12 USC 1831y; 113 Stat.
1465; Pub L. 106-102 (November 12, 1999)
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(a) Public disclosure of agreements. Any agreement
(as defined in subsection (e)) entered into after the date of the
enactment of the Gramm-Leach-Bliley Act by an insured depository institution
or affiliate with a nongovernmental entity or person made pursuant
to or in connection with the Community Reinvestment Act of 1977 involving
funds or other resources of such insured depository institution or
affiliate—
(1) shall be in its entirety fully disclosed,
and the full text thereof made available to the appropriate Federal
banking agency with supervisory responsibility over the insured depository
institution and to the public by each party to the agreement; and
(2) shall obligate each
party to comply with this section.
(b) Annual report of activity by insured depository
institution. Each insured depository institution or affiliate
that is a party to an agreement described in subsection (a) shall
report to the appropriate Federal banking agency with supervisory
responsibility over the insured depository institution, not less frequently
than once each year, such information as the Federal banking agency
may by rule require relating to the following actions taken by the
party pursuant to the agreement during the preceding 12-month period:
(1) Payments, fees, or loans
made to any party to the agreement or received from any party to the
agreement and the terms and conditions of the same.
(2) Aggregate data on loans, investments,
and services provided by each party in its community or communities
pursuant to the agreement.
(3) Such other pertinent matters as determined
by regulation by the appropriate Federal banking agency with supervisory
responsibility over the insured depository institution.
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(c) Annual report of activity
by nongovernmental entities.
(1) Each nongovernmental entity or person
that is not an affiliate of an insured depository institution and
that is a party to an agreement described in subsection (a) shall
report to the appropriate Federal banking agency with supervisory
responsibility over the insured depository institution that is a party
to such agreement, not less frequently than once each year, an accounting
of the use of funds received pursuant to each such agreement during
the preceding 12-month period.
(2) A nongovernmental entity or person
referred to in paragraph (1) may comply with the reporting requirement
in such paragraph by transmitting the report to the insured depository
institution that is a party to the agreement, and such insured depository
institution shall promptly transmit such report to the appropriate
Federal banking agency with supervisory authority over the insured
depository institution.
(3) The accounting referred to in paragraph (1) shall include a detailed,
itemized list of the uses to which such funds have been made, including
compensation, administrative expenses, travel, entertainment, consulting
and professional fees paid, and such other categories, as determined
by regulation by the appropriate Federal banking agency with supervisory
responsibility over the insured depository institution.
(d) Applicability. Subsections (b) and (c) shall not apply with respect to any agreement
entered into before the end of the 6-month period beginning on the
date of the enactment of the Gramm-Leach-Bliley Act.
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(e) Definitions.
(1) For purposes of this section, the term
“agreement”—
(A) means—
(i) any written
contract, written arrangement, or other written understanding that
provides for cash payments, grants, or other consideration with a
value in excess of $10,000, or for loans the aggregate amount of principal
of which exceeds $50,000, annually (or the sum of all such agreements
during a 12-month period with an aggregate value of cash payments,
grants, or other consideration in excess of $10,000, or with an aggregate
amount of loan principal in excess of $50,000); or
(ii) a group of substantively related contracts
with an aggregate value of cash payments, grants, or other consideration
in excess of $10,000, or with an aggregate amount of loan principal
in excess of $50,000, annually;
made pursuant to, or in connection with,
the fulfillment of the Community Reinvestment Act of 1977, at least
1 party to which is an insured depository institution or affiliate
thereof, whether organized on a profit or not-for-profit basis; and
(B) does not include—
(i) any individual mortgage loan;
(ii) any specific contract or commitment for
a loan or extension of credit to individuals, businesses, farms, or
other entities, if the funds are loaned at rates not substantially
below market rates and if the purpose of the loan or extension of
credit does not include any re-lending of the borrowed funds to other
parties; or
(iii) any
agreement entered into by an insured depository institution or affiliate
with a nongovernmental entity or person who has not commented on,
testified about, or discussed with the institution, or otherwise contacted
the institution, concerning the Community Reinvestment Act of 1977.
(2) For purposes of subparagraph (A), the term “fulfillment”
means a list of factors that the appropriate Federal banking agency
determines have a material impact on the agency’s decision—
(A) to approve or disapprove an application for a deposit facility
(as defined in section 803 of the Community Reinvestment Act of 1977);
or
(B) to assign
a rating to an insured depository institution under section 807 of
the Community Reinvestment Act of 1977.
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(f) Violations.
(1) (A)
If the party to an agreement described in subsection (a) that is not
an insured depository institution or affiliate willfully fails to
comply with this section in a material way, as determined by the appropriate
Federal banking agency, the agreement shall be unenforceable after
the offending party has been given notice and a reasonable period
of time to perform or comply.
(B) If funds or resources received under
an agreement described in subsection (a) have been diverted contrary
to the purposes of the agreement for personal financial gain, the
appropriate Federal banking agency with supervisory responsibility
over the insured depository institution may impose either or both
of the following penalties:
(i) Disgorgement by the offending
individual of funds received under the agreement.
(ii) Prohibition of the offending individual
from being a party to any agreement described in subsection (a) for
a period of not to exceed 10 years.
(2) If an agreement described
in subsection (a) is found to be unenforceable under this subsection,
the appropriate Federal banking agency may assist the insured depository
institution in identifying a successor nongovernmental party to assume
the responsibilities of the agreement.
(3) An error in a report filed under subsection
(c) that is inadvertent or de minimis shall not subject the filing
party to any penalty.
(g) Rule of construction. No provision of this
section shall be construed as authorizing any appropriate Federal
banking agency to enforce the provisions of any agreement described
in subsection (a).
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(h) Regulations.
(1) Each appropriate Federal
banking agency shall prescribe regulations, in accordance with paragraph
(4), requiring procedures reasonably designed to ensure and monitor
compliance with the requirements of this section.
(2) In carrying out paragraph (1), each
appropriate Federal banking agency shall—
(A) ensure
that the regulations prescribed by the agency do not impose an undue
burden on the parties and that proprietary and confidential information
is protected; and
(B) establish procedures to allow any nongovernmental entity or person
who is a party to a large number of agreements described in subsection
(a) to make a single or consolidated filing of a report under subsection
(c) to an insured depository institution or an appropriate Federal
banking agency.
(3) The Board of Governors of the Federal
Reserve System may prescribe regulations—
(A) to prevent
evasions of subsection (e)(1)(B)(iii); and
(B) to provide further exemptions under
such subsection, consistent with the purposes of this section.
(4) In carrying
out paragraph (1), each appropriate Federal banking agency shall consult
and coordinate with the other such agencies for the purposes of assuring,
to the extent possible, that the regulations prescribed by each such
agency are consistent and comparable with the regulations prescribed
by the other such agencies.
[12 USC 1831y. As added
by act of Nov. 12, 1999 (113 Stat. 1465). The date of enactment of
the Gramm-Leach-Bliley Act, referred to in this section, was Nov.
12, 1999.]
