United States 116th Congress Status: In Committee 1 D cosponsors

S 799 — Securities Fraud Enforcement and Investor Compensation Act of 2019

Last action — Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

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  1. ✓
    Introduced
  2. 2
    In Committee
  3. 3
    Passed Senate
  4. 4
    Passed House
  5. 5
    To Executive
  6. 6
    Enacted

This bill died with 116th Congress. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.

This bill is no longer active — its legislative session has ended, so there is no live prognosis. It would have to be reintroduced in the current session to move again.

Summary

Securities Fraud Enforcement and Investor Compensation Act of 2019 This bill provides statutory authority for the Securities and Exchange Commission (SEC) to seek disgorgement (i.e., repayment) as a remedy for unjust enrichment that a person gained through a securities law violation. It also allows the SEC to seek restitution for an investor's loss as a result of a securities law violation by a person registered as or associated with a securities dealer, broker, or other specified financial advisor. The bill establishes a 5-year statute of limitations for disgorgement and a 10-year statute of limitations for equitable remedies, including restitution.

Bill Text

Sections of law this bill changes

1 section in 1 law

From the bill's own amending language, matched to the official United States Code (current through Public Law 119-121).

Securities exchanges · 15 U.S.C. ch. 2B 1 section
  • § 78u Investigations and actions Amends

    15 U.S.C. § 78u — at 78u(d)

    The law today

    (a) Authority and discretion of Commission to investigate violations (1) The Commission may, in its discretion, make such investigations as it deems necessary to determine whether any person has violated, is violating, or is about to violate any provision of this chapter, the rules or regulations thereunder, the rules of a national securities exchange or registered securities association of which such person is a member or a person associated, or, as to any act or practice, or omission to act, while associated with a member, formerly associated with a member, the rules of a registered clearing agency in which such person is a participant, or, as to any act or practice, or omission to act, while a participant, was a participant, the rules of the Public Company Accounting Oversight Board, of which such person is a registered public accounting firm, a person associated with such a firm, or, as to any act, practice, or omission to act, while associated with such firm, a person formerly associated with such a firm, or the rules of the Municipal Securities Rulemaking Board, and may require or permit any person to file with it a statement in writing, under oath or otherwise as the Commission shall determine, as to all the facts and circumstances concerning the matter to be investigated. The Commission is authorized in its discretion, to publish information concerning any such violations, and to investigate any facts, conditions, practices, or matters which it may deem necessary or proper to aid in the enforcement of such provisions, in the prescribing of rules and regulations under this chapter, or in securing information to serve as a basis for recommending further legislation concerning the matters to which this chapter relates. (2) On request from a foreign securities authority, the Commission may provide assistance in accordance with this paragraph if the requesting authority states that the requesting authority is conducting an investigation which it deems necessary to determine whether any person has violated, is violating, or is about to violate any laws or rules relating to securities matters that the requesting authority administers or enforces. The Commission may, in its discretion, conduct such investigation as the Commission deems necessary to collect information and evidence pertinent to the request for assistance. Such assistance may be provided without regard to whether the facts stated in the request would also constitute a violation of the laws of the United States. In deciding whether to provide such assistance, the Commission shall consider whether (A) the requesting authority has agreed to provide reciprocal assistance in securities matters to the Commission; and (B) compliance with the request would prejudice the public interest of the United States. (b) Attendance of witnesses; production of records For the purpose of any such investigation, or any other proceeding under this chapter, any member of the Commission or any officer designated by it is empowered to administer oaths and affirmations, subpena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, or other records which the Commission deems relevant or material to the inquiry. Such attendance of witnesses and the production of any such records may be required from any place in the United States or any State at any designated place of hearing. (c) Judicial enforcement of investigative power of Commission; refusal to obey subpena; criminal sanctions In case of contumacy by, or refusal to obey a subpena issued to, any person, the Commission may invoke the aid of any court of the United States within the jurisdiction of which such investigation or proceeding is carried on, or where such person resides or carries on business, in requiring the attendance and testimony of witnesses and the production of books, papers, correspondence, memoranda, and other records. And such court may issu...

    17 other bills also change this section · Follow it → Official text at uscode.house.gov ↗

How this bill changes current law

9 changes Share ↗

Compared against current U.S. Code AI-generated reading aid — verify against the official bill.

The bill clarifies the SEC's authority to seek disgorgement and restitution for securities law violations and establishes statutes of limitations for such claims.

  • 15 U.S.C. 78u(d)

    jurisdiction to impose → jurisdiction to-- (i) impose, upon a proper showing, a civil penalty to be paid by the person who committed such violation; and (ii) require disgorgement under paragraph (7) by the person who received any unjust enrichment as a result of such violation.

    This change updates the SEC's authority to include seeking disgorgement in addition to civil penalties.

  • 15 U.S.C. 78u(d)(3)(B)

    the penalty → a civil penalty imposed under subparagraph (A)(i)

    Clarifies references to the nature of penalties imposed under the revised subparagraph.

  • 15 U.S.C. 78u(d)(3)(B)(ii)

    amount of penalty → amount of a civil penalty imposed under subparagraph (A)(i)

    Specifies that the amount referred to is a civil penalty from a particular subparagraph.

  • 15 U.S.C. 78u(d)(3)(B)(iii)

    amount of penalty for each such violation → amount of a civil penalty imposed under subparagraph (A)(i) for each violation described in that subparagraph

    Ensures clarity that the penalty amount is specific to each violation.

  • 15 U.S.C. 78u(d)(4)

    under paragraph (7)

    Links disgorgement directly to this section, highlighting its importance in the context of sanctioned actions.

  • 15 U.S.C. 78u(d)

    Disgorgement.-- (A) In general.--In any action or proceeding brought by the Commission under any provision of the securities laws, the Commission may seek, and any Federal court may order, disgorgement of any unjust enrichment that a person obtained as a result of a violation of that provision.

    Establishes formal authority for the SEC to seek disgorgement of unjust enrichments in legal actions.

  • 15 U.S.C. 78u(d)(8)

    Restitution.--In any proceeding brought or instituted by the Commission under any provision of the securities laws, the Commission may seek, and any Federal court, or, with respect to a proceeding instituted by the Commission, the Commission, may order restitution to an investor in the amount of the loss that the investor sustained as a result of a violation of that provision by a person that is-- (A) registered as, or required to be registered as, a broker, dealer, investment adviser, municipal securities dealer, municipal advisor, or transfer agent; or (B) associated with or, as of the date on which the violation occurs, seeking to become associated with, an entity described in subparagraph (A).

    Clarifies the SEC's power to seek restitution for investors harmed by securities law violations.

  • 15 U.S.C. 78u(d)(9)

    Limitations Periods.-- (A) Disgorgement.--The Commission may bring a claim for disgorgement under paragraph (7) not later than 5 years after the date on which the person against which the claim is brought receives any unjust enrichment as a result of the violation that gives rise to the action or proceeding in which the Commission seeks the claim. (B) Equitable remedies.--The Commission may seek a claim for any equitable remedy, including for restitution under paragraph (8), an injunction, or a bar, suspension, or cease and desist order, not later than 10 years after the latest date on which a violation that gives rise to the claim occurs. (C) Calculation.--For the purposes of calculating any limitations period under this paragraph with respect to an action or claim, any time in which the person against which the action or claim, as applicable, is brought is outside of the United States shall not count towards the accrual of that period.

    Introduces specific statutes of limitations for disgorgement and equitable actions, clarifying the time frame for claims.

  • 15 U.S.C. 78u(d)

    Rule of Construction.--Nothing in paragraph (7) or (8) may be construed as altering any right that any private party may have to maintain a suit for a violation of this Act.

    Ensures that the new provisions do not infringe upon existing rights of private parties to sue.

Action History

  1. Introduced in Senate

  2. Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Sponsors

Sponsorship breakdown

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1 sponsors · 0 co-sponsors · 546 not signed on

Sponsors (1)

Co-sponsors (0)

None.

Not signed on (546)

546 members have not signed on to this bill.

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"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Subjects

finance
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Frequently asked questions

What does S 799 do?
Securities Fraud Enforcement and Investor Compensation Act of 2019 This bill provides statutory authority for the Securities and Exchange Commission (SEC) to seek disgorgement (i.e., repayment) as a remedy for unjust enrichment that a person gained through a securities law violation. It also allows the SEC to seek restitution for an investor's loss as a result of a securities law violation by a person registered as or associated with a securities dealer, broker, or other specified financial advisor. The bill establishes a 5-year statute of limitations for disgorgement and a 10-year statute of limitations for equitable remedies, including restitution.
Who sponsors S 799?
S 799 is sponsored by Warner, Mark R. (Democratic).
What is the current status of S 799?
This bill died with 116th Congress. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
Where can I track S 799?
Track S 799 free on One Click Politics — get push/email alerts when it moves.

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