II
118th CONGRESS
1st Session
S. 1340
IN THE SENATE OF THE UNITED STATES
April 27, 2023
Mr. Budd (for himself and Mrs. Gillibrand) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs
A BILL
To establish an Independent Financial Technology Working Group to Combat Terrorism and Illicit Financing, and for other purposes.
Short title
This Act may be cited as the Financial Technology Protection Act of 2023
.
Independent financial technology working group to combat terrorism and illicit financing
Establishment
There is established the Independent Financial Technology Working Group to Combat Terrorism and Illicit Financing (in this section referred to as the Working Group
), which shall consist of the following:
The Secretary of the Treasury, acting through the Under Secretary for Terrorism and Financial Intelligence, who shall serve as the chair of the Working Group.
A senior-level representative from each of the following:
Each of the following components of the Department of the Treasury:
The Financial Crimes Enforcement Network.
The Internal Revenue Service.
The Office of Foreign Assets Control.
The Department of Justice and each of the following components of the Department:
The Federal Bureau of Investigation.
The Drug Enforcement Administration.
The Department of Homeland Security and the United States Secret Service.
The Department of State.
The Central Intelligence Agency.
Five individuals appointed by the Under Secretary for Terrorism and Financial Intelligence to represent the following:
Financial technology companies.
Blockchain intelligence companies.
Financial institutions.
Institutions or organizations engaged in research.
Duties
The Working Group shall—
conduct research on terrorist and illicit use of new financial technologies, including digital assets; and
develop legislative and regulatory proposals to improve anti-money laundering, counter-terrorist, and other counter-illicit financing efforts in the United States.
Reports
In general
Not later than one year after the date of the enactment of this Act, and annually for the 3 years thereafter, the Working Group shall submit to the Secretary of the Treasury, the heads of each agency represented in the Working Group pursuant to subsection (a)(2), and the appropriate congressional committees a report containing the findings and determinations made by the Working Group in the previous year and any legislative and regulatory proposals developed by the Working Group.
Final report
Before the date on which the Working Group terminates under subsection (e)(1), the Working Group shall submit to the appropriate congressional committees a final report detailing the findings, recommendations, and activities of the Working Group.
Travel expenses
Members of the Working Group shall serve without pay, but shall receive travel expenses in accordance with sections 5702 and 5703 of title 5, United States Code.
Sunset
In general
The Working Group shall, subject to paragraph (3), terminate on the date that is 4 years after the date of the enactment of this Act.
Expiration and return of appropriated funds
On the date on which the Working Group terminates under paragraph (1)—
all authorities granted to the Working Group under this section shall expire, subject to paragraph (3); and
any funds appropriated for the Working Group that are available for obligation as of that date shall be returned to the Treasury.
Authority to wind up activities
The termination of the Working Group under paragraph (1) and the expiration of authorities under paragraph (2) shall not affect any investigations, research, or other activities of the Working Group ongoing as of the date on which the Working Group terminates under paragraph (1). Such investigations, research, and activities may continue until their completion.
Preventing rogue and foreign actors from evading sanctions
Report and strategy with respect to digital assets and other related emerging technologies
In general
Not later than 180 days after the date of the enactment of this Act, the President, acting through the Secretary of the Treasury and in consultation with the head of each agency represented on the Independent Financial Technology Working Group to Combat Terrorism and Illicit Financing pursuant to section 2(a)(2), shall submit to the appropriate congressional committees a report that describes—
the potential uses of digital assets and other related emerging technologies by states, non-state actors, foreign terrorist organizations, and other terrorist groups to evade sanctions, finance terrorism, or launder monetary instruments, and threaten United States national security; and
a strategy how the United States will mitigate and prevent the illicit use of digital assets and other related emerging technologies.
Form of report; public availability
In general
The report required by paragraph (1) shall be submitted in unclassified form, but may include a classified annex.
Public availability
The unclassified portion of each report required by paragraph (1) shall be made available to the public and posted on a publicly accessible website of the Department of the Treasury—
in precompressed, easily downloadable versions, in all appropriate formats; and
in machine-readable format, if applicable.
Sources of information
In preparing the reports required by paragraph (1), the President may utilize any credible publication, database, or web-based resource, and any credible information compiled by any government agency, nongovernmental organization, or other entity that is made available to the President.
Briefing
Not later than 2 years after the date of the enactment of this Act, the Secretary of the Treasury shall brief the appropriate congressional committees on the implementation of the strategy required by subsection (a)(2).
Definitions
In this Act:
Appropriate congressional committees
The term appropriate congressional committees means—
the Committee on Banking, Housing, and Urban Affairs, the Committee on Finance, the Committee on Foreign Relations, the Committee on Homeland Security and Governmental Affairs, the Committee on the Judiciary, and the Select Committee on Intelligence of the Senate; and
the Committee on Financial Services, the Committee on Foreign Affairs, the Committee on Homeland Security, the Committee on the Judiciary, the Committee on Way and Means, and the Permanent Select Committee on Intelligence of the House of Representatives.
Blockchain intelligence company
The term blockchain intelligence company means any business providing software, research, or other services (such as blockchain tracing tools, geofencing, transaction screening, the collection of business data, and sanctions screening) that—
support private and public sector investigations and risk management activities; and
involve cryptographically secured distributed ledgers or any similar technology or implementation.
Digital asset
The term digital asset means any digital representation of value that is recorded on a cryptographically secured digital ledger or any similar technology.
Foreign terrorist organization
The term foreign terrorist organization means an organization that is designated as a foreign terrorist organization under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189).
Illicit use
The term illicit use includes fraud, darknet marketplace transactions, money laundering, the purchase and sale of illicit goods, sanctions evasion, theft of funds, funding of illegal activities, transactions related to child sexual abuse material, and any other financial transaction involving the proceeds of specified unlawful activity (as defined in section 1956(c) of title 18, United States Code).
Terrorist
The term terrorist includes a person carrying out domestic terrorism or international terrorism (as such terms are defined, respectively, under section 2331 of title 18, United States Code).