[111th Congress Public Law 21]
[From the U.S. Government Printing Office]
[[Page 123 STAT. 1616]]
Public Law 111-21
111th Congress
An Act
To improve enforcement of mortgage fraud, securities and commodities
fraud, financial institution fraud, and other frauds related to Federal
assistance and relief programs, for the recovery of funds lost to these
frauds, and for other purposes. <<NOTE: May 20, 2009 - [S. 386]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Fraud
Enforcement and Recovery Act of 2009.>>
SECTION 1. <<NOTE: 18 USC 1 note.>> SHORT TITLE.
This Act may be cited as the ``Fraud Enforcement and Recovery Act of
2009'' or ``FERA''.
SEC. 2. AMENDMENTS TO IMPROVE MORTGAGE, SECURITIES, COMMODITIES,
AND FINANCIAL FRAUD RECOVERY AND ENFORCEMENT.
(a) Definition of Financial Institution Amended To Include Mortgage
Lending Business.--Section 20 of title 18, United States Code, is
amended--
(1) in paragraph (8), by striking ``or'' after the
semicolon;
(2) in paragraph (9), by striking the period and inserting
``; or''; and
(3) by inserting at the end the following:
``(10) a mortgage lending business (as defined in section 27
of this title) or any person or entity that makes in whole or in
part a federally related mortgage loan as defined in section 3
of the Real Estate Settlement Procedures Act of 1974.''.
(b) Mortgage Lending Business Defined.--
(1) In general.--Chapter 1 of title 18, United States Code,
is amended by inserting after section 26 the following:
``Sec. 27. Mortgage lending business defined
``In this title, the term `mortgage lending business' means an
organization which finances or refinances any debt secured by an
interest in real estate, including private mortgage companies and any
subsidiaries of such organizations, and whose activities affect
interstate or foreign commerce.''.
(2) Chapter analysis.--The chapter analysis for chapter 1 of
title 18, United States Code, is amended by adding at the end
the following:
``27. Mortgage lending business defined.''.
(c) False Statements in Mortgage Applications Amended To Include
False Statements by Mortgage Brokers and Agents of Mortgage Lending
Businesses.--Section 1014 of title 18, United States Code, is amended
by--
[[Page 123 STAT. 1617]]
(1) striking ``or'' after ``the International Banking Act of
1978),''; and
(2) inserting after ``section 25(a) of the Federal Reserve
Act'' the following: ``, or a mortgage lending business, or any
person or entity that makes in whole or in part a federally
related mortgage loan as defined in section 3 of the Real Estate
Settlement Procedures Act of 1974''.
(d) Major Fraud Against the Government Amended To Include Economic
Relief and Troubled Asset Relief Program Funds.--Section 1031(a) of
title 18, United States Code, is amended by--
(1) inserting after ``or promises, in'' the following: ``any
grant, contract, subcontract, subsidy, loan, guarantee,
insurance, or other form of Federal assistance, including
through the Troubled Asset Relief Program, an economic stimulus,
recovery or rescue plan provided by the Government, or the
Government's purchase of any troubled asset as defined in the
Emergency Economic Stabilization Act of 2008, or in'';
(2) striking ``the contract, subcontract'' and inserting
``such grant, contract, subcontract, subsidy, loan, guarantee,
insurance, or other form of Federal assistance''; and
(3) striking ``for such property or services''.
(e) Securities Fraud Amended To Include Fraud Involving Options and
Futures in Commodities.--
(1) In general.--Section 1348 of title 18, United States
Code, is amended--
(A) in the caption, by inserting ``and commodities''
after ``Securities'';
(B) in paragraph (1), by inserting ``any commodity
for future delivery, or any option on a commodity for
future delivery, or'' after ``any person in connection
with''; and
(C) in paragraph (2), by inserting ``any commodity
for future delivery, or any option on a commodity for
future delivery, or'' after ``in connection with the
purchase or sale of''.
(2) Chapter analysis.--The item for section 1348 in the
chapter analysis for chapter 63 of title 18, United States Code,
is amended by inserting ``and commodities'' after
``Securities''.
(f) Money Laundering Amended To Define Proceeds of Specified
Unlawful Activity.--
(1) Money laundering.--Section 1956(c) of title 18, United
States Code, is amended--
(A) in paragraph (8), by striking the period and
inserting ``; and''; and
(B) by inserting at the end the following:
``(9) the term `proceeds' means any property derived from or
obtained or retained, directly or indirectly, through some form
of unlawful activity, including the gross receipts of such
activity.''.
(2) Monetary transactions.--Section 1957(f) of title 18,
United States Code, is amended by striking paragraph (3) and
inserting the following:
``(3) the terms `specified unlawful activity' and `proceeds'
shall have the meaning given those terms in section 1956 of this
title.''.
(g) Sense of the Congress and Report Concerning Required Approval
for Merger Cases.--
[[Page 123 STAT. 1618]]
(1) Sense of congress.--It is the sense of the Congress that
no prosecution of an offense under section 1956 or 1957 of title
18, United States Code, should be undertaken in combination with
the prosecution of any other offense, without prior approval of
the Attorney General, the Deputy Attorney General, the Assistant
Attorney General in charge of the Criminal Division, a Deputy
Assistant Attorney General in the Criminal Division, or the
relevant United States Attorney, if the conduct to be charged as
``specified unlawful activity'' in connection with the offense
under section 1956 or 1957 is so closely connected with the
conduct to be charged as the other offense that there is no
clear delineation between the two offenses.
(2) Report.--One year after the date of the enactment of
this Act, and at the end of each of the four succeeding one-year
periods, the Attorney General shall report to the House and
Senate Committees on the Judiciary on efforts undertaken by the
Department of Justice to ensure that the review and approval
described in paragraph (1) takes place in all appropriate cases.
The report shall include the following:
(A) The number of prosecutions described in
paragraph (1) that were undertaken during the previous
one-year period after prior approval by an official
described in paragraph (1), classified by type of
offense and by the approving official.
(B) The number of prosecutions described in
paragraph (1) that were undertaken during the previous
one-year period without such prior approval, classified
by type of offense, and the reasons why such prior
approval was not obtained.
(C) The number of times during the previous year in
which an approval described in paragraph (1) was denied.
SEC. 3. AUTHORIZATION OF ADDITIONAL FUNDING TO COMBAT MORTGAGE
FRAUD, SECURITIES AND COMMODITIES FRAUD, AND
OTHER FRAUDS INVOLVING FEDERAL ECONOMIC
ASSISTANCE.
(a) Authorization of Additional Appropriations for the Department of
Justice.--
(1) In general.--There is authorized to be appropriated to
the Attorney General, $165,000,000 for each of the fiscal years
2010 and 2011, for the purposes of investigations and
prosecutions and civil and administrative proceedings involving
Federal assistance programs and financial institutions,
including financial institutions to which this Act and
amendments made by this Act apply.
(2) Allocations.--With respect to fiscal years 2010 and
2011, the amounts authorized to be appropriated under paragraph
(1) shall be allocated as follows:
(A) Federal Bureau of Investigation: $75,000,000 for
fiscal year 2010 and $65,000,000 for fiscal year 2011,
an appropriate percentage of which amounts shall be used
to investigate mortgage fraud.
(B) The offices of the United States Attorneys:
$50,000,000 for each fiscal year.
[[Page 123 STAT. 1619]]
(C) The criminal division of the Department of
Justice: $20,000,000 for each fiscal year.
(D) The civil division of the Department of Justice:
$15,000,000 for each fiscal year.
(E) The tax division of the Department of Justice:
$5,000,000 for each fiscal year.
(b) Authorization of Additional Appropriations for the Postal
Inspection Service.--There is authorized to be appropriated to the
Postal Inspection Service of the United States Postal Service,
$30,000,000 for each of the fiscal years 2010 and 2011 for
investigations involving Federal assistance programs and financial
institutions, including financial institutions to which this Act and
amendments made by this Act apply.
(c) Authorization of Additional Appropriations for the Inspector
General for the Department of Housing and Urban Development.--There is
authorized to be appropriated to the Inspector General of the Department
of Housing and Urban Development, $30,000,000 for each of the fiscal
years 2010 and 2011 for investigations involving Federal assistance
programs and financial institutions, including financial institutions to
which this Act and amendments made by this Act apply.
(d) Authorization of Additional Appropriations for the United States
Secret Service.--There is authorized to be appropriated to the United
States Secret Service of the Department of Homeland Security,
$20,000,000 for each of the fiscal years 2010 and 2011 for
investigations involving Federal assistance programs and financial
institutions, including financial institutions to which this Act and
amendments made by this Act apply.
(e) Authorization of Additional Appropriations for the Securities
and Exchange Commission.--
(1) In general.--There is authorized to be appropriated to
the Securities and Exchange Commission, $20,000,000 for each of
the fiscal years 2010 and 2011 for investigations and
enforcement proceedings involving financial institutions,
including financial institutions to which this Act and
amendments made by this Act apply.
(2) Inspector general.--There is authorized to be
appropriated to the Securities and Exchange Commission,
$1,000,000 for each of the fiscal years 2010 and 2011 for the
salaries and expenses of the Office of the Inspector General of
the Securities and Exchange Commission.
(f) Use of Funds.--
(1) In general.--The funds appropriated pursuant to
authorization under this section shall be limited to covering
the costs of each listed agency or department for investigating
possible criminal, civil, or administrative violations and for
criminal, civil, or administrative proceedings involving
financial crimes and crimes against Federal assistance programs,
including mortgage fraud, securities and commodities fraud,
financial institution fraud, and other frauds related to Federal
assistance and relief programs.
(2) Funds for training and research.--Funds authorized to be
appropriated under this section may be used and expended for
programs for improving the detection, investigation, and
prosecution of economic crime including financial fraud and
mortgage fraud. Funds allocated under this section may be
allocated to programs which assist State and local criminal
[[Page 123 STAT. 1620]]
justice agencies to develop, establish, and maintain
intelligence-focused policing strategies and related information
sharing; provide training and investigative support services to
State and local criminal justice agencies to provide such
agencies with skills and resources needed to investigate and
prosecute such criminal activities and related criminal
activities; provide research support, establish partnerships,
and provide other resources to aid State and local criminal
justice agencies to prevent, investigate, and prosecute such
criminal activities and related problems; provide information
and research to the general public to facilitate the prevention
of such criminal activities; and any other programs specified by
the Attorney General as furthering the purposes of this Act.
(g) Additional Nature of Authorizations; Availability.--The amounts
authorized under this section are in addition to amounts otherwise
authorized in other Acts and shall remain available until expended.
(h) Report to Congress.--Following the final expenditure of all
funds appropriated pursuant to authorization under this section, the
Attorney General, in consultation with the United States Postal
Inspection Service, the Inspector General for the Department of Housing
and Urban Development, the Secretary of Homeland Security, and the
Commissioner of the Securities and Exchange Commission, shall submit a
report to Congress identifying--
(1) the amounts expended under each of subsections (a), (b),
(c), (d), and (e) and a certification of compliance with the
requirements listed in subsection (f); and
(2) the amounts recovered as a result of criminal or civil
restitution, fines, penalties, and other monetary recoveries
resulting from criminal, civil, or administrative proceedings
and settlements undertaken with funds authorized by this Act.
SEC. 4. CLARIFICATIONS TO THE FALSE CLAIMS ACT TO REFLECT THE
ORIGINAL INTENT OF THE LAW.
(a) Clarification of the False Claims Act.--Section 3729 of title
31, United States Code, is amended--
(1) by striking subsection (a) and inserting the following:
``(a) Liability for Certain Acts.--
``(1) In general.--Subject to paragraph (2), any person
who--
``(A) knowingly presents, or causes to be presented,
a false or fraudulent claim for payment or approval;
``(B) knowingly makes, uses, or causes to be made or
used, a false record or statement material to a false or
fraudulent claim;
``(C) conspires to commit a violation of
subparagraph (A), (B), (D), (E), (F), or (G);
``(D) has possession, custody, or control of
property or money used, or to be used, by the Government
and knowingly delivers, or causes to be delivered, less
than all of that money or property;
``(E) is authorized to make or deliver a document
certifying receipt of property used, or to be used, by
the Government and, intending to defraud the Government,
makes or delivers the receipt without completely knowing
that the information on the receipt is true;
[[Page 123 STAT. 1621]]
``(F) knowingly buys, or receives as a pledge of an
obligation or debt, public property from an officer or
employee of the Government, or a member of the Armed
Forces, who lawfully may not sell or pledge property; or
``(G) knowingly makes, uses, or causes to be made or
used, a false record or statement material to an
obligation to pay or transmit money or property to the
Government, or knowingly conceals or knowingly and
improperly avoids or decreases an obligation to pay or
transmit money or property to the Government,
is liable to the United States Government for a civil penalty of
not less than $5,000 and not more than $10,000, as adjusted by
the Federal Civil Penalties Inflation Adjustment Act of 1990 (28
U.S.C. 2461 note; Public Law 104-410), plus 3 times the amount
of damages which the Government sustains because of the act of
that person.
``(2) Reduced damages.--If the court finds that--
``(A) the person committing the violation of this
subsection furnished officials of the United States
responsible for investigating false claims violations
with all information known to such person about the
violation within 30 days after the date on which the
defendant first obtained the information;
``(B) such person fully cooperated with any
Government investigation of such violation; and
``(C) at the time such person furnished the United
States with the information about the violation, no
criminal prosecution, civil action, or administrative
action had commenced under this title with respect to
such violation, and the person did not have actual
knowledge of the existence of an investigation into such
violation,
the court may assess not less than 2 times the amount of damages
which the Government sustains because of the act of that person.
``(3) Costs of civil actions.--A person violating this
subsection shall also be liable to the United States Government
for the costs of a civil action brought to recover any such
penalty or damages.'';
(2) by striking subsections (b) and (c) and inserting the
following:
``(b) Definitions.--For purposes of this section--
``(1) the terms `knowing' and `knowingly'--
``(A) mean that a person, with respect to
information--
``(i) has actual knowledge of the information;
``(ii) acts in deliberate ignorance of the
truth or falsity of the information; or
``(iii) acts in reckless disregard of the
truth or falsity of the information; and
``(B) require no proof of specific intent to
defraud;
``(2) the term `claim'--
``(A) means any request or demand, whether under a
contract or otherwise, for money or property and whether
or not the United States has title to the money or
property, that--
``(i) is presented to an officer, employee, or
agent of the United States; or
[[Page 123 STAT. 1622]]
``(ii) is made to a contractor, grantee, or
other recipient, if the money or property is to be
spent or used on the Government's behalf or to
advance a Government program or interest, and if
the United States Government--
``(I) provides or has provided any
portion of the money or property
requested or demanded; or
``(II) will reimburse such
contractor, grantee, or other recipient
for any portion of the money or property
which is requested or demanded; and
``(B) does not include requests or demands for money
or property that the Government has paid to an
individual as compensation for Federal employment or as
an income subsidy with no restrictions on that
individual's use of the money or property;
``(3) the term `obligation' means an established duty,
whether or not fixed, arising from an express or implied
contractual, grantor-grantee, or licensor-licensee relationship,
from a fee-based or similar relationship, from statute or
regulation, or from the retention of any overpayment; and
``(4) the term `material' means having a natural tendency to
influence, or be capable of influencing, the payment or receipt
of money or property.'';
(3) by redesignating subsections (d) and (e) as subsections
(c) and (d), respectively; and
(4) in subsection (c), as redesignated, by striking
``subparagraphs (A) through (C) of subsection (a)'' and
inserting ``subsection (a)(2)''.
(b) Intervention by the Government.--Section 3731(b) of title 31,
United States Code, is amended--
(1) by redesignating subsection (c) as subsection (d);
(2) by redesignating subsection (d) as subsection (e); and
(3) by inserting the new subsection (c):
``(c) If the Government elects to intervene and proceed with an
action brought under 3730(b), the Government may file its own complaint
or amend the complaint of a person who has brought an action under
section 3730(b) to clarify or add detail to the claims in which the
Government is intervening and to add any additional claims with respect
to which the Government contends it is entitled to relief. For statute
of limitations purposes, any such Government pleading shall relate back
to the filing date of the complaint of the person who originally brought
the action, to the extent that the claim of the Government arises out of
the conduct, transactions, or occurrences set forth, or attempted to be
set forth, in the prior complaint of that person.''.
(c) Civil Investigative Demands.--Section 3733 of title 31, United
States Code, is amended--
(1) in subsection (a)--
(A) in paragraph (1)--
(i) in the matter preceding subparagraph (A)--
(I) by inserting ``, or a designee
(for purposes of this section),'' after
``Whenever the Attorney General''; and
(II) by striking ``the Attorney
General may, before commencing a civil
proceeding under section 3730 or other
false claims law,'' and inserting ``the
[[Page 123 STAT. 1623]]
Attorney General, or a designee, may,
before commencing a civil proceeding
under section 3730(a) or other false
claims law, or making an election under
section 3730(b),''; and
(ii) in the matter following subparagraph
(D)--
(I) by striking ``may not delegate''
and inserting ``may delegate''; and
(II) by adding at the end the
following: ``Any information obtained by
the Attorney General or a designee of
the Attorney General under this section
may be shared with any qui tam relator
if the Attorney General or designee
determine it is necessary as part of any
false claims act investigation.''; and
(B) in paragraph (2)(G), by striking the second
sentence;
(2) in subsection (i)(2)--
(A) in subparagraph (B), by striking ``, who is
authorized for such use under regulations which the
Attorney General shall issue''; and
(B) in subparagraph (C), by striking ``Disclosure of
information to any such other agency shall be allowed
only upon application, made by the Attorney General to a
United States district court, showing substantial need
for the use of the information by such agency in
furtherance of its statutory responsibilities.''; and
(3) in subsection (l)--
(A) in paragraph (6), by striking ``and'' after the
semicolon;
(B) in paragraph (7), by striking the period and
inserting ``; and''; and
(C) by adding at the end the following:
``(8) <<NOTE: Definition.>> the term `official use' means
any use that is consistent with the law, and the regulations and
policies of the Department of Justice, including use in
connection with internal Department of Justice memoranda and
reports; communications between the Department of Justice and a
Federal, State, or local government agency, or a contractor of a
Federal, State, or local government agency, undertaken in
furtherance of a Department of Justice investigation or
prosecution of a case; interviews of any qui tam relator or
other witness; oral examinations; depositions; preparation for
and response to civil discovery requests; introduction into the
record of a case or proceeding; applications, motions, memoranda
and briefs submitted to a court or other tribunal; and
communications with Government investigators, auditors,
consultants and experts, the counsel of other parties,
arbitrators and mediators, concerning an investigation, case or
proceeding.''.
(d) Relief From Retaliatory Actions.--Section 3730(h) of title 31,
United States Code, is amended to read as follows:
``(h) Relief From Retaliatory Actions.--
``(1) In general.--Any employee, contractor, or agent shall
be entitled to all relief necessary to make that employee,
contractor, or agent whole, if that employee, contractor, or
agent is discharged, demoted, suspended, threatened, harassed,
or in any other manner discriminated against in the terms and
conditions of employment because of lawful acts done by the
[[Page 123 STAT. 1624]]
employee, contractor, or agent on behalf of the employee,
contractor, or agent or associated others in furtherance of
other efforts to stop 1 or more violations of this subchapter.
``(2) Relief.--Relief under paragraph (1) shall include
reinstatement with the same seniority status that employee,
contractor, or agent would have had but for the discrimination,
2 times the amount of back pay, interest on the back pay, and
compensation for any special damages sustained as a result of
the discrimination, including litigation costs and reasonable
attorneys' fees. An action under this subsection may be brought
in the appropriate district court of the United States for the
relief provided in this subsection.''.
(e) False Claims Jurisdiction.--Section 3732 of title 31, United
States Code, is amended by adding at the end the following new
subsection:
``(c) Service <<NOTE: Applicability.>> on State or Local
Authorities.--With respect to any State or local government that is
named as a co-plaintiff with the United States in an action brought
under subsection (b), a seal on the action ordered by the court under
section 3730(b) shall not preclude the Government or the person bringing
the action from serving the complaint, any other pleadings, or the
written disclosure of substantially all material evidence and
information possessed by the person bringing the action on the law
enforcement authorities that are authorized under the law of that State
or local government to investigate and prosecute such actions on behalf
of such governments, except that such seal applies to the law
enforcement authorities so served to the same extent as the seal applies
to other parties in the action.''.
(f) Effective <<NOTE: 31 USC 3729 note.>> Date and Application.--The
amendments made by this section shall take effect on the date of
enactment of this Act and shall apply to conduct on or after the date of
enactment, except that--
(1) subparagraph (B) of section 3729(a)(1) of title 31,
United States Code, as added by subsection (a)(1), shall take
effect as if enacted on June 7, 2008, and apply to all claims
under the False Claims Act (31 U.S.C. 3729 et seq.) that are
pending on or after that date; and
(2) section 3731(b) of title 31, as amended by subsection
(b); section 3733, of title 31, as amended by subsection (c);
and section 3732 of title 31, as amended by subsection (e);
shall apply to cases pending on the date of enactment.
SEC. 5. FINANCIAL CRISIS INQUIRY COMMISSION.
(a) Establishment of Commission.--There is established in the
legislative branch the Financial Crisis Inquiry Commission (in this
section referred to as the ``Commission'') to examine the causes,
domestic and global, of the current financial and economic crisis in the
United States.
(b) Composition of the Commission.--
(1) Members.--The Commission shall be composed of 10
members, of whom--
(A) 3 members shall be appointed by the majority
leader of the Senate, in consultation with relevant
Committees;
(B) 3 members shall be appointed by the Speaker of
the House of Representatives, in consultation with
relevant Committees;
[[Page 123 STAT. 1625]]
(C) 2 members shall be appointed by the minority
leader of the Senate, in consultation with relevant
Committees; and
(D) 2 members shall be appointed by the minority
leader of the House of Representatives, in consultation
with relevant Committees.
(2) Qualifications; limitation.--
(A) In general.--It is the sense of the Congress
that individuals appointed to the Commission should be
prominent United States citizens with national
recognition and significant depth of experience in such
fields as banking, regulation of markets, taxation,
finance, economics, consumer protection, and housing.
(B) Limitation.--No person who is a member of
Congress or an officer or employee of the Federal
Government or any State or local government may serve as
a member of the Commission.
(3) Chairperson; vice chairperson.--
(A) In general.--Subject to the requirements of
subparagraph (B), the Chairperson of the Commission
shall be selected jointly by the Majority Leader of the
Senate and the Speaker of the House of Representatives,
and the Vice Chairperson shall be selected jointly by
the Minority Leader of the Senate and the Minority
Leader of the House of Representatives.
(B) Political party affiliation.--The Chairperson
and Vice Chairperson of the Commission may not be from
the same political party.
(4) Meetings, quorum; vacancies.--
(A) Meetings.--
(i) Initial meeting.--The initial meeting of
the Commission shall be as soon as possible after
a quorum of members have been appointed.
(ii) Subsequent meetings.--After the initial
meeting of the Commission, the Commission shall
meet upon the call of the Chairperson or a
majority of its members.
(B) Quorum.--6 members of the Commission shall
constitute a quorum.
(C) Vacancies.--Any vacancy on the Commission
shall--
(i) not affect the powers of the Commission;
and
(ii) be filled in the same manner in which the
original appointment was made.
(c) Functions of the Commission.--The functions of the Commission
are--
(1) to examine the causes of the current financial and
economic crisis in the United States, specifically the role of--
(A) fraud and abuse in the financial sector,
including fraud and abuse towards consumers in the
mortgage sector;
(B) Federal and State financial regulators,
including the extent to which they enforced, or failed
to enforce statutory, regulatory, or supervisory
requirements;
(C) the global imbalance of savings, international
capital flows, and fiscal imbalances of various
governments;
(D) monetary policy and the availability and terms
of credit;
[[Page 123 STAT. 1626]]
(E) accounting practices, including, mark-to-market
and fair value rules, and treatment of off-balance sheet
vehicles;
(F) tax treatment of financial products and
investments;
(G) capital requirements and regulations on leverage
and liquidity, including the capital structures of
regulated and non-regulated financial entities;
(H) credit rating agencies in the financial system,
including, reliance on credit ratings by financial
institutions and Federal financial regulators, the use
of credit ratings in financial regulation, and the use
of credit ratings in the securitization markets;
(I) lending practices and securitization, including
the originate-to-distribute model for extending credit
and transferring risk;
(J) affiliations between insured depository
institutions and securities, insurance, and other types
of nonbanking companies;
(K) the concept that certain institutions are ``too-
big-to-fail'' and its impact on market expectations;
(L) corporate governance, including the impact of
company conversions from partnerships to corporations;
(M) compensation structures;
(N) changes in compensation for employees of
financial companies, as compared to compensation for
others with similar skill sets in the labor market;
(O) the legal and regulatory structure of the United
States housing market;
(P) derivatives and unregulated financial products
and practices, including credit default swaps;
(Q) short-selling;
(R) financial institution reliance on numerical
models, including risk models and credit ratings;
(S) the legal and regulatory structure governing
financial institutions, including the extent to which
the structure creates the opportunity for financial
institutions to engage in regulatory arbitrage;
(T) the legal and regulatory structure governing
investor and mortgagor protection;
(U) financial institutions and government-sponsored
enterprises; and
(V) the quality of due diligence undertaken by
financial institutions;
(2) to examine the causes of the collapse of each major
financial institution that failed (including institutions that
were acquired to prevent their failure) or was likely to have
failed if not for the receipt of exceptional Government
assistance from the Secretary of the Treasury during the period
beginning in August 2007 through April 2009;
(3) to submit a report under subsection (h);
(4) to refer to the Attorney General of the United States
and any appropriate State attorney general any person that the
Commission finds may have violated the laws of the United States
in relation to such crisis; and
[[Page 123 STAT. 1627]]
(5) to build upon the work of other entities, and avoid
unnecessary duplication, by reviewing the record of the
Committee on Banking, Housing, and Urban Affairs of the Senate,
the Committee on Financial Services of the House of
Representatives, other congressional committees, the Government
Accountability Office, other legislative panels, and any other
department, agency, bureau, board, commission, office,
independent establishment, or instrumentality of the United
States (to the fullest extent permitted by law) with respect to
the current financial and economic crisis.
(d) Powers of the Commission.--
(1) Hearings and evidence.--The Commission may, for purposes
of carrying out this section--
(A) hold hearings, sit and act at times and places,
take testimony, receive evidence, and administer oaths;
and
(B) require, by subpoena or otherwise, the
attendance and testimony of witnesses and the production
of books, records, correspondence, memoranda, papers,
and documents.
(2) Subpoenas.--
(A) Service.--Subpoenas issued under paragraph
(1)(B) may be served by any person designated by the
Commission.
(B) Enforcement.--
(i) In general.--In the case of contumacy or
failure to obey a subpoena issued under paragraph
(1)(B), the United States district court for the
judicial district in which the subpoenaed person
resides, is served, or may be found, or where the
subpoena is returnable, may issue an order
requiring such person to appear at any designated
place to testify or to produce documentary or
other evidence. Any failure to obey the order of
the court may be punished by the court as a
contempt of that court.
(ii) Additional enforcement.--
Sections <<NOTE: Applicability.>> 102 through 104
of the Revised Statutes of the United States (2
U.S.C. 192 through 194) shall apply in the case of
any failure of any witness to comply with any
subpoena or to testify when summoned under the
authority of this section.
(iii) Issuance.--A subpoena may be issued
under this subsection only--
(I) by the agreement of the
Chairperson and the Vice Chairperson; or
(II) by the affirmative vote of a
majority of the Commission, including an
affirmative vote of at least one member
appointed under subparagraph (C) or (D)
of subsection (b)(1), a majority being
present.
(3) Contracting.--The Commission may enter into contracts to
enable the Commission to discharge its duties under this
section.
(4) Information from federal agencies and other entities.--
(A) In general.--The Commission may secure directly
from any department, agency, bureau, board, commission,
[[Page 123 STAT. 1628]]
office, independent establishment, or instrumentality of
the United States any information related to any inquiry
of the Commission conducted under this section,
including information of a confidential nature (which
the Commission shall maintain in a secure manner). Each
such department, agency, bureau, board, commission,
office, independent establishment, or instrumentality
shall furnish such information directly to the
Commission upon request.
(B) Other entities.--It is the sense of the Congress
that the Commission should seek testimony or information
from principals and other representatives of government
agencies and private entities that were significant
participants in the United States and global financial
and housing markets during the time period examined by
the Commission.
(5) Administrative support services.--Upon the request of
the Commission--
(A) the Administrator of General Services shall
provide to the Commission, on a reimbursable basis, the
administrative support services necessary for the
Commission to carry out its responsibilities under this
Act; and
(B) other Federal departments and agencies may
provide to the Commission any administrative support
services as may be determined by the head of such
department or agency to be advisable and authorized by
law.
(6) Donations of goods and services.--The Commission may
accept, use, and dispose of gifts or donations of services or
property.
(7) Postal services.--The Commission may use the United
States mails in the same manner and under the same conditions as
departments and agencies of the United States.
(8) Powers of subcommittees, members, and agents.--Any
subcommittee, member, or agent of the Commission may, if
authorized by the Commission, take any action which the
Commission is authorized to take by this section.
(e) Staff of the Commission.--
(1) Director.--The Commission shall have a Director who
shall be appointed by the Chairperson and the Vice Chairperson,
acting jointly.
(2) Staff.--The Chairperson and the Vice Chairperson may
jointly appoint additional personnel, as may be necessary, to
enable the Commission to carry out its functions.
(3) Applicability of certain civil service laws.--The
Director and staff of the Commission may be appointed without
regard to the provisions of title 5, United States Code,
governing appointments in the competitive service, and may be
paid without regard to the provisions of chapter 51 and
subchapter III of chapter 53 of such title relating to
classification and General Schedule pay rates, except that no
rate of pay fixed under this paragraph may exceed the equivalent
of that payable for a position at level V of the Executive
Schedule under section 5316 of title 5, United States Code. Any
individual appointed under paragraph (1) or (2) shall be treated
as an employee for purposes of chapters 63, 81, 83, 84, 85, 87,
89, 89A, 89B, and 90 of that title.
(4) Detailees.--Any Federal Government employee may be
detailed to the Commission without reimbursement from
[[Page 123 STAT. 1629]]
the Commission, and such detailee shall retain the rights,
status, and privileges of his or her regular employment without
interruption.
(5) Consultant services.--The Commission is authorized to
procure the services of experts and consultants in accordance
with section 3109 of title 5, United States Code, but at rates
not to exceed the daily rate paid a person occupying a position
at level IV of the Executive Schedule under section 5315 of
title 5, United States Code.
(f) Compensation and Travel Expenses.--
(1) Compensation.--Each member of the Commission may be
compensated at a rate not to exceed the daily equivalent of the
annual rate of basic pay in effect for a position at level IV of
the Executive Schedule under section 5315 of title 5, United
States Code, for each day during which that member is engaged in
the actual performance of the duties of the Commission.
(2) Travel expenses.--While away from their homes or regular
places of business in the performance of services for the
Commission, members of the Commission shall be allowed travel
expenses, including per diem in lieu of subsistence, in the same
manner as persons employed intermittently in the Government
service are allowed expenses under section 5703(b) of title 5,
United States Code.
(g) Nonapplicability of Federal Advisory Committee Act.--The Federal
Advisory Committee Act (5 U.S.C. App.) shall not apply to the
Commission.
(h) Report of the Commission; Appearance Before and Consultations
With Congress.--
(1) Report.--On December 15, 2010, the Commission shall
submit to the President and to the Congress a report containing
the findings and conclusions of the Commission on the causes of
the current financial and economic crisis in the United States.
(2) Institution-specific reports authorized.--At the
discretion of the chairperson of the Commission, the report
under paragraph (1) may include reports or specific findings on
any financial institution examined by the Commission under
subsection (c)(2).
(3) Appearance before the congress.--
The <<NOTE: Deadline.>> chairperson of the Commission shall, not
later than 120 days after the date of submission of the final
reports under paragraph (1), appear before the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives
regarding such reports and the findings of the Commission.
(4) Consultations with the congress.--The Commission shall
consult with the Committee on Banking, Housing, and Urban
Affairs of the Senate, the Committee on Financial Services of
the House of Representatives, and other relevant committees of
the Congress, for purposes of informing the Congress on the work
of the Commission.
(i) Termination of Commission.--
(1) In general.--The Commission, and all the authorities of
this section, shall terminate 60 days after the date on which
the final report is submitted under subsection (h).
(2) Administrative activities before termination.--The
Commission may use the 60-day period referred to in paragraph
[[Page 123 STAT. 1630]]
(1) for the purpose of concluding the activities of the
Commission, including providing testimony to committees of the
Congress concerning reports of the Commission and disseminating
the final report submitted under subsection (h).
(j) Authorization of Appropriation.--There is authorized to be
appropriated to the Secretary of the Treasury such sums as are necessary
to cover the costs of the Commission.
Approved May 20, 2009.
LEGISLATIVE HISTORY--S. 386:
---------------------------------------------------------------------------
SENATE REPORTS: No. 111-10 (Comm. on the Judiciary).
CONGRESSIONAL RECORD, Vol. 155 (2009):
Apr. 22, 23, 27, 28, considered and passed Senate.
May 6, considered and passed House, amended.
May 14, Senate concurred in House amendments with an
amendment.
May 19, House concurred in Senate amendment.
DAILY COMPILATION OF PRESIDENTIAL DOCUMENTS (2009):
May 20, Presidential remarks and statement.
<all>
Friday, March 29, 2013
Public law concerning Fraud
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