S.Amdt. 2200

SA 2200. Mr. CRUZ (for himself and Mr. Lee) submitted an amendment
intended to be proposed to amendment SA 2151 proposed by Mr. McConnell
(for Mr. Crapo (for himself, Mr. Donnelly, Ms. Heitkamp, Mr. Tester,
and Mr. Warner)) to the bill S. 2155, to promote economic growth,
provide tailored regulatory relief, and enhance consumer protections,
and for other purposes; which was ordered to lie on the table; as
follows:

At the appropriate place, insert the following:

SEC. ___. FINANCIAL INSTITUTION CUSTOMER PROTECTION.

(a) Requirements for Deposit Account Termination Requests
and Orders.--
(1) Definitions.--In this section:

[[Page S1637]]

(A) Appropriate federal banking agency.--The term
``appropriate Federal banking agency''--
(i) has the meaning given the term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
(ii) means the National Credit Union Administration, in the
case of an insured credit union.
(B) Depository institution.--The term ``depository
institution''--
(i) has the meaning given the term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
(ii) includes an insured credit union.
(C) Insured credit union.--The term ``insured credit
union'' has the meaning given the term in section 101 of the
Federal Credit Union Act (12 U.S.C. 1752).
(2) Termination requests or orders must be valid.--
(A) In general.--An appropriate Federal banking agency may
not formally or informally request or order a depository
institution to terminate a specific customer account, or a
group of customer accounts, or to otherwise restrict or
discourage a depository institution from entering into or
maintaining a banking relationship with a specific customer,
or a group of customers, unless--
(i) the agency has a valid reason for the request or order;
and
(ii) the reason described in clause (i) is not based solely
on reputation risk to the depository institution.
(B) Treatment of national security threats.--
(i) In general.--If an appropriate Federal banking agency
has a belief described in clause (ii) of this subparagraph,
that belief shall be deemed to satisfy the requirement under
clauses (i) and (ii) of subparagraph (A) with respect to a
request or order described in that subparagraph.
(ii) Belief of national security threat.--A belief
described in this clause is a belief by an appropriate
Federal banking agency that a specific customer, or a group
of customers, is, or is acting as a conduit for, an entity
that--

(I) poses a threat to national security;
(II) is involved in terrorist financing;
(III) is an agency of the Government of Iran, North Korea,
Syria, or any country listed from time to time on the state
sponsor of terrorism list;
(IV) is located in, or is subject to the jurisdiction of,
any country described in subclause (III); or
(V) does business with any entity described in subclause
(III) or (IV), unless the appropriate Federal banking agency
determines that the customer, or group of customers, has
exercised due diligence to avoid doing business with any such
entity.

(3) Notice requirement.--
(A) In general.--If an appropriate Federal banking agency
formally or informally requests or orders that a depository
institution terminate a specific customer account, or a group
of customer accounts, the appropriate Federal banking agency
shall provide--
(i) the request or order to the depository institution in
writing; and
(ii) along with the request or order provided under clause
(i), a written justification for why the termination is
needed, including any specific law or regulation that the
appropriate Federal banking agency believes the customer, or
group of customers, is violating, if any.
(B) Justification requirement.--A justification provided
under subparagraph (A)(ii) may not be based solely on the
reputation risk to the depository institution to which the
justification is provided.
(4) Customer notice.--
(A) Notice required.--Except as provided in subparagraph
(B), or as otherwise prohibited from being disclosed by law,
if an appropriate Federal banking agency orders a depository
institution to terminate a specific customer account, or a
group of customer accounts, the depository institution shall
inform the specific customer, or group of customers, of the
justification for the termination provided by the appropriate
Federal banking agency under paragraph (3)(A)(ii).
(B) Notice prohibited.--
(i) Notice prohibited in cases of national security.--If an
appropriate Federal banking agency requests or orders a
depository institution to terminate a specific customer
account, or a group of customer accounts, based on a belief
that the customer, or group of customers, poses a threat to
national security, or is otherwise described in paragraph
(2)(B)(ii), neither the depository institution nor the
appropriate Federal banking agency may inform the customer,
or group of customers, of the justification for the
termination of the account or accounts, as applicable.
(ii) Notice prohibited in other cases.--If an appropriate
Federal banking agency determines that the notice required
under subparagraph (A) may interfere with an authorized
criminal investigation, neither the depository institution
that is required to provide the notice nor the appropriate
Federal banking agency may inform the specific customer, or
group of customers, of the justification for the termination
of the account or accounts, as applicable.
(5) Reporting requirement.--Each appropriate Federal
banking agency shall submit to Congress an annual report that
contains--
(A) the aggregate number of specific customer accounts that
the agency requested or ordered that a depository institution
terminate during the year covered by the report;
(B) the legal authority on which the agency relied in
making the requests and orders described in subparagraph (A);
and
(C) the frequency with which the agency relied on each
legal authority described in subparagraph (B).
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