Financial Technology Protection Act

Mr. Speaker, I thank the gentleman from Colorado for yielding. I also want to thank Chairman Hensarling for his dedicated leadership of his committee. I appreciate all he did to bring my legislation, H.R. 5036, to the floor. I also want to thank the gentleman from Massachusetts (Mr. Lynch), my co-lead on the bill, for his efforts, his experience, and his knowledge. It only made the bill better, so I appreciated working with him.

Mr. Speaker, I rise today in strong support of my bipartisan legislation, the Financial Technology Protection Act.

We all know that illicit financing networks are the lynchpin of any terrorist group's, criminal organization's, or rogue state's operations. As we move into an increasingly digital world, criminals and terrorists will start to use these new technologies that are available to them. That presents a problem.

That problem is that we know that criminals use digital currencies through dark net markets to criminalize and to monetize cyber attacks. There is documented evidence that terrorists are increasingly using these currencies.

The RAND Corporation has some good supporting evidence on this. The bottom line is that the Federal Government has to be one step ahead of the illicit actors in this new space without threatening technological innovation, and that is what H.R. 5036 will do.

Specifically, my legislation will do the following things to help make sure the United States stays ahead of this problem: First, it establishes the Independent Financial Technology Task Force to Combat Terrorism and Illicit Financing, whose goal is to improve coordination between private and public sectors on digital currency terror strategy and to combat illicit use. From my perspective, industry and the Federal Government should be coming together to find best practices and solutions to stop this new terrorist funding threat.

Secondly, H.R. 5036 includes language from H.R. 5227, the Preventing Rogue and Foreign Actors From Evading Sanctions Act, which was introduced by my friend Mark Meadows of North Carolina. This language directs the Treasury Department to develop a strategy that identifies and describes the potential uses of virtual currencies and other emerging technologies by states, nonstate actors, and terrorist organizations to evade sanctions, finance terrorism, or launder monetary instruments and threaten the United States' national security.

Again, the development of a national strategy to combat illicit use strikes me as common sense; therefore, we are

excited to have it included in the bill and to have Mr. Meadows' support as well.

Also, the Budd-Lynch legislation establishes a targeted rewards program for information leading to the capture of terrorists or illicit actors involved with terror digital currency networks. The government should be encouraging individuals with knowledge of illicit use of virtual currencies to come forward through the offerings of rewards for successful convictions.

Finally, and perhaps most importantly, H.R. 5036 establishes the Fintech Leadership in Innovation and Financial Intelligence Program, which will be used for grants and rewards in the Fintech space for ideas and programs to combat terrorist use of digital currencies.

These technologies would be open access and open source. Experts in the private sector can track illicit use of these currencies and perhaps do a better job of leveraging their talent to create tools and programs through the Fintech Leadership and Financial Intelligence Program. We need to give them the ability to try, and that is what this bill does.

Here is the bottom line, Mr. Speaker. H.R. 5036 is legislation that sparks private-sector innovation to deal with terror and illicit financing when it comes to virtual currencies. I think that Congress should be promoting programs and technologies that give industry the tools they need to save their technology and industry from illicit use and, hopefully, save them from further regulation down the road.

Mr. Speaker, I urge adoption of the bill.

Mr. Speaker, I rise in support of H.R. 5036, the Financial Technology Protection Act. Before I begin, I would like to thank the Financial Services Committee Chair Hensarling and Ranking Member Waters for their support in helping to guide this bill through the committee process. I am very pleased that this legislation was passed through the committee unanimously when it was marked up back in July.

I would also like to thank my colleague from North Carolina, Mr. Budd, for his good work on this important legislation. This has truly been a bipartisan effort.

Mr. Speaker, by a strange coincidence, I was actually elected in the Democratic primary in Massachusetts on September 11, 2001, the day of the attacks on the United States in New York, the Pentagon, and in western Pennsylvania. Since my arrival here in Washington and throughout my time in Congress, I have taken an active interest in cutting off the flow of funding to terrorists and other illicit actors.

I am very pleased to say that many of my colleagues, Democratic and Republican, have likewise approached this work with the deliberate and relentless sense of purpose that has lifted us above the petty squabbling that sometimes causes us to fall short of the high expectations of the American people.

Over the years, this work has taken me dozens of times to many countries in the Middle East, to Amman, Jordan, a major banking center, where members of our committee urged and assisted that nation to establish its first financial intelligence unit. It must, of course, be noted that we had the robust and earnest cooperation of King Abdullah of Jordan in that effort. He is someone who, I believe, has, over the years, been the greatest friend that freedom-loving people have in the Arab world.

Members of this committee also worked to expand geographic targeting orders to help the Financial Crimes Enforcement Network crack down on money laundering as part of the Countering America's Adversaries Through Sanctions Act.

Similarly, in Afghanistan, Morocco, Tunisia, and throughout the Persian Gulf, our committee has coaxed and guided our international neighbors to adopt methods that secure the legitimate banking system from terrorists and criminal exploitation.

From this work it has recently become clear to Mr. Budd and myself that terrorists and criminal actors are increasingly relying on digital currencies, including bitcoin, to fund their illicit activities.

For example, in August of 2015, a Virginia man was sentenced to 11 years in prison for providing material support to ISIS. He admitted to using Twitter to provide instructions on how to use bitcoin to mask the transfer of funds to that terrorist group. Also, in December of 2017, a woman in New York was indicted for bank fraud and money laundering for supporting terrorists. She is alleged to have spent about $62,000 in digital currency to engage in a pattern of financial activity designed to ultimately benefit ISIS.

I am very pleased that the legislation before us today helps address this emerging threat in multiple ways.

As my friend, Mr. Budd, has noted, this bill establishes a public-private sector task force to research terrorist and criminal uses of new financial technologies, including digital currencies, and then develops countermeasures to thwart such terrorist and illicit uses.

The bill also establishes a fund to pay rewards to people who provide information leading to the conviction of an individual involved with terrorist use of digital currencies.

Finally, the bill creates a grant program for the development of tools and pilot programs to detect terrorist and illicit use of digital currencies.

Mr. Speaker, in closing, I thank the chairman and ranking member, as well as my Republican cosponsor, the gentleman from North Carolina (Mr. Budd) and urge my colleagues on both sides of the aisle to support this important legislation.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, H.R. 5036, the Financial Technology Protection Act, would strengthen our efforts to deter terrorist and illicit uses of financial technology. Although financial technology has potential benefits to the economy, there are pressing concerns about the digital currencies facilitating terrorist financing and money laundering.

For example, in August 2015, a Virginia man was sentenced to prison for providing material to support terrorists and admitted to using Twitter to advise others on how to use bitcoin to mask terror financing. Also, in July 2018, Special Counsel Robert Mueller indicted 12 Russian intelligence officers for hacking into the Democratic National Committee during the 2016 presidential election. The hackers used cryptocurrency to purchase the servers and other equipment necessary for the email breaches and used bitcoin to help fund their activities.

This bill would establish a public-private sector task force, a grant program, and a reward program to counter such terrorist or illicit uses of digital currencies. Also, it would require the government to identify how state and nonstate actors and foreign terrorist organizations evade sanctions, finance terrorism, or launder money using these currencies.

Mr. Speaker, I thank Congressman Budd and Congressman Lynch for introducing this bipartisan legislation. I urge my colleagues to support it, and I reserve the balance of my time.

Mr. Speaker, I yield 3 minutes to the gentleman from Massachusetts (Mr. Lynch).

Mr. Speaker, I yield the gentleman from Massachusetts such time as he may consume.

Mr. Speaker, I support the bill; I urge my colleagues to support it as well; and I yield back the balance of my time.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 5036) to establish an Independent Financial Technology Task Force, to provide rewards for information leading to convictions related to terrorist use of digital currencies, to establish a FinTech Leadership in Innovation Program to encourage the development of tools and programs to combat terrorist and illicit use of digital currencies, and for other purposes, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill.

Mr. Speaker, I yield 5 minutes to the gentleman from North Carolina (Mr. Budd).

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I have no further requests for time on this legislation, and I reserve the balance of my time.

Mr. Speaker, I yield myself the balance of my time.

I thank my colleagues from both sides of the aisle for bringing forward this legislation to better protect our consumers and our neighbors from illicit financial activity and I urge passage, and I yield back the balance of my time.