I 116TH CONGRESS 1ST SESSION H. R. 2079 To amend the Federal Reserve Act to prohibit certain member banks from using discount window lending programs, and for other purposes. IN THE HOUSE OF REPRESENTATIVES APRIL 4, 2019 Mr. WILLIAMS introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Federal Reserve Act to prohibit certain mem- ber banks from using discount window lending programs, 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 ‘‘Freedom Financing 4 Act’’. 5 SEC. 2. FINDINGS. 6 Congress finds that— 7 (1) article I of the Constitution of the United 8 States guarantees the people of the United States 9 VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 2079 IH the right to enact policy reforms through the free 1 and fair election of representatives; and 2 (2) member banks leveraging their power and 3 position to effectively illegalize legal commerce by re- 4 fusing to do business with certain industries and in- 5 dividuals due to their differing political beliefs from 6 the member bank violates and usurps the people of 7 the United States and the right of their elected rep- 8 resentatives to determine public policy. 9 SEC. 3. ADVANCES TO INDIVIDUAL MEMBER BANKS. 10 (a) MEMBER BANKS.—Section 10B of the Federal 11 Reserve Act (12 U.S.C. 347b) is amended by adding at 12 the end the following: 13 ‘‘(c) PROHIBITION ON USE OF DISCOUNT WINDOW 14 LENDING PROGRAMS.— 15 ‘‘(1) DEFINITION.—In this subsection, the term 16 ‘traditional underwriting and credit consider- 17 ations’— 18 ‘‘(A) includes a good-faith determination 19 by a member bank that the member bank lacks 20 sufficient familiarity with a line of business or 21 geographic region to do business with a person 22 in that line of business or geographic region; 23 and 24 ‘‘(B) does not include reputational risks. 25 VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 2079 IH ‘‘(2) PROHIBITION.—No member bank with 1 more than $10,000,000,000 in total consolidated as- 2 sets may use a discount window lending program if 3 the member bank refuses to do business with any 4 person licensed under section 923 of title 18, United 5 States Code, who is in compliance with the law, 6 based on concerns other than traditional under- 7 writing and credit considerations.’’. 8 (b) INSURED DEPOSITORY INSTITUTIONS.—Section 9 8(a)(2)(A) of the Federal Deposit Insurance Act (12 10 U.S.C. 1818(a)(2)(A)) is amended— 11 (1) in clause (ii), by striking ‘‘or’’ at the end; 12 (2) in clause (iii), by adding ‘‘or’’ at the end; 13 and 14 (3) by inserting after clause (iii) the following: 15 ‘‘(iv) an insured depository institution 16 with more than $10,000,000,000 in total 17 consolidated refuses to do business with 18 any person licensed under section 923 of 19 title 18, United States Code, who is in 20 compliance with the law, based on concerns 21 other than traditional underwriting and 22 credit considerations (as defined in section 23 10B(c) of the Federal Reserve Act (12 24 U.S.C. 347b(c))),’’. 25 VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 2079 IH SEC. 4. PAYMENT CARD NETWORK. 1 (a) DEFINITION.—In this section, the term ‘‘payment 2 card network’’ has the meaning given the term in section 3 921(c) of the Electronic Fund Transfer Act (15 U.S.C. 4 1693o–2(c)). 5 (b) PROHIBITION.—No payment card network may, 6 directly or through any agent, processor, or licensed mem- 7 ber of the network, by contract, requirement, condition, 8 penalty, or otherwise, prohibit or inhibit the ability of any 9 person licensed under section 923 of title 18, United 10 States Code, who is in compliance with the law, to obtain 11 access to services or products of the payment card network 12 because of political or reputational considerations. 13 (c) CIVIL PENALTY.—Any payment card network 14 that violates subsection (b) shall be assessed a civil penalty 15 of not more than 10 percent of the value of the services 16 or products described in that subsection, not to exceed 17 $10,000 per violation. 18 SEC. 5. CREDIT UNIONS. 19 (a) ADVANCES TO CREDIT UNIONS.—Section 13 of 20 the Federal Reserve Act (12 U.S.C. 342) is amended by 21 inserting ‘‘Provided further, That no such nonmember 22 bank or trust company with more than $10,000,000,000 23 in total consolidated assets may refuse to do business with 24 any person licensed under section 923 of title 18, United 25 States Code, who is in compliance with the law, based on 26 VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 2079 IH concerns other than traditional underwriting and credit 1 considerations, as defined in section 10B(c):’’ after ‘‘ap- 2 propriate:’’. 3 (b) REVOCATION OF NCUA INSURANCE.—Section 4 206(b)(1) of the Federal Credit Union Act (12 U.S.C. 5 1786) is amended by inserting ‘‘or is refusing or has re- 6 fused to do business with any person licensed under sec- 7 tion 923 of title 18, United States Code, who is in compli- 8 ance with the law, based on concerns other than tradi- 9 tional underwriting and credit considerations, as defined 10 in section 10B(c) of the Federal Reserve Act (12 U.S.C. 11 347b(c)),’’ after ‘‘as an insured credit union,’’. 12 SEC. 6. USE OF AUTOMATED CLEARING HOUSE NETWORK. 13 (a) DEFINITIONS.—In this section: 14 (1) COVERED CREDIT UNION.—The term ‘‘cov- 15 ered credit union’’ means— 16 (A) any insured credit union, as defined in 17 section 101 of the Federal Credit Union Act 18 (12 U.S.C. 1752); or 19 (B) any credit union that is eligible to 20 make application to become an insured credit 21 union under section 201 of the Federal Credit 22 Union Act (12 U.S.C. 1781). 23 (2) MEMBER BANK.—The term ‘‘member bank’’ 24 has the meaning given the term in the third undesig- 25 VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 2079 IH nated paragraph of the first section of the Federal 1 Reserve Act (12 U.S.C. 221). 2 (b) PROHIBITION.—No covered credit union or mem- 3 ber bank with more than $10,000,000,000 in total consoli- 4 dated assets may use the Automated Clearing House Net- 5 work if that member bank refuses to do business with any 6 person licensed under section 923 of title 18, United 7 States Code, who is in compliance with the law, based on 8 concerns other than traditional underwriting and credit 9 considerations, as defined in section 10B(c) of the Federal 10 Reserve Act (12 U.S.C. 347b(c)), as added by section 3(a) 11 of this Act. 12 Æ VerDate Sep 11 2014 00:27 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\H2079.IH H2079 pamtmann on DSKBFK8HB2PROD with BILLS