Combating Money Laundering, Terrorist Financing, and Counterfeiting Act of 2019

II Calendar No. 160 116TH CONGRESS 1ST SESSION S. 1883 To improve the prohibitions on money laundering, and for other purposes. IN THE SENATE OF THE UNITED STATES JUNE 18, 2019 Mr. GRASSLEY (for himself, Mrs. FEINSTEIN, Mr. CORNYN, Mr. WHITE- HOUSE, and Ms. KLOBUCHAR) introduced the following bill; which was read twice and referred to the Committee on the Judiciary JULY 23, 2019 Reported by Mr. GRAHAM, with an amendment [Strike out all after the enacting clause and insert the part printed in italic] A BILL To improve the prohibitions on money laundering, 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; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Combating Money Laundering, Terrorist Financing, and 5 Counterfeiting Act of 2019’’. 6 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 2 •S 1883 RS (b) TABLE OF CONTENTS.—The table of contents for 1 this Act is as follows: 2 Sec. 1. Short title; table of contents. Sec. 2. Transportation or transhipment of blank checks in bearer form. Sec. 3. Bulk cash smuggling. Sec. 4. Section 1957 violations involving commingled funds and aggregated transactions. Sec. 5. Charging money laundering as a course of conduct. Sec. 6. Illegal money services businesses. Sec. 7. Concealment money laundering. Sec. 8. Freezing bank accounts of persons arrested for offenses involving the movement of money across international borders. Sec. 9. Prohibiting money laundering through hawalas, other informal value transfer systems, and closely related transactions. Sec. 10. Technical amendment to restore wiretap authority for certain money laundering and counterfeiting offenses. Sec. 11. Making the international money laundering statute apply to tax eva- sion. Sec. 12. Conduct in aid of counterfeiting. Sec. 13. Administrative subpoenas for money laundering cases. Sec. 14. Obtaining foreign bank records from banks with United States cor- respondent accounts. Sec. 15. Danger pay allowance. Sec. 16. Clarification of Secret Service authority to investigate money laun- dering. Sec. 17. Prohibition on concealment of ownership of account. Sec. 18. Prohibition on concealment of the source of assets in monetary trans- actions. Sec. 19. Rule of construction. SEC. 2. TRANSPORTATION OR TRANSHIPMENT OF BLANK 3 CHECKS IN BEARER FORM. 4 Section 5316 of title 31, United States Code, is 5 amended by adding at the end the following: 6 ‘‘(e) MONETARY INSTRUMENTS WITH AMOUNT LEFT 7 BLANK.—For purposes of this section, a monetary instru- 8 ment in bearer form that has the amount left blank, such 9 that the amount could be filled in by the bearer, shall be 10 considered to have a value of more than $10,000 if the 11 instrument was drawn on an account that contained, or 12 was intended to contain more than $10,000 at the time— 13 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 3 •S 1883 RS ‘‘(1) the instrument was transported; or 1 ‘‘(2) the instrument was negotiated or was in- 2 tended to be negotiated.’’. 3 SEC. 3. BULK CASH SMUGGLING. 4 Section 5332(b) of title 31, United States Code, is 5 amended— 6 (1) in paragraph (1), by striking ‘‘5 years’’ and 7 inserting ‘‘10 years’’; 8 (2) by redesignating paragraphs (2), (3), and 9 (4), as paragraphs (3), (4), and (5), respectively; 10 (3) by inserting after paragraph (1) the fol- 11 lowing: 12 ‘‘(2) FINE.— 13 ‘‘(A) IN GENERAL.—Whoever violates this 14 section shall be fined under title 18. 15 ‘‘(B) ENHANCED FINE FOR AGGRAVATED 16 CASES.—Whoever violates this section while vio- 17 lating another law of the United States, other 18 than section 5316 or 5324(c) of this title, or as 19 a part of a pattern of any unlawful activity, in- 20 cluding a violation of section 5316 or 5324(c) 21 of this title, shall be fined double the amount 22 provided in subsection (b)(3) or (c)(3) of sec- 23 tion 3571 of title 18.’’; and 24 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 4 •S 1883 RS (4) in paragraph (5), as redesignated, by strik- 1 ing ‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’. 2 SEC. 4. SECTION 1957 VIOLATIONS INVOLVING COMMIN- 3 GLED FUNDS AND AGGREGATED TRANS- 4 ACTIONS. 5 Section 1957 of title 18, United States Code, is 6 amended by adding at the end the following: 7 ‘‘(g) In a prosecution for an offense under this sec- 8 tion, the Government may satisfy the $10,000 monetary 9 transaction value requirement under subsection (a) by 10 showing that— 11 ‘‘(1) the monetary transaction involved the 12 transfer, withdrawal, encumbrance, or other disposi- 13 tion of more than $10,000 from an account in which 14 more than $10,000 in proceeds of specified unlawful 15 activity was commingled with other funds; or 16 ‘‘(2) the defendant conducted a series of mone- 17 tary transactions in amounts of not more than 18 $10,000 that— 19 ‘‘(A) exceeded $10,000 in the aggregate; 20 and 21 ‘‘(B) were closely related to each other as 22 demonstrated by factors such as— 23 ‘‘(i) the time period between the 24 transactions; 25 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 5 •S 1883 RS ‘‘(ii) the identity of the parties in- 1 volved; 2 ‘‘(iii) the nature or purpose of the 3 transactions; and 4 ‘‘(iv) the manner in which the trans- 5 actions were conducted.’’. 6 SEC. 5. CHARGING MONEY LAUNDERING AS A COURSE OF 7 CONDUCT. 8 Section 1956 of title 18, United States Code, is 9 amended— 10 (1) in subsection (h), by striking ‘‘or section 11 1957’’ and inserting ‘‘, section 1957, or section 12 1960’’; and 13 (2) by adding at the end the following: 14 ‘‘(j) MULTIPLE VIOLATIONS.—Multiple violations of 15 this section that are part of the same scheme or con- 16 tinuing course of conduct may be charged, at the election 17 of the Government, in a single count in an indictment or 18 information.’’. 19 SEC. 6. ILLEGAL MONEY SERVICES BUSINESSES. 20 (a) IN GENERAL.—Section 1960 of title 18, United 21 States Code, is amended by striking subsections (a) and 22 (b) and inserting the following: 23 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 6 •S 1883 RS ‘‘(a) OFFENSE.—Whoever knowingly conducts, con- 1 trols, manages, supervises, directs, or owns all or part of 2 a covered money services business that— 3 ‘‘(1) is operated without an appropriate license 4 in a State where such operation is punishable as a 5 misdemeanor or a felony under State law, whether 6 or not the person knows that the operation is re- 7 quired to be licensed or that the operation is so pun- 8 ishable; 9 ‘‘(2) fails to comply with the money services 10 business registration requirements under section 11 5330 of title 31, or regulations prescribed under 12 that section, whether or not the person knows that 13 the operation is required to comply with those reg- 14 istration requirements; or 15 ‘‘(3) otherwise engages in a transaction involv- 16 ing funds that the person knows have been derived 17 from a criminal offense or are intended to be used 18 to promote or support unlawful activity, 19 shall be punished as provided in subsection (b). 20 ‘‘(b) CRIMINAL PENALTY.—Any person who vio- 21 lates— 22 ‘‘(1) subsection (a) shall be fined in accordance 23 with this title, imprisoned for not more than 5 years, 24 or both; and 25 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 7 •S 1883 RS ‘‘(2) subsection (a) by conducting, controlling, 1 managing, supervising, directing, or owning all or 2 part of a covered money services business that en- 3 gaged in activity as a covered money services busi- 4 ness involving more than $1,000,000 during a 12- 5 month period, or by engaging in a transaction or 6 transactions involving more than $1,000,000 during 7 a 12-month period, shall be fined double the amount 8 provided in subsection (b)(3) or (c)(3) (as applica- 9 ble) of section 3571, imprisoned for not more than 10 10 years, or both. 11 ‘‘(c) DEFINITIONS.—In this section— 12 ‘‘(1) the term ‘covered money services business’ 13 means a money services business that— 14 ‘‘(A) operates on behalf of the public; and 15 ‘‘(B) affects interstate or foreign commerce 16 in any manner or degree; 17 ‘‘(2) the term ‘money services business’— 18 ‘‘(A) has the meaning given the term in 19 section 5330 of title 31 and any regulations 20 prescribed under that section; and 21 ‘‘(B) includes a person that engages in the 22 transfer, transportation, or exchange of cur- 23 rency, funds, or value that substitutes for cur- 24 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 8 •S 1883 RS rency by any and all means, even when not per- 1 formed for profit; and 2 ‘‘(3) the term ‘State’ means any State of the 3 United States, the District of Columbia, the North- 4 ern Mariana Islands, and any commonwealth, terri- 5 tory, or possession of the United States.’’. 6 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 7 (1) SECTION 1960 OF TITLE 18, UNITED STATES 8 CODE.— 9 (A) SECTION HEADING.—Section 1960 of 10 title 18, United States Code, is amended in the 11 section heading— 12 (i) by striking ‘‘unlicensed’’ and 13 inserting ‘‘illegal’’; and 14 (ii) by striking ‘‘transmitting’’ and 15 inserting ‘‘services’’. 16 (B) TABLE OF SECTIONS.—The table of 17 sections for chapter 95 of title 18, United 18 States Code, is amended by striking the item 19 relating to section 1960 and inserting the fol- 20 lowing: 21 ‘‘1960. Prohibition of illegal money services businesses.’’. (2) SECTION 5330 OF TITLE 31, UNITED STATES 22 CODE.— 23 (A) HEADINGS.—Section 5330 of title 31, 24 United States Code, is amended— 25 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 9 •S 1883 RS (i) in the section heading, by striking 1 ‘‘transmitting’’ and inserting ‘‘serv- 2 ices’’; 3 (ii) in subsection (c)— 4 (I) in the subsection heading, by 5 striking ‘‘TRANSMITTING’’ and insert- 6 ing ‘‘SERVICES’’; 7 (II) in paragraph (1), in the 8 paragraph heading, by striking 9 ‘‘TRANSMITTING’’ and inserting 10 ‘‘SERVICES’’; and 11 (III) in paragraph (2), in the 12 paragraph heading, by striking 13 ‘‘TRANSMITTING’’ and inserting 14 ‘‘SERVICES’’; and 15 (iii) in subsection (d)(1), in the para- 16 graph heading, by striking ‘‘TRANSMIT- 17 TING’’ and inserting ‘‘SERVICES’’. 18 (B) TEXT.—Section 5330 of title 31, 19 United States Code, is amended— 20 (i) by striking ‘‘money transmitting 21 business’’ each place that term appears 22 and inserting ‘‘money services business’’; 23 and 24 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 10 •S 1883 RS (ii) in subsection (a)(3), by striking 1 ‘‘money transmitting businesses’’ and in- 2 serting ‘‘a money services business’’. 3 (C) TABLE OF SECTIONS.—The table of 4 sections for subchapter II of chapter 53 of title 5 31, United States Code, is amended by striking 6 the item relating to section 5330 and inserting 7 the following: 8 ‘‘5330. Registration of money services businesses.’’. SEC. 7. CONCEALMENT MONEY LAUNDERING. 9 Section 1956(a) of title 18, United States Code, is 10 amended— 11 (1) in paragraph (1)(B), by striking ‘‘knowing 12 that’’ and all that follows through ‘‘Federal law,’’ 13 and inserting the following: 14 ‘‘(B) knowing that the transaction— 15 ‘‘(i) conceals or disguises, or is intended to 16 conceal or disguise, the nature, source, location, 17 ownership, or control of the proceeds of some 18 form of unlawful activity; or 19 ‘‘(ii) avoids, or is intended to avoid, a 20 transaction reporting requirement under State 21 or Federal law,’’; and 22 (2) in paragraph (2)(B), by striking ‘‘knowing 23 that’’ and all that follows through ‘‘Federal law,’’ 24 and inserting the following: 25 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 11 •S 1883 RS ‘‘(B) knowing that— 1 ‘‘(i) the monetary instrument or funds in- 2 volved in the transportation, transmission, or 3 transfer represent the proceeds of some form of 4 unlawful activity; and 5 ‘‘(ii) the transportation, transmission, or 6 transfer— 7 ‘‘(I) conceals or disguises, or is in- 8 tended to conceal or disguise, the nature, 9 source, location, ownership, or control of 10 the proceeds of some form of unlawful ac- 11 tivity; or 12 ‘‘(II) avoids, or is intended to avoid, a 13 transaction reporting requirement under 14 State or Federal law,’’. 15 SEC. 8. FREEZING BANK ACCOUNTS OF PERSONS AR- 16 RESTED FOR OFFENSES INVOLVING THE 17 MOVEMENT OF MONEY ACROSS INTER- 18 NATIONAL BORDERS. 19 Section 981(b) of title 18, United States Code, is 20 amended by adding at the end the following: 21 ‘‘(5)(A) If a person is arrested or charged in connec- 22 tion with an offense described in subparagraph (C) involv- 23 ing the movement of funds into or out of the United 24 States, the Attorney General may apply to any Federal 25 VerDate Sep 11 2014 23:52 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6401 E:\BILLS\S1883.RS S1883 kjohnson on DSK79L0C42 with BILLS 12 •S 1883 RS judge or magistrate judge in the district in which the ar- 1 rest is made or the charges are filed for an ex parte order 2 restraining any account held by the person arrested or 3 charged for not more than 30 days, except that such 30- 4 day time period may be extended for good cause shown 5 at a hearing conducted in the manner provided in Rule 6 43(c) of the Federal Rules of Civil Procedure. The court 7 may receive and consider evidence and information sub- 8 mitted by the Government that would be inadmissible 9 under the Federal Rules of Evidence. 10 ‘‘(B) The application for the restraining order re- 11 ferred to in subparagraph (A) shall— 12 ‘‘(i) identify the offense for which the person 13 has been arrested or charged; 14 ‘‘(ii) identify the location and description of the 15 accounts to be restrained; and 16 ‘‘(iii) state that the restraining order is needed 17 to prevent the removal of the funds in the account 1 [Text truncated for display. Full text available on Congress.gov.]