Maxine Waters

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I like Mr. Poliquin. He is a nice man. He always has a nice smile. But I don't trust him more than I trust J Street. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. I am disappointed that we are here, yet again, debating another Republican bill to undermine the Iran nuclear deal--a deal that, so far, has delivered on its principal goal of blocking Iran's path to nuclear weapons for the foreseeable future. This is a dangerous move that, if enacted, would put U.S. and global security at risk. Specifically, H.R. 5711 would prohibit the Treasury Secretary from authorizing any transaction by a U.S. financial institution to support the export of commercial planes to Iran. Doing so would violate a key component of the agreement in which the U.S. has committed to allowing the sales of these planes and the associated financial services that are necessary to support the sales. Earlier this year, the Treasury Department issued a license to Boeing for the sale of 80 passenger planes to Iran--valued at $17.6 billion-- and authorized U.S. financial institutions to engage in all transactions necessary to allow Boeing to receive payment for the sale. This legislation not only puts the Boeing deal in the crosshairs by prohibiting it from conducting a lawful sale under the agreement, but it also places the viability of the nuclear deal itself in question. Moreover, this legislation would breach the good faith provision in the agreement by which all parties agreed not to undermine its successful implementation. H.R. 5711 also includes language that prevents the Export-Import Bank from financing exports to Iran, which is a red herring because the Ex- Im Bank has not supported exports to Iran since the 1970s, and it is legally prohibited from doing so as long as Iran is a state sponsor of terror. Notably, the bill removes the President's national security waiver with regard to these restrictions--a move that denies the President the flexibility that is necessary to work with our allies to find the most effective ways of changing Iran's behavior. The fact is that all previous Iran sanctions bills that have passed the House and that have become law have included a Presidential waiver that gives the President the flexibility to act quickly and maneuver when doing so serves the U.S. national security interest. Mr. Speaker, I am particularly concerned that this bill comes at a time of deep global uncertainty about U.S. foreign policy. We have a President-elect whose talk on foreign policy has ranged from vague and contradictory in some areas to utterly incoherent elsewhere. He has inserted unpredictability into the international arena, has questioned the value of U.S. alliances, and has threatened the cornerstones of decades of American foreign policy leadership. Yet, instead of reassuring the world that the United States is committed to working with our global allies to promote our collective security, House Republicans have decided to push yet another piece of legislation through the House to destabilize the agreement that is central to preventing Iran from acquiring nuclear weapons. I do wonder why their leadership decided to bring this bill to the floor now in the lameduck session when they know the President will veto it. Perhaps my colleagues on the other side of the aisle know that in two short months, they will no longer have the luxury of legislating without consequences. Come January, we will have a President who has called the Iran nuclear agreement the worst deal ever negotiated. Like most of his other nonsense policies, Mr. Trump has claimed he will either more strictly enforce the agreement or negotiate ``a much better deal'' or dismantle it altogether. We don't know, and he doesn't know. So I am going to bet that, under the Trump administration, Republicans will not be so eager to move legislation to unravel this agreement because, like the rest of us, they do not know how Mr. Trump will govern and because they know there is no other reasonable approach to curbing Iran's nuclear ambition, short of military intervention. I, therefore, urge my colleagues to join me in opposing this bill and sending a strong message to the President-elect and our allies around the world that Democrats remain committed to a strong U.S. engagement in the world and will not tolerate any attempt to undermine the Iran nuclear deal or any other international arrangements that keep us safe. I reserve the balance of my time.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Chairman, I continue to reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chairman, I yield 2 minutes to the gentleman from New York (Mr. Meeks), a member of the Financial Services and Foreign Affairs Committees.

Ms. MAXINE WATERS of California. Mr. Chairman, I yield 4 minutes to the gentleman from Washington (Mr. Heck), a member of the Financial Services Committee.

Ms. MAXINE WATERS of California. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, we have received any number of letters and correspondence in opposition to this bill, but I thought it would be important to just share with you one such communication from J Street, which is an Israel lobbying group. They basically say that: `` . . . in light of its limited practical utility--this bill appears to be yet another piece of a sustained effort by US opponents of the JCPOA and other diplomatic engagement with Iran to undermine the agreement by weakening the domestic standing of Iranian President Hassan Rouhani and his allies vis-a-vis Iranian hardliners who also oppose the agreement and bilateral dialogue. It is likely not a coincidence that proponents have arranged for floor consideration of this bill just as Rouhani is in the United States for the United Nations General Assembly, and that it would require the finalization of the first report around the time of the next Iranian Presidential election. ``Hindering the US Government's ability to enforce the terms of the JCPOA and sanctions on Iran's dangerous non-nuclear behavior while simultaneously undermining Rouhani's standing would make America and our allies less safe and redound to the benefit of the very Iranian hardliners who seek to do us harm. Risking these consequences for the sake of procuring information that could not be shared with its intended audience would be both pointless and reckless. We therefore urge Members of Congress to oppose this bill.'' That is from J Street, the Israel lobbying group. Mr. Chairman, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chairman, I continue to reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chair, I yield 5 minutes to the gentleman from Connecticut (Mr. Himes), a member of the Financial Services Committee.

Ms. MAXINE WATERS of California. Mr. Chair, let me end this part of my presentation by saying that the world is watching us. And for us to do anything to undermine an agreement that the President has entered into along with other major allies in the world would be devastating. And for us to do that and not understand the implications of that is beyond my ability to understand. With the combination of Donald Trump, who they think is way out of line and crazy and does not know or understand what is going on, and these kind of actions in the Congress of the United States, who is standing up for this country? Who is supporting the President? Who is making sure that we are safe? I raise that question. Mr. Chair, I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chair, I yield myself such time as I may consume. Mr. Chairman, I rise today in opposition to H.R. 5461, the so-called Iranian Leadership Asset Transparency Act. The administration has stated this bill would endanger our ability to ensure that Iran's nuclear program is and remains exclusively peaceful. Indeed, this harmful bill is the latest in a series of Republican efforts aimed at undermining the landmark nuclear agreement reached last year by Iran and the world's six major powers. The comprehensive nuclear deal with Iran was intended to address one specific problem, and it has so far been a success. This success should not be underestimated, given how much a nuclear-armed Iran would magnify risk in a turbulent region in a terrible way. Despite the fact that the nuclear deal so far has delivered on its principal goal of blocking Iran's path to nuclear weapons for an extended period of time, opponents remain committed to undermining the ongoing viability of the deal, chipping away at it piece by piece, whether by passing legislation to block the sale of aircraft to Iran that was a central component of the agreement or accusing the administration of making extreme concessions to Iran by insisting, for example, that a legitimate legal settlement was an illegal ransom payment of some kind or by spreading rumors of suspected cheating by Iran. Republicans are intent on spreading this false narrative and dismantling the agreement. So here we are, considering this bill, which requires the Secretary of the Treasury to report on the total estimated funds or assets under direct or indirect control of as many as 80 senior Iranian leaders, along with a description of how the funds were acquired and employed. The report would not be tied to any specific prohibition or legal action against Iran and clearly plays into the hands of critics who are seeking to gin up prospects of reputational risks for companies that might seek to do business with Iran. Moreover, the lack of a tie to any specific prohibition or legal action against the listed individuals will likely increase confusion regarding compliance obligations rather than make remaining sanctions more easily understood. Undoubtedly, the report would be seized upon by Iran as an intentional effort to discourage international investment, which Iran would view as a violation of the express U.S. commitment under the nuclear deal not to interfere with the full realization of the relief provided under the accord. The major world powers that joined us in this agreement would also likely view the legislation as bad faith. By denying Iran the economic benefits it was promised in exchange for dismantling critical elements of this nuclear program, this bill would remove the critical incentive for Iran to hold up its end of the bargain. As the Statement of Administration Policy notes: ``If the JCPOA were to fail on that basis, it would remove the unprecedented constraints on and monitoring of Iran's nuclear program, lead to the unraveling of the international sanctions regime against Iran, and deal a devastating blow to the credibility of America's leadership and our commitment to our closest allies.'' In addition to my central concern that this bill destabilizes the Iran nuclear deal, I also share the administration's concerns that producing the report that is required under this bill would divert massive resources away from investigations and the targeting of sanctions on Iran related to terrorism, human rights violations, and ballistic missiles. Meeting the requirements of this bill would place a very real strain on the Treasury Department and intelligence community. We need to think carefully about the national security implications of diverting resources away from the Treasury investigators who are tasked with implementing current sanctions on Iran and uncovering illicit conduct across the globe. Proponents of this legislation have also underscored the importance of the need to show the people of Iran the corrupt practices in which their leaders are engaged. However, this bill would not accomplish that goal. There is a profound trust gap between the United States and Iran, and any findings in this report would be met with a high degree of skepticism among the Iranian people and their leaders. Therefore, to the extent any portion of this report could actually be made public, since much of the most important facts would likely be classified anyway, it would do little to enlighten the people of Iran about their leaders. In fact, it would inevitably be rejected as United States propaganda by both the regime and by its people as a predictable attack on the country's government by the United States. In light of the bill's limited practical utility, its failure to meet its own stated objectives, its diversion of resources away from investigations related to sanctions, and the destablizing effects it would have on the Iran nuclear deal, I urge its opposition. Moreover, the President has announced that he would veto this bill if it came across his desk. I include in the Record the Statement of Administration Policy on this bill. Statement of Administration Policy H.R. 5461--Iranian Leadership Asset Transparency Act--September 21, 2016 The Administration shares the Congress' goals of increasing transparency and bringing Iran into compliance with international standards in the global fight against terror finance and money laundering. However, this bill would be counterproductive toward those shared goals. The bill requires the U.S. Government to publicly report all assets held by some of Iran's highest leaders and to describe how these assets are acquired and used. Rather than preventing terrorist financing and money laundering, this bill would incentivize those involved to make their financial dealings less transparent and create a disincentive for Iran's banking sector to demonstrate transparency. These onerous reporting requirements also would take critical resources away from the U.S. Department of the Treasury's important work to identify Iranian entities engaged in sanctionable conduct. Producing this information could also compromise intelligence sources and methods. One of our best tools for impeding destabilizing Iranian activities has been to identify Iranian companies that are controlled by the Islamic Revolutionary Guards Corps (IRGC) or other Iranians on the list of Specially Designated Nationals and Blocked Persons (SDN List) to non-U.S. businesses, so that they can block assets or stop material transfers. This process is labor-intensive and requires the judicious use of our national intelligence assets. Redirecting these assets to preparing this onerous public report would be counterproductive and will not reduce institutional corruption or promote transparency within Iran's system. In addition, this bill's required public postings also may be perceived by Iran and likely our Joint Comprehensive Plan of Action (JCPOA) partners as an attempt to undermine the fulfilment of our commitments, in turn impacting the continued viability of this diplomatic arrangement that peacefully and verifiably prevents Iran from acquiring a nuclear weapon. If the JCPOA were to fail on that basis, it would remove the unprecedented constraints on and monitoring of Iran's nuclear program, lead to the unraveling of the international sanctions regime against Iran, and deal a devastating blow to the credibility of America's leadership and our commitments to our closest allies. As we address our concerns with Iran's nuclear program through implementation of the JCPOA, the Administration remains clear-eyed regarding Iran's support for terrorism, its ballistic missile program, human rights abuses, and destabilizing activity in the region. The United States should retain all of the tools needed to counter this activity, ranging from powerful sanctions to our efforts to disrupt and interdict illicit shipments of weapons and proliferation-sensitive technologies. This bill would adversely affect the U.S. Government's ability to wield these tools, would undermine the very goals it purports to achieve, and could even endanger our ability to ensure that Iran's nuclear program is and remains exclusively peaceful. If the President were presented with H.R. 5461, his senior advisors would recommend that he veto this bill.

Ms. MAXINE WATERS of California. Mr. Chairman, I yield 4 minutes to the gentleman from North Carolina (Mr. Price), a leading member of the House Appropriations Committee.

Ms. MAXINE WATERS of California. Mr. Chairman, I really should not spend my time on this. This is kind of ridiculous that this long list we have of which they want to find out about the assets--where they came from, how they are managed, who they give them to, et cetera--is kind of senseless anyway because, even if the Treasury Department took all of this time and effort that it should be using on enforcing sanctions, et cetera, it would be classified. I don't know how they expect to get this to the Iranian people to view as they are trying to have them think that they can somehow undermine what their government is doing and, I guess, create a war between Iran and the United States. I don't know what they are doing, but I know this--it doesn't make good sense. It ties up the Treasury Department to do all of this useless stuff. And to have a list where you spend time on the floor of the United States Congress saying, I want to add one more name--give me a break. I oppose the amendment. Mr. Chairman, I yield back the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chairman, I rise in opposition to the amendment.

Ms. MAXINE WATERS of California. Mr. Chairman, the Young amendment would add three additional requirements to the report that are called for under the underlying bill, including a description of how the administration views the effectiveness of its sanctions programs and recommendations for improving their enforcement. I believe it would be a strategic mistake to disclose to our adversaries how we view the effectiveness of our sanctions programs and would be imprudent to signal to them how we might respond or alter our approach through the use of economic sanctions. Furthermore, the amendment appears to be premised on the assumption that the administration isn't already actively enforcing sanctions related to Iran, particularly its pursuit of ballistic missile technology. Ironically, the extensive reporting requirements on roughly 80 senior Iranian officers in the underlying bill would detract from the administration's ability to implement the very sanctions that the Young amendment seeks to embrace. Given its false premise, the increased burden the amendment would place on the Treasury Department, and the strategic folly of revealing our strategy for using sanctions to rein in Iran's nefarious behavior, I oppose the amendment. Mr. Chairman, I simply don't believe that these Members who are engaging in this kind of activity really understand what they are doing. I refer to it as folly, but it is worse than that. It is weighing in on something they really don't know about. In doing so, they don't recognize the damage they are doing to their own country and to the President of the United States. I oppose this amendment. I yield back the balance of my time.

Ms. MAXINE WATERS of California. Mr. Chairman, I rise in opposition to this amendment.

Ms. MAXINE WATERS of California. Mr. Chairman, I yield myself the balance of my time. Mr. Chairman, as I have said at the onset of this debate, it is clear that this bill is nothing more than an effort to derail the administration's diplomatic accomplishments with regard to the Iran nuclear deal. After failing to block the deal from being implemented, opponents have shifted their focus towards unraveling and delegitimizing it bit by bit. This is despite the fact that over a year after the accord was signed, the JCPOA is widely seen as having diffused the global security threat of a nuclear armed Iran for at least a generation. Despite the ongoing success of the agreement, my colleagues on the other side of the aisle have gone to great lengths to promote a false narrative that the administration too readily concedes to Iran's demands, including by pushing claims that the U.S. made secret ransom payments to Iran. Other efforts to destabilize the agreement have been aimed squarely at violating the terms of the agreement itself. For example, Republicans moved a spate of measures earlier this summer that would block the sale of aircraft to Iran, despite the fact that these sales were a central component of the nuclear agreement. Moreover, Republicans also rushed legislation to the floor before leaving for the last congressional recess to undermine Iran's conduct of banking transactions outside of the United States--activity that became permissible as part of the nuclear deal. So while the bill before us today, H.R. 5461, may appear to contain a simple reporting requirement, it is most certainly not a bill that promotes our national security interests. By requiring an extraneous report on the assets of Iranian leaders without regard to current sanctions or other obligations, the bill would prevent the Iranian people from receiving the full benefits of this agreement. This would put the agreement in jeopardy and strengthen the hand of the hardliners in Iran who want nothing more than to see the nuclear deal fall apart. This scenario would threaten global security and deal a severe blow in our efforts to prevent a nuclear Iran. In closing, I would like to ask critics of the deal what they believe their moral responsibility will be if their relentless efforts to undo the deal are successful? How do you think rejection by the U.S. of the nuclear deal will affect American leadership on any future foreign policy negotiations? Some critics of the Iran nuclear deal express outrage that the deal has not curtailed Iran's other destabilizing influence in the region or support for what they say is terrorism at this time. I think it is important to note that the Iran nuclear deal was quite deliberately focused on the nuclear issue as the paramount concern regarding Iran's foreign policy. The Iran nuclear deal is an arms control agreement, and in that respect, it has been successful to date. It is my hope that the ongoing success of the nuclear deal might give us the leverage to work toward constructing a better policy towards Iran that will help us address the range of Iran's destabilizing behavior in the region, but I urge my colleagues not to confuse the legislation like H.R. 5461 with any serious effort to move us in that direction. So rather than force the President to veto this harmful and misguided legislation, I urge my colleagues to block this bill from moving forward here in the House. Mr. Chairman, I am going to reiterate that the world is watching what we do here. I want to reiterate that we didn't just enter into this deal by ourselves. We have all of our allies who have agreed to this deal. If this is undermined, if it is seen to cause us to act in bad faith, then what are we to say to our allies? What are we to say to the rest of the world about a deal that was negotiated by the leader of this country, the President of the United States? If the President of the United States of America can't count on the Congress of the United States to back him up in the world, if the President of the United States can't count on the Members of Congress to stand with him, and if the President of the United States can't be comfortable that the Members of Congress are not going to make him look as if he did not mean what he said, that he was not truthful in the negotiation, then what can a leader do? How can a leader lead a country? All of us who claim to love this country and to care about its safety and security have ourselves on the line with this legislation. This is legislation that will be deemed to undermine that agreement and be seen as just another attempt to undermine the President of the United States of America. It is not concerned about whether or not we have stopped the nuclear proliferation in Iran, not concerned that we have caused all of that region to feel safe and us to feel safe for another generation, but rather, pursuing to undermine the agreement simply because they don't like some part of it or they are not able to make the President do what they want him to do. This is outrageous. This cannot go forward in the way that it is intended by my friends on the opposite side of the aisle. I know that they are smart and they are bright and they are intelligent, but they cannot let their emotions about either not liking the President of the United States or simply not liking Iran to get in the way of this deal that will create safety in the world. Mr. Chairman, I yield back the balance of my time.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, we stand here today after an extraordinarily long recess, and Republicans' first order of businesses is to protect Wall Street profits instead of dealing with a host of critical issues facing the American public. I recently visited Baton Rouge, Louisiana, where thousands of residents are still without homes and communities are struggling to recover in the wake of last month's historic devastating flooding. There is so much that we need to do as Members of Congress to help our constituents in the short amount of time we have left in session, whether it is helping the people of Baton Rouge, ending the crisis of homelessness in America, or preventing senseless gun violence. However, rather than working together to pass sensible legislation to address these issues, we are debating H.R. 5424, a bad bill that would put Americans' savings and investments at risk by opening the door to further abuses in the private equity industry. This is an industry that touches all of us because it is not just private businesses looking to these funds to raise capital. One-quarter of the investments held by private equity firms come from our public pension funds that are holding our teachers' and firefighters' retirement savings. And it is not just our public pensions that are on the line. It is also our emergency services and mortgages and consumer lending markets where private equity funds are increasing their presence. That is why it is so important to have adequate oversight of this industry. We must ensure that Wall Street does not turn a profit at the expense of investors, consumers, and retirees. Unfortunately, H.R. 5424 would roll back Dodd-Frank's much-needed oversight and transparency measures for the shadow banking industry. Dodd-Frank required advisers to private equity funds and hedge funds with more than $150 million in assets under management to register with the SEC and comply with important reporting and audit requirements. In addition, it required newly registered advisers to file systemic risk reports with the Financial Stability Oversight Council, because we had sufficient information on the risks that private funds could pose to our economy as a whole. Thanks to this new oversight, the Securities and Exchange Commission has been able to examine and, where appropriate, bring enforcement actions against private fund advisers. In fact, the SEC has brought numerous enforcement actions against private fund advisers for a variety of transgressions in the past few years. In 2013, the SEC identified violations or weaknesses in more than 50 percent of cases where it had examined how fees and expenses are handled by advisers. Recently, the SEC Director of Enforcement urged greater transparency in this area and said the Commission ``will continue to aggressively bring impactful cases in this space.'' All of this comes on top of recent news reports showing how private equity firms are investing in our fire departments, ambulance services, and mortgage and consumer lending markets. Their profit-driven tactics have resulted in slower reaction times in our emergency services, exorbitant interest rates, and the same sort of foreclosure abuses that we witnessed before and during the financial crisis. So, when it comes to private equity funds and hedge funds, it is clear that more regulation is needed, not less. Yet this bill takes us in the wrong direction. For example, advisers would no longer have to notify clients of a change in ownership or provide them with information on their procedures for handling conflicts of interest in voting proxies. Additionally, they would not have to disclose information on large funds to the FSOC, making it harder to monitor and detect systemic risk. Also troubling is that the bill would create a Bernie Madoff loophole by providing a broad exception from an annual audit requirement for funds whose investors may have a relationship with the adviser and for funds invested in private securities that are not represented by a paper certificate. I must note that, despite efforts by my colleagues to amend this bill and remove some of its harmful provisions, there are still too many problematic provisions in this bill that would put investors, retirees, and consumers at risk. That is why it is opposed by consumer and investor advocates, State security regulators, institutional investors, and labor unions representing workers whose pensions could be affected. Moreover, the White House has threatened to veto the bill, saying it ``would enable private fund advisers to slip back into the shadows'' and ``unnecessarily put working and middle class families at risk, while benefiting Wall Street and other narrow special interests.'' I, therefore, strongly urge my colleagues to oppose H.R. 5424. I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, after general debate, my colleague from Illinois will offer an amendment to eliminate two toxic provisions of this bill. While I am supportive of his effort, I am concerned that his amendment does not go far enough. I am going to describe the six provisions Mr. Foster's amendment leaves intact but that are still harmful to investors and threatens the ability of the SEC to oversee private equity funds and hedge funds. As such, even if the amendment is adopted, I urge all Members to oppose final passage of H.R. 5424. The first reason to vote against final passage is that H.R. 5424 would still remove systemic risk reporting requirements for private equity funds. Congress created the Financial Stability Oversight Council when it passed the Dodd-Frank Act to look for risks across the entire financial system, including those within shadow banks like private equity funds. Democrats understood that one of the most important lessons of the crisis was the value of sunshine into all of the dark corners of our markets. We do not want another AIG to make enough risky financial bets to take down the entire economy without anyone knowing until it is too late. H.R. 5424, however, would repeal the requirement that large private equity firms provide certain information about their portfolio companies and their leverage. The second reason to vote ``no'' on an amended H.R. 5424 is that the bill still would prohibit the SEC from applying the antifraud guidance related to advertising materials of mutual funds to private equity funds and hedge funds. This is a basic investor protection. Private equity funds should not be able to selectively use performance data to dupe investors into buying their funds. It works for mutual funds and it will work for other funds similarly. Reason number three to oppose H.R. 5424 is that the amended bill would remove the bright-line test for fraudulent and misleading advertising materials, thereby allowing private equity advisers to use testimonials and past recommendations to create a false perception of the adviser's performance. This provision will enable private equity funds to more easily sell key securities to unsuspecting investors. Reason number four to vote ``no'' is the bill would still remove the requirement that fund advisers notify investors of ownership changes. This would allow an adviser to sell its business or the fund it manages to anyone, raising the concern that an unacceptable party would suddenly be managing a pension's invested money without their consent. The public pension plans have a right to know if the star manager has been replaced with an underachiever. An amended H.R. 5424 also would repeal disclosures of proxy voting procedures for handling conflicts of interest. Namely, the bill eliminates a requirement that advisers to private equity funds and hedge funds have policies and procedures in place to dictate how and when the adviser will vote a proxy and how it will mitigate any conflicts of interest. Because these policies and procedures inform investors and the SEC to whether an adviser is meeting some of its fiduciary responsibilities, I find it hard to understand how Democrats who stood up to protect the fiduciary obligations of everyday Americans can now support weakening it for the funds investing on behalf of those Americans. Finally, even though the Foster amendment preserves the audit requirement for certificated securities, the bill would remove the audit requirement under the SEC's custody rules for private, uncertificated securities for which advisers would not have to keep any record. Although such securities may not be common in the private space, this distinction between two types of securities has all the trappings of a loophole in the making and would create a terrible incentive. So I would urge all Members to oppose H.R. 5424 even if the Foster amendment is adopted. I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield 3\1/2\ minutes to the gentlewoman from New York (Mrs. Carolyn B. Maloney), the ranking member of our Subcommittee on Capital Markets and Government Sponsored Enterprises.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself as such time as I may consume. I will remind the Members that Nancy Pelosi, our leader, has weighed in on this pretty heavily. She doesn't weigh in on a lot of things, but she has put out an advisory here today titled: H.R. 5424, a House GOP giveaway to the shadow banking industry. We have from the administration that a Presidential veto will take place on this legislation should it get to his desk. This morning's debate illustrates Republican's misguided priorities. When we are here in Washington, the American public expects us to address the pressing needs of our Nation and not waste our time with Wall Street giveaways that the financial crisis taught us is neither prudent nor without devastating consequences. Why is it that the interest of Wall Street takes high priority when we return from our break? Why aren't we talking about homelessness? Why aren't we talking about Flint? Why aren't we talking about Zika? Why aren't we talking about Baton Rouge? I will tell you that there are those who think, perhaps, they have to take care of Wall Street, that it comes first, but I do not think so. I ask for a ``no'' vote on this bill. I yield back the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume. I think I heard my colleague on the opposite side of the aisle reference Main Street, but I did not hear him describe who his Main Street is, and we don't know who he is talking about. Let me just remind the Members one more time who is opposing this bill--this is truly representative of Main Street--AFL-CIO; American Federation of Teachers; American Federation of State, County and Municipal Employees; Americans for Financial Reform; Communications Workers of America; Consumer Federation of America; Council of Institutional Investors; CalPERS; CalSTRS; Institutional Limited Partners Association; North American Securities Administrators Association; Public Citizen; UNITE HERE; United Automobile, Aerospace and Agricultural Implement Workers of America, UAW; and U.S. Public Interest Research Group. We have opposition from working people, from the real people of Main Street, on this legislation. I think, as Members begin to read and look at this bill, they will understand how dangerous it is and how we would be rolling back the clock, jeopardizing the reforms that we have made with Dodd-Frank, and also taking us back to undermining the SEC in extraordinary ways. Recently, Mr. Speaker, there was an investigative series initiated by The New York Times looking into the operations of private equity firms. I would like to read for you a few key excerpts from the articles which I think might highlight the need for further regulation of private equity and not the rollbacks we see today in H.R. 5424. This is from a June 25, 2016, article titled: ``When You Dial 911 and Wall Street Answers.'' ``Since the 2008 financial crisis, private equity firms, the `corporate raiders' of an earlier era, have increasingly taken over a wide array of civic and financial services that are central to American life. ``Unlike other for-profit companies, which often have years of experience making a product or offering a service, private equity is primarily skilled in making money. And in many of these businesses, The Times found, private equity firms applied a sophisticated moneymaking playbook: a mix of cost cuts, price increases, lobbying and litigation. ``In emergency care and firefighting, this approach creates a fundamental tension: the push to turn a profit while caring for people in their most vulnerable moments.'' This article then goes on to describe how response times slowed and lives were put in danger--and I am talking about the response time of fire departments that are now controlled by equity funds--when these profit-hungry Wall Street firms took over essential public health services, like ensuring ambulances arrived to victims on time. From an article titled, ``How Housing's New Players Spiraled into Banks' Old Mistakes,'' dated June 26, 2016: ``When the housing crisis sent the American economy to the brink of disaster in 2008, millions of people lost their homes. The banking system had failed homeowners and their families. ``New investors soon swept in--mainly private equity firms--promising to do better. ``But some of these new investors are repeating the mistakes that banks committed throughout the housing crisis, an investigation by The New York Times has found. They are quickly foreclosing on homeowners. They are losing families' mortgage paperwork, much as the banks did. And many of these practices were enabled by the federal government, which sold tens of thousands of discounted mortgages to private equity investors, while making few demands on how they treated struggling homeowners. ``The rising importance of private equity in the housing market is one of the most consequential transformations of the post-crisis American financial landscape. A home, after all, is the single largest investment most families will ever make. ``Private equity firms, and the mortgage companies they own, face less oversight than the banks. And yet they are the cleanup crew for the worst housing crisis since the Great Depression.'' The article then goes on to describe how private equity firms can squeeze fees out of homeowners during every stage of the foreclosure process, often through conflicts of interest that make foreclosure more profitable than providing sustainable loan modifications. Mr. Speaker, this investigated series by The New York Times exposes practices that I think no credible Member of Congress would want to be associated with. This is horrible that we could even think that we are allowing our citizens to be placed at risk and their lives jeopardized because we have a private equity firm that is brought up and is now in control of critical services to our citizens, and they have to do it and make a profit. The way they make that profit is they cut back on personnel, equipment, machinery, or whatever it takes to turn that dollar. I am absolutely amazed that any Member of Congress would dare to think about supporting this kind of legislation that would allow these practices not only to continue in ways that I have described, and let me just remind you, I don't know how we can soon forget the crisis that this country experienced in 2008 when we had this subprime meltdown and we had so many foreclosures, so many families that were literally put on the streets because they lost their home because of practices that were not regulated by this government. This is amazing. This is absolutely amazing, and it is outrageous. I believe when the Members who come to vote today take a look at the fine print that they will understand what is happening here today. I think even if some Members thought they could, or should, support this bill, I think they are going to change their minds. And while it is being touted as a bipartisan effort, I don't think so. I reserve the balance of my time.

Ms. MAXINE WATERS of California. Mr. Speaker, investors, consumer advocates, public pension funds, and others have spoken on H.R. 5424, and they have deemed it to be harmful. Let me read for you a few excerpts from opposition letters received by the House of Representatives. First of all, let me tell you who they are: Americans for Financial Reform; the American Federation of State, County, and Municipal Employees; the American Federation of Teachers; the Consumer Federation of America; Communications Workers of America; and U.S. PIRG. ``Far from modernizing the regulation of investment advisers, this legislation would roll back the clock to the years before private fund advisers were subject to elementary oversight measures, measures that numerous documented abuses have shown to be necessary for investor protection. The laundry list of regulatory exemptions in this bill would enable the exploitation of investors, possibly including outright fraud. It would also reduce the information available to regulators to address systemic risk.'' North American Securities Administrators Association, Incorporated, these are our State securities regulators, the cops on the beat policing Main Street from financial crime, let me give you their quote: ``Although the bill purports to be an updating of the framework for the regulation of investment advisers, it is in fact little more than an effort to shield advisers to private funds from the scrutiny of SEC registration and examination oversight.'' Let's hear what CalPERS has to say: ``We believe that H.R. 5424 would erode the Dodd-Frank provisions that established greater transparency into private equity funds, protected investors against fraud by fund advisers, and enhanced the ability of regulators to effectively monitor systemic risk in the private fund industry.'' CalSTRS: ``This current legislation amends the Investment Advisers Act of 1940 to purportedly `modernize' certain requirements related to private equity advisers. In actuality, this proposed legislation would roll back important investor protections provided to funds, in terms of transparency and oversight by the Securities and Exchange Commission.'' Let's hear from the Institutional Limited Partners Association: ``The ILPA believes that the changes to mandatory disclosures and other requirements as proposed in H.R. 5424 would be counterproductive to providing institutional limited partners with the transparency they need to ensure alignment of interest in their private equity fund investments, and to carry out their duty to protect the interests of millions of beneficiaries of these investments--retirees, policyholders, nonprofit and educational institutions.'' Let's hear from the Council Institutional Investors: ``H.R. 5424 rolls back important transparency and reporting requirements that we and many of our members believe are critical to investor protection. For example, section 3(b) of H.R. 5424 would provide exceptions for private equity and hedge funds from existing disclosure requirements on Form PF, a confidential form used by the U.S. Securities and Exchange Commission and other regulators to track risks in the financial system.'' Let's hear from Public Citizen: ``This bill allows investment advisers to escape current safeguards designed to reduce inflated sales pitches or obfuscation of investment risks. Specifically, investment advisers need to make sure that potential private equity investors have basic sales documents such as the company prospectus before consummating a sale. Investors in private funds should be accorded ample information. The bill also frustrates efforts by investors to gain access to company records in so-called books-and-records requests.'' Unite Here: ``H.R. 5424 is an invitation for private equity managers to make false and misleading statements to the public. At a time when the nearly $4 trillion private equity industry should become more transparent, H.R. 5424 would enable it to become more opaque, putting workers, retirees, and the general public at risk.'' Mr. Speaker, I reserve the balance of my time.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, I come this morning rather stunned because I am witnessing comments by Presidential candidate Trump and Vice Presidential candidate Mike Pence that stuns me. Today I heard that Pence basically said that Vladimir Putin has been a stronger leader in his country than Barack Obama in his country. And then, of course, Donald Trump is arguing that the Russians are not meddling in American Presidential politics, despite the fact he was interviewing on a Russian television station. What is going on here? Is this patriotism? I don't know why all of a sudden we have a Presidential candidate who is praising or talking about basically a dictator being better than the President of the United States of America.

Ms. MAXINE WATERS of California

Ms. MAXINE WATERS of California. Mr. Speaker, on that I demand the yeas and nays.