HR 2424 IHCommentsClose CommentsPermalink

To amend title 31, United States Code, to authorize reviews by the Comptroller General of the United States of any credit facility established by the Board of Governors of the Federal Reserve System or any Federal reserve bank during the current financial crisis, and for other purposes.CommentsClose CommentsPermalink

May 14, 2009CommentsClose CommentsPermalink

Mr. KUCINICH (for himself, Mr. TOWNS, Mr. ISSA, and Mr. JORDAN of Ohio) introduced the following bill; which was referred to the Committee on Oversight and Government ReformCommentsClose CommentsPermalink

To amend title 31, United States Code, to authorize reviews by the Comptroller General of the United States of any credit facility established by the Board of Governors of the Federal Reserve System or any Federal reserve bank during the current financial crisis, and for other purposes.CommentsClose CommentsPermalink

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Federal Reserve Credit Facility Review Act of 2009’.CommentsClose CommentsPermalink

SEC. 2. FINDINGS.

The Congress finds as follows:CommentsClose CommentsPermalink





(1) In August 2007, liquidity abruptly dried up in credit and securities markets.CommentsClose CommentsPermalink





(2) This lack of access to affordable credit was initially limited to financial firms with interests in mortgage-backed securities that contained subprime and predatory mortgages.CommentsClose CommentsPermalink





(3) The lack of access to credit quickly spread throughout the financial services industry, and eventually worldwide.CommentsClose CommentsPermalink





(4) At the inception of the financial crisis, the Board of Governors of the Federal Reserve System responded by exercising its authorities in the traditional manner to effect the Federal funds rate target, which culminated in a December 16, 2008, decision to establish a Federal funds rate target range of 0 percent to 0.25 percent.CommentsClose CommentsPermalink





(5) The Board of Governors of the Federal Reserve System, as it employed its traditional tools to provide liquidity and stability to the financial markets, came to acknowledge the severity of the current crisis by exercising its authority to act in response to ‘unusual and exigent circumstances’.CommentsClose CommentsPermalink





(6) The Federal Reserve has exercised its authority to address ‘unusual and exigent circumstances’ no less than 11 times since the beginning of the financial crisis.CommentsClose CommentsPermalink





(7) Before this financial crisis, the Board of Governors of the Federal Reserve System last exercised its authority to address ‘unusual and exigent circumstances’ in 1934.CommentsClose CommentsPermalink





(8) In connection with the Board of Governors of the Federal Reserve System’s efforts to address unusual and exigent circumstances, the Board extended assistance to nonmember institutions, something it had not done since 1959.CommentsClose CommentsPermalink





(9) In connection with the Board of Governors of the Federal Reserve System’s efforts to address unusual and exigent circumstances, the Board has purchased debt obligations from government-sponsored enterprises, something it had not done since 1981.CommentsClose CommentsPermalink





(10) In the course of the crisis, the Federal Reserve established joint programs with the Department of the Treasury to aid financial markets, such as the guarantee of Citigroup’s and Bank of America’s assets, the Term Asset-Backed Securities Lending Facility, and the Public-Private Partnership Investment Program.CommentsClose CommentsPermalink





(11) On February 10, 2009, Chairman Ben Bernanke affirmed his commitment to transparency when he testified to the Committee on Financial Services of the House of Representatives that ‘the Federal Reserve is committed to keeping the Congress and the public informed about its lending programs and balance sheet’.CommentsClose CommentsPermalink

SEC. 3. REVIEWS OF SPECIAL FEDERAL RESERVE CREDIT FACILITIES.

Section 714 of title 31, United States Code, is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(e) Reviews of Credit Facilities of the Federal Reserve System-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Subject to paragraph (3) and notwithstanding any limitation in subsection (b) on the auditing and overseeing of certain functions of the Board of Governors of the Federal Reserve System or any Federal reserve bank, the Comptroller General may conduct reviews, including onsite examinations when the Comptroller General determines such actions are appropriate, of credit facilities established by the Board or any Federal reserve bank, and of the establishment of such credit facilities by the Board or any Federal reserve bank--CommentsClose CommentsPermalink





‘(A) in carrying out any action or function approved by the Board under the 3rd undesignated paragraph of section 13 of the Federal Reserve Act (12 U.S.C. 343) as the lender of last resort; orCommentsClose CommentsPermalink





‘(B) in providing temporary assistance to private institutions as the lender of last resort.CommentsClose CommentsPermalink





‘(2) DESCRIPTION- As of the date of the enactment of the Federal Reserve Credit Facility Review Act of 2009, the credit facilities to which this subsection applies include the following:CommentsClose CommentsPermalink





‘(A) Money Market Investor Funding Facility.CommentsClose CommentsPermalink





‘(B) Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility.CommentsClose CommentsPermalink





‘(C) Term Asset-Backed Securities Loan Facility.CommentsClose CommentsPermalink





‘(D) Term Auction Facility.CommentsClose CommentsPermalink





‘(E) The Primary Dealer Credit Facility.CommentsClose CommentsPermalink





‘(F) The Commercial Paper Funding Facility.CommentsClose CommentsPermalink





‘(G) The Term Securities Lending Facility, including the Term Securities Lending Facility Options ProgramCommentsClose CommentsPermalink





‘(H) Maiden Lane, LLC.CommentsClose CommentsPermalink





‘(I) Maiden Lane II, LLC.CommentsClose CommentsPermalink





‘(J) Maiden Lane III, LLC.CommentsClose CommentsPermalink





‘(K) The Revolving Credit Facility.CommentsClose CommentsPermalink





‘(L) Reciprocal currency arrangements with foreign central banks.CommentsClose CommentsPermalink





‘(M) Mortgage Backed Securities Purchase Program, as well as the purchase of debt obligations from a Government Sponsored Enterprise.CommentsClose CommentsPermalink





‘(N) Any special purpose vehicle through which any such credit facility conducts any activity or lending.CommentsClose CommentsPermalink





‘(3) TERMINATION OF AUTHORITY- Paragraph (1) shall cease to apply after the expiration of the 5-year period beginning on the date of the enactment of this subsection.CommentsClose CommentsPermalink





‘(4) REPORT-CommentsClose CommentsPermalink





‘(A) REQUIRED- A report on each review conducted under paragraph (1) shall be submitted by the Comptroller General to the Congress before the end of the 90-day period beginning on the date on which such review is completed.CommentsClose CommentsPermalink





‘(B) CONTENTS- The report under subparagraph (A) shall include a detailed description of the findings and conclusion of the Comptroller General with respect to the review that is the subject of the report, together with such recommendations for legislative or administrative action as the Comptroller General may determine to be appropriate.’.CommentsClose CommentsPermalink

SEC. 4. ACCESS TO RECORDS.

(a) Access to Records- Section 714(d)(1) of title 31, United States Code, is amended--CommentsClose CommentsPermalink





(1) in the first sentence, by inserting ‘or any credit facility established by an agency’ after ‘an agency’; andCommentsClose CommentsPermalink





(2) by inserting after the first sentence the following: ‘The Comptroller General shall have access to the officers, employees, contractors, and other agents and representatives of any agency or any credit facility established by an agency (as specified in subsection (e)) at any reasonable time as the Comptroller General may request. The Comptroller General may make and retain copies of such records as the Comptroller General determines appropriate.’.CommentsClose CommentsPermalink





(b) Unauthorized Access- Section 714(d)(2) of title 31, United States Code, is amended--CommentsClose CommentsPermalink





(1) by inserting ‘, copies of any records,’ after ‘records’; andCommentsClose CommentsPermalink





(2) by inserting ‘or any credit facility established by an agency (as specified in subsection (e))’ after ‘agency’.CommentsClose CommentsPermalink