12 U.S.C. § 5018 — Depositary services efficiency and cost re-

Page 1784 TITLE 12—BANKS AND BANKING § 5015 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 5001 of this title and Tables. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title. § 5015. Study and report on funds availability (a) Study In order to evaluate the implementation and the impact of this chapter, the Board shall con- duct a study of— (1) the percentage of total checks cleared in which the paper check is not returned to the paying bank; (2) the extent to which banks make funds available to consumers for local and nonlocal checks prior to the expiration of maximum hold periods; (3) the length of time within which deposi- tary banks learn of the nonpayment of local and nonlocal checks; (4) the increase or decrease in check-related losses over the study period; and (5) the appropriateness of the time periods and amount limits applicable under sections 4002 and 4003 of this title, as in effect on Octo- ber 28, 2003. (b) Report to Congress Before the end of the 30-month period begin- ning on the effective date of this chapter, the Board shall submit a report to the Congress con- taining the results of the study conducted under this section, together with recommendations for legislative action. (Pub. L. 108–100, § 16, Oct. 28, 2003, 117 Stat. 1190.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsec. (a), was in the original ‘‘this Act’’, meaning Pub. L. 108–100, Oct. 28, 2003, 117 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 5001 of this title and Tables. The effective date of this chapter, referred to in sub- sec. (b), is at the end of the 12-month period beginning on Oct. 28, 2003, except as otherwise specifically pro- vided in this chapter, see section 20 of Pub. L. 108–100, set out as an Effective Date note under section 5001 of this title. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title. § 5016. Statistical reporting of costs and revenues for transporting checks between reserve banks In the annual report prepared by the Board for the first full calendar year after October 28, 2003, and in each of the 9 subsequent annual reports by the Board, the Board shall include the amount of operating costs attributable to, and an estimate of the Federal Reserve banks’ im- puted revenues derived from, the transportation of commercial checks between Federal Reserve bank check processing centers. (Pub. L. 108–100, § 17, Oct. 28, 2003, 117 Stat. 1191.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title. § 5017. Evaluation and report by the Comptroller General (a) Study During the 5-year period beginning on October 28, 2003, the Comptroller General of the United States shall evaluate the implementation and administration of this chapter, including— (1) an estimate of the gains in economic effi- ciency made possible from check truncation; (2) an evaluation of the benefits accruing to consumers and financial institutions from re- duced transportation costs, longer hours for accepting deposits for credit within 1 business day, the impact of fraud losses, and an esti- mate of consumers’ share of the total benefits derived from this chapter; and (3) an assessment of consumer acceptance of the check truncation process resulting from this chapter, as well as any new costs incurred by consumers who had their original checks returned with their regular monthly state- ments prior to October 28, 2003. (b) Report to Congress Before the end of the 5-year period referred to in subsection (a), the Comptroller General shall submit a report to the Congress containing the findings and conclusions of the Comptroller General in connection with the evaluation con- ducted pursuant to subsection (a), together with such recommendations for legislative and ad- ministrative action as the Comptroller General may determine to be appropriate. (Pub. L. 108–100, § 18, Oct. 28, 2003, 117 Stat. 1191.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsec. (a), was in the original ‘‘this Act’’, meaning Pub. L. 108–100, Oct. 28, 2003, 117 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 5001 of this title and Tables. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title. § 5018. Depositary services efficiency and cost re- duction (a) Findings The Congress finds as follows: Page 1785 TITLE 12—BANKS AND BANKING § 5018 (1) The Secretary of the Treasury has long compensated financial institutions for various critical depositary and financial agency serv- ices provided for or on behalf of the United States by— (A) placing large balances, commonly re- ferred to as ‘‘compensating balances’’, on de- posit at such institutions; and (B) using imputed interest on such funds to offset charges for the various depositary and financial agency services provided to or on behalf of the Government. (2) As a result of sharp declines in interest rates over the last few years to record low lev- els, or the public debt outstanding reaching the statutory debt limit, the Department of the Treasury often has had to dramatically in- crease or decrease the size of the compen- sating balances on deposit at these financial institutions. (3) The fluctuation of the compensating bal- ances, and the necessary pledging of collateral by financial institutions to secure the value of compensating balances placed with those in- stitutions, have created unintended financial uncertainty for the Secretary of the Treasury and for the management by financial institu- tions of their cash and securities. (4) It is imperative that the process for pro- viding financial services to the Government be transparent, and provide the information nec- essary for the Congress to effectively exercise its appropriation and oversight responsibil- ities. (5) The use of direct payment for services rendered would strengthen cash and debt man- agement responsibilities of the Secretary of the Treasury because the Secretary would no longer need to dramatically increase or de- crease the level of such balances when interest rates fluctuate sharply or when the public debt outstanding reaches the statutory debt limit. (6) An alternative to the use of compen- sating balances, such as direct payments to fi- nancial institutions, would ensure that pay- ments to financial institutions for the services they provide would be made in a more predict- able manner and could result in cost savings. (7) Limiting the use of compensating bal- ances could result in a more direct and cost-ef- ficient method of obtaining those services cur- rently provided under compensating balance arrangements. (8) A transition from the use of compen- sating balances to another compensation method must be carefully managed to prevent higher-than-necessary transitional costs and enable participating financial institutions to modify their planned investment of cash and securities. (b) Authorization of appropriations for services rendered by depositaries and financial agen- cies of the United States There are authorized to be appropriated for fiscal years beginning after fiscal year 2003 to the Secretary of the Treasury such sums as may be necessary for reimbursing financial institu- tions in their capacity as depositaries and finan- cial agents of the United States for all services required or directed by the Secretary of the Treasury, or a designee of the Secretary, to be performed by such financial institutions on be- half of the Secretary of the Treasury or another Federal agency, including services rendered be- fore fiscal year 2004. (c) Orderly transition (1) In general As appropriations authorized in subsection (b) become available, the Secretary of the Treasury shall promptly begin the process of phasing in the use of the appropriations to pay financial institutions serving as depositaries and financial agents of the United States, and transitioning from the use of compensating balances to fund these services. (2) Post-transition use limited to extraordinary circumstances (A) In general Following the transition to the use of the appropriations authorized in subsection (b), the Secretary of the Treasury may use the compensating balances to pay financial in- stitutions serving as depositaries and finan- cial agents of the United States only in ex- traordinary situations where the Secretary determines that they are needed to ensure the fiscal operations of the Government con- tinue to function in an efficient and effec- tive manner. (B) Report Any use of compensating balances pursu- ant to subparagraph (A) shall promptly be reported by the Secretary of the Treasury to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. (3) Requirements for orderly transition In transitioning to the use of the appropria- tions authorized in subsection (b), the Sec- retary of the Treasury shall take such steps as may be appropriate to— (A) prevent abrupt financial disruption to the functions of the Department of the Treasury or to the participating financial institutions; and (B) maintain adequate accounting and management controls to ensure that pay- ments to financial institutions for their banking services provided to the Govern- ment as depositaries and financial agents are accurate and that the arrangements last no longer than is necessary. (4) Reports required (A) Annual report (i) In general For each fiscal year, the Secretary of the Treasury shall submit a report to the Con- gress on the use of compensating balances and on the use of appropriations author- ized in subsection (b) during that fiscal year. (ii) Inclusion in budget The report required under clause (i) may be submitted as part of the budget sub- Page 1786 TITLE 12—BANKS AND BANKING § 5101 1 See References in Text note below. mitted by the President under section 1105 of title 31 for the following fiscal year and if so, the report shall be submitted concur- rently to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. (B) Final report following transition (i) In general Following completion of the transition from the use of compensating balances to the use of the appropriations authorized in subsection (b) to pay financial institutions for their services as depositaries and finan- cial agents of the United States, the Sec- retary of the Treasury shall submit a re- port on the transition to the Committee on Financial Services of the House of Rep- resentatives and the Committee on Bank- ing, Housing, and Urban Affairs of the Sen- ate. (ii) Contents of report The report submitted under clause (i) shall include a detailed analysis of— (I) the cost of transition; (II) the direct costs of the services being paid from the appropriations au- thorized in subsection (b); and (III) the benefits realized from the use of direct payment for such services, rath- er than the use of compensating balance arrangements. (d) Omitted (e) Effective date Notwithstanding section 20,1 this section shall take effect on October 28, 2003. (Pub. L. 108–100, § 19, Oct. 28, 2003, 117 Stat. 1191.) Editorial Notes REFERENCES IN TEXT Section 20, referred to in subsec. (e), means section 20 of Pub. L. 108–100, which is set out as an Effective Date note under section 5001 of this title. CODIFICATION Section is comprised of section 19 of Pub. L. 108–100. Subsec. (d) of section 19 of Pub. L. 108–100 amended sec- tion 412 of this title. Statutory Notes and Related Subsidiaries FUNDS FOR REIMBURSEMENT FOR DEPOSITARY AND FINANCIAL AGENCY SERVICES Pub. L. 108–199, div. F, title II, § 218, Jan. 23, 2004, 118 Stat. 321, provided that: ‘‘For fiscal year 2004 and each fiscal year thereafter, there are appropriated to the Secretary of the Treasury such sums as may be nec- essary to reimburse financial institutions in their ca- pacity as depositaries and financial agents of the United States for all services required or directed by the Secretary of the Treasury, or the Secretary’s des- ignee, to be performed by such financial institutions on behalf of the Department of the Treasury or other Fed- eral agencies, including services rendered prior to fiscal year 2004.’’ CHAPTER 51—SECURE AND FAIR ENFORCEMENT FOR MORTGAGE LICENSING Sec. 5101. Purposes and methods for establishing a mortgage licensing system and registry. 5102. Definitions. 5103. License or registration required. 5104. State license and registration application and issuance. 5105. Standards for State license renewal. 5106. System of registration administration by Federal agencies. 5107. Bureau of Consumer Financial Protection backup authority to establish loan origi- nator licensing system. 5108. Backup authority to establish a nationwide mortgage licensing and registry system. 5109. Fees. 5110. Background checks of loan originators. 5111. Confidentiality of information. 5112. Liability provisions. 5113. Enforcement by the Bureau. 5114. State examination authority. 5115. Reports and recommendations to Congress. 5116. Study and reports on defaults and fore- closures. 5117. Employment transition of loan originators. § 5101. Purposes and methods for establishing a mortgage licensing system and registry In order to increase uniformity, reduce regu- latory burden, enhance consumer protection, and reduce fraud, the States, through the Con- ference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, are hereby encouraged to establish a Nationwide Mortgage Licensing System and Registry for the residential mortgage industry that accomplishes all of the following objec- tives: (1) Provides uniform license applications and reporting requirements for State-licensed loan originators. (2) Provides a comprehensive licensing and supervisory database. (3) Aggregates and improves the flow of in- formation to and between regulators. (4) Provides increased accountability and tracking of loan originators. (5) Streamlines the licensing process and re- duces the regulatory burden. (6) Enhances consumer protections and sup- ports anti-fraud measures. (7) Provides consumers with easily acces- sible information, offered at no charge, uti- lizing electronic media, including the Inter- net, regarding the employment history of, and publicly adjudicated disciplinary and enforce- ment actions against, loan originators. (8) Establishes a means by which residential mortgage loan originators would, to the great- est extent possible, be required to act in the best interests of the consumer. (9) Facilitates responsible behavior in the subprime mortgage market place and provides comprehensive training and examination re- quirements related to subprime mortgage lending. (10) Facilitates the collection and disburse- ment of consumer complaints on behalf of State and Federal mortgage regulators. (Pub. L. 110–289, div. A, title V, § 1502, July 30, 2008, 122 Stat. 2810.)