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LegislationLEGISLATION | Detail


S. 890: Fighting Fraud to Protect Taxpayers Act of 2011

Sponsor: Leahy (D - VT)

Official Title: A bill to establish the supplemental fraud fighting account, and for other purposes.

Status:
5/5/2011: Introduced in Senate
5/5/2011: Referred to Senate Judiciary Committee
5/19/2011: Ordered to be reported Senate Judiciary Committee
5/19/2011: Reported to Senate by Senate Judiciary Committee
5/19/2011: Placed on Senate calendar
1/30/2012: Written report reported by Senate Judiciary Committee

Commentary:
This bill would extend the international money laundering statute (18 U.S.C. § 1956 (a)(2)(A)) to cover actions in violation of sections 7201 and 7206 of the Internal Revenue Code of 1986 (26 U.S.C. § 7201 and 26 U.S.C. § 7206), which prohibit willful attempts to evade or defeat federal tax law and proscribe fraud or false statements made in connection with any return, statement, or other federal tax document. Specifically, the vague and overly broad criminal offense in S. 890 would apply the federal international money laundering statute to anyone who “transports, transmits, or transfers, or attempts to transport, transmit, or transfer a monetary instrument or funds from a place in the United States to or through a place outside the United States or to a place in the United States from or through a place outside the United States” with intent “to promote the carrying on of specified unlawful activity” and “[to] engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code.” Violations of this ambiguous provision would be punishable by criminal sanctions of up to 20 years imprisonment, fines of up to $500,000 or twice the value of the monetary instrument involved in the violation, or both. In addition, S. 890 would amend 18 U.S.C. § 1030(a)(6) to broaden the reach of the criminal statute outlawing the fraudulent trafficking of computer passwords or similar information by removing the federal jurisdictional hook in the provision. Currently, federal law prohibits such behavior if it “affects interstate or foreign commerce,” or if the computer involved is “used by or for the Government of the United States.” S. 890 would remove such limiting language and allow prosecution for fraudulent password trafficking on any “protected computer,” which is undefined by the legislation or statute. The bill also seeks to amend 18 U.S.C. § 1028(a)(7) to expand the current prohibition on “fraud and related activity in connection with identification documents, authentication features, and information” to include organizational as well as personal identification materials. Despite existing civil and criminal remedies to combat the fraudulent use of organizational identification materials, S. 890 would allow prosecutors to pursue criminal sanctions against anyone who “knowingly transfers, possesses, or uses, without lawful authority, a means of identification” of any person or organization “with the intent to commit, or to aid or abet, or in connection with, any unlawful activity that constitutes a violation of Federal law, or that constitutes a felony under any applicable State or local law.” Such violations would be punishable by up to 15 years imprisonment, fines under Title 18 of the U.S. Code, or both, if the offense involved one or more means of identification and the offense involved obtaining anything of value aggregating $1,000 or more in a one-year period. All other violations of this provision would be punishable by up to five years imprisonment, fines under Title 18 of the U.S. Code, or both. On top of modifying these specific criminal statutes, S. 890 would also broaden the venue provision (18 U.S.C. § 3237(a)) for federal mail fraud offenses and would amend the 21st Century Department of Justice Appropriations Authorization Act (28 U.S.C. 527 note) to establish a supplemental fraud fighting account in the Department of Justice Working Capital Fund for the cost of the “investigation of and conduct of criminal, civil, or administrative proceedings relating to fraud offenses.”

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