,,ii #aaith ,,congress #b;d ,session ,s4 #ecbj ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,august #f1 #bjbf,mr4 ,reed 7for himself1 ,mr4 ,van ,hollen1 ,mr4 ,kim1 ,ms4 ,alsobrooks1 and ,ms4 ,blunt ,rochester7 introduced the following bill2 which was read twice and referred to the ,committee on ,banking1 ,housing1 and ,urban ,affairs ,a ,,bill ,to amend the ,securities ,exchange ,act of #aicd to prohibit certain securities trading and related communications by those who possess material1 nonpublic information1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,insider ,trading ,prohibition ,act4 #b4 ,prohibition on insider trading 7a7 ,in general ,the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;a et seq47 is amended by inserting after section #af 7#ae ,u4,s4,c4 #ghp7 the following3 #af;,a4 ,prohibition on insider trading 7a7 ,prohibition against trading securities while aware of material1 nonpublic information ,it shall be unlawful for any person1 directly or indirectly1 to purchase1 sell1 or enter into1 or cause the purchase or sale of1 or entry into1 any security1 security-based swap1 or security-based swap agreement if that person1 at the time the person takes such an action-- 7#a7 has access to information relating to such security1 security-based swap1 or security-based swap agreement that is material and nonpublic and is aware 7including if the person consciously avoids being aware71 or recklessly disregards1 that such information is material and nonpublic2 and 7#b7 is aware 7including if the person consciously avoids being aware71 or recklessly disregards1 that-- 7,a7 the information described in paragraph 7#a7 has been obtained wrongfully2 or 7,b7 the purchase1 sale1 or entry would constitute wrongful trading on the information described in paragraph 7#a74 7b7 ,prohibition against the wrongful communication of certain material1 nonpublic information ,it shall be unlawful for any person1 the purchase or sale of a security or security-based swap 7or entry into a security-based swap agreement7 by which would violate subsection 7a71 to wrongfully communicate material1 nonpublic information relating to that security1 security-based swap1 or security-based swap agreement to any other person1 if-- 7#a7 the person communicating the information1 at the time the person communicates the information1 is aware 7including if the person consciously avoids being aware71 or recklessly disregards1 that such communication would result in such a purchase1 sale1 or entry2 and 7#b7 any recipient of the wrongfully communicated information purchases1 sells1 or causes the purchase or sale of any security or security-based swap1 or enters into 7or causes the entry into7 any security-based swap agreement1 based on that communication4 7c7 ,standard and knowledge requirement 7#a7 ,standard ,for purposes of this section1 trading while aware of material1 nonpublic information under subsection 7a71 or communicating material1 nonpublic information under subsection 7b71 is wrongful only if the information has been obtained by1 or the communication or trading on the information would constitute1 directly or indirectly-- 7,a7 theft1 conversion1 bribery1 misrepresentation1 espionage 7through electronic or other means71 or other unauthorized access of the information2 7,b7 a violation of any ,federal law protecting-- 7i7 computer data2 or 7ii7 the intellectual property or privacy of computer users2 7,c7 misappropriation from a source of the information2 or 7,d7 a breach of any fiduciary duty to shareholders of an issuer for a direct or indirect personal benefit1 including-- 7i7 an existing or future pecuniary gain or reputational benefit2 or 7ii7 a gift of confidential information to a relative or friend4 7#b7 ,knowledge requirement ,it shall not be necessary that a person trading while aware of information in violation of subsection 7a71 or making a communication in violation of subsection 7b71 knows the specific means by which the information was obtained or communicated or traded on1 or the specific benefit described in paragraph 7#a77;,d7 that was received1 paid1 or promised by or to any person in the chain of communication1 if the person trading while aware of the information or making the communication1 as applicable1 at the time the person makes the trade or communicates the information1 is aware 7including if the person consciously avoids being aware71 or recklessly disregards1 that the information was wrongfully obtained1 wrongfully traded on1 or wrongfully communicated4 7d7 ,affirmative defenses 7#a7 ,in general ,the ,commission may1 by rule or by order1 exempt any person1 security1 or transaction1 or any class of persons1 securities1 or transactions1 from any or all of the provisions of this section1 upon such terms and conditions as the ,commission considers necessary or appropriate in furtherance of the purposes of this title4 7#b7 ,rule #aj;b#e-a compliant transactions ,the prohibitions of this section shall not apply to any transaction that satisfies the requirements of section #bdj4aj;b#e-a of title #ag1 ,code of ,federal ,regulations1 or any successor regulation4 7e7 ,rule of construction ,the rights and remedies provided by this section shall be in addition to any and all other rights and remedies that may exist at law or in equity 7without regard to whether such a right or remedy is provided under this ,act7 with respect to an action by a person to-- 7#a7 purchase1 sell1 or enter into a security1 security-based swap1 or security-based swap agreement while aware of material1 nonpublic information2 or 7#b7 communicate material1 nonpublic information relating to a security1 security-based swap1 or security-based swap agreement4 4 7b7 ,conforming amendments ,the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;a et seq47 is amended-- 7#a7 in section #c7;a77#gh77;,a7 7#ae ,u4,s4,c4 #gh;c7a77#gh77;,a771 by inserting #af;,a1 after #af12 7#b7 in section #ba7;d77#b7 7#ae ,u4,s4,c4 #ghu7d77#b771 by striking or the rules or regulations thereunder and inserting 1 section #af;,a of this title1 or the rules or regulations under either such section2 7#c7 in section #ba;,a 7#ae ,u4,s4,c4 #ghu-#a7-- 7,a7 in subsection 7g77#a71 by striking section #aj7;b7 and ,rule #aj;b-#e thereunder and inserting section #aj7;b71 ,rule #aj;b-#e thereunder1 and section #af;,a2 and 7,b7 in subsection 7h77#a71 by striking section #aj7;b71 and ,rule #aj;b-#e thereunder and inserting section #aj7;b71 ,rule #aj;b-#e thereunder1 and section #af;,a2 and 7#d7 in section #ba;,c7f7 7#ae ,u4,s4,c4 #ghu-#c7;f771 by striking or the rules or regulations thereunder and inserting 1 section #af;,a1 or the rules or regulations under either such section4