Kleptocracy Asset Recovery Rewards Act

IIB 116TH CONGRESS 1ST SESSION H. R. 389 IN THE SENATE OF THE UNITED STATES MAY 15, 2019 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To authorize the Secretary of the Treasury to pay rewards under an asset recovery rewards program to help identify and recover stolen assets linked to foreign government corruption and the proceeds of such corruption hidden behind complex financial structures in the United States and abroad. VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 2 HR 389 RFS Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 The Act may be cited as the ‘‘Kleptocracy Asset Re- 4 covery Rewards Act’’. 5 SEC. 2. FINDINGS; SENSE OF CONGRESS. 6 (a) FINDINGS.—Congress finds the following: 7 (1) The Stolen Asset Recovery Initiative 8 (StAR), a World Bank and United Nations anti- 9 money-laundering effort, estimates that between $20 10 billion to $40 billion has been lost to developing 11 countries annually through corruption. 12 (2) In 2014, more than $480 million in corrup- 13 tion proceeds hidden in bank accounts around the 14 world by former Nigerian dictator Sani Abacha and 15 his co-conspirators was forfeited through efforts by 16 the Department of Justice. 17 (3) In 2010, the Department of Justice estab- 18 lished the Kleptocracy Asset Recovery Initiative, to 19 work in partnership with Federal law enforcement 20 agencies to forfeit the proceeds of foreign official 21 corruption and, where appropriate, return those pro- 22 ceeds to benefit the people harmed by these acts of 23 corruption and abuse of office. 24 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 3 HR 389 RFS (4) Of the $20 billion to $40 billion lost by de- 1 veloping countries annually through corruption, only 2 about $5 billion has been repatriated in the last 15 3 years. 4 (5) Governments weakened by corruption and 5 loss of assets due to corruption have fewer resources 6 to devote to the fight against terrorism and fewer re- 7 sources to devote to building strong financial, law 8 enforcement, and judicial institutions to aid in the 9 fight against the financing of terrorism. 10 (6) The United States has a number of effective 11 programs to reward individuals who provide valuable 12 information that assist in the identification, arrest, 13 and conviction of criminal actors and their associ- 14 ates, as well as seizure and forfeiture of illicitly de- 15 rived assets and the proceeds of criminal activity. 16 (7) The Internal Revenue Service has the Whis- 17 tleblower Program, which pays awards to individuals 18 who provide specific and credible information to the 19 IRS if the information results in the collection of 20 taxes, penalties, interest or other amounts from non- 21 compliant taxpayers. 22 (8) The Department of State administers re- 23 wards programs on international terrorism, illegal 24 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 4 HR 389 RFS narcotics, and transnational organized crime with 1 the goal of bringing perpetrators to justice. 2 (9) None of these existing rewards programs 3 specifically provide monetary incentives for identi- 4 fying and recovering stolen assets linked solely to 5 foreign government corruption, as opposed to crimi- 6 nal prosecutions or civil or criminal forfeitures. 7 (10) The recovery of stolen assets linked to for- 8 eign government corruption and the proceeds of such 9 corruption may not always involve a BSA violation 10 or lead to a forfeiture action. In such cases there 11 would be no ability to pay rewards under existing 12 Treasury Department authorities. 13 (11) Foreign government corruption can take 14 many forms but typically entails government officials 15 stealing, misappropriating, or illegally diverting as- 16 sets and funds from their own government treasuries 17 to enrich their personal wealth directly through em- 18 bezzlement or bribes to allow government resources 19 to be expended in ways that are not transparent and 20 may not either be necessary or be the result of open 21 competition. Corruption also includes situations 22 where public officials take bribes to allow govern- 23 ment resources to be expended in ways which are 24 not transparent and may not be necessary or the re- 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 5 HR 389 RFS sult of open competition. These corrupt officials 1 often use the United States and international finan- 2 cial system to hide their stolen assets and the pro- 3 ceeds of corruption. 4 (12) The individuals who come forward to ex- 5 pose foreign governmental corruption and 6 kleptocracy often do so at great risk to their own 7 safety and that of their immediate family members 8 and face retaliation from persons who exercise for- 9 eign political or governmental power. Monetary re- 10 wards can provide a necessary incentive to expose 11 such corruption and provide a financial means to 12 provide for their well-being and avoid retribution. 13 (b) SENSE OF CONGRESS.—It is the sense of Con- 14 gress that a Department of the Treasury stolen asset re- 15 covery rewards program to help identify and recover stolen 16 assets linked to foreign government corruption and the 17 proceeds of such corruption hidden behind complex finan- 18 cial structures is needed in order to— 19 (1) intensify the global fight against corruption; 20 and 21 (2) serve United States efforts to identify and 22 recover such stolen assets, forfeit proceeds of such 23 corruption, and, where appropriate and feasible, re- 24 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 6 HR 389 RFS turn the stolen assets or proceeds thereof to the 1 country harmed by the acts of corruption. 2 SEC. 3. IN GENERAL. 3 (a) DEPARTMENT OF THE TREASURY KLEPTOCRACY 4 ASSET RECOVERY REWARDS PROGRAM.—Chapter 97 of 5 title 31, United States Code, is amended by adding at the 6 end the following: 7 ‘‘§ 9706. Department of the Treasury Kleptocracy 8 Asset Recovery Rewards Program 9 ‘‘(a) ESTABLISHMENT.— 10 ‘‘(1) IN GENERAL.—There is established in the 11 Department of the Treasury a program to be known 12 as the ‘Kleptocracy Asset Recovery Rewards Pro- 13 gram’ for the payment of rewards to carry out the 14 purposes of this section. 15 ‘‘(2) PURPOSE.—The rewards program shall be 16 designed to support U.S. Government programs and 17 investigations aimed at restraining, seizing, for- 18 feiting, or repatriating stolen assets linked to foreign 19 government corruption and the proceeds of such cor- 20 ruption. 21 ‘‘(3) IMPLEMENTATION.—The rewards program 22 shall be administered by, and at the sole discretion 23 of, the Secretary of the Treasury, in consultation, as 24 appropriate, with the Secretary of State, the Attor- 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 7 HR 389 RFS ney General, and the heads of such other depart- 1 ments and agencies as the Secretary may find ap- 2 propriate. 3 ‘‘(b) REWARDS AUTHORIZED.—In the sole discretion 4 of the Secretary and in consultation, as appropriate, with 5 the heads of other relevant Federal departments or agen- 6 cies, the Secretary may pay a reward to any individual, 7 or to any nonprofit humanitarian organization designated 8 by such individual, if that individual furnishes information 9 leading to— 10 ‘‘(1) the restraining or seizure of stolen assets 11 in an account at a U.S. financial institution (includ- 12 ing a U.S. branch of a foreign financial institution), 13 that come within the United States, or that come 14 within the possession or control of any United States 15 person; 16 ‘‘(2) the forfeiture of stolen assets in an ac- 17 count at a U.S. financial institution (including a 18 U.S. branch of a foreign financial institution), that 19 come within the United States, or that come within 20 the possession or control of any United States per- 21 son; or 22 ‘‘(3) where appropriate, the repatriation of sto- 23 len assets in an account at a U.S. financial institu- 24 tion (including a U.S. branch of a foreign financial 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 8 HR 389 RFS institution), that come within the United States, or 1 that come within the possession or control of any 2 United States person. 3 ‘‘(c) COORDINATION.— 4 ‘‘(1) PROCEDURES.—To ensure that the pay- 5 ment of rewards pursuant to this section does not 6 duplicate or interfere with any other payment au- 7 thorized by the Department of Justice or other Fed- 8 eral law enforcement agencies for the obtaining of 9 information or other evidence, the Secretary of the 10 Treasury, in consultation with the Secretary of 11 State, the Attorney General, and the heads of such 12 other agencies as the Secretary may find appro- 13 priate, shall establish procedures for the offering, 14 administration, and payment of rewards under this 15 section, including procedures for— 16 ‘‘(A) identifying actions with respect to 17 which rewards will be offered; 18 ‘‘(B) the receipt and analysis of data; and 19 ‘‘(C) the payment of rewards and approval 20 of such payments. 21 ‘‘(2) PRIOR APPROVAL OF THE ATTORNEY GEN- 22 ERAL REQUIRED.—Before making a reward under 23 this section in a matter over which there is Federal 24 criminal jurisdiction, the Secretary of the Treasury 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 9 HR 389 RFS shall obtain the written concurrence of the Attorney 1 General. 2 ‘‘(d) PAYMENT OF REWARDS.— 3 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 4 For the purpose of paying rewards pursuant to this 5 section, there is authorized to be appropriated— 6 ‘‘(A) $450,000 for fiscal year 2020; and 7 ‘‘(B) for each fiscal year, any amount re- 8 covered in stolen assets described under sub- 9 section (b) that the Secretary determines is nec- 10 essary to carry out this program consistent with 11 this section. 12 ‘‘(2) LIMITATION ON ANNUAL PAYMENTS.—Ex- 13 cept as provided under paragraph (3), the total 14 amount of rewards paid pursuant to this section 15 may not exceed $25 million in any calendar year. 16 ‘‘(3) PRESIDENTIAL AUTHORITY.—The Presi- 17 dent may waive the limitation under paragraph (2) 18 with respect to a calendar year if the President pro- 19 vides written notice of such waiver to the appro- 20 priate committees of the Congress at least 30 days 21 before any payment in excess of such limitation is 22 made pursuant to this section. 23 ‘‘(4) PAYMENTS TO BE MADE FIRST FROM STO- 24 LEN ASSET AMOUNTS.—In paying any reward under 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 10 HR 389 RFS this section, the Secretary shall, to the extent pos- 1 sible, make such reward payment— 2 ‘‘(A) first, from appropriated funds au- 3 thorized under paragraph (1)(B); and 4 ‘‘(B) second, from appropriated funds au- 5 thorized under paragraph (1)(A). 6 ‘‘(e) LIMITATIONS.— 7 ‘‘(1) SUBMISSION OF INFORMATION.—No award 8 may be made under this section based on informa- 9 tion submitted to the Secretary unless such informa- 10 tion is submitted under penalty of perjury. 11 ‘‘(2) MAXIMUM AMOUNT.—No reward paid 12 under this section may exceed $5 million, unless the 13 Secretary— 14 ‘‘(A) personally authorizes such greater 15 amount in writing; 16 ‘‘(B) determines that offer or payment of 17 a reward of a greater amount is necessary due 18 to the exceptional nature of the case; and 19 ‘‘(C) notifies the appropriate committees of 20 the Congress of such determination. 21 ‘‘(3) APPROVAL.— 22 ‘‘(A) IN GENERAL.—No reward amount 23 may be paid under this section without the 24 written approval of the Secretary. 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 11 HR 389 RFS ‘‘(B) DELEGATION.—The Secretary may 1 not delegate the approval required under sub- 2 paragraph (A) to anyone other than an Under 3 Secretary of the Department of the Treasury. 4 ‘‘(4) PROTECTION MEASURES.—If the Secretary 5 determines that the identity of the recipient of a re- 6 ward or of the members of the recipient’s immediate 7 family must be protected, the Secretary shall take 8 such measures in connection with the payment of 9 the reward as the Secretary considers necessary to 10 effect such protection. 11 ‘‘(5) FORMS OF REWARD PAYMENT.—The Sec- 12 retary may make a reward under this section in the 13 form of a monetary payment. 14 ‘‘(f) INELIGIBILITY, REDUCTION IN, OR DENIAL OF 15 REWARD.— 16 ‘‘(1) OFFICER AND EMPLOYEES.—An officer or 17 employee of any entity of Federal, State, or local 18 government or of a foreign government who, while in 19 the performance of official duties, furnishes informa- 20 tion described under subsection (b) shall not be eligi- 21 ble for a reward under this section. 22 ‘‘(2) PARTICIPATING INDIVIDUALS.—If the 23 claim for a reward is brought by an individual who 24 the Secretary has a reasonable basis to believe know- 25 VerDate Sep 11 2014 03:07 May 16, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H389.RFS H389 pbinns on DSK79D2C42PROD with BILLS 12 HR 389 RFS ingly planned, initiated, directly participated in, or 1 facilitated the actions that led to assets of a foreign 2 state or governmental entity being stolen, misappro- 3 priated, or illegally diverted or to the payment of 4 bribes or other foreign governmental corruption, the 5 Secretary shall appropriately reduce, and may deny, 6 such award. If such individual is convicted of crimi- 7 nal conduct arising from the role described in the 8 preceding sentence, the Secretary shall deny or may 9 seek to recover any reward, as the case may be. 10 ‘‘(g) REPORT.— 11 ‘‘(1) IN GENERAL.—Within 180 days of the en- 12 actment of this section, and annually thereafter for 13 5 years, the Secretary shall issue a report to the ap- 14 propriate committees of the Congress— 15 ‘‘(A) detailing to the g [Text truncated for display. Full text available on Congress.gov.]