Combating Money Laundering and Terrorist Financing Act of 2007

Mr. President, it is a privilege to join Senator Enzi in introducing the Enhancing Drug Safety and Innovation Act of 2007. The goals of the legislation are to strengthen the Food and Drug Administration's authority over the safety of prescription drugs after they are approved; to encourage innovation in medical products; to increase access to clinical trials for patients and ensure that doctors and patients are aware of the results of clinical trials involving the drugs they prescribe and use; and to improve the screening of members of FDA's scientific advisory committees to avoid conflicts of interest.

The withdrawal of the drug Vioxx from the market 2 years ago demonstrated again that all prescription drugs have risks, many of which are unknown when a drug is approved, or even for years after approval. We need a more effective system to identify and assess the serious risks of drugs, inform health care providers and patients about such risks, and manage and mitigate these risks as soon as they are detected.

Our bill will require drugs to have a risk evaluation and mitigation strategy when it is approved. For many drugs, the strategy will include only the drug labeling, reports of adverse events, a justification for why only such reporting is needed, and a timetable for assessing how the REMS is working.

The FDA will be able to include additional requirements for drugs that pose serious risks, such as by requiring that the drug be dispensed with labels that patients can understand, that the drug company have a plan to inform health care providers about how to use the drug safely, and that a drug should not be advertised directly to consumers for up to 2 years after approval. If a serious safety concern needs to be understood, FDA can require further studies

or even clinical trials after the drug is approved. Enhanced data collection and data mining techniques will help identify risk signals earlier and more thoroughly.

For drugs with the most serious side effects, FDA will be able to require that its risk evaluation and mitigation strategy include the restrictions on distribution or use needed to assure its safe use.

The FDA will be able to impose any of these requirements at the time a drug is approved. The agency can also modify the labeling or otherwise alter a drug's availability after the approval. The drug's manufacturer will propose the overall strategy, or modifications to it, and the FDA and the company will try to work out an adequate compromise. If the agency and the company cannot agree, the agency's Drug Safety Oversight Board can review the dispute and recommend a resolution to senior FDA officials, who will make the final decision.

Civil monetary penalties are added to FDA's traditional enforcement authority to ensure compliance. Drug user fees will also be used to review and implement the program.

The bill formalizes and makes mandatory what is now only informal and voluntary. Our intent is not to change the standards for approving drugs, but to see that the FDA has the ability to identify, assess, and manage risks as they become known. Better risk management will mean that drugs with special benefits for some patients will remain available, despite serious risks for other patients, because FDA can better identify the risks and manage them.

The bill helps to improve drug safety in other ways as well. The Reagan-Udall Institute for Applied Biomedical Research will be a new public-private partnership at the FDA to advance the agency's critical path initiative. The initiative is intended to improve the science of developing, manufacturing, and evaluating the safety and effectiveness of drugs, biologics, medical devices, and diagnostics.

The Institute will be supported by Federal funds and by contributions from the pharmaceutical and device industries. Philanthropic organizations will be able to supplement Federal support. The institute will have a board of directors and an executive director, and will report to Congress annually on its operations.

The bill will also expand the public database at NIH to encourage more patients to enroll in clinical trials of drugs. The database will build on the current systems and would include late phase II, phase III, and all phase IV clinical trials for all drugs.

A second, publicly available database would include the results of phase III and phase IV clinical trials of drugs, with the possibility that late phase II trials would be added later. Posting of results could be delayed for up to 2 years, pending the approval of the drug or the publication of trial results in a peer- reviewed journal.

The public needs to know about the results of clinical trials on drugs. Tragically, such information was not adequately available for the clinical studies of antidepressants in children.

Posting information in the clinical trials registry and the clinical trials results database will be requirements for federal research funding and for drug review and approval by the FDA. Both the FDA and other appropriate offices in the Department of Health and Human Services will review the content of submissions to the results database to ensure they are truthful and nonpromotional. These Federal requirements will preempt State requirements for clinical trial databases.

Finally, the bill will improve FDA's process for screening advisory committee members for financial conflicts of interest. The agency relies on advisory committees to provide independent, expert, nonbinding recommendations on significant issues. Ideally, committee members should be free of any financial ties to the companies affected by an issue before a committee. But at times, there may be no individual without financial ties to such companies--for example, when the issue involves a rare disease or a cutting edge medical technology. In these cases, the FDA must be able to grant a waiver to allow an individual with essential expertise to serve on the committee. The bill will require the agency to seek qualified experts with minimal conflicts, clarify how it makes waiver decisions, and disclose those decisions at least 15 days before a committee meeting.

Our bill is a comprehensive response to drug safety and other important issues involving prescription drugs and other medical technologies. I commend Chairman Enzi and his dedicated staff-- especially Amy Muhlberg--for working closely with us on this proposal, and I urge our colleagues to support it.

Mr. President, it's a privilege to join my colleague, Senator Durbin, in introducing the Student Loan Sunshine Act, to provide greater support for students and families across America who are struggling with great difficulty to pay for college.

Over the past 20 years, the cost of attending college has doubled. Today, the average cost of attendance at a 4-year public college is almost $13,000. As a result, students and families are going deeper and deeper into debt to finance the cost of higher education. In 1993, fewer than a third of students at four-year colleges graduated with debt to pay on their student loans. Today that number has doubled. Two- thirds of students now graduate with student loan debt.

The average debt load has soared as well. In the past decade, it has increased by 57 percent at public colleges and 38 percent at private colleges. Today, the typical graduate leaves college saddled with $17,000 in student loans.

Nowhere has this growth been more pronounced than in private student loans. Until recently, most students who borrowed for college took out loans under the Direct Loan program and the Federal Family Education Loan program--the two main student loan programs subsidized by the Federal Government.

With the cost of college rising rapidly and grant aid stagnating, however, more and more students are turning to the private loan sector and are taking out so-called ``alternative loans''--private loans that lenders offer through colleges and universities. Students are also borrowing increasingly from direct-to-consumer education lenders, which include giant lenders such as Sallie Mae that also participate in the FFEL program, as well as other companies that just offer private-market loans, such as Loan to Learn.

A decade ago, private loans accounted for only 3 percent of all funds used to finance students' post-secondary education. Since then, the volume of private loans has grown by an astronomical 1200 percent. Today, private loans now total $17 billion, and represent 20 percent of all borrowing for higher education.

Many lenders making these private loans claim they're providing an important service. They say that at a time when college prices are rising rapidly, they provide needed funds to help students pay for college.

What they won't tell you is the exorbitant cost that countless students are paying for these loans. Unlike loans offered through the federal programs, private loans frequently carry much higher interest rates, especially for students without credit histories and families without strong credit ratings. In some cases, the interest rates on private loans may be as high as 19 percent a year, compared to 6.8 percent for loans offered through the FFEL and Direct Loan programs.

The lenders also don't tell you about the aggressive tactics they use to persuade colleges to offer private loans to their students--and to persuade students to borrow directly as well.

The private company Student Loan Xpress has offered 100 percent loan approval at colleges if the college agrees to ``brand'' the private loan with the college's name and emblem--making the loan appear to be offered by the college, not the private lender.

Other private loan companies encourage borrowers not to fill out the Free Application for Federal Student Aid, which allows borrowers to obtain loans at lower interest rates. They don't prominently disclose the fact that their interest rates are typically much higher.

Some lenders make gifts to college and university employees. Loan to Learn invited college officials and their spouses to an all-expenses paid ``education conference'' in the West Indies. Many lenders who participate in the FFEL program offer similar ``educational conferences'' at fancy hotels, and offer free entertainment and tickets to sporting events to college officials. The Attorney General in New York State has opened an investigation into such practices and is looking into the practices of six lenders, including Sallie Mae, Nelnet, and Educap, the corporate name of Loan to Learn.

We need to take immediate steps to stop actions that prevent students from obtaining the best loan agreement possible. That is what the Student Loan Sunshine Act does.

First and foremost, it is a consumer protection measure. It will protect student and parent borrowers by ending the inappropriate lender practices I've just mentioned.

It prohibits lenders from offering to a college employee any gift worth more than $10, including free or discounted trips, meals, invitations to entertainment events or other form of hospitality.

It prohibits lenders from offering services to financial aid offices that create a conflict of interest, such as lending staff during peak loan processing times. It also prohibits lenders from ``branding'' their loans with a college name, emblem, or logo.

The Sunshine Act also arms students and parents with the information they need to make wise decisions when they borrow funds for higher education.

The Act requires lenders to report any special arrangements they have with colleges to make such loans, and it ensures that this information is conveyed to borrowers.

It requires the Secretary of Education, together with members of the higher education community and students, to develop a clear, easy-to- use model format for reporting the terms and conditions of student loans, similar to the APR disclosure required for other types of loans.

If a college creates a ``preferred lender'' list, the Act requires the college to disclose clearly and fully why it has identified a lender as a preferred lender. Schools must also include at least three nonaffiliated lenders on the list, so that students have a real choice. Finally, the Sunshine Act also addresses the fast-growing direct-to- consumer educational loan market. It offers new protections for students who take out direct-to-consumer loans, so they don't borrow more than is necessary to pay for their college education.

The Act requires all lenders of direct-to-consumer private educational loans to state clearly and prominently that borrowers may qualify for low-interest loans through the Federal Government's loan programs. It also requires lenders to clearly disclose the terms and conditions of the loans they're offering, including any hidden fees, as well as any complaints against the lender that have been filed by consumer agencies such as the Better Business Bureau or the state attorney general's office.

Before a direct-to-consumer lender can offer an education loan of more than $1000, the Act requires the lender to notify the borrower's college of the amount of the proposed loan, so that the school can advise the borrower whether the loan exceeds what's necessary to cover the student's cost of attendance after other aid sources are factored in.

Students deserve the best loan advice possible from financial aid officers and the best deal from lenders. They have the right to exhaust their federal loan eligibility before turning to more expensive private lenders for aid.

Going to college is a lifetime investment, but paying for college is a heavy burden for too many families. As the private student loan market continues to grow, it's our responsibility to protect students from exploitation in that market.

I thank the bill's cosponsors, and I urge my colleagues to support this bill as well. It's time we put students first, and the Student Loan Sunshine Act takes important steps to do just that.

I ask unanimous consent that the text of this bill be printed in the Record.

Mr. President, I rise to speak in support of a bill that I am introducing today, the Combating Money Laundering and Terrorist Financing Act of 2007.

The life-blood of any criminal organization or enterprise is money. Whether engaged in drug dealing or terrorism, criminals cannot operate without money. The targeting of efforts by criminals to hide illegitimate funds in legitimate financial institutions has long been a focus of law enforcement.

Yet like all other aspects of criminal activity, money laundering continues to evolve into newer and more complex forms. This is particularly true in the funding of terrorist organizations and operations. Therefore, money laundering remains not only a criminal racket but also poses a grave threat to our national security.

Tracking how terrorists obtain, store, and move illicit funds is among the most critical aspects of stopping their efforts. Among its recommendations, the 9/11 Commission report stated that, ``Vigorous efforts to track terrorist financing must remain front and center in the U.S. counterterrorism efforts.'' We have made some significant strides in identifying how terrorists accumulate and move money, but more remains to be done. Terrorists and criminal networks continually evolve new ways of using legitimate means to launder illegally obtained funds. We must not underestimate the intelligence or resolve of these groups. Many have already utilized loopholes in current law to hide funds or circumvent required reporting to U.S. Customs officials.

Work must continue so that terrorists and other criminals are left without the ability to hide illegally obtained funds inside or in concert with legitimate means. We should commit to increasing pressure on these organizations to make money laundering as difficult and unprofitable as possible. And ultimately, we must give law enforcement and prosecutors the ability to effectively deal with criminals' ever- changing tactics.

The legislation that I am introducing today will strengthen our current money laundering statutes by streamlining those laws, closing those loopholes in the laws exploited by criminal organizations, and creating more efficient means for dealing with violators of money laundering laws. My bill goes about doing this in several ways.

First, my bill deals with the problem of ``specified unlawful activities'' or ``SUAs.'' SUAs are predicate offenses required for current money laundering statutes to apply, and there are currently over 200 of them. As criminals continue to change methods of laundering money, the list of SUAs will continue to grow. This legislation will prevent criminals from turning to other means not designated as an SUA, and will consolidate the ever growing list of SUAs by including all federal and state offenses punishable by imprisonment for more than one year. Also, criminals will no longer be able to hide behind borders, as this legislation would subject violations in foreign countries that have an effect on the U.S. to the same penalties as if they had occurred in the United States.

Currently, most circuit courts must charge each violation of money laundering statutes separately. My bill will allow, at the election of the government, prosecutors to charge multiple acts under one count in an indictment. This will significantly reduce the time and expense incurred by the courts in these cases, versus the current method of charging each and every violation separately.

Criminals have realized that the movement of large sums of money through traditional financial institutions will result in increased scrutiny and investigation. Therefore, many have turned to smuggling large quantities of money via a courier or bulk cash smuggling. They have developed techniques to avoid having to declare property with a value greater than $10,000 and to protect those couriers who are caught. My legislation will remove the criminal's ability to get around current laws, and remove protections for the smuggler.

For example, current law requires that couriers know specifics about the illegal activities that produced the monies they carry before they may be prosecuted under money laundering statutes. As a result, many claim ignorance about the illegal origins of the money and are released. With my bill, couriers will now be held responsible for their actions, even if they try to claim ignorance. Therefore, law enforcement can get both the courier and the money off the street. This bill also would stiffen the penalty for bulk cash smuggling to 10 years.

Another tactic now being used by criminals is to have couriers carry blank checks in bearer form. The couriers argue that the check has no amount, so it is not subject to declaration. Once the courier arrives at his destination, he merely has to fill in the amount, whatever it may be. My legislation would remove this loophole by setting the value of any blank check in bearer form equal to the highest amount in that account during the time period it was being transported, or when it is cashed.

My bill also seeks to mitigate the tactics of ``commingling funds'' and ``structured transactions.'' The ``commingling funds'' tactic involves depositing illegal money in an account with legitimate funds. Under current law, criminals can argue that money withdrawn from the account was from the legitimate sources. The language in this bill would clarify that transactions on accounts containing more than $10,000 in illegally obtained funds will be considered a transaction involving more than $10,000 in criminally derived property, regardless of how the other money in the account was obtained. Nor will criminals be allowed to avoid the law by structuring smaller transactions below the $10,000 reporting requirement. Under my bill, individual but related transactions will be considered at their aggregate value.

Finally, this bill will provide the United States Secret Service with the legislative and financial resources it needs to combat counterfeiters and other criminals seeking to harm our financial systems. The U.S. Federal Reserve Note is the most identifiable currency in the world and the backbone of many other nations' economies. To help ensure continued stability of the Greenback worldwide, my bill will make illegal the possession of any materials used to make counterfeit currency. This is necessary because technology has evolved far beyond the old days of printing plates, stones, and digital images. Like the evolving tactics used by those in money laundering operations, the counterfeiter constantly changes his tactics and technologies. Furthermore, the crime of counterfeiting is becoming more and more international in scope every day. The Secret Service has identified counterfeiting operations in Colombia, Nigeria, Italy, Iraq, and North Korea. This is apparent in the use of bleached notes. Bleached notes are simply bills with low denominations being bleached with chemicals. This produces a blank canvas of genuine currency paper for counterfeiters to work with, to which they can add higher denominations. My bill will make it illegal to possess these bleached or otherwise altered notes, and give the Secret Service the authorization it needs to pursue these criminals outside the United States.

Additionally, this bill gives the Secret Service the authorization to use funds seized from criminals to pay for ongoing undercover investigations. This seems like common sense, and indeed, every other federal investigative agency has this authority. Tasked with protecting our financial systems, the Secret Service should be provided with all the resources necessary to fund its undercover operations. This makes even more sense, considering it's the criminals themselves who would be paying those bills. My bill provides that authority to the Secret Service and will allow them to continue the important work of protecting our financial infrastructure.

As I said, money is essential for the operation of any criminal or terrorist organization. The ability to get, move, and hide these funds is critical to the operations of both. We have had some success in thwarting this ability, as is evident by the constantly changing techniques for laundering money. We must continue to apply pressure on these groups, and do everything we can to identify and stop their financing operations. This bill is designed to do just that, and put these organizations out of business for good. I urge my colleagues to join me and my cosponsors, Senators Kyl, Cornyn, and Graham, in supporting this legislation to combat the financing of criminal and terrorist activities.

Mr. President, I ask unanimous consent that the text of this bill be printed in the Record.

Mr. President, I rise to speak in support of a bill that I am introducing today, the Combating Money Laundering and Terrorist Financing Act of 2007.

The life-blood of any criminal organization or enterprise is money. Whether engaged in drug dealing or terrorism, criminals cannot operate without money. The targeting of efforts by criminals to hide illegitimate funds in legitimate financial institutions has long been a focus of law enforcement.

Yet like all other aspects of criminal activity, money laundering continues to evolve into newer and more complex forms. This is particularly true in the funding of terrorist organizations and operations. Therefore, money laundering remains not only a criminal racket but also poses a grave threat to our national security.

Tracking how terrorists obtain, store, and move illicit funds is among the most critical aspects of stopping their efforts. Among its recommendations, the 9/11 Commission report stated that, ``Vigorous efforts to track terrorist financing must remain front and center in the U.S. counterterrorism efforts.'' We have made some significant strides in identifying how terrorists accumulate and move money, but more remains to be done. Terrorists and criminal networks continually evolve new ways of using legitimate means to launder illegally obtained funds. We must not underestimate the intelligence or resolve of these groups. Many have already utilized loopholes in current law to hide funds or circumvent required reporting to U.S. Customs officials.

Work must continue so that terrorists and other criminals are left without the ability to hide illegally obtained funds inside or in concert with legitimate means. We should commit to increasing pressure on these organizations to make money laundering as difficult and unprofitable as possible. And ultimately, we must give law enforcement and prosecutors the ability to effectively deal with criminals' ever- changing tactics.

The legislation that I am introducing today will strengthen our current money laundering statutes by streamlining those laws, closing those loopholes in the laws exploited by criminal organizations, and creating more efficient means for dealing with violators of money laundering laws. My bill goes about doing this in several ways.

First, my bill deals with the problem of ``specified unlawful activities'' or ``SUAs.'' SUAs are predicate offenses required for current money laundering statutes to apply, and there are currently over 200 of them. As criminals continue to change methods of laundering money, the list of SUAs will continue to grow. This legislation will prevent criminals from turning to other means not designated as an SUA, and will consolidate the ever growing list of SUAs by including all federal and state offenses punishable by imprisonment for more than one year. Also, criminals will no longer be able to hide behind borders, as this legislation would subject violations in foreign countries that have an effect on the U.S. to the same penalties as if they had occurred in the United States.

Currently, most circuit courts must charge each violation of money laundering statutes separately. My bill will allow, at the election of the government, prosecutors to charge multiple acts under one count in an indictment. This will significantly reduce the time and expense incurred by the courts in these cases, versus the current method of charging each and every violation separately.

Criminals have realized that the movement of large sums of money through traditional financial institutions will result in increased scrutiny and investigation. Therefore, many have turned to smuggling large quantities of money via a courier or bulk cash smuggling. They have developed techniques to avoid having to declare property with a value greater than $10,000 and to protect those couriers who are caught. My legislation will remove the criminal's ability to get around current laws, and remove protections for the smuggler.

For example, current law requires that couriers know specifics about the illegal activities that produced the monies they carry before they may be prosecuted under money laundering statutes. As a result, many claim ignorance about the illegal origins of the money and are released. With my bill, couriers will now be held responsible for their actions, even if they try to claim ignorance. Therefore, law enforcement can get both the courier and the money off the street. This bill also would stiffen the penalty for bulk cash smuggling to 10 years.

Another tactic now being used by criminals is to have couriers carry blank checks in bearer form. The couriers argue that the check has no amount, so it is not subject to declaration. Once the courier arrives at his destination, he merely has to fill in the amount, whatever it may be. My legislation would remove this loophole by setting the value of any blank check in bearer form equal to the highest amount in that account during the time period it was being transported, or when it is cashed.

My bill also seeks to mitigate the tactics of ``commingling funds'' and ``structured transactions.'' The ``commingling funds'' tactic involves depositing illegal money in an account with legitimate funds. Under current law, criminals can argue that money withdrawn from the account was from the legitimate sources. The language in this bill would clarify that transactions on accounts containing more than $10,000 in illegally obtained funds will be considered a transaction involving more than $10,000 in criminally derived property, regardless of how the other money in the account was obtained. Nor will criminals be allowed to avoid the law by structuring smaller transactions below the $10,000 reporting requirement. Under my bill, individual but related transactions will be considered at their aggregate value.

Finally, this bill will provide the United States Secret Service with the legislative and financial resources it needs to combat counterfeiters and other criminals seeking to harm our financial systems. The U.S. Federal Reserve Note is the most identifiable currency in the world and the backbone of many other nations' economies. To help ensure continued stability of the Greenback worldwide, my bill will make illegal the possession of any materials used to make counterfeit currency. This is necessary because technology has evolved far beyond the old days of printing plates, stones, and digital images. Like the evolving tactics used by those in money laundering operations, the counterfeiter constantly changes his tactics and technologies. Furthermore, the crime of counterfeiting is becoming more and more international in scope every day. The Secret Service has identified counterfeiting operations in Colombia, Nigeria, Italy, Iraq, and North Korea. This is apparent in the use of bleached notes. Bleached notes are simply bills with low denominations being bleached with chemicals. This produces a blank canvas of genuine currency paper for counterfeiters to work with, to which they can add higher denominations. My bill will make it illegal to possess these bleached or otherwise altered notes, and give the Secret Service the authorization it needs to pursue these criminals outside the United States.

Additionally, this bill gives the Secret Service the authorization to use funds seized from criminals to pay for ongoing undercover investigations. This seems like common sense, and indeed, every other federal investigative agency has this authority. Tasked with protecting our financial systems, the Secret Service should be provided with all the resources necessary to fund its undercover operations. This makes even more sense, considering it's the criminals themselves who would be paying those bills. My bill provides that authority to the Secret Service and will allow them to continue the important work of protecting our financial infrastructure.

As I said, money is essential for the operation of any criminal or terrorist organization. The ability to get, move, and hide these funds is critical to the operations of both. We have had some success in thwarting this ability, as is evident by the constantly changing techniques for laundering money. We must continue to apply pressure on these groups, and do everything we can to identify and stop their financing operations. This bill is designed to do just that, and put these organizations out of business for good. I urge my colleagues to join me and my cosponsors, Senators Kyl, Cornyn, and Graham, in supporting this legislation to combat the financing of criminal and terrorist activities.

Mr. President, I ask unanimous consent that the text of this bill be printed in the Record.

Mr. President, I rise today to urge my colleagues to support the Kennedy-Durbin ``Student Loan Sunshine Act.''

There is no question that having a college education is essential in today's job market. Over the course of a lifetime, a college graduate will earn over $1 million more than those with only a high school diploma.

In addition to the individual benefits of a college education, investing in and producing more college-educated Americans is vital to our nation's growth. Economists estimate that the increase in the education level of the United States labor force between 1915 and 1999 directly resulted in at least 23 percent of the overall growth in U.S. productivity.

However, paying for college is becoming increasingly difficult for students and their families. Tuition at four-year public institutions rose by 42 percent in the last five years, and more and more students are leaving college saddled with ever increasing debt burdens. According to the U.S. Department of Education, the average student debt has increased by more than 50 percent over the last decade. In 2004, college students graduated with an average of $17,400 in federal student loan debt, almost 45 percent more than students who graduated in 1993. When private loans are factored in, the average debt increases to more than $19,000.

As students and their families struggle to find ways to pay for higher education, more and more are forced to turn to private student loans in order to close the gap. Because these loans are not guaranteed or subsidized by the government, they often carry much higher interest rates.

According to The College Board, private student loans are now a $17.3 billion industry. Between the 2000-2001 and 2005-2006 school years, private student loans grew at an average annual rate of 27 percent, after adjusting for inflation.

As more students begin to rely on private student loans to help pay for college, some lenders and colleges are engaging in practices that do not appear to be in the best interests of the students. An article published in The New York Times revealed examples of incentives offered to colleges by student loan companies in order to be placed on a college's ``preferred lender'' list.

An example cited in the article included an all-expense paid trip to the Caribbean for university officials and their spouses to attend an education ``summit'' held at a luxury five-star beachfront resort. Between symposiums, forums and roundtable discussions on the importance of addressing the cost of higher education, guests could enjoy complimentary water and beach sports such as snorkeling, sailing, kayaking, sailboarding and volleyball as well as access to an 18-hole championship golf course, a 10-court tennis complex, two beachfront pools and a luxury spa. News of the trip garnered such a negative response from the public that the sponsor of the trip, Loan to Learn, ultimately cancelled the trip. Aside from all-expense paid trips, other examples of incentives include iPods that were given away at a financial aid administrators meeting and bonuses that are based on how much students borrow.

Colleges and universities should not be enticed to select ``preferred lenders'' or take other actions related to the student loan program on the basis of factors that are irrelevant, or at best ancillary, to the primary interests of the students.

The Student Loan Sunshine Act protects students and parents from potential exploitation by private student loan lenders and lenders that offer gifts to schools as a way to acquire the school's loan business. It ensures that students and their families have all the facts and can feel confident that they're receiving the best deal on their college loan.

First, this bill puts a stop to inappropriate lender practices. Lenders are

prohibited from offering any gift over $10 to employees of a university, including free trips, meals, and tickets to entertainment events. Lenders are no longer allowed to offer services to a financial aid office that create a conflict of interest such as lending staff during peak loan processing times, printing literature for the financial aid office and e-mailing students on behalf of the financial aid office.

Second, the Act provides students and their families access to information about preferred lender lists, special arrangements between lenders and colleges and terms and conditions of loans. A school's preferred lender list must include at least three lenders that are independent from each other, clearly disclose why a lender was identified as a preferred lender, and clearly state that students and parents may take out a student loan with a lender that is not on their school's preferred lender list. This requirement is needed because in some instances, a school's preferred lender list may include what appear to be five different lenders; however, four of the five lenders may turn out to be subsidiaries of a single company. Lenders are required to report to the Secretary of Education any special arrangement they have with colleges to make loans to the students at a school including the terms of the arrangement and any benefit provided to the school in connection with the loan arrangement. In addition, the Act requires the Secretary of Education, along with the higher education community and students, to develop an easy-to-understand form for reporting the terms and conditions of student loans--similar to an APR disclosure.

Finally, the Act encourages students to maximize their borrowing options through the government's loan programs before obtaining private loans with higher interest rates and discourages over-borrowing through direct-to-consumer education loans. Some companies fail to clearly disclose that their private educational loans typically carry a higher interest rate and even encourage students not to complete the Free Application for Federal Student Aid form, which allows students to borrow low-interest educational loans. The Act requires all direct-to- consumer lenders to clearly disclose to students certain information such as: the fact that the student may be eligible for low-interest student loans through the federal government, how the interest rate is determined, any and all fees, and whether any complaints have been filed against the lender. Additionally, the Act puts in place provisions that will ensure that before a student obtains an educational loan through a direct-to-consumer lender, the student is informed of their loan options through the federal government and whether the loan will cause the student to exceed what is necessary to cover the student's cost of attendance.

These requirements are simply meant to ensure that as students are about to sign on the dotted line and accept what will likely be one of the largest debts they will incur in their lives, they have the information they need to make an informed decision and some assurance that their school has only their best interests in mind--not visions of the Caribbean or the latest iPod. We must not look away and allow them to be taken advantage of at one of the most critical points in their lives. I urge my colleagues to support this important legislation.

Mr. President, I rise today to introduce a very important bill, one that my colleague Senator Kennedy and I have been working on for some time.

For decades, the United States has been the standard bearer in bringing new drugs and medications to the world market. Like it or not, the FDA

has a very important role in all of our daily lives. The FDA is involved in ensuring the safety of the meals we are eating today, the pills we are taking, and even the cell phones in our pockets and briefcases. The FDA's role in our health and in our economy is broad.

Nearly half of all Americans take a prescription drug daily. Anyone who prescribes, provides or takes a prescription drug could benefit from enhanced safety and risk communication about these life-saving products. Over the last few years, a spate of safety issues, such as the withdrawal of the arthritis drug Vioxx and the labeling of antidepressants for suicidality in adolescents, has caused a crisis of public confidence in the FDA. I believe the American people are losing confidence in the FDA and its ability to evaluate and weigh the benefits and risks of prescription drugs. In addition, staff at the agency feel like they are under heavy fire, with little or no protection from the prevailing political winds, due to the lack of a confirmed Commissioner of Food and Drugs for most of the last six years. I believe that only Congress can restore the public's confidence in FDA and morale at the agency.

In 2005, the HELP Committee held two hearings on the issue of drug safety. We received over 50 recommendations from witnesses at those hearings. At that time, Senator Kennedy and I pledged to develop a comprehensive response to the drug safety issues raised. Last August, we introduced the Enhancing Drug Safety and Innovation Act. That bill, S. 3807, was the product of working across party lines, and created a structured framework for resolving safety concerns. Careful and comprehensive pre-approval planning of how drugmakers and FDA will identify, assess and manage serious risks post-approval is a better way to obtain safety information without compromising patient access.

In September 2006, the Institute of Medicine released its report titled ``The Future of Drug Safety: Promoting and Protecting the Health of the Public.'' The recommendations in this report had much in common with S. 3807. The Senate HELP Committee held a hearing in November 2006 at which representatives of the IOM, a physician and drug safety expert, patient groups, a consumer group, and a pharmaceutical company testified about the IOM report, the bill, and the relationship between them. In addition, other stakeholder groups made additional comments on the bill. Yesterday, FDA released their response to the IOM report. Newly confirmed Commissioner Dr. Andrew von Eschenbach has put forward a number of promising ideas to improve the internal processes and culture at FDA. His leadership is outstanding and his ideas are helpful, but internal change is not enough to alter public perception. FDA needs new drug safety authorities, and this bill provides those authorities.

While the bill we are introducing today reflects numerous refinements to clarify ambiguities or to address issues that S. 3807 had not addressed, we realize that there are thoughtful differences of opinion and ideas on how best to move forward with drug safety. I welcome any and all suggestions on improving this bill, and I look forward to working with my colleagues and other stakeholders to understand those concerns more fully and incorporate any necessary changes in the bill which will be considered in front of the HELP Committee in the next few weeks. I hope that all of my colleagues will take another look at this legislation and its goals and work with me to change the status quo. Everyone agrees: We must do more for drug safety.

Under the Enhancing Drug Safety and Innovation Act, FDA would begin to approve drugs and biologics, and new indications for these products, with risk evaluation and mitigation strategies (REMS). The REMS is designed to be an integrated, flexible mechanism to acquire and adapt to new safety information about a drug. The sponsor and FDA will assess and review an approved REMS at least annually for the first three years, as well as in applications for a new indication, when the sponsor suggests changes, or when FDA requests a review based on new safety information.

The development of tools to evaluate medical products has not kept pace with discoveries in basic science. New tools are needed to better predict safety and efficacy, which in turn would increase the speed and efficiency of applied biomedical research. The Enhancing Drug Safety and Innovation Act would spur innovation by establishing a new public- private partnership between the FDA, industry and academia to advance the Critical Path Initiative and improve the sciences of developing, manufacturing, and evaluating the safety and effectiveness of drugs, devices, biologics and diagnostics.

The Enhancing Drug Safety and Innovation Act also establishes a central clearinghouse for information about clinical trials and their results to help patients, providers and researchers learn new information and make more informed health care decisions.

Finally, the Enhancing Drug Safety and Innovation Act would make improvements to FDA's process for screening advisory committee members for financial conflicts of interest. FDA relies on its 30 advisory committees to provide independent expert advice, lend credibility to the product review process, and inform consumers of trends in product development. The bill would clarify and streamline FDA's processes for evaluating candidates for service on an advisory committee, and address the key challenge of identifying a sufficient number of people with the necessary expertise and the fewest potential conflicts of interest to serve on advisory committees.

I want to thank the dozens of stakeholders, including the Food and Drug Administration, patient and consumer groups, industry associations, individual companies, and scientific experts who have taken the time and effort to give us their comments and input on the bill. Their assistance has been invaluable, and I look forward to continuing to work with them as we go through this legislative process.

Senator Kennedy and I believe that this bipartisan effort will bring more consistency, transparency, and accountability to the process of assuring a drug's safety after it is approved. The 110th Congress will hold an exceptionally full agenda with respect to the FDA. In addition to updating the FDA's authorities as we are proposing today, Congress must renew the drug and device user fee programs, as well as the Best Pharmaceuticals for Children and Pediatric Research Equity Acts. The introduction of this bill today is the beginning, not the end, of the process, and I look forward to working with my colleagues to advance these important pieces of legislation.