S. 1185 — Introduced in Senate

II 113th CONGRESS 1st Session S. 1185 IN THE SENATE OF THE UNITED STATES June 19, 2013 Mr. Casey introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To enhance penalties for violations of securities protections that involve targeting seniors. 1. Short title This Act may be cited as the Senior Investor Protections Enhancement Act of 2013. 2. Definitions (a) In general In this Act, the following definitions shall apply: (1) Senior The term senior means an individual who is 62 years of age or older. (2) Securities laws The term securities laws means the Securities Act of 1933 (15 U.S.C. 77b et seq.), the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), the Investment Company Act of 1940 (15 U.S.C. 80a et seq.), and the Investment Advisers Act of 1940 (15 U.S.C. 80b et seq.). (b) Application of senior definition (1) Securities Act of 1933 Section 2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)) is amended by adding at the end the following: (20) The term senior means an individual who is 62 years of age or older. . (2) Securities Exchange Act of 1934 Section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended— (A) by redesignating the first paragraph designated as (80), as added by 101(b)(2) of the Jumpstart Our Business Startups Act (126 Stat. 307) (relating to emerging growth companies), as paragraph (81); and (B) by adding at the end the following: (82) The term senior means an individual who is 62 years of age or older. . (3) Investment Company Act of 1940 Section 2(a) of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)) is amended by adding at the end the following: (55) The term senior means an individual who is 62 years of age or older. . (4) Investment Advisers Act of 1940 Section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)) is amended— (A) by redesignating the second paragraph designated as paragraph (29), as added by section 770 of the Wall Street Transparency and Accountability Act of 2010 (124 Stat. 1801), as paragraph (31) and moving such paragraph to the end; and (B) by adding at the end the following: (32) The term senior means an individual who is 62 years of age or older. . 3. Enhanced penalties for violations of Securities Act of 1933 (a) Civil actions Section 20(d)(2) of the Securities Act of 1933 (15 U.S.C. 77t(d)(2)) is amended by adding at the end the following: (D) Special rule for seniors Notwithstanding subparagraphs (A), (B), and (C), if a person commits a violation described in paragraph (1), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (b) Other violations Section 24 of the Securities Act of 1933 (15 U.S.C. 77x) is amended— (1) by inserting (a) In general.— before Any person; and (2) by adding at the end the following: (b) Special rule for seniors Notwithstanding subsection (a), if a person commits a violation described in subsection (a), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . 4. Enhanced penalties for violations of Securities Act of 1934 (a) Civil actions Section 21(d)(3)(B) of the Securities Exchange Act of 1934 (15 U.S.C. 78u(d)(3)(B)) is amended by adding at the end the following: (iv) Special rule for seniors Notwithstanding clauses (i), (ii), and (iii), if a person commits a violation described in subparagraph (A), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (b) Willful violations Section 21B(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78u–2(b)) is amended by adding at the end the following: (4) Special rule for seniors Notwithstanding paragraphs (1), (2), and (3), if a person engages in an act or omission described in subsection (a), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (c) Other violations Section 32 of the Securities Exchange Act of 1934 (15 U.S.C. 78ff) is amended by adding at the end the following: (d) Special rule for seniors Notwithstanding subsections (a), (b), and (c), if a person commits a violation described in this section, and the violation is directed toward, targets, or is committed against a person, who at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . 5. Enhanced penalties for violations of Investment Company Act of 1940 (a) Willful violations Section 9(d)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a–9(d)(2)) is amended by adding at the end the following: (D) Special rule for seniors Notwithstanding subparagraphs (A), (B), and (C), if a person engages in an act or omission described in paragraph (1), and the violation is directed toward, targets, or is committed against a person, who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (b) Civil actions Section 42(e)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a–41(e)(2)) is amended by adding at the end the following: (D) Special rule for seniors Notwithstanding subparagraphs (A), (B), and (C), if a person commits a violation described in paragraph (1), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty not more than $50,000 for each such violation. . (c) Other violations Section 49 of the Investment Company Act of 1940 (15 U.S.C. 80a–48) is amended— (1) by inserting (a) In general.— before Any person; and (2) by adding at the end the following: (b) Special rule for seniors Notwithstanding subsection (a), if a person commits a violation described in subsection (a), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . 6. Enhanced penalties for violations of Investment Advisers Act of 1940 (a) Willful violations Section 203(i)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3(i)(2)) is amended by adding at the end the following: (D) Special rule for seniors Notwithstanding subparagraphs (A), (B), and (C), if a person engages in an act or omission described in paragraph (1), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (b) Civil actions Section 209(e)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–9(e)(2)) is amended by adding at the end the following: (D) Special rule for seniors Notwithstanding subparagraphs (A), (B), and (C), if a person commits a violation under this title, and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . (c) Other violations Section 217 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–17) is amended— (1) by inserting (a) In general.— before Any person; and (2) by adding at the end the following: (b) Special rule for seniors Notwithstanding subsection (a), if a person commits a violation described in subsection (a), and the violation is directed toward, targets, or is committed against a person who, at the time of the violation, is a senior, the Commission, in addition to any other applicable civil penalty, may impose a civil penalty of not more than $50,000 for each such violation. . 7. Directive to the United States Sentencing Commission (a) In general Pursuant to its authority under section 994(p) of title 28, United States Code, and in accordance with this section, the United States Sentencing Commission shall review and amend the Federal sentencing guidelines and policy statements to ensure that the guideline offense levels and enhancements appropriately punish violations of the securities laws against seniors. (b) Requirements In carrying out this section, the United States Sentencing Commission shall— (1) ensure that section 2B1.1 and 2C1.1 of the Federal sentencing guidelines (and any successors thereto) apply to and punish offenses in which the victim of a violation of the securities laws is a senior; (2) ensure reasonable consistency with other relevant directives, provisions of the Federal sentencing guidelines, and statutory provisions; (3) make any necessary and conforming changes to the Federal sentencing guidelines, in accordance with the amendments made by this Act; and (4) ensure that the Federal sentencing guidelines adequately meet the purposes of sentencing set forth in section 3553(a)(2) of title 18, United States Code.