FIND Trafficking Act

II 116TH CONGRESS 1ST SESSION S. 410 To require the Comptroller General of the United States to carry out a study on how virtual currencies and online marketplaces are used to buy, sell, or facilitate the financing of goods or services associated with sex trafficking or drug trafficking, and for other purposes. IN THE SENATE OF THE UNITED STATES FEBRUARY 7, 2019 Ms. CORTEZ MASTO (for herself and Mr. TOOMEY) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To require the Comptroller General of the United States to carry out a study on how virtual currencies and online marketplaces are used to buy, sell, or facilitate the fi- nancing of goods or services associated with sex traf- ficking or drug trafficking, and for other purposes. 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 This Act may be cited as the ‘‘Fight Illicit Networks 4 and Detect Trafficking Act’’ or the ‘‘FIND Trafficking 5 Act’’. 6 VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS 2 •S 410 IS SEC. 2. FINDINGS. 1 The Congress finds the following: 2 (1) According to the Drug Enforcement Admin- 3 istration 2017 National Drug Threat Assessment, 4 transnational criminal organizations are increasingly 5 using virtual currencies. 6 (2) In the 2015 National Money Laundering 7 Risk Assessment, the Department of the Treasury 8 concluded: ‘‘The development of virtual currencies is 9 an attempt to meet a legitimate market demand. Ac- 10 cording to a Federal Reserve Bank of Chicago econ- 11 omist, United States consumers want payment op- 12 tions that are versatile and that provide immediate 13 finality. No United States payment method meets 14 that description, although cash may come closest. 15 Virtual currencies can mimic cash’s immediate final- 16 ity and anonymity and are more versatile than cash 17 for online and cross-border transactions, making vir- 18 tual currencies vulnerable for illicit transactions.’’. 19 (3) Virtual currencies have become a prominent 20 method to pay for goods and services associated with 21 illegal sex trafficking and drug trafficking, which are 22 two of the most detrimental and troubling illegal ac- 23 tivities facilitated by online marketplaces. 24 (4) Online marketplaces, including the dark 25 web, have become a prominent platform to buy, sell, 26 VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS 3 •S 410 IS and advertise for illicit goods and services associated 1 with sex trafficking and drug trafficking. 2 (5) According to the International Labour Or- 3 ganization, in 2016, 4,800,000 people in the world 4 were victims of forced sexual exploitation, and in 5 2014, the global profit from commercial sexual ex- 6 ploitation was $99,000,000,000. 7 (6) In 2016, within the United States, the Cen- 8 ter for Disease Control estimated that there were 9 64,000 deaths related to drug overdose, and the 10 most severe increase in drug overdoses were those 11 associated with fentanyl and fentanyl analogs (syn- 12 thetic opioids), which amounted to over 20,000 over- 13 dose deaths. 14 (7) According to the 2015 National Money 15 Laundering Risk Assessment published by the De- 16 partment of the Treasury, an estimated 17 $64,000,000,000 is generated annually from United 18 States drug trafficking sales. 19 (8) Illegal fentanyl in the United States origi- 20 nates primarily from China, and it is readily avail- 21 able to purchase through online marketplaces. 22 SEC. 3. GAO STUDY. 23 (a) STUDY REQUIRED.—The Comptroller General of 24 the United States shall conduct a study on how virtual 25 VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS 4 •S 410 IS currencies and online marketplaces are used to facilitate 1 sex and drug trafficking. The study shall consider— 2 (1) how online marketplaces, including the dark 3 web, are being used as platforms to buy, sell, or fa- 4 cilitate the financing of goods or services associated 5 with sex trafficking or drug trafficking (specifically, 6 opioids and synthetic opioids, including fentanyl, 7 fentanyl analogs, and any precursor chemicals asso- 8 ciated with manufacturing fentanyl or fentanyl 9 analogs) destined for, originating from, or within the 10 United States; 11 (2) how financial payment methods, including 12 virtual currencies and peer-to-peer mobile payment 13 services, are being utilized by online marketplaces to 14 facilitate the buying, selling, or financing of goods 15 and services associated with sex or drug trafficking 16 destined for, originating from, or within the United 17 States; 18 (3) how virtual currencies are being used to fa- 19 cilitate the buying, selling, or financing of goods and 20 services associated with sex or drug trafficking, des- 21 tined for, originating from, or within the United 22 States, when an online platform is not otherwise in- 23 volved; 24 VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS 5 •S 410 IS (4) how illicit funds that have been transmitted 1 online and through virtual currencies are repatriated 2 into the formal banking system of the United States 3 through money laundering or other means; 4 (5) the participants (state and non-state actors) 5 throughout the entire supply chain that participate 6 in or benefit from the buying, selling, or financing 7 of goods and services associated with sex or drug 8 trafficking (either through online marketplaces or 9 virtual currencies) destined for, originating from, or 10 within the United States; 11 (6) Federal and State agency efforts to impede 12 the buying, selling, or financing of goods and serv- 13 ices associated with sex or drug trafficking through 14 online marketplaces or virtual currencies destined 15 for, originating from, or within the United States, 16 including efforts to prevent the proceeds from sex or 17 drug trafficking from entering the United States 18 banking system through online marketplaces or vir- 19 tual currencies; 20 (7) how virtual currencies and their underlying 21 technologies can be used to detect and deter these 22 illicit activities; and 23 VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS 6 •S 410 IS (8) to what extent can the immutable and 1 traceable nature of virtual currencies contribute to 2 the tracking and prosecution of illicit funding. 3 (b) SCOPE.—For the purposes of the study required 4 under subsection (a), the term ‘‘sex trafficking’’ means the 5 recruitment, harboring, transportation, provision, obtain- 6 ing, patronizing, or soliciting of a person for the purpose 7 of a commercial sex act that is induced by force, fraud, 8 or coercion, or in which the person induced to perform 9 such act has not attained 18 years of age. 10 (c) REPORT TO CONGRESS.—Not later than 1 year 11 after the date of enactment of this Act, the Comptroller 12 General of the United States shall submit to the Com- 13 mittee on Banking, Housing, and Urban Affairs of the 14 Senate and the Committee on Financial Services of the 15 House of Representatives a report summarizing the re- 16 sults of the study required under subsection (a), together 17 with any recommendations for legislative or regulatory ac- 18 tion that would improve the efforts of Federal agencies 19 to impede the use of virtual currencies and online market- 20 places in facilitating sex and drug trafficking. 21 Æ VerDate Sep 11 2014 18:46 Feb 19, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\S410.IS S410 pamtmann on DSKBFK8HB2PROD with BILLS