COMMITTEE ON THE JUDICIARY NINETY-NINTH CONGRESS FIRST SESSION ON H.R. 2617, H.R. 2839, and H.R. 3511 BANK BRIBERY JULY 11 AND 17, 1985 Serial No. 104 Printed for the use of the Committee on the Judiciary 59-087 O U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 1987 For sale by the Superintendent of Documents, U.S. Government Printing Office JACK BROOKS, Texas COMMITTEE ON THE JUDICIARY PETER W. RODINO, JR., New Jersey, Chairman ROBERT W. KASTENMEIER, Wisconsin BARNEY FRANK, Massachusetts HARLEY O. STAGGERS, JR., West Virginia HAMILTON FISH, JR., New York F. JAMES SENSENBRENNER, JR., BILL MCCOLLUM, Florida WILLIAM E. DANNEMEYER, California PATRICK L. SWINDALL, Georgia Buck, Peter A., general counsel, S.A.F.E. Federal Credit Union, New High- lands, CA, on behalf of the National Association of Federal Credit Unions Gaiswinkler, Robert S., president, National Savings and Loan Association of Milwaukee, WI, on behalf of the National Council of Savings Institutions. Koppe, Bruce A., senior vice president and general counsel, Rainier National Pfeiler, Thomas A., general counsel, U.S. League of Savings Institutions Shapiro, Stephen M., Esq., Chicago, IL, on behalf of a Coalition of Financial Toensing, Victoria, Deputy Assistant Attorney General, Criminal Division, American Bankers Association.. Credit Union National Association. Financial Trade Associations.. National Association of Federal Credit Unions. 99, 125 42, 47 2, 18 Chafetz, Marc E., letter to Mr. Michael Ward, assistant counsel, Subcommit- Dennis, Warren L. and Chafetz, Marc E., "The New Bribery Act: A Trap for Сваты Евха BANK BRIBERY THURSDAY, JULY 11, 1985 HOUSE OF REPRESENTATIVES, COMMITTEE ON THE JUDICIARY, Washington, DC. The subcommittee met at 10:15 a.m., in room 2237, Rayburn House Office Building, Hon. Rick Boucher presiding. Present: Representatives Boucher, Bryant, and Gekas. Staff present: Thomas W. Hutchison, counsel; Michael E. Ward, assistant counsel; Raymond Smietanka, associate counsel; and Bennie B. Williams, clerk. Mr. BOUCHER. The subcommittee will come to order. Representative Conyers is unable to be here at this time and has asked that I chair the hearing in his absence. Today we are initiating hearings on H.R. 2839 and H.R. 2617, bills to amend section 215 of title 18, United States Code, which prohibits bank bribery. Approximately 1 year ago, on July 30, 1984, the House of Representatives, after suspending the rules, passed the Financial Bribery and Fraud Amendments Act of 1984 to revise and expand Federal criminal laws prohibiting bribery and fraud in banking operations. That bill was drafted by this subcommittee as an alternative to a little noticed provision in the Comprehensive Crime Control Act which had previously been adopted in the Senate. The bank bribery provisions of the crime package had never been the subject of hearings in the Senate and had not been brought to the attention of the affected business community. After evaluating the Senate provisions, this subcommittee concluded that the Senate version was drafted so broadly as to make everyday business activities criminal conduct. The Senate proposal prohibited giving or receiving anything of value in connection with any transaction of a covered financial institution. Thus, allowing a client to pay for lunch or accepting an honor from a grateful charitable organization, for example, would fall within the literal prohibitions of the new section. That Federal prosecutors may be unlikely ever to prosecute such a violation is of little consolation since members of the industry would still be left, and are left today, in a quandary about when acceptably illegal conduct becomes unacceptable. The legislation prepared by this subcommittee is intended to remedy that problem. Unfortunately there was never an opportunity to resolve the differences between the two approaches. During the rush to bring Congress to a close the Comprehensive Crime Control Act in its (1) |