Bill Text: MO HB1051 | 2012 | Regular Session | Amended

Missouri House Bill 1051 (Prior Session Legislation)

Bill Title: Requires the State Auditor to perform, on a one-time basis, a comparative audit of at least five, but no more than 10, of the largest state agencies and of each chamber of the General Assembly

Spectrum: Partisan Bill (Republican 1-0)

Status: (Engrossed - Dead) 2012-05-18 - Reported to the House with... (S) - SS AS AMENDED [HB1051 Detail]

Download: Missouri-2012-HB1051-Amended.html

4592S.03F

SENATE SUBSTITUTE

FOR

SENATE COMMITTEE SUBSTITUTE

FOR

HOUSE BILL NO. 1051

AN ACT

To repeal sections 361.070, 361.080, and 513.653, RSMo, and to enact in lieu thereof four new sections relating to audits, with existing penalty provisions.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF MISSOURI, AS FOLLOWS:

Section A. Sections 361.070, 361.080, and 513.653, RSMo, are repealed and four new sections enacted in lieu thereof, to be known as sections 29.375, 361.070, 361.080, and 513.653, to read as follows:

29.375. 1. The state auditor shall, on a one-time basis, perform a comparative audit of at least five, but no more than ten, of the largest state agencies, as determined by total appropriation for fiscal year 2012, and perform a comparative audit of each chamber of the general assembly.

2. The state auditor shall develop criteria for fiscal responsibility that are applicable to all agencies regardless of their statutory, legal, or programmatic mandates. While creating criteria for the audit, the auditor shall conform with the provisions of applicable law and the standards for auditing of governmental organizations, programs, activities, and functions established by the comptroller general of the United States.

3. Upon completion of the audit, which shall occur no later than August 28, 2014, the auditor shall submit a report of the findings and recommendations to the general assembly, all statewide elected officials, the office of administration, and all state departments. The report issued shall contain recommendations including, but not limited to, the optimal fiscal practices to be promoted across all state agencies and efficiency or cost saving measures, including recommended changes to agency policy or state law, that could reduce the amount of government spending.

361.070. 1. The director of finance and all employees of the division of finance, which term shall, for purposes of this section and section 361.080, include special agents, shall, before entering upon the discharge of their duties, take the oath of office prescribed by the constitution, and, in addition, take an oath that they will not reveal the conditions or affairs of any financial institution or any facts pertaining to the same, that may come to their knowledge by virtue of their official positions, unless required by law to do so in the discharge of the duties of their offices or when testifying in any court proceeding. For purposes of this section and section 361.080, "financial institution" shall mean any entity subject to chartering, licensing, or regulation by the division of finance.

2. The director of finance and all employees of the division of finance shall further execute to the state of Missouri good and sufficient bonds with corporate surety, to be approved by the governor and attorney general, conditioned that they will faithfully and impartially discharge the duties of their offices, and pay over to the persons entitled by law to receive it, all money coming into their hands by virtue of their offices. The principal amount of bond applicable to each employee shall be determined by the state banking and savings and loan board. The bond, after approval by the governor and attorney general, shall be filed with the secretary of state for safekeeping. The bond premiums, not to exceed one percent on the amount thereof, shall be paid out of the state treasury in the same manner as other expenses of the division.

3. Neither the director of finance nor any employees of the division of finance who participate in the examination of any bank or trust company, or who may be called upon to make any official decision or determination affecting the operation of any bank or trust company, other than the members of the state banking and savings and loan board who are required to have experience managing a bank or association as defined in chapter 369, shall be an officer, director, attorney, owner, or holder of stock in any bank or trust company or any bank holding company as that term is defined in section 362.910, nor shall they receive, directly or indirectly, any payment or gratuity from any such organization, nor engage in the negotiation of loans for others with any state bank or trust company, nor be indebted to any state bank or trust company.

4. The director of the division of finance shall establish an internal policy to ensure the professional conduct of employees of the division of finance who participate in the examination of any person or entity under the jurisdiction of the director of the division of finance, or who may be called upon to make any official decision or determination affecting the operation of any person or entity under the jurisdiction of the director of the division of finance. The policy shall address such matters deemed appropriate by the director of the division of finance, including, but not limited to, procedures to address and mitigate the conflict of interest presented by offers of employment or negotiations regarding employment between an employee of the division and any person or entity under the jurisdiction of the director of the division of finance.

5. The director of finance, in connection with any examination or investigation of any person, company, or event, shall have the authority to compel the production of documents, in whatever form they may exist, and shall have the authority to compel the attendance of and administer oaths to any person having knowledge of any issue involved with the examination or investigation. The director may seek judicial enforcement of an administrative subpoena by application to the appropriate court. An administrative subpoena shall be subject to the same defenses or subject to a protective order or conditions as provided and deemed appropriate by the court in accordance with the Missouri Supreme Court Rules.

361.080. 1. To ensure the integrity of the examination process, the director of finance and all employees of the division of finance shall be bound under oath to keep secret all facts and information obtained in the course of all examinations and investigations [except] subject only to the exceptions set out below. When disclosure is necessary or required under this subsection, the director may set conditions and limitations including an agreement of confidentiality or seek a judicial protective order under subsection 2 of this section. The exceptions allowing disclosure are as follows:

(1) To the extent that the public duty of the director requires the director to report information to another government official or agency or take administrative or judicial enforcement action regarding the affairs of a financial institution;

(2) When called as a witness in a court proceeding relating to such financial institution's safety and soundness or in any criminal proceeding;

(3) When reporting on the condition of the financial institution to the officers and directors of the financial institution or to a holding company which owns the financial institution;

(4) When reporting findings to a complainant, provided the disclosure is limited to such complainant's account information;

(5) When exchanging information with any agency which regulates financial institutions under federal law or the laws of any state when the director of finance determines that the sharing of information is necessary for the proper performance by the director of finance and the other agencies, that such information will remain confidential as though subject to section 361.070 and this section and that said agencies routinely share information with the division of finance;

(6) When authorized by the financial institution's board of directors to provide the information to anyone else; or

(7) [When disclosure is necessary or required, the director may set conditions and limitations, including an agreement of confidentiality or a judicial or administrative protective order.] When undergoing a state audit, provided that the director of finance has entered an agreement of confidentiality with the state auditor. The agreement of confidentiality shall include provisions for the redaction of records to remove protected information from disclosure. The redaction of information shall be required when it is comprised of nonpublic personal or proprietary commercial and financial information, trade secrets, information the disclosure of which could prejudice the effective performance or security of the division of finance including component CAMELS ratings or other sensitive findings, or information that is protected under any recognized privilege, such as attorney client privilege or work product. Protected information shall also be identifying bank information including anything that could be matched with public information to discern the identity of a financial institution under the jurisdiction of the division of finance or of individual persons or business entities served by such financial institutions. When confidential or protected information relating to a particular financial institution under the division's jurisdiction is requested, the director of the division of finance shall provide notice to that institution at least thirty days prior to production, and shall provide the institution a copy of the proposed agreement of confidentiality. The affected institution may submit comments to the director regarding the agreement or the production and may seek review of the decision to produce the information or of the confidentiality agreement, or both, under the provisions of section 536.150. The director of the division of finance may forego the notice to a financial institution under this subsection when the notice would compromise an investigation by any agency with criminal prosecutorial powers.

2. In all other circumstances, facts and information obtained by the director of finance and the employees of the division of finance through examinations or investigations shall be held in confidence absent a court's finding of compelling reasons for disclosure. Such finding shall demonstrate that the need for the information sought outweighs the public interest in free and open communications during the examination or investigation process. To assure a meaningful hearing, any financial institution that is not already a party to the judicial proceeding and whose information is the subject of a records request or subpoena shall be joined or notified and permitted to intervene in the hearing and to participate regarding the production request or subpoena. In no event shall a financial institution, or any officer, director, or employee thereof, be charged with libel, slander, or defamation for any good faith communications with the director of finance or any employees of the division of finance.

3. If the director or any employees of the division of finance disclose the name of any debtor of any financial institution or disclose any facts obtained in the course of any examination or investigation of any financial institution, except as herein provided, the disclosing party shall be deemed guilty of a misdemeanor and upon conviction shall be subject to forfeiture of office and the payment of a fine not to exceed one thousand dollars.

513.653. 1. Law enforcement agencies involved in using the federal forfeiture system under federal law shall [be required at the end of their respective fiscal year to acquire an independent audit of the federal seizures and the proceeds received therefrom and provide this audit to their respective governing body and to the department of public safety. A copy of such audit shall be provided to the state auditor's office. This audit shall be paid for out of the proceeds of such federal forfeitures] file a report regarding federal seizures and the proceeds therefrom. Such report shall be filed annually by January thirty-first for the previous calendar year with the department of public safety and the state auditor's office. The report for the calendar year shall include the type and value of items seized and turned over to the federal forfeiture system, the beginning balance as of January first of federal forfeiture funds or assets previously received and not expended or used, the proceeds received from the federal government (the equitable sharing amount), the expenditures resulting from the proceeds received, and the ending balance as of December thirty-first of federal forfeiture funds or assets on hand. The department of public safety shall not issue funds to any law enforcement agency that fails to comply with the provisions of this section.

2. Intentional or knowing failure to comply with the [audit] reporting requirement contained in this section shall be a class A misdemeanor, punishable by a fine of up to one thousand dollars.