Updated civil money penalties for securities laws violations

(a) Securities Act of 1933 (1) Money penalties in administrative actions Section 8A(g)(2) of the Securities Act of 1933 (15 U.S.C. 77h–1(g)(2)) is amended— (A) in subparagraph (A)— (i) by striking $7,500 and inserting $10,000; and (ii) by striking $75,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $75,000 and inserting $100,000; and (ii) by striking $375,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier act or omission, the amount of penalty for each such act or omission shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the act or omission; or (III) the amount of losses incurred by victims as a result of the act or omission. (ii) Third tier act or omission For the purposes of this subparagraph, the term third tier act or omission means an act or omission described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the act or omission.. (2) Money penalties in civil actions Section 20(d)(2) of the Securities Act of 1933 (15 U.S.C. 77t(d)(2)) is amended— (A) in subparagraph (A)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier violation, the amount of penalty for each such violation shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the violation; or (III) the amount of losses incurred by victims as a result of the violation. (ii) Third tier violation For the purposes of this subparagraph, the term third tier violation means a violation described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the violation.. (b) Securities Exchange Act of 1934 (1) Money penalties in civil actions Section 21(d)(3)(B) of the Securities Exchange Act of 1934 (15 U.S.C. 78u(d)(3)(B)) is amended— (A) in clause (i)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in clause (ii)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking clause (iii) and inserting the following: (iii) Third tier (I) In general Notwithstanding clauses (i) and (ii), for a third tier violation, the amount of penalty for each such violation shall not exceed the greater of— (aa) $1,000,000 for a natural person or $10,000,000 for any other person; (bb) 3 times the gross amount of pecuniary gain to the person who committed the violation; or (cc) the amount of losses incurred by victims as a result of the violation. (II) Third tier violation For the purposes of this clause, the term third tier violation means a violation described in subparagraph (A) that— (aa) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (bb) directly or indirectly— (AA) resulted in substantial losses to other persons; (BB) created a significant risk of substantial losses to other persons; or (CC) resulted in substantial pecuniary gain to the person who committed the violation.. (2) Money penalties in administrative actions Section 21B(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78u–2(b)) is amended— (A) in paragraph (1)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in paragraph (2)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking paragraph (3) and inserting the following: (3) Third tier (A) In general Notwithstanding paragraphs (1) and (2), for a third tier act or omission, the amount of penalty for each such act or omission shall not exceed the greater of— (i) $1,000,000 for a natural person or $10,000,000 for any other person; (ii) 3 times the gross amount of pecuniary gain to the person who committed the act or omission; or (iii) the amount of losses incurred by victims as a result of the act or omission. (B) Third tier act or omission For the purposes of this paragraph, the term third tier act or omission means an act or omission described in paragraph (1) that— (i) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (ii) directly or indirectly— (I) resulted in substantial losses to other persons; (II) created a significant risk of substantial losses to other persons; or (III) resulted in substantial pecuniary gain to the person who committed the act or omission.. (c) Investment Company Act of 1940 (1) Money penalties in administrative actions Section 9(d)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a–9(d)(2)) is amended— (A) in subparagraph (A)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier act or omission, the amount of penalty for each such act or omission shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the act or omission; or (III) the amount of losses incurred by victims as a result of the act or omission. (ii) Third tier act or omission For the purposes of this subparagraph, the term third tier act or omission means an act or omission described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the act or omission.. (2) Money penalties in civil actions Section 42(e)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a–41(e)(2)) is amended— (A) in subparagraph (A)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier violation, the amount of penalty for each such violation shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the violation; or (III) the amount of losses incurred by victims as a result of the violation. (ii) Third tier violation For the purposes of this subparagraph, the term third tier violation means a violation described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the violation.. (d) Investment Advisers Act of 1940 (1) Money penalties in administrative actions Section 203(i)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3(i)(2)) is amended— (A) in subparagraph (A)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier act or omission, the amount of penalty for each such act or omission shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the act or omission; or (III) the amount of losses incurred by victims as a result of the act or omission. (ii) Third tier act or omission For the purposes of this subparagraph, the term third tier act or omission means an act or omission described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the act or omission.. (2) Money penalties in civil actions Section 209(e)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–9(e)(2)) is amended— (A) in subparagraph (A)— (i) by striking $5,000 and inserting $10,000; and (ii) by striking $50,000 and inserting $100,000; (B) in subparagraph (B)— (i) by striking $50,000 and inserting $100,000; and (ii) by striking $250,000 and inserting $500,000; and (C) by striking subparagraph (C) and inserting the following: (C) Third tier (i) In general Notwithstanding subparagraphs (A) and (B), for a third tier violation, the amount of penalty for each such violation shall not exceed the greater of— (I) $1,000,000 for a natural person or $10,000,000 for any other person; (II) 3 times the gross amount of pecuniary gain to the person who committed the violation; or (III) the amount of losses incurred by victims as a result of the violation. (ii) Third tier violation For the purposes of this subparagraph, the term third tier violation means a violation described in paragraph (1) that— (I) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and (II) directly or indirectly— (aa) resulted in substantial losses to other persons; (bb) created a significant risk of substantial losses to other persons; or (cc) resulted in substantial pecuniary gain to the person who committed the violation..