinary course of business with respect to its customers residing in the United States.

      `(4) INFORMATION RELATING TO CERTAIN CORRESPONDENT ACCOUNTS- If the Secretary finds a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States to be of primary money laundering concern, the Secretary may require any domestic financial institution or domestic financial agency that opens or maintains a correspondent account in the United States for a foreign financial institution involving any such jurisdiction or any such financial institution operating outside the United States, or a correspondent account through which any such transaction may be conducted, as a condition of opening or maintaining such account, to--

        `(A) identify each customer (and representative of such customer) of any such financial institution who is permitted to use, or whose transactions are routed through, such correspondent account; and

        `(B) obtain, with respect to each such customer (and each such representative), the same information that the depository institution obtains in the ordinary course with respect to its customers residing in the United States.

      `(5) PROHIBITIONS OR CONDITIONS ON OPENING OR MAINTAINING CERTAIN CORRESPONDENT OR PAYABLE-THROUGH ACCOUNTS- If the Secretary finds a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States to be of primary money laundering concern, the Secretary, in consultation with the Secretary of State, the Attorney General, and the Chairman of the Board of Governors of the Federal Reserve System, may prohibit, or impose conditions upon, the opening or maintaining in the United States of a correspondent account or payable-through account by any domestic financial institution or domestic financial agency for or on behalf of a foreign banking institution if such correspondent account or payable-through account involves any such jurisdiction or institution, or if any such transaction may be conducted through such correspondent account or payable-through account.

    `(c) PROHIBITION ON UNITED STATES CORRESPONDENT ACCOUNTS WITH FOREIGN SHELL BANKS-

      `(1) IN GENERAL- A depository institution shall not establish, maintain, administer, or manage a correspondent account in the United States for, or on behalf of, a foreign bank that does not have a physical presence in any country.

      `(2) PREVENTION OF INDIRECT SERVICE TO FOREIGN SHELL BANKS- A depository institution shall take reasonable steps to ensure that any correspondent account established, maintained, administered, or managed by that institution in the United States for a foreign bank is not being used by that foreign bank to indirectly provide banking services to another foreign bank that does not have a physical presence in any country.

      `(3) EXCEPTION- Paragraphs (1) and (2) shall not be construed as prohibiting a depository institution from providing a correspondent account to a foreign bank, if the foreign bank--

        `(A) is an affiliate of a depository institution, credit union, financial services company, or other foreign bank that maintains a physical presence in the United States or a foreign country, as applicable; and

        `(B) is subject to supervision by a banking authority in the country regulating the affiliated depository institution, credit union, financial services company, or foreign bank, described in subparagraph (A), as applicable.

      `(4) DEFINITIONS- For purposes of this subsection, the following definitions shall apply:

        `(A) AFFILIATE- The term `affiliate' means a foreign bank that is controlled by or is under common control with a depository institution, credit union, financial services company, or foreign bank.

        `(B) DEPOSITORY INSTITUTION- The `depository institution'--

          `(i) has the meaning given such term in section 3 of the Federal Deposit Insurance Act; and

          `(ii) includes a credit union.

        `(C) PHYSICAL PRESENCE- The term `physical presence' means a place of business that--

          `(i) is maintained by a foreign bank;

          `(ii) is located at a fixed address (other than solely an electronic address) in a country in which the foreign bank is authorized to conduct banking activities, at which location the foreign bank--

            `(I) employs 1 or more individuals on a full-time basis; and

            `(II) maintains operating records related to its banking activities; and

          `(iii) is subject to inspection by the banking authority which licensed the foreign bank to conduct banking activities.

    `(d) CONSULTATIONS AND INFORMATION TO BE CONSIDERED IN FINDING JURISDICTIONS, INSTITUTIONS, OR TRANSACTIONS TO BE OF PRIMARY MONEY LAUNDERING CONCERN-

      `(1) IN GENERAL- In making a finding that reasonable grounds exist for concluding that a jurisdiction outside the United States, 1 or more financial institutions operating outside the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside the United States is of primary money laundering concern so as to authorize the Secretary to invoke 1 or more of the special measures of subsection (b), the Secretary shall consult with the Secretary of State, the Attorney General, the Secretary of Commerce, and the United States Trade Representative.

      `(2) INFORMATION- The Secretary also shall consider such information as the Secretary considers to be relevant, including the following potentially relevant factors:

        `(A) In the case of a particular jurisdiction--

          `(i) the extent to which that jurisdiction or financial institutions operating therein offer bank secrecy or special tax or regulatory advantages to nonresidents or nondomiciliaries of such jurisdiction;

          `(ii) the substance and quality of administration of that jurisdiction's bank supervisory and counter-money laundering laws;

          `(iii) the relationship between the volume of financial transactions occurring in that jurisdiction and the size of the jurisdiction's economy;

          `(iv) the extent to which that jurisdiction is characterized as a tax haven or offshore banking or secrecy haven by credible international organizations or multilateral expert groups;

          `(v) whether the United States has a mutual legal assistance treaty with that jurisdiction, and the experience of United States law enforcement officials, regulatory officials, and tax administrators in obtaining information about transactions originating in or routed through or to such jurisdiction; and

          `(vi) the extent to which that jurisdiction is characterized by high levels of official or institutional corruption.

        `(B) In the case of a decision to apply 1 or more of the special measures described in subsection (b) only to a financial institution or institutions, or to a transaction or class of transactions, or to both, within, or involving, a particular jurisdiction--

          `(i) the extent to which such financial institutions or transactions are used to facilitate or promote money laundering in or through the jurisdiction;

          `(ii) the extent to which such institutions or transactions are used for legitimate business purposes in such jurisdiction; and

          `(iii) the extent to which such action is sufficient to ensure, with respect to transactions involving such jurisdiction and institutions operating in such jurisdiction, that the purposes of this subchapter continue to be fulfilled, and to guard against international money laundering and other financial crimes.

    `(e) NOTIFICATION OF SPECIAL MEASURES INVOKED BY THE SECRETARY- Within 10 days after the date of any action taken by the Secretary under subsection (a)(1), the Secretary shall notify, in writing, the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate of any such action.

    `(f) DEFINITIONS- Notwithstanding any other provision of this subchapter, for purposes of this section, the following definitions shall apply:

      `(1) DEFINED TERMS-

        `(A) BANK DEFINITIONS- The following definitions shall apply with respect to a bank:

          `(i) ACCOUNT- The term `account'--

            `(I) means a formal banking or business relationship established to provide regular services, dealings, and other financial transactions; and

            `(II) includes a demand deposit, savings deposit, or other transaction or asset account and a credit account or other extension of credit.

          `(ii) CORRESPONDENT ACCOUNT- The term `correspondent account' means an account established to receive deposits from and make payments on behalf of a foreign financial institution.

          `(iii) PAYABLE-THROUGH ACCOUNT- The term `payable-through account' means an account, including a transaction account (as defined in section 19(b)(1)(C) of the Federal Reserve Act), opened at a depository institution by a foreign financial institution by means of which the foreign financial institution permits its customers to engage, either directly or through a sub-account, in banking activities usual in connection with the business of banking in the United States.

        `(B) DEFINITIONS APPLICABLE TO INSTITUTIONS OTHER THAN BANKS- With respect to any financial institution other than a bank, the Secretary shall define, by regulation, order, or otherwise as permitted by law, the term `account' and shall include within the meaning of such term arrangements similar to payable-through and correspondent accounts.

      `(2) OTHER TERMS- The Secretary may, by regulation, order, or otherwise as permitted by law, further define the terms in paragraph (1) and define other terms for the purposes of this section, as the Secretary deems appropriate.'.

    (b) CLERICAL AMENDMENT- The table of sections for subchapter II of chapter 53 of title 31, United States Code, is amended by inserting after the item relating to section 5318 the following new item:

      `5318A. Special measures for jurisdictions, financial institutions, or international transactions of primary money laundering concern.'.

SEC. 302. INTERNATIONAL COOPERATION IN INVESTIGATIONS OF MONEY LAUNDERING, FINANCIAL CRIMES, AND THE FINANCES OF TERRORIST GROUPS.

    (a) NEGOTIATIONS-

      (1) IN GENERAL- In addition to the requirements of section 4702 of the Anti-Drug Abuse Act of 1988, the Secretary of the Treasury (hereinafter in this section referred to as the `Secretary'), in consultation with the Attorney General, the Secretary of State, and the Board of Governors of the Federal Reserve System, shall enter into negotiations with the appropriate financial supervisory agencies and other officials of any foreign country the financial institutions of which do business with United States financial institutions or which may be utilized by any foreign terrorist organization (as designated under section 219 of the Immigration and Nationality Act), any person who is a member or representative of any such organization, or any person engaged in money laundering or financial or other crimes.

      (2) PURPOSES OF NEGOTIATIONS- In carrying out negotiations under paragraph (1), the Secretary shall seek to enter into and further cooperative efforts, voluntary information exchanges, the use of letters rogatory, mutual legal assistance treaties, and international agreements to--

        (A) ensure that foreign banks and other financial institutions maintain adequate records of--

          (i) large United States currency transactions; and

          (ii) transaction and account information relating to any foreign terrorist organization (as designated under section 219 of the Immigration and Nationality Act), any person who is a member or representative of any such organization, or any person engaged in money laundering or financial or other crimes; and

      (B) establish a mechanism whereby such records may be made available to United States law enforcement officials and domestic financial institution supervisors, when appropriate.

    (b) REPORTS-

      (1) INTERIM REPORT- Not later than 1 year after the date of enactment of this Act, the Secretary shall submit an interim report to the Congress on progress in the negotiations under subsection (a).

      (2) FINAL REPORT- Not later than 2 years after the date of the enactment of this Act, the Secretary shall submit a final report to the President and the Congress, on the outcome of negotiations under subsection (a).

      (3) IDENTIFICATION OF CERTAIN COUNTRIES- In the report submitted under paragraph (2), the Secretary shall identify countries--

        (A) with respect to which the Secretary determines there is evidence that the financial institutions in such countries are being utilized, knowingly or unwittingly, by any foreign terrorist organization (as designated under section 219 of the Immigration and Nationality Act), any person who is a member or representative of any such organization, or any person engaged in money laundering or financial or other crimes; and

        (B) which have not reached agreement with United States authorities to meet the objectives of subparagraphs (A) and (B) of subsection (a)(2).

    (c) AUTHORITY FOR OTHER ACTION-

      (1) IN GENERAL- If the President determines that--

          (A) a foreign country is described in subparagraphs (A) and (B) of subsection (b)(3); and

          (B) such country is not negotiating in good faith to reach an agreement described in subsection (a)(2),

      the President may impose appropriate penalties and sanctions on such country and, except as provided in paragraph (3), financial institutions of such country.

      (2) PENALTIES AND SANCTIONS- The penalties and sanctions which may be imposed by the President under paragraph (1) include temporarily or permanently--

        (A) prohibiting such persons, institutions, or other entities as the President may designate in any such country from participating in any United States dollar clearing or wire transfer system; and

        (B) prohibiting such persons, institutions or entities as the President may designate in such countries from maintaining an account with any bank or other financial institution chartered under the laws of the United States or any State.

      (3) EXEMPTION FOR CERTAIN FINANCIAL INSTITUTIONS- Financial institutions that maintain adequate records shall be exempt from such penalties and sanctions.
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SECTION 303 (BELOW) WAS REMOVED FROM THIS BILL ON OCTOBER 16, 2001

SEC. 303. PROHIBITION ON ACCEPTANCE OF ANY BANK INSTRUMENT FOR UNLAWFUL INTERNET GAMBLING.

    (a) IN GENERAL- No person engaged in the business of betting or wagering may knowingly accept, in connection with the participation of another person in unlawful Internet gambling--

      (1) credit, or the proceeds of credit, extended to or on behalf of such other person (including credit extended through the use of a credit card);

      (2) an electronic fund transfer or funds transmitted by or through a money transmitting business, or the proceeds of an electronic fund transfer or money transmitting service, from or on behalf of the other person;

      (3) any check, draft, or similar instrument which is drawn by or on behalf of the other person and is drawn on or payable at or through any financial institution; or

      (4) the proceeds of any other form of financial transaction as the Secretary may prescribe by regulation which involves a financial institution as a payor or financial intermediary on behalf of or for the benefit of the other person.

    (b) DEFINITIONS- For purposes of this Act, the following definitions shall apply:

      (1) BETS OR WAGERS- The term `bets or wagers'--

        (A) means the staking or risking by any person of something of value upon the outcome of a contest of others, a sporting event, or a game subject to chance, upon an agreement or understanding that the person or another person will receive something of greater value than the amount staked or risked in the event of a certain outcome;

        (B) includes the purchase of a chance or opportunity to win a lottery or other prize (which opportunity to win is predominantly subject to chance);

        (C) includes any scheme of a type described in section 3702 of title 28;

        (D) includes any instructions or information pertaining to the establishment or movement of funds in an account by the bettor or customer with the business of betting or wagering; and

        (E) does not include--

          (i) any bona fide business transaction governed by the securities laws (as that term is defined in section 3(a)(47) of the

Securities Exchange Act of 1934) for the purchase or sale at a future date of securities (as that term is defined in section 3(a)(10) of such Act);

          (ii) any transaction on or subject to the rules of a contract market designated pursuant to section 5 of the Commodity Exchange Act;

          (iii) any over-the-counter derivative instrument;

          (iv) any contract of indemnity or guarantee;

          (v) any contract for life, health, or accident insurance;

          `(vi) any deposit or other transaction with a depository institution (as defined in section 3(c) of the Federal Deposit Insurance Act)

          (vii) any participation in a simulation sports game or an educational game or contest that--

            (I) is not dependent solely on the outcome of any single sporting event or nonparticipant's singular individual performance in any single sporting event;

            (II) has an outcome that reflects the relative knowledge and skill of the participants with such outcome determined predominantly by accumulated statistical results of sporting events; and

            (III) offers a prize or award to a participant that is established in advance of the game or contest and is not determined by the number of participants or the amount of any fees paid by those participants.

      (2) BUSINESS OF BETTING OR WAGERING- The term `business of betting or wagering' does not include, other than for purposes of subsection (e), any creditor, credit card issuer, insured depository institution, financial institution, operator of a terminal at which an electronic fund transfer may be initiated, money transmitting business, or international, national, regional, or local network utilized to effect a credit transaction, electronic fund transfer, stored value product transaction, or money transmitting service, or any participant in such network.

      (3) INTERNET- The term `Internet' means the international computer network of interoperable packet switched data networks.

      (4) UNLAWFUL INTERNET GAMBLING- The term `unlawful Internet gambling' means to place, receive, or otherwise transmit a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager is unlawful under any applicable Federal or State law in the State in which the bet or wager is initiated, received, or otherwise made.

      (5) OTHER TERMS-

        (A) CREDIT; CREDITOR; AND CREDIT CARD- The terms `credit', `creditor', and `credit card' have the meanings given such terms in section 103 of the Truth in Lending Act.

        (B) ELECTRONIC FUND TRANSFER- The term `electronic fund transfer'--

          (i) has the meaning given such term in section 903 of the Electronic Fund Transfer Act; and

          (ii) includes any fund transfer covered by Article 4A of the Uniform Commercial Code, as in effect in any State.

        (C) FINANCIAL INSTITUTION- The term `financial institution' has the meaning given such term in section 903 of the Electronic Fund Transfer Act.

        (D) MONEY TRANSMITTING BUSINESS AND MONEY TRANSMITTING SERVICE- The terms `money transmitting business' and `money transmitting service' have the meanings given such terms in section 5330(d) of title 31, United States Code.

        (E) SECRETARY- The term `Secretary' means the Secretary of the Treasury.

    (c) CIVIL REMEDIES-

      (1) JURISDICTION- The district courts of the United States shall have original and exclusive jurisdiction to prevent and restrain violations of this section by issuing appropriate orders in accordance with this section, regardless of whether a prosecution has been initiated under this section.

      (2) PROCEEDINGS-

        (A) INSTITUTION BY FEDERAL GOVERNMENT-

          (i) IN GENERAL- The United States, acting through the Attorney General, may institute proceedings under this subsection to prevent or restrain a violation of this section.

          (ii) RELIEF- Upon application of the United States under this subparagraph, the district court may enter a preliminary injunction or an injunction against any person to prevent or restrain a violation of this section, in accordance with Rule 65 of the Federal Rules of Civil Procedure.

        (B) INSTITUTION BY STATE ATTORNEY GENERAL-

          (i) IN GENERAL- The attorney general of a State (or other appropriate State official) in which a violation of this section allegedly has occurred or will occur may institute proceedings under this subsection to prevent or restrain the violation.

          (ii) RELIEF- Upon application of the attorney general (or other appropriate State official) of an affected State under this subparagraph, the district court may enter a preliminary injunction or an injunction against any person to prevent or restrain a violation of this section, in accordance with Rule 65 of the Federal Rules of Civil Procedure.

        (C) INDIAN LANDS-

          (i) IN GENERAL- Notwithstanding subparagraphs (A) and (B), for a violation that is alleged to have occurred, or may occur, on Indian lands (as that term is defined in section 4 of the Indian Gaming Regulatory Act)--

            (I) the United States shall have the enforcement authority provided under subparagraph (A); and

            (II) the enforcement authorities specified in an applicable Tribal-State compact negotiated under section 11 of the Indian Gaming Regulatory Act shall be carried out in accordance with that compact.

          (ii) RULE OF CONSTRUCTION- No provision of this section shall be construed as altering, superseding, or otherwise affecting the application of the Indian Gaming Regulatory Act.

        (D) BANKING REGULATORS- Before initiating any proceeding under this paragraph with respect to a violation or potential violation of subsection (e) by an insured depository institution (as defined in section 3 of the Federal Deposit Insurance Act), the Attorney General of the United States or an attorney general of a State (or other appropriate State official) shall--

          (i) notify the appropriate Federal banking agency (as defined in such section) of such violation or potential violation; and

          (ii) allow such agency a reasonable time to issue an order to such insured depository institution under section 8(x) of the Federal Deposit Insurance Act.

      (3) EXPEDITED PROCEEDINGS-

        (A) IN GENERAL- In addition to any proceeding under paragraph (2), a district court may, in exigent circumstances, enter a temporary restraining order against a person alleged to be in violation of this section upon application of the United States under paragraph (2)(A), or the attorney general (or other appropriate State official) of an affected State under paragraph (2)(B), in accordance with Rule 65(b) of the Federal Rules of Civil Procedure.

    (d) CRIMINAL PENALTY-

      (1) IN GENERAL- Whoever violates this section shall be fined under title 18, United States Code, or imprisoned for not more than 5 years, or both.

      (2) PERMANENT INJUNCTION- Upon conviction of a person under this subsection, the court may enter a permanent injunction enjoining such person from placing, receiving, or otherwise making bets or wagers or sending, receiving, or inviting information assisting in the placing of bets or wagers.

    (e) CIRCUMVENTIONS PROHIBITED- Notwithstanding subsection (b)(2), a creditor, credit card issuer, financial institution, operator of a terminal at which an electronic fund transfer may be initiated, money transmitting business, or international, national, regional, or local network utilized to effect a credit transaction, electronic fund transfer, or money transmitting service, or any participant in such network, may be liable under this section if such creditor, issuer, institution, operator, business, network, or participant--

      (1) operates, manages, supervises, or directs an Internet website at which unlawful bets or wagers

may be placed, received, or otherwise made or at which unlawful bets or wagers are offered to be placed, received, or otherwise made; or

      (2) owns or controls, or is owned or controlled by, any person who operates, manages, supervises, or directs an Internet website at which unlawful bets or wagers may be placed, received, or otherwise made or at which unlawful bets or wagers are offered to be placed, received, or otherwise made.

    (f) ENFORCEMENT ACTIONS- Section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) is amended by adding at the end the following new subsection:

    `(x) DEPOSITORY INSTITUTION INVOLVEMENT IN INTERNET GAMBLING- If any appropriate Federal banking agency determines that any insured depository institution is engaged in any of the following activities, the agency may issue an order to such institution prohibiting such institution from continuing to engage in any of the following activities:

      `(1) Extending credit, or facilitating an extension of credit, electronic fund transfer, or money transmitting service with the actual knowledge that any person is violating section 3(a) of the Unlawful Internet Gambling Funding Prohibition Act in connection with such extension of credit, electronic fund transfer, or money transmitting service.

      `(2) Paying, transferring, or collecting on any check, draft, or other instrument drawn on any depository institution with the actual knowledge that any person is violating section 3(a) of the Unlawful Internet Gambling Funding Prohibition Act in connection with such check, draft, or other instrument.'.

************************************************************

SECTION 304 (BELOW) WAS REMOVED FROM THIS BILL ON OCTOBER 16, 2001

SEC. 304. INTERNET GAMBLING IN OR THROUGH FOREIGN JURISDICTIONS.

    (a) IN GENERAL- In deliberations between the United States Government and any other country on money laundering, corruption, and crime issues, the United States Government should--

      (1) encourage cooperation by foreign governments and relevant international fora in identifying whether Internet gambling operations are being used for money laundering, corruption, or other crimes;

      (2) advance policies that promote the cooperation of foreign governments, through information sharing or other measures, in the enforcement of this Act; and

      (3) encourage the Financial Action Task Force on Money Laundering, in its annual report on money laundering typologies, to study the extent to which Internet gambling operations are being used for money laundering.

    (b) REPORT REQUIRED- The Secretary of the Treasury shall submit an annual report to the Congress on the deliberations between the United States and other countries on issues relating to Internet gambling.

******************************************************************************************

TITLE IV--CURRENCY PROTECTION

SEC. 401. COUNTERFEITING DOMESTIC CURRENCY AND OBLIGATIONS.

    (a) COUNTERFEIT ACTS COMMITTED OUTSIDE THE UNITED STATES- Section 470 of title 18, United States Code, is amended--

      (1) in paragraph (2), by inserting `analog, digital, or electronic image,' after `plate, stone,'; and

      (2) by striking `shall be fined under this title, imprisoned not more than 20 years, or both' and inserting `shall be punished as is provided for the like offense within the United States'.

    (b) OBLIGATIONS OR SECURITIES OF THE UNITED STATES- Section 471 of title 18, United States Code, is amended by striking `fifteen years' and inserting `20 years'.

    (c) UTTERING COUNTERFEIT OBLIGATIONS OR SECURITIES- Section 472 of title 18, United States Code, is amended by striking `fifteen years' and inserting `20 years'.

    (d) DEALING IN COUNTERFEIT OBLIGATIONS OR SECURITIES- Section 473 of title 18, United States Code, is amended by striking `ten years' and inserting `20 years'.

    (e) PLATES, STONES, OR ANALOG, DIGITAL, OR ELECTRONIC IMAGES FOR COUNTERFEITING OBLIGATIONS OR SECURITIES-

      (1) IN GENERAL- Section 474(a) of title 18, United States Code, is amended by inserting after the second paragraph the following new paragraph:

      `Whoever, with intent to defraud, makes, executes, acquires, scans, captures, records, receives, transmits, reproduces, sells, or has in such person's control, custody, or possession, an analog, digital, or electronic image of any obligation or other security of the United States; or'.

      (2) AMENDMENT TO DEFINITION- Section 474(b) of title 18, United States Code, is amended by striking the first sentence and inserting the following new sentence: `For purposes of this section, the term `analog, digital, or electronic image'

includes any analog, digital, or electronic method used for the making, execution, acquisition, scanning, capturing, recording, retrieval, transmission, or reproduction of any obligation or security, unless such use is authorized by the Secretary of the Treasury.'.

      (3) CLERICAL AMENDMENT- The heading for section 474 of title 18, United States Code, is amended by striking `or stones' and inserting `, stones, or analog, digital, or electronic images'.

    (f) TAKING IMPRESSIONS OF TOOLS USED FOR OBLIGATIONS OR SECURITIES- Section 476 of title 18, United States Code, is amended--

      (1) by inserting `analog, digital, or electronic image,' after `impression, stamp,'; and

      (2) by striking `ten years' and inserting `25 years'.

    (g) POSSESSING OR SELLING IMPRESSIONS OF TOOLS USED FOR OBLIGATIONS OR SECURITIES- Section 477 of title 18, United States Code, is amended--

      (1) in the first paragraph, by inserting `analog, digital, or electronic image,' after `imprint, stamp,';

      (2) in the second paragraph, by inserting `analog, digital, or electronic image,' after `imprint, stamp,'; and

      (3) in the third paragraph, by striking `ten years' and inserting `25 years'.

    (h) CONNECTING PARTS OF DIFFERENT NOTES- Section 484 of title 18, United States Code, is amended by striking `five years' and inserting `10 years'.

    (i) BONDS AND OBLIGATIONS OF CERTAIN LENDING AGENCIES- The first and second paragraphs of section 493 of title 18, United States Code, are each amended by striking `five years' and inserting `10 years'.

SEC. 402. COUNTERFEITING FOREIGN CURRENCY AND OBLIGATIONS.

    (a) FOREIGN OBLIGATIONS OR SECURITIES- Section 478 of title 18, United States Code, is amended by striking `five years' and inserting `20 years'.

    (b) UTTERING COUNTERFEIT FOREIGN OBLIGATIONS OR SECURITIES- Section 479 of title 18, United States Code, is amended by striking `three years' and inserting `20 years'.

    (c) POSSESSING COUNTERFEIT FOREIGN OBLIGATIONS OR SECURITIES- Section 480 of title 18, United States Code, is amended by striking `one year' and inserting `20 years'.

    (d) PLATES, STONES, OR ANALOG, DIGITAL, OR ELECTRONIC IMAGES FOR COUNTERFEITING FOREIGN OBLIGATIONS OR SECURITIES-

      (1) IN GENERAL- Section 481 of title 18, United States Code, is amended by inserting after the second paragraph the following new paragraph:

      `Whoever, with intent to defraud, makes, executes, acquires, scans, captures, records, receives, transmits, reproduces, sells, or has in such person's control, custody, or possession, an analog, digital, or electronic image of any bond, certificate, obligation, or other security of any foreign government, or of any treasury note, bill, or promise to pay, lawfully issued by such foreign government and intended to circulate as money; or'.

      (2) INCREASED SENTENCE- The last paragraph of section 481 of title 18, United States Code, is amended by striking `five years' and inserting `25 years'.

      (3) CLERICAL AMENDMENT- The heading for section 481 of title 18, United States Code, is amended by striking `or stones' and inserting `, stones, or analog, digital, or electronic images'.

    (e) FOREIGN BANK NOTES- Section 482 of title 18, United States Code, is amended by striking `two years' and inserting `20 years'.

    (f) UTTERING COUNTERFEIT FOREIGN BANK NOTES- Section 483 of title 18, United States Code, is amended by striking `one year' and inserting `20 years'.

SEC. 403. PRODUCTION OF DOCUMENTS.

    Section 5114(a) of title 31, United States Code (relating to engraving and printing currency and security documents), is amended--

      (1) by striking `(a) The Secretary of the Treasury' and inserting:

    `(a) AUTHORITY TO ENGRAVE AND PRINT-

      `(1) IN GENERAL- The Secretary of the Treasury'; and

      (2) by adding at the end the following new paragraph:

      `(2) ENGRAVING AND PRINTING FOR OTHER GOVERNMENTS- The Secretary of the Treasury may, if the Secretary determines that it will not interfere with engraving and printing needs of the United States, produce currency, postage stamps, and other security documents for foreign governments, subject to a determination by the Secretary of State that such production would be consistent with the foreign policy of the United States.'.

SEC. 404. REIMBURSEMENT.

    Section 5143 of title 31, United States Code (relating to payment for services of the Bureau of Engraving and Printing), is amended--

      (1) in the first sentence, by inserting `, any foreign government, or any territory of the United States' after `agency';

      (2) in the second sentence, by inserting `and other' after `administrative'; and

      (3) in the last sentence, by inserting `, foreign government, or territory of the United States' after `agency'.
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