S.Amdt. 4067

SA 4067. Mr. FEINGOLD submitted an amendment intended to be proposed
to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself
and Mrs. Lincoln)) to the bill S. 3217, to promote the financial
stability of the United States by improving accountability and
transparency in the financial system, to end ``too big to fail'', to
protect the American taxpayer by ending bailouts, to protect consumers
from abusive financial services practices, and for other purposes;
which was ordered to lie on the table; as follows:

On page 1455, after line 25, insert the following:

SEC. 1077. MANDATORY PREDISPUTE ARBITRATION RULEMAKING.

(a) Section 921.--Section 921 of this Act is amended to
read as follows:

``SEC. 921. AUTHORITY TO ISSUE RULES RELATED TO MANDATORY
PREDISPUTE ARBITRATION.

``(a) Amendment to Securities Exchange Act of 1934.--
Section 15 of the Securities Exchange Act of 1934 (15 U.S.C.
78o), as amended by section 918, is amended by adding at the
end the following:
`` `(i) Authority to Restrict Mandatory Predispute
Arbitration.--The Commission shall--
`` `(1) conduct a rulemaking on the use of agreements that
require customers or clients of any broker, dealer, or
municipal securities dealer to arbitrate any dispute between
such customers or clients and such broker, dealer, or
municipal securities dealer that arises under the securities
laws or the rules of a self-regulatory organization; and
`` `(2) if the Commission finds that prohibition of, or
imposition of conditions or limitations on, the use of
agreements described in paragraph (1) is in the public
interest and for the protection of investors, promulgate
rules or regulations to establish such prohibitions,
conditions, or limitations.'.
``(b) Amendment to the Investment Advisers Act of 1940.--
Section 205 of the Investment Advisers Act of 1940 (15 U.S.C.
80b-5) is amended by adding at the end the following:
`` `(f) Authority to Issue Rules Related to Mandatory
Predispute Arbitration.--The Commission shall--
`` `(1) conduct a rulemaking on the use of agreements that
require customers or clients of any investment adviser to
arbitrate any dispute between such customers or clients and
such investment adviser that arises under the securities
laws, as defined in section 3 of the Securities Exchange Act
of 1934 (15 U.S.C. 78c), or the rules of a self-regulatory
organization; and
`` `(2) if the Commission finds that prohibition of, or
imposition of conditions or limitations on, the use of
agreements described in paragraph (1) is in the public
interest and for the protection of investors, promulgate
rules or regulations to establish such prohibitions,
conditions, or limitations.'.''
(b) Section 1028.--Section 1028 of this Act is amended to
read as follows:

``SEC. 1028. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE
ARBITRATION.

``(a) Study and Report.--Not later than 1 year after the
designated transfer date, the Bureau shall conduct a study
and submit a report to Congress concerning the use of
agreements providing for arbitration of any future dispute
between covered persons and consumers in connection with the
offering or providing of consumer financial products or
services.
``(b) Further Authority.--The Bureau, by regulation, may
prohibit or impose conditions or limitations on the use of an
agreement between a covered person and a consumer for a
consumer financial product or service providing for
arbitration of any future dispute between the parties, if the
Bureau determines that such a prohibition or imposition of
conditions or limitations is in the public interest and for
the protection of consumers. The determination of the Bureau
under this subsection shall be consistent with the study
conducted under subsection (a).
``(c) Limitation.--The authority described in subsection
(b) may not be construed to prohibit or restrict a consumer
from entering into a voluntary arbitration agreement with a
covered person after a dispute has arisen.
``(d) Rule of Construction.--No other provision of Federal
law shall be construed to preempt or otherwise affect the
applicability of any regulation prescribed by the Bureau
under subsection (b).''.
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