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S. 1057 (104th): A bill to amend section 1956 of title 18, United States Code to include equity skimming as a predicate offense, to amend section 1516 of title 18, United States Code to curtail delays in the perfomance of audits, and for other purposes.


The text of the bill below is as of Jul 21, 1995 (Introduced). The bill was not enacted into law.


S 1057 IS

104th CONGRESS

1st Session

S. 1057

To amend section 1956 of title 18, United States Code, to include equity skimming as a predicate offense, to amend section 1516 of title 18, United States Code, to curtail delays in the performance of audits, and for other purposes.

IN THE SENATE OF THE UNITED STATES

July 21 (legislative day, JULY 10), 1995

Mr. COHEN (for himself, Mr. D’AMATO, Mr. BOND, Mr. FAIRCLOTH, and Mr. MACK) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs


A BILL

To amend section 1956 of title 18, United States Code, to include equity skimming as a predicate offense, to amend section 1516 of title 18, United States Code, to curtail delays in the performance of audits, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. FINDINGS.

    The Congress finds that--

      (1) the Federal Government makes available mortgage insurance and other assistance to encourage investors and lending institutions to provide housing to low-income individuals and families;

      (2) in general, this current system functions well;

      (3) some unscrupulous owners of federally assisted housing, however, have diverted Federal housing subsidies and other funds to personal and other improper uses, while failing to make payments on their insured mortgages or maintain the assisted housing;

      (4) this practice of diverting funds, known as equity skimming, has cost the Nation’s taxpayers an estimated $6,000,000,000; and

      (5) current law is inadequate to deter or prevent the practice of equity skimming.

SEC. 2. INCLUSION OF EQUITY SKIMMING AS A LAUNDERING OFFENSE.

    Section 1956(c)(7)(D) of title 18, United States Code, is amended by inserting ‘section 254 of the National Housing Act (relating to equity skimming),’ before ‘or any felony violation of the Foreign Corrupt Practices Act’.

SEC. 3. OBSTRUCTION OF FEDERAL AUDIT.

    Section 1516(a) of title 18, United States Code, is amended by inserting ‘or relating to any property that is security for a mortgage that is insured, guaranteed, acquired, or held by the Secretary of Housing and Urban Development pursuant to any provision of law described in section 254(a) of the National Housing Act,’ after ‘under a contract or subcontract,’.

SEC. 4. EFFECT OF EQUITY SKIMMING ON MORTGAGE INSURANCE.

    Section 254 of the National Housing Act (12 U.S.C. 1715z-19) is amended--

      (1) by striking ‘Whoever’ and inserting the following:

    ‘(a) IN GENERAL- Whoever’; and

      (2) by adding at the end the following new subsection:

    ‘(b) EFFECT OF VIOLATION- Each contract for insurance under any provision of law described in subsection (a) shall provide that if an owner, agent, manager, or other person who is otherwise in custody, control, or possession of any property described in subsection (a) is convicted of a violation of that subsection, the Secretary may recover from such owner, agent, manager, or other person an amount equal to the sum of--

      ‘(1) any benefit of insurance conferred on the mortgagee by the Secretary with respect to such property; and

      ‘(2) any loss incurred by the Secretary in connection with such property;

    if the Secretary determines that the violation contributed to such conferred benefit or incurred loss. Any recovery under this subsection shall be in addition to any fine, imprisonment, or other penalty imposed under subsection (a).’.