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Code · BILL · 113th Congress · S. 2954 (Introduced in Senate) — To improve the Higher Education Act of 1965, and for other purposes. · Sec. 106

Sec. 106. Code of conduct in affiliated consumer financial products or services

1,221 words·~6 min read·/bill/113/s/2954/is/section-106

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Part B of title I ( 20 U.S.C. 1011 et seq. ), as amended by section 105, is further amended by adding at the end the following: In this section: The term affiliated , when used with respect to a consumer financial product or service and an institution of higher education, means an association between such institution and product or service resulting from— the name, emblem, mascot, or logo of the institution being used with respect to such product or service; or some other word, picture, or symbol readily identified with the institution in the marketing of the consumer financial product or service in any way that implies that the institution endorses the consumer financial product or service.
Nothing in subparagraph
(A)shall be construed to deem an association between an institution of higher education and a consumer financial product or service to be affiliated if such association is solely based on an advertisement by a financial institution that is delivered to a wide and general audience consisting of more than enrolled students at the institution of higher education. The term associated individual , when used with respect to an institution of higher education, means an individual who is— an officer of such institution of higher education; an employee or agent of the institution of higher education who is involved in the contracting, approval, analysis, or decisionmaking process for an affiliated consumer financial product or service; or an employee or agent of the institution of higher education involved in the marketing or solicitation process pertaining to an affiliated consumer financial product or service. The term consumer financial product or service has the meaning given the term in section 1002 of the Consumer Financial Protection Act of 2010 ( 12 U.S.C. 5481 ). The term financial institution has the meaning given the term in section 140B of the Truth in Lending Act. The term institution of higher education means an institution of higher education as defined in section 102. Notwithstanding any other provision of law, no institution of higher education that is affiliated with a consumer financial product or service shall be eligible to receive funds or any other form of financial assistance under this Act, unless the institution— develops a code of conduct with respect to affiliated consumer financial products or services with which associated individuals shall comply that— prohibits a conflict of interest with the responsibility of an associated individual with respect to such affiliated consumer financial product or services; requires each associated individual to act in the best interest of the students enrolled at the institution of higher education in carrying out their duties; and at a minimum, is aligned with the requirements and prohibitions described under subsections
(c)through (g); publishes such code of conduct prominently on the institution's website; and administers and enforces such code by, at a minimum, requiring that all of the institution's associated individuals be annually informed of the provisions of the code of conduct. An institution of higher education that is affiliated with a consumer financial product or service shall not enter into any revenue-sharing arrangement with the financial institution. In this subsection, the term revenue-sharing arrangement — means an arrangement between an institution of higher education and a financial institution under which— the financial institution provides or issues a consumer financial product or service to students attending the institution of higher education; the institution of higher education recommends, promotes, sponsors, or otherwise endorses the financial institution, or the consumer financial products or services offered by the financial institution; and the financial institution pays a fee or provides other material benefits, including revenue or profit sharing, to the institution of higher education in connection with the consumer financial products or services provided to students of the institution of higher education; and does not include an arrangement solely based on a financial institution paying a fair market price to an institution of higher education for the institution of higher education to advertise or market the financial institution to the general public. No associated individual of an institution of higher education shall solicit or accept any gift from a financial institution that has a consumer financial product or service with which the institution is affiliated. In this subsection, the term gift means any gratuity, favor, discount, entertainment, hospitality, loan, or other item having a monetary value of more than a de minimis amount. The term includes a gift of services, transportation, lodging, or meals, whether provided in kind, by purchase of a ticket, payment in advance, or reimbursement after the expense has been incurred. The term gift shall not include any of the following: Standard material, activities, or programs on issues related to a consumer financial product or service or financial literacy, such as a brochure, a workshop, or training. Such material, training, or program shall not promote a product or service of any specific financial institution. Food, refreshments, training, or informational material furnished to an associated individual as an integral part of a training session that is designed to improve the service of a financial institution to the institution of higher education, if such training contributes to the professional development of the associated individual. Favorable terms, conditions, and borrower benefits on a consumer financial product or service provided to all employees of the institution of higher education if such terms, conditions, or benefits are comparable to those provided to all students of the institution. Philanthropic contributions to an institution of higher education from a financial institution that are unrelated to the affiliated consumer financial product or service or the financial institution in general or any contribution from the financial institution that is not made in exchange for any advantage related to the financial institution. For purposes of this subsection, a gift to a family member of an associated individual of an institution of higher education shall be considered a gift to the associated individual if— the gift is given with the knowledge and acquiescence of the associated individual; and the associated individual has reason to believe the gift was given because of the official position of the associated individual. No associated individual of an institution of higher education shall accept from a financial institution that has a consumer financial product or service with which the institution is affiliated a fee, payment, or other financial benefit (including the opportunity to purchase stock) as compensation for any type of consulting arrangement or other contract to provide services to the financial institution or on behalf of the financial institution. Nothing in this subsection shall be construed as prohibiting the conduct of an individual who is not an associated individual. An institution of higher education shall not request or accept from a financial institution with which the institution has an affiliated consumer financial product or service any assistance with call center staffing, financial aid office staffing, or any other office or department of the institution of higher education. Any associated individual of an institution of higher education who serves on an advisory board, commission, or group established by a financial institution that has a consumer financial product or service with which the institution is affiliated shall be prohibited from receiving anything of value from the financial institution, except that the individual may be reimbursed for reasonable expenses incurred in serving on such advisory board, commission, or group. .
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Sec. 106
Code of conduct in affiliated consumer financial products or services
U.S.C.§ 1011
U.S.C.§ 5481
Cites 2Cited by 0 across 0 sources
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