S.Amdt. 712

SA 712. Ms. LUMMIS (for herself, Mrs. Gillibrand, Ms. Warren, and Mr.
Marshall) submitted an amendment intended to be proposed by her to the
bill S. 2226, to authorize appropriations for fiscal year 2024 for
military activities of the Department of Defense, for military
construction, and for defense activities of the Department of Energy,
to prescribe military personnel strengths for such fiscal year, and for
other purposes; which was ordered to lie on the table; as follows:

At the appropriate place, insert the following:

Subtitle _____--Crypto Assets

SEC. ___01. ANTI-MONEY LAUNDERING EXAMINATION STANDARDS.

(a) Treasury.--Not later than 2 years after the date of
enactment of this Act, the Secretary of the Treasury, in
consultation with the Conference of State Bank Supervisors
and the Federal Financial Institutions Examination Council,
shall establish a risk-focused examination and review process
for money service businesses, as defined in section 1010.100
of title 31, Code of Federal Regulations, to assess the
following relating to crypto assets--
(1) the adequacy of reporting obligations and anti-money
laundering programs under subsections (g) and (h) of section
5318 of title 31, United States Code, respectively as applied
to those businesses; and
(2) compliance of those businesses with anti-money
laundering and countering the financing of terrorism
requirements under subchapter II of chapter 53 of title 31,
United States Code.
(b) Securities Exchange Commission.--Not later than 2 years
after the date of enactment of this Act, the Securities and
Exchange Commission shall establish a dedicated risk-focused
examination and review process for entities regulated by the
Commission to assess the following relating to crypto
assets--
(1) the adequacy of reporting obligations and anti-money
laundering programs under subsections (g) and (h) of section
5318 of title 31, United States Code, respectively as applied
to those entities; and
(2) compliance of those entities with anti-money laundering
and countering the financing of terrorism requirements under
subchapter II of chapter 53 of title 31, United States Code.
(c) Commodity Futures Trading Commission.--Not later than 2
years after the date of enactment of this Act, the Commodity
Futures Trading Commission shall establish a dedicated risk-
focused examination and review process for entities regulated
by the Commodity Futures Trading Commission to assess the
following relating to crypto assets--
(1) the adequacy of reporting obligations and anti-money
laundering programs under subsections (g) and (h) of section
5318 of title 31, United States Code, respectively, as
applied to those entities; and
(2) compliance of those entities with anti-money laundering
and countering the financing of terrorism requirements under
subchapter II of chapter 53 of title 31, United States Code.

SEC. ___02. CRYPTO ASSET KIOSKS.

(a) Definition.--In this section, the term ``crypto asset
kiosk'' means a stand-alone machine, including a crypto asset
automated teller machine, which facilitates the buying,
selling, or exchange of crypto assets.
(b) Update.--Beginning not later than 2 years after the
date of enactment of this Act, the Director of the Financial
Crimes Enforcement Network of the Department of the Treasury
shall require crypto asset kiosk owners and administrators to
submit and update the physical addresses of the kiosks owned
or operated by the owner or administrator, as applicable,
once every 120 days and collect the name, date of birth,
physical address, and phone number of each counterparty to a
transaction..
(c) Rulemaking.--Not later than 2 years after the date of
enactment of this Act, the Director of the Financial Crimes
Enforcement Network of the Department of the Treasury shall
issue rules requiring crypto asset kiosk owners and
administrators to verify the identity of each customer using
a valid form of government-issued identification or other
documentary method, as determined by the Secretary of the
Treasury.
(d) Reports.--
(1) Financial crimes enforcement network.--Not later than
180 days after the date of enactment of this Act, the
Director of the Financial Crimes Enforcement Network of the
Department of the Treasury shall issue a public report
identifying unlicensed kiosk operators and administrators,
including identification of known unlicensed operators and
estimates of the number and locations of suspected unlicensed
operators, as applicable.
(2) Drug enforcement agency.--Not later than 1 year after
the date of enactment of this Act, the Drug Enforcement
Administration shall issue a report to Congress identifying
recommendations to reduce drug trafficking with crypto asset
kiosks.

SEC. ___03. SANCTIONS COMPLIANCE RESPONSIBILITIES OF PAYMENT
STABLECOIN ISSUERS.

Not later than 120 days after the date of the enactment of
this Act, the Secretary of the Treasury shall adopt guidance
clarifying the sanctions compliance responsibilities and
liability of an issuer of a payment stablecoin with respect
to downstream transactions relating to the stablecoin that
take place after the stablecoin is first provided to a
customer of the issuer.

SEC. ___04. CRYPTO ASSET MIXERS AND TUMBLERS.

(a) In General.--Not later than 1 year after the date of
enactment of this Act, the Director of the Financial Crimes
Enforcement Network of the Department of the Treasury shall
submit to the Committee on Banking, Housing and Urban Affairs
of the Senate and the Committee on Financial Services of the
House of Representatives a report that analyzes the following
issues:
(1) Current (as of the date on which the report is
submitted) typologies of crypto asset mixers and tumblers and
historical transaction volume.
(2) Estimates of the percentage of transactions relating to
mixers and tumblers which are used by actors engaged in
illicit finance.

[[Page S2848]]

(3) An assessment of potential non-illicit uses of mixers
and tumblers described in paragraph (1).
(4) Analysis of regulatory approaches employed by other
jurisdictions relating to mixers and tumblers.
(5) Recommendations for legislation or regulation relating
to mixers and tumblers.
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