S. 2680 — LETITIA Act

This section states the sense of Congress that public officials who commit crimes of dishonesty or moral turpitude—particularly mortgage, bank, credit, and tax fraud—betray the public trust and deserve heightened punishments beyond those for ordinary citizens, including mandatory minimum sentences of imprisonment to prevent abuse of influence, with even harsher mandatory penalties for multiple offenses.

This section restructures the bank fraud statute into subsections (a) offense and (b) penalties, retaining the general penalty for violations—a fine up to $1,000,000, imprisonment up to 30 years, or both. It establishes enhanced penalties when the offender is a public official (i.e., an officer, employee, elected or appointed representative of, or individual acting for or on behalf of, the United States, a State, subdivision of a State, or any department, agency, or branch of government, in an official function), as follows: (1) for a first or second offense, a fine up to $1,500,000 (from $1,000,000 maximum) and imprisonment of 1 to 35 years (from up to 30 years); and (2) for a third or subsequent offense, a fine up to $2,000,000 (from $1,000,000 maximum) and imprisonment of 5 to 40 years (from up to 30 years).

This section restructures 18 U.S.C. 1014, which prohibits knowingly making false statements or willfully overvaluing land, property, or security to influence actions of federal lending, credit, housing finance, farm credit, and related entities (e.g., Federal Housing Administration, Farm Credit Administration, FDIC-insured institutions), to retain the general penalty of a fine not more than $1,000,000, imprisonment not more than 30 years, or both, and to establish enhanced penalties for public officials. For public officials (defined to include officers, employees, elected or appointed representatives of, or persons acting for the United States, a state, political subdivision, or governmental department, agency, or branch), penalties increase to— (1) a fine not more than $1,500,000 (from $1,000,000) and imprisonment not less than 1 year nor more than 35 years (from up to 30 years) for a first or second offense; and (2) a fine not more than $2,000,000 and imprisonment not less than 5 years nor more than 40 years for a third or subsequent offense.

This section establishes enhanced criminal penalties under Section 7206 of the Internal Revenue Code for public officials who falsify tax filings. (1) For a public official's first or second offense, it increases the maximum fine to $150,000 (from $100,000) and the prison term to not less than 6 months and not more than 5 years (from not more than 3 years); and (2) for a third or subsequent offense, it increases the maximum fine to $200,000 (from $100,000) and the prison term to not less than 2 years and not more than 10 years (from not more than 3 years). A public official includes any officer, employee, elected or appointed representative of, or individual acting for or on behalf of, the United States, a state, a subdivision of a state, or any department, agency, or branch of government.

This section directs the Attorney General to issue, within 90 days of enactment, a directive to Department of Justice law enforcement personnel and task forces involved in investigating bank fraud (18 U.S.C. §1344) and falsification of loan and credit applications (18 U.S.C. §1014). The directive must provide instructions on updates made by this Act to those sections and on investigating public officials for such offenses. Similarly, it directs the Secretary of the Treasury, in consultation with the Attorney General, to issue a directive within 90 days of enactment to Treasury law enforcement personnel and task forces involved in investigating falsified tax filings (26 U.S.C. §7206), covering updates made by this Act to that section, investigating public officials for such acts, and best practices for collaborating with the Department of Justice.