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H.R. 3329 (115th): Hizballah International Financing Prevention Amendments Act of 2017


The text of the bill below is as of Oct 24, 2017 (Reported by House Committee).


IB

Union Calendar No. 268

115th CONGRESS

1st Session

H. R. 3329

[Report No. 115–366, Part I]

IN THE HOUSE OF REPRESENTATIVES

July 20, 2017

(for himself and Mr. Engel) introduced the following bill; which was referred to the Committee on Foreign Affairs, and in addition to the Committees on Financial Services, and the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

October 24, 2017

Additional sponsors: Mr. Fitzpatrick, Mr. Roskam, Mr. O'Halleran, Ms. Hanabusa, Mr. Murphy of Pennsylvania, Mr. Brendan F. Boyle of Pennsylvania, Mr. Deutch, Mr. Brooks of Alabama, Mrs. Napolitano, Mr. Hudson, Ms. Frankel of Florida, Mr. Palazzo, Ms. Wasserman Schultz, Mr. Culberson, Mr. Hastings, Mr. Higgins of New York, Mr. Walker, Mr. Garrett, Mr. Poe of Texas, Mrs. Walorski, Mr. Conaway, Mr. Jenkins of West Virginia, Mr. Harris, Ms. Meng, Mr. Gene Green of Texas, Mr. Jeffries, Mr. Gaetz, Mr. Zeldin, Mr. Schneider, Mr. Carbajal, Mr. Coffman, Mr. Delaney, Mr. Posey, Mr. Gohmert, Mr. Kustoff of Tennessee, Ms. Rosen, Mr. Brown of Maryland, Mr. Carter of Georgia, Mr. Hollingsworth, Mr. Perry, Mr. Cole, Mr. Messer, Mrs. Noem, Mr. Sherman, Mr. Cicilline, Mr. Duncan of South Carolina, Mrs. Demings, Ms. Sinema, Mr. Frelinghuysen, Mr. Cook, Mrs. Lowey, Mr. Budd, Mr. Grothman, Mr. Buchanan, Mr. Sean Patrick Maloney of New York, Mrs. McMorris Rodgers, Mr. Himes, Mr. Pascrell, Mr. Gottheimer, Mr. Graves of Georgia, Mr. Gomez, Mr. Carter of Texas, Mr. Bilirakis, Mr. Costello of Pennsylvania, Mr. McHenry, Mr. King of New York, Mr. Veasey, Mr. Francis Rooney of Florida, Mr. Rokita, Mr. Ted Lieu of California, Mr. Dunn, Mr. Bacon, Mr. Suozzi, Mr. Hoyer, Mr. McCaul, Mr. Quigley, Mr. Lamborn, Mrs. Love, Ms. Tenney, Mr. Joyce of Ohio, Ms. Granger, Mr. Williams, Mr. Smith of Texas, Mr. Johnson of Georgia, Mr. Ryan of Ohio, Mr. Payne, Ms. Kaptur, Mr. Curbelo of Florida, Mr. Barr, Mr. LoBiondo, Mr. Barletta, Mr. Valadao, Mr. Thompson of Pennsylvania, Mr. Soto, Mr. Cramer, Mr. Bishop of Georgia, Mr. Young of Iowa, Mr. Thomas J. Rooney of Florida, Mr. O'Rourke, Mr. Pallone, Mr. Kilmer, Mr. Larson of Connecticut, Mr. Meadows, Mr. Sessions, Mr. Ross, Mr. Moulton, Ms. Ros-Lehtinen, Mr. Nadler, Ms. Cheney, Ms. Esty of Connecticut, Mr. Norcross, Mr. Scalise, and Mr. Gibbs

October 24, 2017

Reported from the Committee on Foreign Affairs with an amendment

Strike out all after the enacting clause and insert the part printed in italic

October 24, 2017

The Committees on Financial Services and the Judiciary discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed

For text of introduced bill, see copy of bill as introduced on July 20, 2017

A BILL

To amend the Hizballah International Financing Prevention Act of 2015 to impose additional sanctions with respect to Hizballah, and for other purposes.


1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Hizballah International Financing Prevention Amendments Act of 2017.

(b)

Table of contents

The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Title I—Prevention of access by Hizballah to international financial and other institutions

Sec. 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah.

Sec. 102. Modification of report with respect to financial institutions that engage in certain transactions.

Sec. 103. Sanctions against foreign states that support Hizballah.

Sec. 104. Prohibitions and conditions with respect to certain accounts held by foreign financial institutions.

Sec. 105. United States strategy to prevent hostile activities by Iran and disrupt and degrade Hizballah’s illicit networks in the Western Hemisphere.

Title II—Narcotics trafficking and significant transnational criminal activities of Hizballah

Sec. 201. Blocking of property of affiliated networks of Hizballah.

Sec. 202. Report on racketeering activities engaged in by Hizballah.

Sec. 203. Modification of report on activities of foreign governments to disrupt global logistics networks and fundraising, financing, and money laundering activities of Hizballah.

Sec. 204. Report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations.

Title III—General provisions

Sec. 301. Regulatory authority.

Sec. 302. Implementation; penalties; judicial review; exemptions.

I

Prevention of access by Hizballah to international financial and other institutions

101.

Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah

(a)

In general

Section 101 of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended to read as follows:

101.

Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah

(a)

In general

The President shall, on or after the date of the enactment of this section, impose the sanctions described in subsection (b) with respect to any foreign person that the President determines knowingly assists, sponsors, or, provides significant financial, material, or technological support for—

(1)

Bayt al-Mal, Jihad al-Bina, the Islamic Resistance Support Association, the Foreign Relations Department of Hizballah, the External Security Organization of Hizballah, or any successor or affiliate thereof;

(2)

al-Manar TV, al Nour Radio, or the Lebanese Media Group, or any successor or affiliate thereof;

(3)

a foreign person determined by the President to be engaged in fundraising or recruitment activities for Hizballah; or

(4)

a foreign person owned or controlled by a foreign person described in paragraph (1), (2), or (3).

(b)

Sanctions described

(1)

In general

The sanctions described in this subsection are the following:

(A)

Asset blocking

The exercise of all powers granted to the President by the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (except that the requirements of section 202 of such Act (50 U.S.C. 1701) shall not apply) to the extent necessary to block and prohibit all transactions in all property and interests in property of a foreign person determined by the President to be subject to subsection (a) if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person.

(B)

Aliens ineligible for visas, admission, or parole

(i)

Visas, admission, or parole

An alien who the President determines is subject to subsection (a) is—

(I)

inadmissible to the United States;

(II)

ineligible to receive a visa or other documentation to enter the United States; and

(III)

otherwise ineligible to be admitted or paroled into the United States or to receive any other benefit under the Immigration and Nationality Act (8 U.S.C. 1101 et seq.).

(ii)

Current visas revoked

(I)

In general

The issuing consular officer, the Secretary of State, or the Secretary of Homeland Security shall revoke any visa or other entry documentation issued to an alien who the President determines is subject to subsection (a), regardless of when issued.

(II)

Effect of revocation

A revocation under subclause (I) shall take effect immediately and shall automatically cancel any other valid visa or entry documentation that is in the possession of the alien.

(2)

Penalties

The penalties provided for 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 paragraph (1)(A) to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206.

(c)

Implementation

The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act (50 U.S.C. 1702 and 1704) to carry out this section.

(d)

Waiver

(1)

In general

The President may, for periods not to exceed 180 days, waive the imposition of sanctions under this section with respect to a foreign person or foreign persons if the President certifies to the appropriate congressional committees that such waiver is in the national security interests of the United States.

(2)

Consultation

(A)

Before waiver exercised

Before a waiver under paragraph (1) takes effect with respect to a foreign person, the President shall notify and brief the appropriate congressional committees on the status of the involvement of the foreign person in activities described in subsection (a).

(B)

After waiver exercised

Not later than 90 days after the issuance of a waiver under paragraph (1) with respect to a foreign person, and every 120 days thereafter while the waiver remains in effect, the President shall brief the appropriate congressional committees on the status of the involvement of the foreign person in activities described in subsection (a).

(e)

Report

Not later than 90 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017, and every 180 days thereafter, the President shall submit to the appropriate congressional committees a report that lists the foreign persons that the President has credible evidence knowingly assists, sponsors, or provides significant financial, material, or technological support for the foreign persons described in paragraph (1), (2), (3), or (4) of subsection (a).

(f)

Definitions

In this section:

(1)

Admitted; alien

The terms admitted and alien have meanings given those terms in section 101 of the Immigration and Nationality Act (8 U.S.C. 1101).

(2)

Appropriate congressional committees

The term appropriate congressional committees means—

(A)

the Committee on Foreign Affairs, the Committee on Ways and Means, the Committee on the Judiciary, and the Committee on Financial Services of the House of Representatives; and

(B)

the Committee on Foreign Relations, the Committee on Banking, Housing, and Urban Affairs, and the Committee on the Judiciary of the Senate.

(3)

Entity

The term entity

(A)

means a partnership, association, corporation, or other organization, group, or subgroup; and

(B)

includes a governmental entity

(4)

Fundraising or recruitment activities

The term fundraising or recruitment activities includes online fundraising and other online commercial activities, or other means of such fundraising, recruitment, and retention, as determined by the President.

(5)

Hizballah

The term Hizballah has the meaning given such term in section 102(f).

(6)

Person

The term person means an individual or entity.

(7)

United States person

The term United States person means a United States citizen, permanent resident alien, entity organized under the laws of the United States (including foreign branches), or a person in the United States.

.

(b)

Clerical amendment

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by striking the item relating to section 101 and inserting the following new item:

Sec. 101. Mandatory sanctions with respect to fundraising and recruitment activities for Hizballah.

.

102.

Modification of report with respect to financial institutions that engage in certain transactions

(a)

In general

Subsection (d) of section 102 of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended to read as follows:

(d)

Report on financial institutions organized under the laws of state sponsors of terrorism

(1)

In general

Not later than 90 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017, and annually thereafter for a period not to exceed three years, the President shall submit to the appropriate congressional committees a report that—

(A)

identifies each foreign financial institution described in paragraph (2) that the President determines engages in one or more activities described in subsection (a)(2);

(B)

provides a detailed description of each such activity; and

(C)

contains a determination with respect to each such foreign financial institution that is identified under subparagraph (A) as engaging in one or more activities described in subsection (a)(2) as to whether or not such foreign financial institution is in violation of 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) or section 2339B of title 18, United States Code, by reason of engaging in one or more such activities.

(2)

Foreign financial institution described

(A)

In general

A foreign financial institution described in this paragraph is a foreign financial institution—

(i)

that, wherever located, is—

(I)

organized under the laws of a state sponsor of terrorism or any jurisdiction within a state sponsor of terrorism;

(II)

owned or controlled by the government of a state sponsor of terrorism;

(III)

located in the territory of a state sponsor of terrorism; or

(IV)

owned or controlled by a foreign financial institution described in subclause (I), (II), or (III); and

(ii)

the capitalization of which exceeds $10,000,000.

(B)

State sponsor of terrorism

In this paragraph, the term state sponsor of terrorism means a country the government of which the Secretary of State has determined is a government that has repeatedly provided support for acts of international terrorism for purposes of—

(i)

section 6(j) of the Export Administration Act of 1979 (50 U.S.C. 4605(j)) (as continued in effect pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.));

(ii)

section 620A of the Foreign Assistance Act of 1961 (22 U.S.C. 2371);

(iii)

section 40 of the Arms Export Control Act (22 U.S.C. 2780); or

(iv)

any other provision of law.

.

(b)

Sense of Congress

It is the sense of the Congress that—

(1)

all countries should designate the entirety of Hizballah as a terrorist organization; and

(2)

the notion of separate Hizballah political and military wings is an artificial construct that attempts to legitimize Hizballah members of parliament and Hizballah cabinet officials who are complicit in Hizballah’s use of violence and coercion against its political opponents.

(c)

Modification of definition of Hizballah

Clause (ii) of section 102(f)(1)(E) of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended—

(1)

by striking (I) and inserting (I)(aa);

(2)

by striking (II) and inserting (bb);

(3)

by striking of Hizballah. and inserting of Hizballah; or; and

(4)

by adding at the end the following:

(II)

who the President determines is an agent or affiliate of, or is owned or controlled by Hizballah.

.

(d)

Report

(1)

In general

Not later than 120 days after the date of the enactment of this Act, the President shall transmit to the appropriate congressional committee a report that contains a description of any sanctions described in section 102 of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) apply with respect to a foreign financial institution by reason of engaging in an activity described in subsection (a)(2) of such section with a member of the Lebanese parliament or any cabinet official of the Lebanese Republic who is a member of Hizballah or identifies as such.

(2)

Form

The report required by this subsection shall be transmitted in unclassified form but may include a classified annex.

103.

Sanctions against foreign states that support Hizballah

(a)

In general

Title I of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended by adding at the end the following:

103.

Sanctions against foreign states that support Hizballah

(a)

Sanctions against certain agencies and instrumentalities of foreign states

(1)

In general

Not later than 90 days after the date of the enactment of this section, and as appropriate thereafter, the President shall impose the sanctions described in paragraph (3) with respect to any agency or instrumentality of a foreign state described in paragraph (2).

(2)

Agency or instrumentality described

An agency or instrumentality of a foreign state described in this paragraph is an agency or instrumentality of a foreign state that the President determines has, on or after the date of the enactment of this section, knowingly—

(A)

directly or indirectly conducted combat operations with, or supported combat operations of, Hizballah or an entity owned or controlled by Hizballah; or

(B)

directly or indirectly provided significant financial or material support for, or significant arms or related material to, Hizballah or an entity owned or controlled by Hizballah.

(3)

Sanctions described

The sanctions described in this paragraph are the exercise of all powers granted to the President by the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (except that the requirements of section 202 of such Act (50 U.S.C. 1701) shall not apply) to the extent necessary to block and prohibit all transactions in all property and interests in property of an agency or instrumentality of a foreign state if such property and interests in property are in the United States, come within the United States, or are or come within the possession or control of a United States person.

(b)

Sanctions against state sponsors of terrorism

(1)

In general

In the case of an agency or instrumentality of a foreign state that engages in the activities described in subsection (a) that is an agency or instrumentality of a foreign state described in paragraph (2), the President shall, pursuant to section 6 of the Export Administration Act of 1979 (as continued in effect pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.)), require a license under the Export Administration Regulations to export or re-export to that foreign state any item designated by the Secretary of Commerce as EAR 99, other than food, medicine, medical devices, or similarly licensed items.

(2)

Foreign state described

A foreign state described in this paragraph is a foreign state that—

(A)

the President determines has, on or after the date of the enactment of this section, knowingly provided significant financial or material support for, or arms or related material to—

(i)

Hizballah; or

(ii)

an entity owned or controlled by Hizballah; and

(B)

is a state sponsor of terrorism.

(c)

Waiver

(1)

In general

The President may, for periods not to exceed 180 days, waive the imposition of sanctions under this section with respect to a foreign state or an agency or instrumentality of a foreign state if the President certifies to the appropriate congressional committees that such waiver is vital to the national security interests of the United States.

(2)

Consultation

(A)

Before waiver exercised

Before a waiver under paragraph (1) takes effect with respect to a foreign state or an agency or instrumentality of a foreign state, the President shall notify and brief the appropriate congressional committees on the status of the involvement of the foreign state in activities described in subsection (b)(2) or involvement of the agency or instrumentality of a foreign state in activities described in subsection (a)(2), as the case may be.

(B)

After waiver exercised

Not later than 90 days after the issuance of a waiver under paragraph (1) with respect to a foreign state or an agency or instrumentality of a foreign state, and every 120 days thereafter while the waiver remains in effect, the President shall brief the appropriate congressional committees on the status of the involvement of the foreign state in activities described in subsection (b)(2) or involvement of the agency or instrumentality of a foreign state in activities described in subsection (a)(2), as the case may be.

(d)

Report on supply chain of Hizballah’s missile production facilities

(1)

In general

Not later than 120 days after the date of the enactment of this subsection, the President shall submit to the appropriate congressional committees a report that contains the following:

(A)

An analysis of the foreign and domestic supply chain that significantly facilitates, supports, or otherwise aids Hizballah’s acquisition or development of missile production facilities.

(B)

A description of the geographic distribution of the foreign and domestic supply chain described in subparagraph (A).

(C)

An assessment of the provision of goods, services, or technology transferred to Hizballah by the Government of Iran or its affiliates to indigenously manufacture or otherwise produce missiles.

(D)

An identification of foreign persons that have, on or after the date of the enactment of this subsection, and based on credible evidence—

(i)

knowingly provided significant financial or material support for, or significant arms or related material to, Hizballah or an entity owned or controlled by Hizballah; or

(ii)

knowingly facilitated the transfer of significant arms or related materiel to Hizballah utilizing commercial aircraft or air carriers.

(E)

A description of the steps that the President is taking to disrupt the foreign and domestic supply chain described in subparagraph (A).

(2)

Form

The report required under paragraph (1) shall be submitted in unclassified form, but may contain a classified annex.

(e)

Definitions

In this section:

(1)

Agency or instrumentality of a foreign state; foreign state

The terms agency or instrumentality of a foreign state and foreign state have the meanings given those terms in section 1603 of title 28, United States Code.

(2)

Appropriate congressional committees

The term appropriate congressional committees means—

(A)

the Committee on Foreign Affairs, the Committee on Financial Services, the Committee on Ways and Means, and the Committee on the Judiciary of the House of Representatives; and

(B)

the Committee on Foreign Relations, the Committee on Banking, Housing, and Urban Affairs, and the Committee on the Judiciary of the Senate.

(3)

Arms or related material

The term arms or related material means—

(A)

nuclear, biological, chemical, or radiological weapons or materials or components of such weapons;

(B)

ballistic or cruise missile weapons or materials or components of such weapons;

(C)

destabilizing numbers and types of advanced conventional weapons;

(D)

defense articles or defense services, as those terms are defined in paragraphs (3) and (4), respectively, of section 47 of the Arms Export Control Act (22 U.S.C. 2794); or

(E)

defense information, as that term is defined in section 644 of the Foreign Assistance Act of 1961 (22 U.S.C. 2403).

(4)

Export Administration Regulations

The term Export Administration Regulations means subchapter C of chapter VII of title 15, Code of Federal Regulations (as in effect on the date of the enactment of this Act).

(5)

Hizballah

The term Hizballah has the meaning given that term in section 102(f).

(6)

State sponsor of terrorism

In this paragraph, the term state sponsor of terrorism means a country the government of which the Secretary of State has determined is a government that has repeatedly provided support for acts of international terrorism for purposes of—

(A)

section 6(j) of the Export Administration Act of 1979 (50 U.S.C. 4605(j)) (as continued in effect pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.));

(B)

section 620A of the Foreign Assistance Act of 1961 (22 U.S.C. 2371);

(C)

section 40 of the Arms Export Control Act (22 U.S.C. 2780); or

(D)

any other provision of law.

.

(b)

Clerical amendment

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by inserting after the item relating to section 102 the following new item:

Sec. 103. Sanctions against foreign states that support Hizballah.

.

(c)

Report on significant material support and arms or related materiel provided by the Russian Federation to Hizballah

(1)

In general

Not later than 120 days after the date of the enactment of this Act, the President shall submit to the appropriate congressional committees a report that contains the following:

(A)

A description of significant material support and arms or related material that the Government of the Russian Federation has, on or after the date of the enactment of this Act, knowingly, directly or indirectly, provided to Hizballah or an entity owned or controlled by Hizballah.

(B)

An analysis of the extent to which Russian strategic weapons deployed in Syria, including air defense systems, have provided protection for Hizballah fighters in Syria.

(C)

An assessment of whether Russian counter-proliferation safeguards can ensure that any arms or related materiel described in subparagraph (A) will not be used against Israel in the future.

(2)

Form

The report required by paragraph (1) shall be submitted in unclassified form but may include a classified annex.

(3)

Definitions

In this subsection:

(A)

Appropriate congressional committees

The term appropriate congressional committees means the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate.

(B)

Arms or related material

The term arms or related material has the meaning given such term in section 103 of the Hizballah International Financing Prevention Act of 2015, as added by this section.

104.

Prohibitions and conditions with respect to certain accounts held by foreign financial institutions

Section 104(c)(2)(A)(ii) of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (22 U.S.C. 8513(c)(2)(A)(ii)) is amended by inserting before or support for acts of international terrorism the following , including Hizballah (as defined in section 102(f)(1)(E) of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note)), and any affiliates or successors thereof,.

105.

United States strategy to prevent hostile activities by Iran and disrupt and degrade Hizballah’s illicit networks in the Western Hemisphere

(a)

In general

Not later than 180 days after the date of the enactment of this Act, the Secretary of State shall submit to the relevant congressional committees a strategy to prevent hostile activities by Iran and disrupt and degrade Hizballah’s illicit networks in the Western Hemisphere that—

(1)

identifies Department of State priorities, in coordination with other executive branch agencies, for defining United States policy to protect United States interests from Iranian and Hizballah threats in the Western Hemisphere;

(2)

coordinates with other executive branch agencies to ensure that information-sharing, interdictions, arrests, investigations, indictments, sanctions, and designations related to Hizballah individuals or networks in the Western Hemisphere are integrated, coordinated, and publicly communicated by the United States in a manner that supports United States interests;

(3)

describes Iranian and Hizballah activities in the Western Hemisphere, their relationships with transnational criminal organizations in the region, their use of the region’s commodities trade to engage in illicit activities, and their use of Latin American and Caribbean visas, including through Citizenship by Investment Programs to seek admittance into the United States, as well as a plan to address any security vulnerabilities to the United States;

(4)

includes a review of all relevant United States sanctions that relate to Hizballah’s activities in Latin America and the Caribbean and an assessment of their use, effectiveness, and any capability gaps;

(5)

includes a review of the use of the Department of State’s rewards program under section 36 of the State Department Basic Authorities Act (22 U.S.C. 2708) to obtain information related to Latin America-based Hizballah operatives and illicit networks and an assessment of the effectiveness of this program for targeting Hizballah in the Western Hemisphere;

(6)

includes a review of all relevant United States sanctions on financial institutions in Latin America and the Caribbean that engage in activities outlined by section 102 of Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) and an assessment of the use of the authorities outlined, their effectiveness, and recommendations for improvement;

(7)

describes Hizballah criminal support networks, including country facilitation, in the Western Hemisphere and outlines a United States approach to partners in the region to address those illicit networks and build country capacity to combat the transnational criminal activities of Hizballah; and

(8)

includes a review of the actions of governments in the Western Hemisphere to identify, investigate, and prosecute Latin America-based Hizballah operatives, and enforce sanctions either personally or to their business interests of Latin America-based Hizballah operatives as well as recommendations for United States action towards governments who refuse to impose sanctions or who willingly facilitate Latin America-based Hizballah illicit activities.

(b)

Form

The strategy required by subsection (a) shall be submitted in unclassified form to the greatest extent possible but may include a classified annex.

(c)

Diplomatic engagement

(1)

In general

Title I of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 129 Stat. 2206; 50 U.S.C. 1701 note), as amended by section 103 of this Act, is further amended by adding at the end the following:

104.

Diplomatic initiatives

Not later than 90 days after the date of the enactment of this section, the President shall instruct—

(1)

the Secretary of State to increase cooperation with countries in the Western Hemisphere to assist in strengthening the capacity of governments to prevent hostile activity by Iran and disrupt and degrade Hizballah’s illicit networks operating in the region, including diplomatic engagement that involves—

(A)

efforts to target and expose illicit networks, arrest perpetrators, freeze assets, and attack Iran and Hizballah’s use of illicit networks using international trade and banking systems;

(B)

efforts to revoke or deny visas from those implicated in Hizballah’s activity in the region, including lawyers, accountants, business partners, service providers, and politicians who knowingly facilitate or fail to take measures to counter Hizballah’s illicit finance in their own jurisdictions;

(C)

efforts to assist willing nations with the development of counter-organized crime legislation, the strengthening of financial investigative capacity, and a fully-vetted counter-organized crime judicial model in places plagued with corruption; and

(D)

efforts to persuade governments in the region to list Hizballah as a terrorist organization;

(2)

the United States Permanent Representative to the Organization of American States to work to secure support at the Organization of American States for a resolution that would declare Hizballah as a terrorist organization and address Hizballah’s illicit networks operating in the region;

(3)

the United States Ambassador to the Organization for Security and Cooperation in Europe (OSCE) to work to secure a report on compliance by participating states with OSCE Decision Number 1063, the Consolidated Framework for the Fight Against Terrorism, in regard to Hizballah, with particular focus on the mandate to suppress the financing of terrorism, including its links with money-laundering and illegal economic activities, especially as it relates transatlantic relations, including with Latin America and the Caribbean; and

(4)

United States diplomats to work with international forums, including the Financial Action Task Force, to identify government entities within Latin America and the Caribbean that provide support, facilitation, or assistance to individuals affiliated with Hizballah in the Western Hemisphere.

.

(2)

Clerical amendment

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by inserting after the item related to section 103 the following new item:

Sec. 104. Diplomatic initiatives.

.

II

Narcotics trafficking and significant transnational criminal activities of Hizballah

201.

Blocking of property of affiliated networks of Hizballah

(a)

In general

Section 201 of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended to read as follows:

201.

Imposition of sanctions with respect to affiliated networks of Hizballah

(a)

In general

Not later than 120 days after the date of the enactment of this section, and as appropriate thereafter, the President shall impose the sanctions described in subsection (b) with respect to affiliated networks of Hizballah, including by reason of significant transnational criminal activities of such networks.

(b)

Sanctions described

The sanctions described in this subsection are sanctions applied with respect to a foreign person pursuant to Executive Order 13581 (75 Fed. Reg. 44,757) (as such Executive order was in effect on the day before the date of the enactment of this section).

(c)

Definition

In this section, the term Hizballah has the meaning given such term in section 102(f).

.

(b)

Clerical amendments

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended—

(1)

by striking the item relating to title II and inserting the following:

Title II—Imposition of sanctions with respect to affliated networks of Hizballah and reports and briefings on narcotics trafficking and significant transnational criminal activities of Hizballah

;

and
(2)

by striking the item relating to section 201 and inserting the following:

Sec. 201. Imposition of sanctions with respect to affiliated networks of Hizballah.

.

(c)

Effective date

The amendments made by this section take effect on the date that is 90 days after the date of the enactment of this Act.

202.

Report on racketeering activities engaged in by Hizballah

(a)

In general

Section 202 of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended to read as follows:

202.

Report on racketeering activities engaged in by Hizballah

(a)

In general

Not later than 120 days after the date of the enactment of the Hizballah International Financing Prevention Amendments Act of 2017, and annually thereafter for the following 5 years, the Assistant Attorney General for the Criminal Division of the Department of Justice and the Administrator of the Drug Enforcement Administration, in coordination with the Secretary of the Treasury and the heads of other applicable Federal agencies, shall jointly submit to the appropriate congressional committees a report on the following:

(1)

Activities that Hizballah, and agents and affiliates of Hizballah, have engaged in that are racketeering activities.

(2)

The extent to which Hizballah, and agents and affiliates of Hizballah, engage in a pattern of such racketeering activities.

(b)

Form of report

Each report required under subsection (a) shall be submitted in an unclassified form but may contain a classified annex.

(c)

Definitions

In this section:

(1)

Appropriate congressional committees

The term appropriate congressional committees means—

(A)

the Committee on the Judiciary and the Committee on Foreign Affairs of the House of Representatives; and

(B)

the Committee on the Judiciary and the Committee on Foreign Relations of the Senate.

(2)

Hizballah

The term Hizballah has the meaning given that term in section 102(f).

(3)

Racketeering activity

The term racketeering activity has the meaning given that term in section 1961(1) of title 18, United States Code.

.

(b)

Clerical amendment

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by striking the item relating to section 202 and inserting the following:

Sec. 202. Report on racketeering activities engaged in by Hizballah.

.

203.

Modification of report on activities of foreign governments to disrupt global logistics networks and fundraising, financing, and money laundering activities of Hizballah

(a)

In general

Section 204(a)(1) of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note) is amended—

(1)

in the matter preceding subparagraph (A), by striking this Act and inserting the Hizballah International Financing Prevention Amendments Act of 2017, and annually thereafter for the following 5 years;

(2)

in subparagraph (D)(ii)(II), by striking and at the end;

(3)

in subparagraph (E), by striking and free-trade zones. and inserting free-trade zones, business partnerships and joint ventures, and other investments in small and medium-sized enterprises;; and

(4)

by adding at the end the following:

(F)

a list of provinces, municipalities, and local governments outside of Lebanon that expressly consent to, or with knowledge allow, tolerate, or disregard the use of their territory by Hizballah to carry out terrorist activities, including training, financing, and recruitment;

(G)

a description of the total aggregate revenues and remittances that Hizballah receives from the global logistics networks of Hizballah, including—

(i)

a list of Hizballah's sources of revenue, including sources of revenue based on illicit activity, revenues from Iran, charities, and other business activities; and

(ii)

a list of Hizballah's expenditures, including expenditures for ongoing military operations, social networks, and external operations;

(H)

a survey of national and transnational legal measures available to target Hizballah's financial networks;

(I)

a review of Hizballah’s international operational capabilities, including in the United States; and

(J)

a review of—

(i)

the total number and value of Hizballah-related assets seized and forfeited; and

(ii)

the total number of indictments, prosecutions, and extraditions of Hizballah members or affiliates.

.

(b)

Report on estimated net worth of and determination with respect to senior Hizballah members

(1)

In general

Not later than 180 days after the date of the enactment of this Act, and not less frequently than annually thereafter for the following 2 years, the President shall submit to the appropriate congressional committees a report that contains—

(A)

the estimated total net worth of each individual described in paragraph (2);

(B)

a description of how funds of each individual described in paragraph (2) were acquired, and how such funds have been used or employed; and

(C)

a determination of whether each individual described in paragraph (2) meets the criteria described in paragraph (3) or (4) of section 1263(a) of the National Defense Authorization Act for Fiscal Year 2017 (Public Law 114–328; 22 U.S.C. 2656 note).

(2)

Individuals described

The individuals described in this paragraph are the following:

(A)

The Secretary General of Hizballah.

(B)

Members of the Hizballah Politburo.

(C)

Any other individual that the President determines is a senior foreign political figure of Hizballah, is associated with Hizballah, or otherwise provides significant support to Hizballah.

(3)

Form of report; public availability

(A)

Form

The report required under paragraph (1) shall be submitted in unclassified form but may include a classified annex.

(B)

Public availability

The unclassified portion of the report required under paragraph (1) shall be made available to the public and posted on the website of the Department of State and all United States Embassy websites.

(4)

Definitions

In this subsection:

(A)

Appropriate congressional committees

The term appropriate congressional committees means—

(i)

the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives; and

(ii)

the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate.

(B)

Funds

The term funds means—

(i)

cash;

(ii)

equity;

(iii)

any other intangible asset the value of which is derived from a contractual claim, including bank deposits, bonds, stocks, a security (as defined in section 2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a))), or a security or an equity security (as those terms are defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))); and

(iv)

anything else of value that the President determines to be appropriate.

(C)

Senior foreign political figure

The term senior foreign political figure has the meaning given that term in section 1010.605 of title 31, Code of Federal Regulations (or any successor regulation).

204.

Report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations

(a)

In general

Not later than 180 days after the date of the enactment of this Act, the President shall submit to the appropriate congressional committees a report on combating the illicit tobacco trafficking networks used by Hizballah and other foreign terrorist organizations to finance their operations, as described in the report submitted to Congress in December 2015 by the Department of State, the Department of Justice, the Department of the Treasury, the Department of Homeland Security, and the Department of Health and Human Services entitled, The Global Illicit Trade in Tobacco: A Threat to National Security..

(b)

Matters To be addressed

The report required by subsection (a) shall include the following:

(1)

A description of the steps to be taken by Federal agencies to combat the illicit tobacco trafficking networks used by Hizballah, other foreign terrorist organizations, and other illicit actors.

(2)

A description of the steps to be taken to engage State and local law enforcement authorities in efforts to combat illicit tobacco trafficking networks operating within the United States.

(3)

A description of the steps to be taken to engage foreign government law enforcement and intelligence authorities in efforts to combat illicit tobacco trafficking networks operating outside the United States.

(4)

Recommendations for legislative or administrative action needed to address the threat of illicit tobacco trafficking networks.

(c)

Appropriate congressional committees defined

In this section, the term appropriate congressional committees means—

(1)

the Committee on Foreign Affairs, the Committee on Armed Services, the Committee on Homeland Security, the Committee on the Judiciary, the Committee on Financial Services, and the Committee on Ways and Means of the House of Representatives; and

(2)

the Committee on Foreign Relations, the Committee on Armed Services, the Committee on Homeland Security and Governmental Affairs, the Committee on the Judiciary, the Committee on Banking, Housing, and Urban Affairs, and the Committee on Finance of the Senate.

III

General provisions

301.

Regulatory authority

(a)

In general

The President shall, not later than 180 days after the date of the enactment of this Act, prescribe regulations as necessary for the implementation of this Act and the amendments made by this Act.

(b)

Briefing to Congress

Not later than 10 days before the prescription of regulations under subsection (a), the President shall brief the appropriate congressional committees of the proposed regulations and the provisions of this Act and the amendments made by this Act that the regulations are implementing.

(c)

Appropriate congressional committees defined

In this section, the term appropriate congressional committees means—

(1)

the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives; and

(2)

the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate.

302.

Implementation; penalties; judicial review; exemptions

(a)

In general

Title I of the Hizballah International Financing Prevention Act of 2015 (Public Law 114–102; 50 U.S.C. 1701 note), as amended by sections 103 and 105 of this Act, is further amended by adding at the end the following:

105.

Implementation; penalties; judicial review; exemptions; rule of construction

(a)

Implementation

The President may exercise all authorities provided under sections 203 and 205 of the International Emergency Economic Powers Act (50 U.S.C. 1702 and 1704) to carry out sections 101 and 103.

(b)

Penalties

The penalties provided for 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 to carry out section 101 or 103 to the same extent that such penalties apply to a person that commits an unlawful act described in subsection (a) of such section 206.

(c)

Procedures for judicial review of classified information

(1)

In general

If a finding, 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.)) and a court reviews the finding or the imposition of the prohibition, condition, or penalty, the President may submit such information to the court ex parte and in camera.

(2)

Rule of construction

Nothing in this subsection shall be construed to confer or imply any right to judicial review of any finding under section 101 or 103 or any prohibition, condition, or penalty imposed as a result of any such finding.

(d)

Exemptions

The following activities shall be exempt from sections 101 and 103:

(1)

Any authorized intelligence, law enforcement, or national security activities of the United States.

(2)

Any transaction necessary to comply with United States obligations under the Agreement between the United Nations and the United States of America regarding the Headquarters of the United States, signed at Lake Success June 26, 1947, and entered into force November 21, 1947, or under the Convention on Consular Relations, done at Vienna April 24, 1963, and entered into force March 19, 1967, or any other United States international agreement.

(e)

Rule of construction

Nothing in section 101 or 103 shall be construed to limit the authority of the President under the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) or under any other provision of law.

.

(b)

Clerical amendment

The table of contents for the Hizballah International Financing Prevention Act of 2015 is amended by inserting after the item relating to section 104, as added by section 105(c) of this Act, the following new item:

Sec. 105. Implementation; penalties; judicial review; exemptions; rule of construction.

.

October 24, 2017

Reported from the Committee on Foreign Affairs with an amendment

October 24, 2017

The Committees on Financial Services and the Judiciary discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed