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Code · BILL · 118th Congress · S. 4155 (Introduced in Senate) — To provide for effective regulation of payment stablecoins, and for other purposes. · Sec. 9

Sec. 9. Appointment of FDIC as conservator or receiver of payment stablecoin issuers

15,167 words·~69 min read·/bill/118/s/4155/is/section-9

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

As used in this section, the term customer means a person, or authorized representative of the person, that— utilized or is utilizing any service of a payment stablecoin issuer with respect to an account in the name of the person maintained by the payment stablecoin issuer; or is in possession or control of a payment stablecoin issued by a payment stablecoin issuer for which the payment stablecoin issuer for which an open account with the issuer is needed to redeem the payment stablecoin.
A payment stablecoin issuer shall not be charged deposit insurance premiums for the purposes of this section, but the Federal Deposit Insurance Corporation (in this section referred to as the Corporation ) may use the capital of the payment stablecoin issuer and any returns on required payment stablecoin reserves to fund the costs of a receivership or conservatorship. The Corporation shall not exercise borrowing authority under section 14 of the Federal Deposit Insurance Act ( 12 U.S.C. 1824 ) related to a receivership or conservatorship under this section.
For the purposes of this section, a payment stablecoin issuer shall be deemed to have been closed on account or inability to meet the demands of its customers in any case in which it has been closed for the purpose of liquidation without adequate provision being made for payment of its customers. Notwithstanding any other provision of Federal law, the law of any State, or the constitution of any State, the Corporation may accept appointment and act as conservator or receiver for a payment stablecoin issuer upon appointment in the manner provided in paragraph
(2)or (3). The Corporation may, at the discretion of the Comptroller, be appointed conservator of a payment stablecoin issuer which is a depository institution chartered by the Comptroller and the Corporation may accept such appointment. The Corporation shall be appointed receiver, and shall accept such appointment, whenever a receiver is appointed for the purpose of liquidation or winding up the affairs of a payment stablecoin issuer which is a depository institution chartered by the Comptroller, notwithstanding any other provision of Federal law. In addition to and not in derogation of the powers conferred and the duties imposed by this section on the Corporation as conservator or receiver, the Corporation, to the extent not inconsistent with such powers and duties, shall have any other power conferred on or any duty (which is related to the exercise of such power) imposed on a conservator or receiver for any Federal depository institution under any other provision of law. When acting as conservator or receiver pursuant to an appointment described in subparagraph (A), the Corporation shall not be subject to the direction or supervision of any other agency or department of the United States or any State in the exercise of the Corporation’s rights, powers, and privileges. Notwithstanding subparagraph (C), a payment stablecoin issuer which is a depository institution chartered by the Comptroller for which the Corporation has been appointed conservator shall remain subject to the supervision of the Comptroller. Whenever a State bank supervisor appoints a conservator or receiver for such institution and tenders appointment to the Corporation, the Corporation may accept such appointment. In addition to the powers conferred and the duties related to the exercise of such powers imposed by State law on any conservator or receiver appointed under the law of such State, the Corporation, as conservator or receiver pursuant to an appointment described in subparagraph (A), shall have the powers conferred and the duties imposed by this section on the Corporation as conservator or receiver. When acting as conservator or receiver pursuant to an appointment described in subparagraph (A), the Corporation shall not be subject to the direction or supervision of any other agency or department of the United States or any State in the agency or department of the United States or any State in the exercise of its rights, powers, and privileges. Notwithstanding subparagraph (C), a State-chartered payment stablecoin issuer for which the Corporation has been appointed conservator shall remain subject to the supervision of the State bank supervisor. The grounds for appointing a conservator or receiver (which may be the Corporation) for a payment stablecoin issuer are as follows: The issuer’s assets are less than the issuer’s obligations to its creditors and others. Substantial dissipation of assets or earnings due to— any violation of any statute or regulation; or any unsafe or unsound practice. An unsafe or unsound condition to transact business. Any willful violation of a cease and desist order which has become final. Any concealment of the institution’s books, papers, records, or assets, or any refusal to submit the institution’s books, papers, records, or affairs for inspection to any examiner or to any lawful agent of the Comptroller, State bank supervisor, or the Board. The issuer is likely to be unable to pay its obligations or meet its customers’ demands in the normal course of business. The issuer has incurred or is likely to incur losses that will deplete all or substantially all of its capital, and there is no reasonable prospect for the institution to come into compliance with capital requirements specified under this Act, consistent with Board regulation. Any violation of any law or regulation, or any unsafe or unsound practice or condition that is likely to— cause insolvency or substantial dissipation of assets or earnings; weaken the issuer’s condition; or otherwise seriously prejudice the interests of the institution’s customers. The issuer, by resolution of its board of directors or its shareholders or members, consents to the appointment. The institution is undercapitalized as specified by Board rule, and— has no reasonable prospect of becoming adequately capitalized (as defined by Board rule); fails to become adequately capitalized when required to do so; fails to submit a capital restoration plan; or materially fails to implement a capital restoration plan. The issuer— is critically undercapitalized, as defined by Board rule; or otherwise has substantially insufficient capital. The Attorney General notifies the Board, Comptroller, or State bank supervisor, as applicable, or the Corporation in writing that the payment stablecoin issuer has been found guilty of a criminal offense under section 1956 or 1957 of title 18, United States Code, or section 5322 or 5324 of title 31, United States Code. The members of the board of directors of a payment stablecoin issuer shall not be liable to the issuer’s shareholders or creditors for acquiescing in or consenting in good faith to— the appointment of the Corporation as conservator or receiver for that issuer; or an acquisition or combination in which the Corporation requires the issuer to be acquired or combined with another payment stablecoin issuer. The Corporation may prescribe such regulations as the Corporation determines to be appropriate regarding the conduct of conservatorships or receiverships of payment stablecoin issuers, in consultation with the Comptroller, State bank supervisors, and the Board. The Corporation shall, as conservator or receiver, and by operation of law, succeed to— all rights, titles, powers, and privileges of the payment stablecoin issuer, and of any stockholder, member, accountholder, depositor, officer, or director of such issuer with respect to the issuer and the assets of the issuer; and title to the books, records, and assets of any previous conservator or other legal custodian of such institution. The Corporation may, as conservator or receiver— take over the assets of and operate the payment stablecoin issuer with all the powers of the members or shareholders, the directors, and the officers of the issuer and conduct all business of the issuer; collect all obligations and money due to the institution; perform all functions of the issuer in the name of the issuer which are consistent with the appointment as conservator or receiver; and preserve and conserve the assets and property of the issuer. The Corporation may, by regulation or order, provide for the exercise of any function by any member or stockholder, director, or officer of any payment stablecoin issuer for which the Corporation has been appointed conservator or receiver. The Corporation may, as conservator, take such action as may be— necessary to put the payment stablecoin issuer in a sound and solvent condition; and appropriate to carry on the business of the issuer and preserve and conserve the assets and property of the issuer. The Corporation may, as receiver, place the payment stablecoin issuer in liquidation and proceed to realize upon the assets of the issuer, having due regard to the conditions of credit in the locality. The Corporation may, as receiver, with respect to any payment stablecoin issuer, organize a bridge payment stablecoin issuer under subsection (m). The Corporation may, as conservator or receiver— merge the payment stablecoin issuer with another payment stablecoin issuer; or subject to clause (ii), transfer any asset or liability of the issuer in default without any approval, assignment, or consent with respect to such transfer. No transfer described in clause (i)(II) may be made to a payment stablecoin issuer or without the approval of the appropriate payment stablecoin regulator for such issuer. The Corporation, as conservator or receiver, shall pay all valid obligations of the payment stablecoin issuer, as determined by the Corporation. The Corporation may, as conservator, receiver, or exclusive manager and for purposes of carrying out any power, authority, or duty with respect to a payment stablecoin issuer (including determining any claim against the issuer and determining and realizing upon any asset of any person in the course of collecting money due the issuer), exercise any power established under section 8(n) of the Federal Deposit Insurance Act ( 12 U.S.C. 1818(n) ) and the provisions of such section shall apply with respect to the exercise of any such power under this subparagraph in the same manner as such provisions apply under such section. A subpoena or subpoena duces tecum may be issued under clause
(i)only by, or with the written approval of, the Board of Directors of the Corporation or their designees. This subsection shall not be construed as limiting any rights that the Corporation, in any capacity, may otherwise have under section 10(c) of the Federal Deposit Insurance Act ( 12 U.S.C. 1820(c) ). The Corporation may, as conservator or receiver— exercise all powers and authorities necessary to conduct the conservatorship or receivership, respectively, and such incidental powers as shall be necessary to carry out such powers; and take any action authorized by this section, which the Corporation determines is in the best interests of the payment stablecoin issuer, its customers, or the Corporation. In carrying out its responsibilities in the management and disposition of assets from payment stablecoin issuers, as conservator, receiver, or in its corporate capacity, the Corporation shall utilize the services of private persons, including property management, auction marketing, legal, and brokerage services, only if such services are available in the private sector and the Corporation determines utilization of such services is the most practicable, efficient, and cost effective. The Corporation may, as receiver, determine claims in accordance with the requirements of this subsection and regulations prescribed under paragraph (4). The Corporation, as receiver, in any case involving the liquidation or winding up of the affairs of a closed payment stablecoin issuer, shall— promptly publish a notice to the payment stablecoin issuer’s creditors to present their claims, together with proof, to the receiver by a date specified in the notice which shall be not less than 90 days after the publication of such notice; and republish such notice approximately 1 month and 2 months, respectively, after the publication under clause (i). The Corporation, as receiver, shall mail a notice similar to the notice published under subparagraph (B)(i) at the time of such publication to any creditor shown on the issuer’s books— at the creditor’s last address appearing in such books; or upon discovery of the name and address of a claimant not appearing on the issuer’s books within 30 days after the discovery of such name and address. The Corporation may prescribe regulations regarding the allowance or disallowance of claims by the Corporation, as receiver, and providing for administrative determination of claims and review of such determination. In the handling of receiverships of payment stablecoin issuers, to maintain essential liquidity and to prevent financial disruption, the Corporation may, after the declaration of an issuer’s insolvency, settle all unsecured claims on the receivership with a final settlement payment which shall constitute full payment and disposition of the Corporation’s obligations to such claimants. Before the end of the 180-day period beginning on the date any claim against a payment stablecoin issuer is filed with the Corporation as receiver, the Corporation shall determine whether to allow or disallow the claim and shall notify the claimant of any determination with respect to such claim. The period described in clause
(i)may be extended by a written agreement between the claimant and the Corporation. The requirements of clause
(i)shall be deemed to be satisfied if the notice of any determination with respect to any claim is mailed to the last address of the claimant which appears— on the payment stablecoin issuer’s books; in the claim filed by the claimant; or in documents submitted in proof of the claim. If any claim filed under clause
(i)is disallowed, the notice to the claimant shall contain— a statement of each reason for the disallowance; and the procedures available for obtaining agency review of the determination to disallow the claim or judicial determination of the claim. The Corporation, as receiver, shall allow any claim received on or before the date specified in the notice published under paragraph (3)(B)(i) by the receiver from any claimant which is proved to the satisfaction of the receiver. Except as provided in clause (ii), claims filed after the date specified in the notice published under paragraph (3)(B)(i) shall be disallowed and such disallowance shall be final. Clause
(i)shall not apply with respect to any claim filed by any claimant after the date specified in the notice published under paragraph (3)(B)(i) and such claim may be considered by the Corporation, as receiver, if— the claimant did not receive notice of the appointment of the receiver in time to file such claim before such date; and such claim is filed in time to permit payment of such claim. The Corporation, as receiver, may disallow any portion of any claim by a creditor or claim of security, preference, or priority which is not proved to the satisfaction of the receiver. In the case of a claim of a creditor against a payment stablecoin issuer which is secured by any property or other asset of such issuer, the Corporation, as receiver— may treat the portion of such claim which exceeds an amount equal to the fair market value of such property or other asset as an unsecured claim against the issuer; and may not make any payment with respect to such unsecured portion of the claim other than in connection with the disposition of all claims of unsecured creditors of the issuer. No court may review the Corporation’s determination pursuant to subparagraph
(D)to disallow a claim. For purposes of any applicable statute of limitations, the filing of a claim with the Corporation as receiver shall constitute a commencement of an action. Subject to paragraph (12), the filing of a claim with the Corporation as receiver shall not prejudice any right of the claimant to continue any action which was filed before the appointment of the Corporation as receiver. Before the end of the 60-day period beginning on the earlier of— the end of the period described in paragraph (5)(A)(i) with respect to any claim against a payment stablecoin issuer for which the Corporation is receiver; or the date of any notice of disallowance of such claim pursuant to paragraph (5)(A)(i), the claimant may request administrative review of the claim in accordance with subparagraph
(A)or
(B)of paragraph
(7)or file suit on such claim (or continue an action commenced before the appointment of the Corporation as receiver in the district or territorial court of the United States for the district within which the payment stablecoin issuer’s principal place of business is located or the United States District Court for the District of Columbia (and such court shall have jurisdiction to hear such claim). If any claimant fails to— request administrative review of any claim in accordance with subparagraph
(A)or
(B)of paragraph (7); or file suit on such claim (or continue an action commenced before the appointment of the Corporation as receiver), before the end of the 60-day period described in subparagraph (A), the claim shall be deemed to be disallowed (other than any portion of such claim which was allowed by the receiver) as of the end of such period, such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim. If any claimant requests review under this subparagraph in lieu of filing or continuing any action under paragraph
(6)and the Corporation agrees to such request, the Corporation shall consider the claim after opportunity for a hearing on the record. The final determination of the Corporation with respect to such claim shall be subject to judicial review under chapter 7 of title 5, United States Code. The Corporation shall also establish such alternative dispute resolution processes as may be appropriate for the resolution of claims filed under paragraph (5)(A)(i). In establishing alternative dispute resolution processes under clause (i), the Corporation shall strive for procedures which are expeditious, fair, independent, and low cost. The Corporation may establish both binding and nonbinding processes, which may be conducted by any government or private party, but all parties, including the claimant and the Corporation, shall agree to the use of the process established under clause
(i)in a particular case. The Corporation shall seek to develop incentives for claimants to participate in the alternative dispute resolution process established under clause (i). The Corporation shall establish a procedure for expedited relief outside of the routine claims process established under paragraph
(5)for claimants who— allege the existence of legally valid and enforceable or perfected security interests in assets of a payment stablecoin issuer for which the Corporation has been appointed receiver; and allege that irreparable injury will occur if the routine claims procedure is followed. Before the end of the 90-day period beginning on the date any claim is filed in accordance with the procedures established pursuant to subparagraph (A), the Corporation shall— determine— whether to allow or disallow such claim; or whether such claim should be determined pursuant to the procedures established pursuant to paragraph (5); and notify the claimant of the determination, and if the claim is disallowed, provide a statement of each reason for the disallowance and the procedure for obtaining agency review or judicial determination. Any claimant who files a request for expedited relief shall be permitted to file a suit, or to continue a suit filed before the appointment of the receiver, seeking a determination of the claimant’s rights with respect to such security interest after the earlier of— the end of the 90-day period beginning on the date of the filing of a request for expedited relief; or the date the Corporation denies the claim. If an action described in subparagraph
(C)is not filed, or the motion to renew a previously filed suit is not made, before the end of the 30-day period beginning on the date on which such action or motion may be filed in accordance with subparagraph (B), the claim shall be deemed to be disallowed as of the end of such period (other than any portion of such claim which was allowed by the receiver), such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim. For purposes of any applicable statute of limitations, the filing of a claim with the Corporation as receiver shall constitute a commencement of an action. Subject to paragraph (12), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the appointment of the Corporation as receiver. Any agreement which does not meet the requirements set forth in section 13(e) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(e) ), shall not form the basis of, or substantially comprise, a claim against the Corporation as receiver. The Corporation as receiver may, in the discretion of the Corporation and to the extent funds are available, pay creditor claims approved pursuant to a final determination pursuant to paragraph
(7)or (8), or determined by the final judgment of any court of competent jurisdiction in such manner and amounts as are authorized under this section. The Corporation, as receiver, may, in the sole discretion of the Corporation, pay dividends on proved claims at any time, and no liability shall attach to the Corporation (in such Corporation’s corporate capacity or as receiver), by reason of any such payment, for failure to pay dividends to a claimant whose claim is not proved at the time of any such payment. The Corporation may prescribe such rules, including definitions of terms, as it deems appropriate to establish a single uniform interest rate for or to make payments of post insolvency interest to creditors holding proven claims against the receivership estates of payment stablecoin issuers following satisfaction by the Corporation as receiver of the principal amount of all creditor claims. Subject to section 5(e)(2)(C) of the Federal Deposit Insurance Act ( 12 U.S.C. 1815(e)(2)(C) ), amounts realized from the liquidation or other resolution of a payment stablecoin issuer by the Corporation as receiver shall be distributed to pay claims (other than secured claims to the extent of any such security) in the following order of priority: Administrative expenses of the Corporation as receiver. Outstanding payment stablecoin liabilities. Any other general or senior liability of the issuer (which is not a liability described in clause
(iv)or (v)). Any obligation subordinated to payment stablecoin liabilities or general creditors (which is not an obligation described in clause (v)). Any obligation to shareholders or members arising as a result of their status as shareholders or members (including any holding company or any shareholder or creditor of such company). A person who violates section 4 shall not be considered to have a secured claim under subparagraph
(A)or State law. The provisions of subparagraph
(A)shall not supersede the law of any State except to the extent such law is inconsistent with the provisions of such subparagraph, and then only to the extent of the inconsistency. Upon the Corporation’s own motion or upon the request of any person with a claim described in subparagraph
(A)or any State which is submitted to the Corporation in accordance with procedures which the Corporation shall prescribe, the Corporation shall determine whether any provision of the law of any State is inconsistent with any provision of subparagraph
(A)and the extent of any such inconsistency. The final determination of the Corporation under clause
(ii)shall be subject to judicial review under chapter 7 of title 5, United States Code. Any distribution by the Corporation in connection with any claim described in subparagraph (A)(v) shall be accompanied by the accounting report required under paragraph (15)(B). In general. After the appointment of the Corporation as conservator or receiver for a payment stablecoin issuer, the Corporation may request a stay for a period not to exceed— 45 days, in the case of the Corporation as conservator; and 90 days, in the case of the Corporation as receiver, in any judicial action or proceeding to which the issuer is or becomes a party. Upon receipt of a request by the Corporation as conservator or receiver pursuant to subparagraph
(A)for a stay of any judicial action or proceeding in any court with jurisdiction of such action or proceeding, the court shall grant such stay as to all parties. The Corporation shall abide by any final unappealable judgment of any court of competent jurisdiction which was rendered before the appointment of the Corporation as conservator or receiver. In the event of any appealable judgment, the Corporation as conservator or receiver shall— have all the rights and remedies available to the payment stablecoin issuer (before the appointment of such conservator or receiver) and the Corporation in its corporate capacity, including removal to Federal court and all appellate rights; and not be required to post any bond in order to pursue such remedies. No attachment or execution may issue by any court upon assets in the possession of the Corporation as receiver. Except as otherwise provided in this subsection, no court shall have jurisdiction over— any claim or action for payment from, or any action seeking a determination of rights with respect to, the assets of a payment stablecoin issuer for which the Corporation has been appointed receiver, including assets which the Corporation may acquire from itself as such receiver; or any claim relating to any act or omission of such issuer or the Corporation as receiver. In exercising any right, power, privilege, or authority as conservator or receiver in connection with any sale or disposition of assets of any payment stablecoin issuer for which the Corporation has been appointed conservator or receiver, the Corporation shall conduct its operations in a manner which— maximizes the net present value return from the sale or disposition of such assets; minimizes the amount of any loss realized in the resolution of cases; ensures adequate competition and fair and consistent treatment of offerors; and prohibits discrimination on the basis of race, sex, or ethnic groups in the solicitation and consideration of offers. Notwithstanding any provision of any contract, the applicable statute of limitations with regard to any action brought by the Corporation as conservator or receiver shall be— in the case of any contract claim, the longer of— the 6-year period beginning on the date the claim accrues; or the period applicable under State law; and in the case of any tort claim, the longer of— the 3-year period beginning on the date the claim accrues; or the period applicable under State law. For purposes of subparagraph (A), the date on which the statute of limitations begins to run on any claim described in such subparagraph shall be the later of— the date of the appointment of the Corporation as conservator or receiver; or the date on which the cause of action accrues. In the case of any tort claim described in clause
(ii)for which the statute of limitations applicable under State law with respect to such claim has expired not more than 5 years before the appointment of the Corporation as conservator or receiver, the Corporation may bring an action as conservator or receiver on such claim without regard to the expiration of the statute of limitations applicable under State law. A tort claim referred to in clause
(i)is a claim arising from fraud, intentional misconduct resulting in unjust enrichment, or intentional misconduct resulting in substantial loss to the institution. The Corporation as conservator or receiver shall, consistent with the accounting and reporting practices and procedures established by the Corporation, maintain a full accounting of each conservatorship and receivership or other disposition of issuers in default. With respect to each conservatorship or receivership to which the Corporation was appointed, the Corporation shall make an annual accounting or report, as appropriate, available to the Secretary of the Treasury, the Comptroller General of the United States, and the authority that appointed the Corporation as conservator or receiver. Any report prepared pursuant to subparagraph
(B)shall be made available by the Corporation upon request to any shareholder of the payment stablecoin issuer for which the Corporation was appointed conservator or receiver or any other member of the public. Except as provided in clause (ii), after the end of the 6-year period beginning on the date the Corporation is appointed as receiver of a payment stablecoin issuer, the Corporation may destroy any records of such institution which the Corporation, in the Corporation’s discretion, determines to be unnecessary unless directed not to do so by a court of competent jurisdiction or governmental agency, or otherwise prohibited by law. Notwithstanding clause (i), the Corporation may destroy records of a payment stablecoin issuer which are at least 10 years old as of the date on which the Corporation is appointed as the receiver of such payment stablecoin issuer in accordance with clause
(i)at any time after such appointment is final, without regard to the 6-year period of limitation contained in clause (i). The Corporation, as conservator or receiver for a payment stablecoin issuer, may avoid a transfer of any interest of an institution-affiliated party, or any person who the Corporation determines is a debtor of the issuer, in property, or any obligation incurred by such party or person, that was made within 5 years of the date on which the Corporation was appointed conservator or receiver if such party or person voluntarily or involuntarily made such transfer or incurred such liability with the intent to hinder, delay, or defraud the payment stablecoin issuer, the Corporation, Board, Comptroller, or a State bank supervisor. To the extent a transfer is avoided under subparagraph (A), the Corporation may recover, for the benefit of the payment stablecoin issuer, the property transferred, or, if a court so orders, the value of such property (at the time of such transfer) from— the initial transferee of such transfer or the institution-affiliated party or person for whose benefit such transfer was made; or any immediate or mediate transferee of any such initial transferee. The Corporation may not recover under subparagraph
(B)from— any transferee that takes for value, including satisfaction or securing of a present or antecedent debt, in good faith; or any immediate or mediate good faith transferee of such transferee. The rights under this paragraph of the Corporation shall be superior to any rights of a trustee or any other party (other than any party which is a Federal agency) under title 11, United States Code. Subject to paragraph (18), any court of competent jurisdiction may, at the request of the Corporation (in the Corporation’s capacity as conservator or receiver for any payment stablecoin issuer or in the Corporation’s corporate capacity with respect to any asset acquired or liability assumed by the Corporation), issue an order in accordance with Rule 65 of the Federal Rules of Civil Procedure, including an order placing the assets of any person designated by the Corporation under the control of the court and appointing a trustee to hold such assets. Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under paragraph
(17)without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate. If, in the case of any proceeding in a State court, the court determines that rules of civil procedure available under the laws of such State provide substantially similar protections to such party’s right to due process as Rule 65 (as modified with respect to such proceeding by subparagraph (A)), the relief sought by the Corporation pursuant to paragraph
(17)may be requested under the laws of such State. Notwithstanding any other provision of this subsection, any final and unappealable judgment for monetary damages entered against the Corporation as receiver or conservator for a payment stablecoin issuer for the breach of an agreement executed or approved by the Corporation after the date of its appointment shall be paid as an administrative expense of the receiver or conservator. Nothing in this paragraph shall be construed to limit the power of the Corporation as receiver or conservator to exercise any rights under contract or law, including to terminate, breach, cancel, or otherwise discontinue such agreement. In addition to any other rights the Corporation as conservator or receiver may have, the Corporation may disaffirm or repudiate any contract or lease— to which the issuer is a party; the performance of which the Corporation, in the discretion of the Corporation, determines to be burdensome; and the disaffirmance or repudiation of which the Corporation determines, in the discretion of the Corporation, will promote the orderly administration of the affairs of the issuer. The Corporation as conservator or receiver appointed for any payment stablecoin issuer in accordance with subsection (d), shall determine whether or not to exercise the rights of repudiation under this subsection within a reasonable period following such appointment. Except as otherwise provided in subparagraph
(C)and paragraphs (4), (5), and (6), the liability of the Corporation as conservator or receiver for the disaffirmance or repudiation of any contract pursuant to paragraph
(1)shall be— limited to actual direct compensatory damages; and determined as of— the date of the appointment of the Corporation as conservator or receiver; or in the case of any contract or agreement referred to in paragraph (8), the date of the disaffirmance or repudiation of such contract or agreement. For purposes of subparagraph (A), the term actual direct compensatory damages does not include— punitive or exemplary damages; damages for lost profits or opportunity; or damages for pain and suffering. In the case of any qualified financial contract or agreement to which paragraph
(8)applies, compensatory damages shall be— deemed to include normal and reasonable costs of cover or other reasonable measures of damages utilized in the industries for such contract and agreement claims; and paid in accordance with this subsection and subsection
(g)except as otherwise specifically provided in this section. If the Corporation as conservator or receiver disaffirms or repudiates a lease under which the payment stablecoin issuer was the lessee, the conservator or receiver shall not be liable for any damages (other than damages determined pursuant to subparagraph (B)) for the disaffirmance or repudiation of such lease. Notwithstanding subparagraph (A), the lessor under a lease to which such subparagraph applies shall— unless the lessor is in default or breach of the terms of the lease, be entitled to the contractual rent accruing before the later of the date— the notice of disaffirmance or repudiation is mailed; or the disaffirmance or repudiation becomes effective; have no claim for damages under any acceleration clause or other penalty provision in the lease; and have a claim for any unpaid rent, subject to all appropriate offsets and defenses, due as of the date of the appointment which shall be paid in accordance with this subsection and subsection (g). If the Corporation as conservator or receiver repudiates an unexpired written lease of real property of the payment stablecoin issuer under which the issuer is the lessor and the lessee is not, as of the date of such repudiation, in default, the lessee under such lease may either— treat the lease as terminated by such repudiation; or remain in possession of the leasehold interest for the balance of the term of the lease unless the lessee defaults under the terms of the lease after the date of such repudiation. If any lessee under a lease described in subparagraph
(A)remains in possession of a leasehold interest pursuant to clause
(ii)of such subparagraph— the lessee— shall continue to pay the contractual rent pursuant to the terms of the lease after the date of the repudiation of such lease; and may offset against any rent payment which accrues after the date of the repudiation of the lease, any damages which accrue after such date due to the nonperformance of any obligation of the payment stablecoin issuer under the lease after such date; and the Corporation as conservator or receiver shall not be liable to the lessee for any damages arising after such date as a result of the repudiation other than the amount of any offset allowed under clause (i)(II). If the Corporation as conservator or receiver repudiates any contract (which meets the requirements of each paragraph of section 13(e) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(e) ) for the sale of real property and the purchaser of such real property under such contract is in possession and is not, as of the date of such repudiation, in default, such purchaser may either— treat the contract as terminated by such repudiation; or remain in possession of such real property. If any purchaser of real property under any contract described in subparagraph
(A)remains in possession of such property pursuant to clause
(ii)of such subparagraph— the purchaser— shall continue to make all payments due under the contract after the date of the repudiation of the contract; and may offset against any such payments any damages which accrue after such date due to the nonperformance (after such date) of any obligation of the payment stablecoin issuer under the contract; and the Corporation as conservator or receiver shall— not be liable to the purchaser for any damages arising after such date as a result of the repudiation other than the amount of any offset allowed under clause (i)(II); deliver title to the purchaser in accordance with the provisions of the contract; and have no obligation under the contract other than the performance required under subclause (II). No provision of this paragraph shall be construed as limiting the right of the Corporation as conservator or receiver to assign the contract described in subparagraph
(A)and sell the property subject to the contract and the provisions of this paragraph. If an assignment and sale described in clause
(i)is consummated, the Corporation as conservator or receiver shall have no further liability under the contract described in subparagraph
(A)or with respect to the real property which was the subject of such contract. In the case of any contract for services between any person and any payment stablecoin issuer for which the Corporation has been appointed conservator or receiver, any claim of such person for services performed before the appointment of the Corporation shall be— a claim to be paid in accordance with subsections
(e)and (g); and deemed to have arisen as of the date the Corporation was appointed conservator or receiver. If, in the case of any contract for services described in subparagraph (A), the conservator or receiver accepts performance by the other person before the Corporation as conservator or receiver makes any determination to exercise the right of repudiation of such contract under this section— the other party shall be paid under the terms of the contract for the services performed; and the amount of such payment shall be treated as an administrative expense of the conservatorship or receivership. The acceptance by the Corporation as conservator or receiver of services referred to in subparagraph
(B)in connection with a contract described in such subparagraph shall not affect the right of the Corporation as conservator or receiver to repudiate such contract under this section at any time after such performance. Subject to paragraphs
(9)and
(10)of this subsection and notwithstanding any other provision of Federal or State law (other than subsection (e)(9) of this section and section 13(e) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(e) ), no person shall be stayed or prohibited from exercising— any right such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a payment stablecoin issuer which arises upon the appointment of the Corporation as receiver for such issuer at any time after such appointment; any right under any security agreement or arrangement or other credit enhancement related to one or more qualified financial contracts described in clause (i); or any right to offset or net out any termination value, payment amount, or other transfer obligation arising under or in connection with 1 or more contracts and agreements described in clause (i), including any master agreement for such contracts or agreements. Subsection (e)(12) shall apply in the case of any judicial action or proceeding brought against the Corporation as receiver referred to in subparagraph (A), or the payment stablecoin issuer for which the Corporation was appointed receiver, by any party to a contract or agreement described in subparagraph (A)(i) with such institution. Notwithstanding paragraph (11), section 5242 of the Revised Statutes of the United States ( 12 U.S.C. 91 ), or any other Federal or State law relating to the avoidance of preferential or fraudulent transfers, the Corporation, whether acting as such or as conservator or receiver of a payment stablecoin issuer, may not avoid any transfer of money or other property in connection with any qualified financial contract with a payment stablecoin issuer. Clause
(i)shall not apply to any transfer of money or other property in connection with any qualified financial contract with a payment stablecoin issuer if the Corporation determines that the transferee had actual intent to hinder, delay, or defraud such institution, the creditors of such institution, or any conservator or receiver appointed for such institution. For purposes of this subsection, the following definitions shall apply: The term qualified financial contract means any securities contract, commodity contract, forward contract, repurchase agreement, swap agreement, and any similar agreement that the Corporation determines by regulation, resolution or order to be a qualified financial contract for purposes of this paragraph. The term securities contract — means a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or any option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such repurchase or reverse repurchase transaction is a repurchase agreement); does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan unless the Corporation determines by regulation, resolution, or order to include any such agreement within the meaning of such term; means any option entered into on a national securities exchange relating to foreign currencies; means the guarantee (including by novation) by or to any securities clearing agency of any settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such settlement is in connection with any agreement or transaction referred to in subclauses
(I)through
(XII)(other than subclause (II)); means any margin loan; means any extension of credit for the clearance or settlement of securities transactions; means any loan transaction coupled with a securities collar transaction, any prepaid securities forward transaction, or any total return swap transaction coupled with a securities sale transaction; means any other agreement or transaction that is similar to any agreement or transaction referred to in this clause; means any combination of the agreements or transactions referred to in this clause; means any option to enter into any agreement or transaction referred to in this clause; means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), (IV), (V), (VI), (VII), (VIII), (IX), or (X), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this clause, except that the master agreement shall be considered to be a securities contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), (IV), (V), (VI), (VII), (VIII), (IX), or (X); and means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause. The term commodity contract means— with respect to a futures commission merchant, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade; with respect to a foreign futures commission merchant, a foreign future; with respect to a leverage transaction merchant, a leverage transaction; with respect to a clearing organization, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization; with respect to a commodity options dealer, a commodity option; any other agreement or transaction that is similar to any agreement or transaction referred to in this clause; any combination of the agreements or transactions referred to in this clause; any option to enter into any agreement or transaction referred to in this clause; a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this clause, except that the master agreement shall be considered to be a commodity contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII); or any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause. The term forward contract means— a contract (other than a commodity contract) for the purchase, sale, or transfer of a commodity or any similar good, article, service, right, or interest which is presently or in the future becomes the subject of dealing in the forward contract trade, or product or byproduct thereof, with a maturity date more than 2 days after the date the contract is entered into, including, a repurchase or reverse repurchase transaction (whether or not such repurchase or reverse repurchase transaction is a repurchase agreement), consignment, lease, swap, hedge transaction, deposit, loan, option, allocated transaction, unallocated transaction, or any other similar agreement; any combination of agreements or transactions referred to in subclauses
(I)and (III); any option to enter into any agreement or transaction referred to in subclause
(I)or (II); a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), or (III), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a forward contract under this clause, except that the master agreement shall be considered to be a forward contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), or (III); or any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (II), (III), or (IV), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause. The term repurchase agreement (which definition also applies to a reverse repurchase agreement)— means an agreement, including related terms, which provides for the transfer of 1 or more certificates of deposit, mortgage related securities (as defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) ), mortgage loans, interests in mortgage-related securities or mortgage loans, eligible bankers’ acceptances, qualified foreign government securities or securities that are direct obligations of, or that are fully guaranteed by, the United States or any agency of the United States against the transfer of funds by the transferee of such certificates of deposit, eligible bankers’ acceptances, securities, mortgage loans, or interests with a simultaneous agreement by such transferee to transfer to the transferor thereof certificates of deposit, eligible bankers’ acceptances, securities, mortgage loans, or interests as described above, at a date certain not later than 1 year after such transfers or on demand, against the transfer of funds, or any other similar agreement; does not include any repurchase obligation under a participation in a commercial mortgage loan unless the Corporation determines by regulation, resolution, or order to include any such participation within the meaning of such term; means any combination of agreements or transactions referred to in subclauses
(I)and (IV); means any option to enter into any agreement or transaction referred to in subclause
(I)or (III); means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a repurchase agreement under this clause, except that the master agreement shall be considered to be a repurchase agreement under this subclause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), or (IV); and means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause. For purposes of this clause, the term qualified foreign government security means a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development (as determined by regulation or order adopted by the Board). The term swap agreement means— any agreement, including the terms and conditions incorporated by reference in any such agreement, which is an interest rate swap, option, future, or forward agreement, including a rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange, precious metals, or other commodity agreement; a currency swap, option, future, or forward agreement; an equity index or equity swap, option, future, or forward agreement; a debt index or debt swap, option, future, or forward agreement; a total return, credit spread or credit swap, option, future, or forward agreement; a commodity index or commodity swap, option, future, or forward agreement; weather swap, option, future, or forward agreement; an emissions swap, option, future, or forward agreement; or an inflation swap, option, future, or forward agreement; any agreement or transaction that is similar to any other agreement or transaction referred to in this clause and that is of a type that has been, is presently, or in the future becomes, the subject of recurrent dealings in the swap or other derivatives markets (including terms and conditions incorporated by reference in such agreement) and that is a forward, swap, future, option, or spot transaction on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, quantitative measures associated with an occurrence, extent of an occurrence, or contingency associated with a financial, commercial, or economic consequence, or economic or financial indices or measures of economic or financial risk or value; any combination of agreements or transactions referred to in this clause; any option to enter into any agreement or transaction referred to in this clause; a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement contains an agreement or transaction that is not a swap agreement under this clause, except that the master agreement shall be considered to be a swap agreement under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), or (IV); and any security agreement or arrangement or other credit enhancement related to any agreements or transactions referred to in subclause (I), (II), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause. Such term is applicable for purposes of this subsection only and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any swap agreement under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act ( Public Law 106–102 ; 113 Stat. 1338), the Legal Certainty for Bank Products Act of 2000 ( 7 U.S.C. 27 et seq. ), the securities laws (as defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) ), and the Commodity Exchange Act ( 7 U.S.C. 1 et seq. ). Any master agreement for any contract or agreement described in any preceding clause of this subparagraph (or any master agreement for such master agreement or agreements), together with all supplements to such master agreement, shall be treated as a single agreement and a single qualified financial contract. If a master agreement contains provisions relating to agreements or transactions that are not themselves qualified financial contracts, the master agreement shall be deemed to be a qualified financial contract only with respect to those transactions that are themselves qualified financial contracts. The term transfer means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or with an interest in property, including retention of title as a security interest and foreclosure of the payment stablecoin issuer’s equity of redemption. The term person includes any governmental entity in addition to any entity included in the definition of such term in section 1 of title 1, United States Code. Notwithstanding any other provision of Federal or State law (other than subsections (e)(9) and (f)(10) of this section, and section 13(e) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(e) )), no person shall be stayed or prohibited from exercising— any right such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a payment stablecoin issuer in a conservatorship based upon a default under such financial contract which is enforceable under applicable non-insolvency law; any right under any security agreement or arrangement or other credit enhancement related to one or more qualified financial contracts described in clause (i); or any right to offset or net out any termination values, payment amounts, or other transfer obligations arising under or in connection with such qualified financial contracts. No provision of law shall be construed as limiting the right or power of the Corporation, or authorizing any court or agency to limit or delay, in any manner, the right or power of the Corporation to transfer any qualified financial contract in accordance with paragraphs
(9)and
(10)of this subsection or to disaffirm or repudiate any such contract in accordance with paragraph (1). Notwithstanding the provisions of subparagraphs
(A)and (E), and sections 403 and 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991 ( 12 U.S.C. 4403 , 4404), no walkaway clause shall be enforceable in a qualified financial contract of a payment stablecoin issuer in default. In the case of a qualified financial contract referred to in clause (i), any payment or delivery obligations otherwise due from a party pursuant to the qualified financial contract shall be suspended from the time the Corporation is appointed as receiver until the earlier of— the time such party receives notice that such contract has been transferred pursuant to paragraph (9)(A); or 5:00 p.m. (eastern time) on the business day following the date of the appointment of the Corporation as receiver. For purposes of this subparagraph, the term walkaway clause means any provision in a qualified financial contract that suspends, conditions, or extinguishes a payment obligation of a party, in whole or in part, or does not create a payment obligation of a party that would otherwise exist, solely because of such party’s status as a nondefaulting party in connection with the insolvency of a payment stablecoin issuer that is a party to the contract or the appointment of or the exercise of rights or powers by the Corporation as conservator or receiver of such issuer, and not as a result of a party’s exercise of any right to offset, setoff, or net obligations that exist under the contract, any other contract between those parties, or applicable law. The Corporation, in consultation with the Board, Comptroller and State bank supervisors, may prescribe regulations requiring more detailed recordkeeping by a payment stablecoin issuer with respect to qualified financial contracts (including market valuations) if the condition of such payment stablecoin issuer warrants it. In general. In making any transfer of assets or liabilities of a payment stablecoin issuer in default which includes any qualified financial contract, the Corporation as conservator or receiver for such issuer shall either— transfer to one financial institution, other than a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed or which is otherwise the subject of a bankruptcy or insolvency proceeding— all qualified financial contracts between any person or any affiliate of such person and the payment stablecoin issuer in default; all claims of such person or any affiliate of such person against such issuer under any such contract (other than any claim which, under the terms of any such contract, is subordinated to the claims of general unsecured creditors of such issuer); all claims of such payment stablecoin issuer against such person or any affiliate of such person under any such contract; and all property securing or any other credit enhancement for any contract described in subclause
(I)or any claim described in subclause
(II)or
(III)under any such contract; or transfer none of the qualified financial contracts, claims, property or other credit enhancement referred to in clause
(i)(with respect to such person and any affiliate of such person). In transferring any qualified financial contracts and related claims and property under subparagraph (A)(i), the Corporation as conservator or receiver for the payment stablecoin issuer shall not make such transfer to a foreign bank, financial institution organized under the laws of a foreign country, or a branch or agency of a foreign bank or financial institution unless, under the law applicable to such bank, financial institution, branch or agency, to the qualified financial contracts, and to any netting contract, any security agreement or arrangement or other credit enhancement related to one or more qualified financial contracts, the contractual rights of the parties to such qualified financial contracts, netting contracts, security agreements or arrangements, or other credit enhancements are enforceable substantially to the same extent as permitted under this section. In the event that the Corporation as conservator or receiver transfers any qualified financial contract and related claims, property, and credit enhancements pursuant to subparagraph (A)(i) and such contract is cleared by or subject to the rules of a clearing organization, the clearing organization shall not be required to accept the transferee as a member by virtue of the transfer. For purposes of this paragraph— the term financial institution means a broker or dealer, a depository institution, a futures commission merchant, or any other institution, as determined by the Corporation by regulation to be a financial institution; and the term clearing organization has the meaning given the term in section 402 of the Federal Deposit Insurance Corporation Improvement Act of 1991 ( 12 U.S.C. 4402 ). If the Corporation as conservator or receiver for a payment stablecoin issuer in default makes any transfer of the assets and liabilities of such institution, and the transfer includes any qualified financial contract, the conservator or receiver shall notify any person who is a party to any such contract of such transfer by 5:00 p.m. (eastern time) on the business day following the date of the appointment of the Corporation as receiver in the case of a receivership, or the business day following such transfer in the case of a conservatorship. A person who is a party to a qualified financial contract with a payment stablecoin issuer may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(A) of this subsection or section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991 ( 12 U.S.C. 4403 , 4404), solely by reason of or incidental to the appointment of the Corporation as receiver for the payment stablecoin issuer (or the insolvency or financial condition of the issuer for which the receiver has been appointed)— until 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver; or after the person has received notice that the contract has been transferred pursuant to paragraph (9)(A). A person who is a party to a qualified financial contract with a payment stablecoin issuer may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(E) of this subsection or section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991 ( 12 U.S.C. 4403 , 4404), solely by reason of or incidental to the appointment of the Corporation as conservator for the payment stablecoin issuer (or the insolvency or financial condition of the issuer for which the Corporation has been appointed conservator). For purposes of this paragraph, the Corporation as receiver or conservator of a payment stablecoin issuer shall be deemed to have notified a person who is a party to a qualified financial contract with such issuer if the Corporation has taken steps that are reasonably calculated to provide notice to such person by the time specified in subparagraph (A). For purposes of this paragraph, the term business day means any day other than any Saturday, Sunday, or any day on which either the New York Stock Exchange or the Federal Reserve Bank of New York is closed. In exercising the rights of disaffirmance or repudiation of a conservator or receiver with respect to any qualified financial contract to which a payment stablecoin issuer is a party, the Corporation as conservator or receiver for such issuer shall either— disaffirm or repudiate all qualified financial contracts between— any person or any affiliate of such person; and the payment stablecoin issuer in default; or disaffirm or repudiate none of the qualified financial contracts referred to in subparagraph
(A)(with respect to such person or any affiliate of such person). No provision of this subsection shall be construed as permitting the avoidance of any legally enforceable or perfected security interest in any of the assets of any payment stablecoin issuer except where such an interest is taken in contemplation of the issuer’s insolvency or with the intent to hinder, delay, or defraud the issuer or the creditors of such issuer. The Corporation as conservator or receiver may enforce any contract, other than a director’s or officer’s liability insurance contract or a bond, entered into by the payment stablecoin issuer notwithstanding any provision of the contract providing for termination, default, acceleration, or exercise of rights upon, or solely by reason of, insolvency or the appointment of or the exercise of rights or powers by the Corporation as conservator or receiver. No provision of this paragraph may be construed as impairing or affecting any right of the Corporation as conservator or receiver to enforce or recover under a director’s or officer’s liability insurance contract or bond under other applicable law. Except as otherwise provided by this section or section 15 of the Federal Deposit Insurance Act ( 12 U.S.C. 1825 ), no person may exercise any right or power to terminate, accelerate, or declare a default under any contract to which the payment stablecoin issuer is a party, or to obtain possession of or exercise control over any property of the issuer or affect any contractual rights of the issuer, without the consent of the Corporation as conservator or receiver, as appropriate, during the 45-day period beginning on the date of the appointment of the Corporation as conservator, or during the 90-day period beginning on the date of the appointment of the Corporation as receiver, as applicable. No provision of this subparagraph shall apply to a director or officer liability insurance contract or bond, to the rights of parties to certain qualified financial contracts pursuant to paragraph (8), or to the rights of parties to netting contracts pursuant to subtitle A of title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 ( 12 U.S.C. 4401 et seq. ), or shall be construed as permitting the Corporation as conservator or receiver to fail to comply with otherwise enforceable provisions of such contract. Nothing in this subparagraph shall be construed to limit or otherwise affect the applicability of title 11, United States Code. The meanings of terms used in this subsection are applicable for purposes of this subsection only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act ( Public Law 106–102 ; 113 Stat. 1338), the Legal Certainty for Bank Products Act of 2000 ( 7 U.S.C. 27 et seq. ), the securities laws (as defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) ), and the Commodity Exchange Act ( 7 U.S.C. 1 et seq. ). In case of the liquidation of, or other closing or winding up of the affairs of a payment stablecoin issuer, payment of the outstanding payment stablecoin liabilities of the issuer shall be made by the Corporation as soon as possible, subject to the provisions of subsection (h), either by cash or by making available to each depositor a transferred deposit in an insured depository institution. The Corporation, in its discretion, may require proof of claims to be filed and may approve or reject such claims for payment stablecoin liabilities. A determination by the Corporation regarding any claim for payment of stablecoin liabilities shall be treated as a final determination for purposes of this section. In its discretion, the Corporation may promulgate regulations prescribing procedures for resolving any disputed claim. A final determination made by the Corporation regarding any claim for payment of stablecoin liabilities shall be a final agency action reviewable in accordance with chapter 7 of title 5, United States Code, by the United States district court for the Federal judicial district where the principal place of business of the payment stablecoin issuer is located. Any request for review of a final determination by the Corporation regarding any claim regarding payment of stablecoin liabilities shall be filed with the appropriate United States district court not later than 60 days after the date on which such determination is issued. Notwithstanding any other provision of Federal law, the law of any State, or the constitution of any State, the Corporation, upon the payment to any customer as provided in subsection
(g)in connection with a payment stablecoin issuer described in such subsection or the assumption of payment stablecoin liabilities by another payment stablecoin issuer pursuant to this section, shall be subrogated to all rights of the customer against such issuer to the extent of such payment or assumption. The subrogation of the Corporation under paragraph
(1)with respect to any payment stablecoin issuer shall include the right on the part of the Corporation to receive the same dividends from the proceeds of the assets of such issuer and recoveries on account of stockholders’ liability as would have been payable to the customer on a claim for the stablecoin liability. With respect to a payment stablecoin issuer, the Corporation shall waive, in favor only of any person against whom stockholders’ individual liability may be asserted, any claim on account of such liability in excess of the liability, if any, to the issuer or its creditors, for the amount unpaid upon such stock in such issuer; but any such waiver shall be effected in such manner and on such terms and conditions as will not increase recoveries or dividends on account of claims to which the Corporation is not subrogated. Subject to subsection (e)(11), if the Corporation is appointed pursuant to subsection (d)(3), the rights of customers and other creditors of any State-chartered payment stablecoin issuer shall be determined in accordance with the applicable provisions of State law. Notwithstanding any other provision of Federal law or the law of any State and regardless of the method which the Corporation determines to utilize with respect to a payment stablecoin issuer in default or in danger of default, including transactions authorized under subsection (o), this subsection shall govern the rights of the creditors (other than customers) of such institution. The maximum liability of the Corporation, acting as receiver or in any other capacity, to any person having a claim against the receiver or the payment stablecoin issuer for which such receiver is appointed shall equal the amount such claimant would have received if the Corporation had liquidated the assets and liabilities of such institution without exercising the Corporation’s authority under subsection
(o)of this section. Except as provided in this section, no court may take any action, except at the request of the Board of Directors of the Corporation by regulation or order, to restrain or affect the exercise of powers or functions of the Corporation as a conservator or a receiver. A director or officer of a payment stablecoin issuer may be held personally liable for monetary damages in any civil action by, on behalf of, or at the request or direction of the Corporation, which action is prosecuted wholly or partially for the benefit of the Corporation— acting as conservator or receiver of such issuer; acting based upon a suit, claim, or cause of action purchased from, assigned by, or otherwise conveyed by such receiver or conservator; or for gross negligence, including any similar conduct or conduct that demonstrates a greater disregard of a duty of care (than gross negligence) including intentional tortious conduct, as such terms are defined and determined under applicable State law, provided that nothing in this paragraph shall impair or affect any right of the Corporation under other applicable law. In any proceeding related to any claim against a payment stablecoin issuer’s director, officer, employee, agent, attorney, accountant, appraiser, or any other party employed by or providing services to a payment stablecoin issuer, recoverable damages determined to result from the improvident or otherwise improper use or investment of any payment stablecoin issuer’s assets shall include principal losses and appropriate interest. When 1 or more payment stablecoin issuers are in default, or when the Corporation anticipates that 1 or more payment stablecoin issuers may become in default, the Corporation may, in its discretion, organize, and the Office of the Comptroller of the Currency, with respect to 1 or more payment stablecoin issuers, shall charter, 1 or more depository institutions, as appropriate, with respect thereto with the powers and attributes of payment stablecoin issuers as applicable, subject to the provisions of this subsection, to be referred to as bridge payment stablecoin issuers . Upon the granting of a charter to a bridge payment stablecoin issuer, the bridge issuer may— assume such payment stablecoin assets and liabilities of the payment stablecoin issuer that is or are in default or in danger of default as the Corporation may, in its discretion, determine to be appropriate; and perform any other temporary function which the Corporation may, in its discretion, prescribe in accordance with this the Federal Deposit Insurance Act ( 12 U.S.C. 1811 et seq. ). The articles of association and organization certificate of a bridge payment stablecoin issuer as approved by the Corporation shall be executed by 3 representatives designated by the Corporation. A bridge payment stablecoin issuer shall have an interim board of directors consisting of not fewer than 5 nor more than 10 members appointed by the Corporation. A bridge payment stablecoin issuer shall be organized as a depository institution under the National Bank Act ( 12 U.S.C. 21 et seq. ). A depository institution may be chartered by the Comptroller as a bridge payment stablecoin issuer only if the Board of Directors of the Corporation determines that— the amount which is reasonably necessary to operate such bridge issuer will not exceed the amount which is reasonably necessary to save the cost of liquidating, including paying the liabilities of, 1 or more payment stablecoin issuers in default or in danger of default with respect to which the bridge payment stablecoin issuer is chartered; the continued operation of such payment stablecoin issuer or issuers in default or in danger of default with respect to which the bridge payment stablecoin issuer is chartered is essential to provide continued services to the customers of the issuer; or the continued operation of such payment stablecoin issuer or issuers in default or in danger of default with respect to which the bridge issuer is chartered is in the best interest of the customer of such issuer or issuers in default or in danger of default or the public. A bridge depository institution shall be a national payment stablecoin issuer from the time it is chartered by the Comptroller as a depository institution. A bridge payment stablecoin issuer shall be treated as an issuer in default at such times and for such purposes as the Corporation may, in its discretion, determine. A bridge payment stablecoin issuer, upon the granting of its charter, shall be under the management of a board of directors consisting of not fewer than 5 nor more than 10 members appointed by the Corporation. The board of directors of a bridge payment stablecoin issuer shall adopt such bylaws as may be approved by the Corporation. Upon the granting of a charter to a bridge payment stablecoin issuer pursuant to this subsection, the Corporation, as receiver, or any other receiver appointed with respect to any payment stablecoin issuer in default with respect to which the bridge payment stablecoin issuer is chartered may transfer any assets and liabilities of such issuer in default to the bridge issuer in accordance with paragraph (1). At any time after a charter is granted to a bridge payment stablecoin issuer, the Corporation, as receiver, or any other receiver appointed with respect to a payment stablecoin issuer in default may transfer any assets and liabilities of such issuer in default as the Corporation may, in its discretion, determine to be appropriate in accordance with paragraph (1). The transfer of any assets or liabilities of a payment stablecoin issuer in default transferred to a bridge payment stablecoin issuer shall be effective without any further approval under Federal or State law, assignment, or consent with respect thereto. Each bridge payment stablecoin issue chartered under this subsection shall have all corporate powers of, and be subject to the same provisions of law as, a payment stablecoin issuer that is a depository institution chartered by the Comptroller, as appropriate, except that— the Corporation may— remove the interim directors and directors of a bridge issuer; fix the compensation of members of the interim board of directors and the board of directors and senior management, as determined by the Corporation in its discretion, of a bridge issuer; and waive any requirement established under section 5145, 5146, 5147, 5148, or 5149 of the Revised Statutes (relating to directors of national banks) or section 31 of the Banking Act of 1933 ( 12 U.S.C. 71a ) which would otherwise be applicable with respect to directors of a bridge issuer by operation of paragraph (2)(B); the Corporation may indemnify the representatives for purposes of paragraph (1)(B) and the interim directors, directors, officers, employees, and agents of a bridge payment stablecoin issuer on such terms as the Corporation determines to be appropriate; no requirement under any provision of law relating to the capital of a payment stablecoin issuer shall apply with respect to a bridge issuer; the Comptroller of the Currency may establish a limitation on the extent to which any person may become indebted to a bridge issuer without regard to the amount of the bridge issuer’s capital or surplus; the board of directors of a bridge payment stablecoin issuer shall elect a chairperson who may also serve in the position of chief executive officer, except that such person shall not serve either as chairperson or as chief executive officer without the prior approval of the Corporation; and the board of directors of a bridge payment stablecoin issuer may appoint a chief executive officer who is not also the chairperson, except that such person shall not serve as chief executive officer without the prior approval of the Corporation; the Comptroller shall waive any requirement for a fidelity bond with respect to a bridge payment stablecoin issuer at the request of the Corporation; any judicial action to which a bridge payment stablecoin issuer becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a payment stablecoin issuer in default shall be stayed from further proceedings for a period of up to 45 days at the request of the bridge issuer; no agreement which tends to diminish or defeat the right, title or interest of a bridge payment stablecoin issuer in any asset of a payment stablecoin issuer in default acquired by it shall be valid against the bridge issuer unless such agreement— is in writing; was executed by such payment stablecoin issuer in default and the person or persons claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by such issuer in default; was approved by the board of directors of such payment stablecoin issuer in default, which approval shall be reflected in the minutes of said board; and has been, continuously from the time of its execution, an official record of such payment stablecoin issuer in default; and except with the prior approval of the Corporation, a bridge payment stablecoin issuer may not, in any transaction or series of transactions, issue capital stock or be a party to any merger, consolidation, disposition of assets or liabilities, sale or exchange of capital stock, or similar transaction, or change its charter. The Corporation shall not be required to— issue any capital stock on behalf of a bridge payment stablecoin issuer chartered under this subsection; or purchase any capital stock of a bridge payment stablecoin issuer. Upon the organization of a bridge payment stablecoin issuer, the capital of the insolvent payment stablecoin issuer shall be used to fund the operations of the bridge issuer. Whenever the Board of Directors of the Corporation determines it is advisable to do so, the Corporation shall cause capital stock of a bridge payment stablecoin issuer to be issued and offered for sale in such amounts and on such terms and conditions as the Corporation may, in its discretion, determine. A bridge payment stablecoin issuer shall not be considered undercapitalized under any other provision of Federal law. A bridge payment stablecoin issuer shall not be considered an agency, establishment, or instrumentality of the United States. Representatives for purposes of paragraph (1)(C), interim directors, directors, officers, employees, or agents of a bridge payment stablecoin issuer shall not be considered, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Corporation or of any Federal instrumentality who serves at the request of the Corporation as a representative for purposes of paragraph (1)(C), interim director, director, officer, employee, or agent of a bridge payment stablecoin issuer shall not— solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5, United States Code, or any other provision of law; or receive any salary or benefits for service in any such capacity with respect to a bridge payment stablecoin issuer in addition to such salary or benefits as are obtained through employment with the Corporation or such Federal instrumentality. Subject to paragraphs
(8)and (9), the status of a bridge payment stablecoin issuer as such shall terminate at the end of the 2-year period following the date it was granted a charter. The Board of Directors of the Corporation may, in its discretion, extend the status of the bridge payment stablecoin issuer as such for 3 additional 1-year periods. The status of any bridge payment stablecoin issuer as such shall terminate upon the earliest of— the merger or consolidation of the bridge issuer with a payment stablecoin issuer that is not a bridge issuer; at the election of the Corporation, the sale of a majority of the capital stock of the bridge payment stablecoin issuer to an entity other than the Corporation and other than another bridge issuer; the sale of 80 percent, or more, of the capital stock of the bridge payment stablecoin issuer to an entity other than the Corporation and other than another bridge issuer; at the election of the Corporation, either the assumption of all or substantially all of the payment stablecoin liabilities of the bridge payment stablecoin issuer by another payment stablecoin issuer, or the acquisition of all or substantially all of the assets of the bridge issuer by a payment stablecoin issuer that is not a bridge issuer, or other entity as permitted under applicable law; and the expiration of the period provided in paragraph (7), or the earlier dissolution of the bridge payment stablecoin issuer as provided in paragraph (10). A bridge payment stablecoin issuer that participates in a merger or consolidation as provided in paragraph (8)(A) shall be for all purposes a payment stablecoin issuer that is a depository institution under the supervision and regulation of the Comptroller, as the case may be, with all the rights, powers, and privileges thereof, and such merger or consolidation shall be conducted in accordance with, and shall have the effect provided in, the provisions of applicable law. Following the sale of a majority of the capital stock of the bridge payment stablecoin issuer as provided in paragraph (8)(B), the Corporation may amend the charter of the bridge payment stablecoin issuer to reflect the termination of the status of the bridge issuer as such, whereupon the issuer shall remain a depository institution under the supervision of the Comptroller, as the case may be, with all of the rights, powers, and privileges thereof, subject to all laws and regulations applicable thereto. Following the sale of 80 percent or more of the capital stock of a bridge payment stablecoin issuer as provided in paragraph (8)(C), the payment stablecoin issuer shall remain a depository institution that is a payment stablecoin issuer under the supervision of the Comptroller, with all of the rights, powers, and privileges thereof, subject to all laws and regulations applicable thereto. Following the assumption of all or substantially all of the liabilities of the bridge payment stablecoin issuer, or the sale of all or substantially all of the assets of the bridge issuer, as provided in paragraph (8)(D), at the election of the Corporation, the bridge issuer may retain its status as such for the period provided in paragraph (7). Following the consummation of a transaction described in subparagraph (A), (B), (C), or
(D)of paragraph (8), the charter of the resulting issuer shall be amended to reflect the termination of bridge payment stablecoin issuer status, if appropriate. Notwithstanding any other provision of State or Federal law, if the bridge payment stablecoin issuer’s status as such has not previously been terminated by the occurrence of an event specified in subparagraph (A), (B), (C), or
(D)of paragraph (8)— the Board of Directors of the Corporation may, in its discretion, dissolve a bridge payment stablecoin issuer in accordance with this paragraph at any time; and the Board of Directors of the Corporation shall promptly commence dissolution proceedings in accordance with this paragraph upon the expiration of the 2-year period following the date the bridge payment stablecoin issuer was chartered, or any extension thereof, as provided in paragraph (7). The Comptroller shall appoint the Corporation as receiver for a bridge payment stablecoin issuer upon certification by the Board of Directors of the Corporation to the Comptroller of its determination to dissolve the bridge issuer. The Corporation as such receiver shall wind up the affairs of the bridge issuer. With respect to any such bridge payment stablecoin issuer, the Corporation as such receiver shall have all the rights, powers, and privileges and shall perform the duties related to the exercise of such rights, powers, or privileges granted by law to a receiver of payment stablecoin issuers and notwithstanding any other provision of law in the exercise of such rights, powers, and privileges the Corporation shall not be subject to the direction or supervision of any State agency or other Federal agency. Subject to paragraph (1)(B)(i), the Corporation may, in the Corporation’s discretion, organize 2 or more bridge payment stablecoin issuers under this subsection to assume any payment stablecoin liabilities, and purchase any assets of a single payment stablecoin issuer in default. Whenever the Corporation has been appointed as receiver for a payment stablecoin issuer, the Comptroller or State bank supervisor, and the Board, shall make available all supervisory records to the receiver which may be used by the receiver in any manner the receiver determines to be appropriate. The Corporation shall prescribe regulations which, at a minimum, shall prohibit the sale of assets of a failed payment stablecoin issuer by the Corporation to— any person who— has defaulted, or was a member of a partnership or an officer or director of a corporation that has defaulted, on 1 or more obligations the aggregate amount of which exceed $1,000,000, to such failed payment stablecoin issuer; and proposes to purchase any such asset in whole or in part through the use of the proceeds of a loan or advance of credit from the Corporation or from any institution for which the Corporation has been appointed as conservator or receiver; any person who participated, as an officer or director of such failed issuer or of any affiliate of such issuer, in a material way in transactions that resulted in a substantial loss to such failed issuer; any person who has been removed from, or prohibited from participating in the affairs of, such failed issuer pursuant to any final enforcement action by the Comptroller, State bank supervisor or the Board; or any person who has demonstrated a pattern or practice of defalcation regarding obligations to such failed issuer. Except as provided in paragraph (3), any person who has been convicted of an offense under section 215, 656, 657, 1005, 1006, 1007, 1008, 1014, 1032, 1341, 1343, or 1344 of title 18, United States Code, or of conspiring to commit such an offense, affecting any payment stablecoin issuer for which the Corporation was appointed conservator or receiver, may not purchase any asset of such institution from the Corporation as conservator or receiver. Paragraphs
(1)and
(2)shall not apply to the sale or transfer by the Corporation of any asset of any payment stablecoin issuer to any person if the sale or transfer of the asset resolves or settles, or is part of the resolution or settlement, of— 1 or more claims that have been, or could have been, asserted by the Corporation against the person; or obligations owed by the person to any payment stablecoin issuer or the Corporation. The notice of appeal of any order, whether interlocutory or final, entered in any case brought by the Corporation against a payment stablecoin issuer’s director, officer, employee, agent, attorney, accountant, or appraiser or any other person employed by or providing services to a payment stablecoin issuer shall be filed not later than 30 days after the date of entry of the order. The hearing of the appeal shall be held not later than 120 days after the date of the notice of appeal. The appeal shall be decided not later than 180 days after the date of the notice of appeal. Consistent with section 1657 of title 28, United States Code, a court of the United States shall expedite the consideration of any case brought by the Corporation against a payment stablecoin issuer’s director, officer, employee, agent, attorney, accountant, or appraiser or any other person employed by or providing services to the issuer. As far as practicable, the court shall give such case priority on its docket. The court may modify the schedule and limitations stated in paragraphs
(1)and
(2)in a particular case, based on a specific finding that the ends of justice that would be served by making such a modification would outweigh the best interest of the public in having the case resolved expeditiously. The Corporation, as conservator or receiver of a payment stablecoin and for purposes of carrying out any power, authority, or duty with respect to an issuer— may request the assistance of any foreign banking authority and provide assistance to any foreign banking authority in accordance with section 8(v) of the Federal Deposit Insurance Act ( 12 U.S.C. 1818(v) ); and may each maintain an office to coordinate foreign investigations or investigations on behalf of foreign banking authorities. The Corporation may not enter into any agreement or approve any protective order which prohibits the Corporation from disclosing the terms of any settlement of an administrative or other action for damages or restitution brought by the Corporation in its capacity as conservator or receiver for a payment stablecoin issuer. A covered agency, in any capacity, shall not be deemed to have waived any privilege applicable to any information by transferring that information to or permitting that information to be used by— any other covered agency, in any capacity; or any other agency of the Federal Government (as defined in section 6 of title 18, United States Code). For purposes of this subsection: The term covered agency means any of the following: Any Federal banking agency or State bank supervisor. The Farm Credit Administration. The Farm Credit System Insurance Corporation. The National Credit Union Administration. The Government Accountability Office. The Bureau of Consumer Financial Protection. The Federal Housing Finance Agency. The term privilege includes any work-product, attorney-client, or other privilege recognized under Federal or State law. Paragraph
(1)shall not be construed as implying that any person waives any privilege applicable to any information because paragraph
(1)does not apply to the transfer or use of that information.
Connectionstraces to 16
2 references not yet in our index
  • Pub. L. 106-102
  • 113 Stat. 1338
Citation graph
cites case law
Sec. 9
Appointment of FDIC as conservator or receiver of payment stablecoin issuers
U.S.C.§ 1824
U.S.C.§ 1818
U.S.C.§ 1820
U.S.C.§ 1823
U.S.C.§ 1815
U.S.C.§ 91
U.S.C.§ 78c
U.S.C.§ 27
U.S.C.§ 1
Pub. L.Pub. L. 106-102
Stat.113 Stat. 1338
Cites 18 · showing 11Cited by 0 across 0 sources
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