Clerk session vote number: 463
Description: Military Personnel Financial Services Protection Act
Bill summary: (This measure has not been amended since it was reported to the Senate on July 13, 2006. The summary of that version is repeated here.)
Military Personnel Financial Services Protection Act - (Sec. 4) Amends the Investment Company Act of 1940 to make it unlawful for any registered investment company to issue or sell any periodic payment plan certificate.
Retains the validity of certain previously issued certificates.
Directs the Securities and Exchange Commission (SEC) to report to certain
congressional committees on: (1) measures taken by a registered broker or dealer to refund voluntarily payments made by military service members on any periodic payment plan certificate, and the amounts of such refunds; (2) the sales practices of such brokers or dealers on military installations over the five years preceding submission of the report, and any legislative or regulatory recommendations to improve such practices; and (3) the revenues generated by such brokers or dealers in the sales of periodic payment plan certificates over such five-year period, and the products marketed by them to replace the revenue generated from the sales of prohibited certificates.
(Sec. 5) Amends the Securities Exchange Act of 1934 to require the rules of a registered securities association to: (1) govern the sales, or offers of sales, of securities on the premises of any military installation to any member of the Armed Forces, including absence of referral fees or incentives and conspicuous disclosure that the securities are neither sanctioned, recommended, nor encouraged by the federal government; and (2) establish a system for collecting and retaining registration, disciplinary, and disputed information, as well as a toll-free telephone listing for prompt response to inquiries about member registration information.
(Sec. 7) Amends the Investment Advisers Act of 1940 to authorize the SEC to require an investment adviser to file with the SEC any fee, application, report, or notice required to be filed, and pay associated costs.
Directs the SEC to require such entity to establish and maintain a toll-free telephone listing, or other readily accessible process to receive and promptly respond to inquiries regarding registration, disciplinary, and other information involving investment advisers and associated persons.
(Sec. 8) Declares that any state law, regulation, or order regarding the business of insurance shall apply to insurance activities conducted on federal land or facilities in the United States and abroad, including military installations.
Prescribes the requirements of primary state jurisdiction of insurance or securities activities on federal land or facilities.
(Sec. 9) Expresses the sense of Congress that the National Association of Insurance Commissioners (NAIC) should study and report to certain congressional committees on the extent to which the states have worked collectively with the Secretary of Defense to ensure implementation of appropriate standards to protect members of the Armed Forces from dishonest and predatory insurance sales practices while on a federal military installation.
Expresses the sense of Congress that senior representatives of the Secretary of Defense, the SEC, and the NAIC should meet twice a year to coordinate their activities and monitor enforcement of the sale of financial products on federal military installations.
(Sec. 10) Prohibits an insurer or producer from selling, or offering for sale, any life insurance product to any member of the Armed Forces or a dependent on a federal military installation, unless specified written disclosures have been provided at the time of the sale.
Makes the sale of a life insurance product in violation of this Act voidable from its inception, at the sole option of the member of the Armed Forces or dependent.
Prohibits any person who has intentionally violated, or willfully disregarded, these prohibitions and requirements from further engaging in the business of insurance with respect to federal employees on federal land, except regarding existing policies.
Exempts from these prohibitions and requirements any life insurance product specifically contracted by or through the federal government.
(Sec. 11) Expresses the sense of Congress that the NAIC should study and report to certain congressional committees on ways of improving the quality of and sale of life insurance products sold on federal military installations.
Directs the Comptroller General, if the NAIC does not submit such a report, to study and report to specified congressional committees on any proposals that have been made to improve the quality and sale of life insurance products sold on military installations of the United States.
(Sec. 12) Prohibits any insurer from contracting with any person that sells or solicits the sale of any life insurance product on U.S. military installations unless the insurer has implemented a system to report to certain state insurance commissioners any federal, state, or corporate disciplinary actions taken with respect to such sales or solicitations.
Expresses the sense of Congress that the states should collectively implement a system to: (1) receive reports of such disciplinary actions; and (2) disseminate such information to all other states and to the Secretary of Defense.
(Sec. 13) Requires the Secretary of Defense to: (1) establish a list of insurance agents and financial advisors that have been barred or banned from doing business on federal military installations; and (2) ensure that federal and state regulatory agencies for securities and insurance are promptly notified upon the inclusion in or removal from the list.
(Sec. 14) Instructs the Inspector General of the Department of Defense to study and report to certain congressional committees on the impact of a certain Department of Defense Instruction and the reforms included in this Act on the quality and suitability of sales of securities and insurance products marketed or otherwise offered to members of the Armed Forces.
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Bill titles: A bill to protect members of the Armed Forces from unscrupulous practices regarding sales of insurance, financial, and investment products.
Links for more info on the vote: congress.gov