,,ii #aacth ,,congress #b;d ,session ,s4 #bche ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,may #bb1 #bjad ,mr4 ,harkin 7for himself1 ,mr4 ,durbin1 and ,ms4 ,warren7 introduced the following bill2 which was read twice and referred to the ,committee on ,health1 ,education1 ,labor1 and ,pensions ,a ,,bill ,to amend the ,higher ,education ,act of #aife and the ,truth in ,lending ,act to provide for disclosure and codes of conduct with respect to consumer financial products or services and institutions of higher education4 #a4 ,short title ,this ,act may be cited as the ,protecting ,aid for ,students ,act of #bjad4 #b4 ,disbursement of credit balance ,part ,g of title ,,iv of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajhh et seq47 is amended by adding at the end the following3 #dic;,e4 ,disbursement of credit balance 7a7 ,credit balance ,in this section1 the term credit balance means the amount of program funds under this title credited to a student's ledger account at the institution of higher education that exceed the amount assessed the student by the institution for allowable institutional charges1 as defined by the ,secretary4 7b7 ,establishment of system for disbursement ,not later than #c years after the date of enactment of the ,protecting ,aid for ,students ,act of #bjad1 each institution of higher education that enrolls a student who receives a grant or loan under this title shall establish a system for the disbursement of credit balances in accordance with subsection 7c74 7c7 ,electronic payment system 7#a7 ,in general ,each institution of higher education described in subsection 7b7 shall establish a system for disbursement of credit balances through electronic payments to a deposit account or a general use prepaid card with the protections afforded under the ,electronic ,fund ,transfer ,act 7#ae ,u4,s4,c4 #afic et seq474 7#b7 ,no preferred financial institution or denial or delay ,in carrying out the system under paragraph 7#a71 an institution of higher education shall not-- 7,a7 require or encourage a student to select a particular financial institution to which an electronic payment under this section shall be made2 or 7,b7 deny or cause a delay in the disbursement of credit balances based on the selection by a student of a particular financial institution4 7d7 ,distribution options 7#a7 ,pilot program ,the ,secretary of ,education1 in consultation with the ,secretary of the ,treasury and the ,director of the ,bureau of ,consumer ,financial ,protection1 shall conduct a pilot program on providing students with the option of receiving credit balances1 through the electronic payment system of the institution of higher education in accordance with subsection 7c71 by using the ,treasury ,direct ,express system established under section #cccf of title #ca1 ,united ,states ,code1 or through any other low-cost alternative as determined by the ,secretary4 7#b7 ,implementation ,if the ,secretary of ,education1 after conducting the pilot program described in paragraph 7#a71 determines that allowing students with credit balances to use any option described in such paragraph is in the best interest of students1 the ,secretary shall take such actions as are necessary to provide any such option to students1 which may include entering into agreements with the ,secretary of ,treasury or other entity to implement this paragraph4 4 #c4 ,code of conduct in affiliated consumer financial products or services ,part ,b of title ,i of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajaa et seq47 is amended by adding at the end the following3 #abd4 ,code of conduct in affiliated consumer financial products or services 7a7 ,definitions ,in this section3 7#a7 ,affiliated 7,a7 ,in general ,the term affiliated1 when used with respect to a consumer financial product or service and an institution of higher education1 means an association between such institution and product or service resulting from-- 7i7 the name1 emblem1 mascot1 or logo of the institution being used with respect to such product or service2 or 7ii7 some other word1 picture1 or symbol readily identified with the institution in the marketing of the consumer financial product or service in any way that implies that the institution endorses the consumer financial product or service4 7,b7 ,rule of construction ,nothing in subparagraph 7,a7 shall be construed to deem an association between an institution of higher education and a consumer financial product or service to be affiliated if such association is solely based on an advertisement by a financial institution that is delivered to a wide and general audience consisting of more than enrolled students at the institution of higher education4 7#b7 ,associated individual ,the term associated individual1 when used with respect to an institution of higher education1 means an individual who is-- 7,a7 an officer of such institution of higher education2 7,b7 an employee or agent of the institution of higher education who is involved in the contracting1 approval1 analysis1 or decisionmaking process for an affiliated consumer financial product or service2 or 7,c7 an employee or agent of the institution of higher education involved in the marketing or solicitation process pertaining to an affiliated consumer financial product or service4 7#c7 ,consumer financial product or service ,the term consumer financial product or service has the meaning given the term in section #ajjb of the ,consumer ,financial ,protection ,act of #bjaj 7#ab ,u4,s4,c4 #edha74 7#d7 ,financial institution ,the term financial institution has the meaning given the term in section #adj;,b of the ,truth in ,lending ,act4 7#e7 ,institution of higher education ,the term institution of higher education means an institution of higher education as defined in section #ajb4 7b7 ,code of conduct ,notwithstanding any other provision of law1 no institution of higher education that is affiliated with a consumer financial product or service shall be eligible to receive funds or any other form of financial assistance under this ,act1 unless the institution-- 7#a7 develops a code of conduct with respect to affiliated consumer financial products or services with which associated individuals shall comply that-- 7,a7 prohibits a conflict of interest with the responsibility of an associated individual with respect to such affiliated consumer financial product or services2 7,b7 requires each associated individual to act in the best interest of the students enrolled at the institution of higher education in carrying out their duties2 and 7,c7 at a minimum1 is aligned with the requirements and prohibitions described under subsections 7c7 through 7g72 7#b7 publishes such code of conduct prominently on the institution's website2 and 7#c7 administers and enforces such code by1 at a minimum1 requiring that all of the institution's associated individuals be annually informed of the provisions of the code of conduct4 7c7 ,ban on revenue-,sharing arrangements 7#a7 ,prohibition ,an institution of higher education that is affiliated with a consumer financial product or service shall not enter into any revenue-sharing arrangement with the financial institution4 7#b7 ,definition ,in this subsection1 the term revenue-sharing arrangement-- 7,a7 means an arrangement between an institution of higher education and a financial institution under which-- 7i7 the financial institution provides or issues a consumer financial product or service to students attending the institution of higher education2 7ii7 the institution of higher education recommends1 promotes1 sponsors1 or otherwise endorses the financial institution1 or the consumer financial products or services offered by the financial institution2 and 7iii7 the financial institution pays a fee or provides other material benefits1 including revenue or profit sharing1 to the institution of higher education in connection with the consumer financial products or services provided to students of the institution of higher education2 and 7,b7 does not include an arrangement under which a financial institution pays a fair market price to an institution of higher education for the advertising or marketing of the financial institution to the general public by the institution of higher education4 7d7 ,gift ban 7#a7 ,prohibition ,no associated individual of an institution of higher education shall solicit or accept any gift from a financial institution that has a consumer financial product or service with which the institution is affiliated4 7#b7 ,definition of gift 7,a7 ,in general ,in this subsection1 the term gift means any gratuity1 favor1 discount1 entertainment1 hospitality1 loan1 or other item having a monetary value of more than a de minimus amount4 ,the term includes a gift of services1 transportation1 lodging1 or meals1 whether provided in kind1 by purchase of a ticket1 payment in advance1 or reimbursement after the expense has been incurred4 7,b7 ,exceptions ,the term gift shall not include any of the following3 7i7 ,standard material1 activities1 or programs on issues related to a consumer financial product or service or financial literacy1 such as a brochure1 a workshop1 or training4 ,such material1 training1 or program shall not promote a product or service of any specific financial institution4 7ii7 ,food1 refreshments1 training1 or informational material furnished to an associated individual as an integral part of a training session that is designed to improve the service of a financial institution to the institution of higher education1 if such training contributes to the professional development of the associated individual4 7iii7 ,favorable terms1 conditions1 and borrower benefits on a consumer financial product or service provided to all employees of the institution of higher education if such terms1 conditions1 or benefits are comparable to those provided to all students of the institution4 7iv7 ,philanthropic contributions to an institution of higher education from a financial institution that are unrelated to the affiliated consumer financial product or service or the financial institution in general or any contribution from the financial institution that is not made in exchange for any advantage related to the financial institution4 7,c7 ,rule for gifts to family members ,for purposes of this subsection1 a gift to a family member of an associated individual of an institution of higher education shall be considered a gift to the associated individual if-- 7i7 the gift is given with the knowledge and acquiescence of the associated individual2 and 7ii7 the associated individual has reason to believe the gift was given because of the official position of the associated individual4 7e7 ,contracting arrangements prohibited 7#a7 ,prohibition ,no associated individual of an institution of higher education shall accept from a financial institution that has a consumer financial product or service with which the institution is affiliated a fee1 payment1 or other financial benefit 7including the opportunity to purchase stock7 as compensation for any type of consulting arrangement or other contract to provide services to the financial institution or on behalf of the financial institution4 7#b7 ,rule of construction ,nothing in this subsection shall be construed as prohibiting the conduct of an individual who is not an associated individual4 7f7 ,ban on staffing assistance ,an institution of higher education shall not request or accept from a financial institution with which the institution has an affiliated consumer financial product or service any assistance with call center staffing1 financial aid office staffing1 or any other office or department of the institution of higher education4 7g7 ,advisory board compensation ,any associated individual of an institution of higher education who serves on an advisory board1 commission1 or group established by a financial institution that has a consumer financial product or service with which the institution is affiliated shall be prohibited from receiving anything of value from the financial institution1 except that the individual may be reimbursed for reasonable expenses incurred in serving on such advisory board1 commission1 or group4 4 #d4 ,revenue sharing and disclosure of affiliation ,chapter #b of title ,i of the ,truth in ,lending ,act 7#ae ,u4,s4,c4 #afca et seq47 is amended by adding at the end the following3 #adj;,b4 ,preventing unfair and deceptive marketing of consumer financial products and services to students of institutions of higher education 7a7 ,definitions ,in this section3 7#a7 ,affiliate ,the term affiliate means any person that controls1 is controlled by1 or is under common control with another person4 7#b7 ,affiliated 7,a7 ,in general ,the term affiliated1 when used with respect to a consumer financial product or service and an institution of higher education1 means an association between such institution and product or service resulting from-- 7i7 the name1 emblem1 mascot1 or logo of the institution being used with respect to such product or service2 or 7ii7 some other word1 picture1 or symbol readily identified with the institution in the marketing of the consumer financial product or service in any way that implies that the institution endorses the consumer financial product or service4 7,b7 ,rule of construction ,nothing in subparagraph 7,a7 shall be construed to deem an association between an institution of higher education and a consumer financial product or service to be affiliated if such association is solely based on an advertisement by a financial institution that is delivered to a wide and general audience consisting of more than enrolled students at the institution of higher education4 7#c7 ,consumer financial product or service ,the term consumer financial product or service has the meaning given the term in section #ajjb of the ,consumer ,financial ,protection ,act of #bjaj 7#ab ,u4,s4,c4 #edha74 7#d7 ,financial institution ,the term financial institution means-- 7,a7 any person that engages in offering or providing a consumer financial product or service2 and 7,b7 any affiliate of such person described in subparagraph 7,a7 if such affiliate acts as a service provider to such person4 7#e7 ,institution of higher education ,the term institution of higher education has the meaning given the term in section #ajb of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajjb74 7#f7 ,person ,the term person means an individual1 partnership1 company1 corporation1 association 7incorporated or unincorporated71 trust1 estate1 cooperative organization1 or other entity4 7#g7 ,revenue-sharing arrangement ,the term revenue-sharing arrangement-- 7,a7 means an arrangement between an institution of higher education and a financial institution under which-- 7i7 a financial institution provides or issues a consumer financial product or service to college students attending the institution of higher education2 7ii7 the institution of higher education recommends1 promotes1 sponsors1 or otherwise endorses the financial institution1 or the consumer financial products or services offered by the financial institution2 and 7iii7 the financial institution pays a fee or provides other material benefits1 including revenue or profit sharing1 to the institution of higher education1 or to an officer1 employee1 or agent of the institution of higher education1 in connection with the consumer financial products and services provided to college students attending the institution of higher education2 and 7,b7 does not include an arrangement under which a financial institution pays a fair market price to an institution of higher education for the advertising or marketing of the financial institution to the general public by the institution of higher education4 7#h7 ,service provider ,the term service provider-- 7,a7 means any person that provides a material service to another person in connection with the offering or provision by such other person of a consumer financial product or service1 including a person that-- 7i7 participates in designing1 operating1 or maintaining the consumer financial product or service2 or 7ii7 processes transactions relating to the consumer financial product or service 7other than unknowingly or incidentally transmitting or processing financial data in a manner that such data is undifferentiated from other types of data of the same form as the person transmits or processes72 and 7,b7 does not include a person solely by virtue of such person offering or providing to another person-- 7i7 a support service of a type provided to businesses generally or a similar ministerial service2 or 7ii7 time or space for an advertisement for a consumer financial product or service through print1 newspaper1 or electronic media4 7b7 ,disclosure of affiliation 7#a7 ,reports by financial institutions 7,a7 ,in general ,not later than #ahj days after the date of enactment of the ,protecting ,aid for ,students ,act of #bjad1 and annually thereafter1 each financial institution shall submit a report to the ,bureau containing the terms and conditions of all business1 marketing1 and promotional agreements that the financial institution has with any institution of higher education1 or an alumni organization or foundation that is an affiliate of or related to an institution of higher education1 relating to any consumer financial product or service offered to college students at institutions of higher education4 7,b7 ,details of report ,the information required to be reported under subparagraph 7,a7 includes-- 7i7 any memorandum of understanding between or among the financial institution and an institution of higher education1 alumni association1 or foundation that directly or indirectly relates to any aspect of an agreement referred to in subparagraph 7,a7 or controls or directs any obligations or distribution of benefits between or among the entities2 and 7ii7 the number and dollar amount outstanding of consumer financial products or services accounts covered by any such agreement that were originated during the period covered by the report1 and the total number and dollar amount of consumer financial products or services accounts covered by the agreement that were outstanding at the end of such period4 7,c7 ,aggregation by institution ,the information required to be reported under subparagraph 7,a7 shall be aggregated with respect to each institution of higher education or alumni organization or foundation that is an affiliate of or related to the institution of higher education4 7#b7 ,reports by ,bureau ,the ,bureau shall submit to ,congress1 and make available to the public1 an annual report that lists the information submitted to the ,bureau under paragraph 7#a74 7#c7 ,electronic disclosures 7,a7 ,posting agreements ,each financial institution shall establish and maintain an ,internet site on which the financial institution shall post the written agreement between the financial institution and the institution of higher education for each affiliated consumer financial product or service4 7,b7 ,financial institution to provide contracts to the bureau ,each financial institution shall provide to the ,bureau1 in electronic format1 the written agreements that it publishes on its ,internet site pursuant to this paragraph4 7,c7 ,record repository ,the ,bureau shall establish and maintain on its publicly available ,internet site a central repository of the agreements received from financial institutions pursuant to this paragraph1 and such agreements shall be easily accessible and retrievable by the public4 7,d7 ,exception ,this paragraph shall not apply to individually negotiated changes to contractual terms1 such as individually modified workouts or renegotiations of amounts owed by an institution of higher education4 7c7 ,prohibition of revenue-,sharing arrangement ,a financial institution that offers a consumer financial product or service that is affiliated with an institution of higher education may not enter into a revenue-sharing arrangement with the institution of higher education4 7d7 ,rule of construction ,nothing in this section shall be construed to prohibit a financial institution from establishing a consumer product or service affiliated with an institution of higher education if -- 7#a7 the consumer product or service will-- 7,a7 assist college students in reducing costs or fees associated with the use of consumer financial products or services2 7,b7 increase consumer choice2 and 7,c7 enhance consumer protections2 and 7#b7 the financial institution is in compliance with the requirements of this ,act4 4