[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 2920 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 2920
To enhance civil penalties under the Federal securities laws, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 19 (legislative day, September 16), 2025
Mr. Reed (for himself and Mr. Grassley) introduced the following bill;
which was read twice and referred to the Committee on Banking, Housing,
and Urban Affairs
_______________________________________________________________________
A BILL
To enhance civil penalties under the Federal securities laws, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Stronger Enforcement of Civil
Penalties Act of 2025''.
SEC. 2. 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
subparagra