Sec. 423. Terrorist financing prevention

1,140 words·~5 min read·/bill/118/s/4443/rs/section-423

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In this section: The term digital asset means any digital representation of value that is recorded on a cryptographically secured distributed ledger or any similar technology, or another implementation which was designed and built as part of a system to leverage or replace blockchain or distributed ledger technology or their derivatives. The term digital asset protocol means any communication protocol, smart contract, or other software— deployed through the use of distributed ledger or similar technology; and that provides a mechanism for users to interact and agree to the terms of a trade for digital assets.

The term foreign digital asset transaction facilitator means any foreign person or group of foreign persons that, as determined by the Secretary, controls, operates, or makes available a digital asset protocol or similar facility, or otherwise materially assists in the purchase, sale, exchange, custody, or other transaction involving an exchange or transfer of value using digital assets. The term foreign financial institution has the meaning given that term under section 561.308 of title 31, Code of Federal Regulations.

The term foreign person means an individual or entity that is not a United States person. The term foreign terrorist organization means an organization that has been designated as a foreign terrorist organization by the Secretary of State, pursuant to section 219 of the Immigration and Nationality Act ( 8 U.S.C. 1189 ). The term good means any article, natural or manmade substance, material, supply, or manufactured product, including inspection and test equipment, and excluding technical data.

The term Secretary means the Secretary of the Treasury. The term specially designated global terrorist organization means an organization that has been designated as a specially designated global terrorist by the Secretary of State or the Secretary, pursuant to Executive Order 13224 ( 50 U.S.C. 1701 note; relating to blocking property and prohibiting transactions with persons who commit, threaten to commit, or support terrorism). The term United States person means— an individual who is a United States citizen or an alien lawfully admitted for permanent residence to the United States; an entity organized under the laws of the United States or any jurisdiction within the United States, including a foreign branch of such an entity; or any person in the United States.

Not later than 60 days after the date of enactment of this Act, and periodically thereafter, the Secretary shall identify and submit to the President a report identifying any foreign financial institution or foreign digital asset transaction facilitator that has knowingly— facilitated a significant financial transaction with— a Foreign Terrorist Organization; a specially designated global terrorist organization; or a person identified on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury, the property and interests in property of which are blocked pursuant to the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq. ) for acting on behalf of or at the direction of, or being owned or controlled by, a foreign terrorist organization or a specially designated global terrorist organization; or engaged in money laundering to carry out an activity described in subparagraph (A).

The President shall prohibit, or impose strict conditions on, the opening or maintaining of a correspondent account or a payable-through account in the United States by a foreign financial institution identified under paragraph (1). The President, pursuant to such regulations as the President may prescribe, shall prohibit any transactions between any person subject to the jurisdiction of the United States and a foreign digital asset transaction facilitator identified under paragraph (1).

The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act ( 50 U.S.C. 1702 , 1704) to the extent necessary to carry out this Act. The penalties set forth in subsections

(b)and

(c)of section 206 of the International Emergency Economic Powers Act ( 50 U.S.C. 1705 ) shall apply to a person that violates, attempts to violate, conspires to violate, or causes a violation of regulations prescribed under this section to the same extent that such penalties apply to a person that commits an unlawful act described in subsection

(a)of such section 206. If a finding under this subsection, or a prohibition, condition, or penalty imposed as a result of any such finding, is based on classified information (as defined in section 1(a) of the Classified Information Procedures Act (18 U.S.C. App.)), the Secretary may submit to a court reviewing the finding or the imposition of the prohibition, condition, or penalty such classified information ex parte and in camera. Nothing in this paragraph shall be construed to confer or imply any right to judicial review of any finding under this subsection or any prohibition, condition, or penalty imposed as a result of any such finding. The Secretary may waive the imposition of sanctions under this subsection with respect to a person if the Secretary— determines that such a waiver is in the national interests of the United States; and submits to Congress a notification of the waiver and the reasons for the waiver. This subsection shall not apply with respect to any activity subject to the reporting requirements under title V of the National Security Act of 1947 ( 50 U.S.C. 3091 et seq. ) or any authorized intelligence activities of the United States. The authorities and requirements under this section shall not include the authority or a requirement to impose sanctions on the importation of goods. Section 5318A of title 31, United States Code, is amended— in subsection (a)(2)(C), by striking subsection (b)(5) and inserting paragraphs

(5)and

(6)of subsection

(b); and in subsection (b)— in paragraph (5), by striking for or on behalf of a foreign banking institution ; and by adding at the end the following: If the Secretary finds a jurisdiction outside of the United States, 1 or more financial institutions operating outside of the United States, 1 or more types of accounts within, or involving, a jurisdiction outside of the United States, or 1 or more classes of transactions within, or involving, a jurisdiction outside of the United States to be of primary money laundering concern, the Secretary, in consultation with the Secretary of State, the Attorney General, and the Chairman of the Board of Governors of the Federal Reserve System, may prohibit, or impose conditions upon, certain transmittals of funds (as such term may be defined by the Secretary in a special measure issuance, by regulation, or as otherwise permitted by law), to or from any domestic financial institution or domestic financial agency if such transmittal of funds involves any such jurisdiction, institution, type of account, class of transaction, or type of account. . There is authorized to be appropriated to the Secretary such funds as are necessary to carry out the purposes of this section.

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8 USC 1189
EO 13224
50 USC 1701
50 USC 1702
50 USC 1705
50 USC 3091

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cites case law

Sec. 423

Terrorist financing prevention

Cite8 USC 1189

Exec. Ord.EO 13224

Cite50 USC 1701

Cite50 USC 1702

Cite50 USC 1705

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