Logansport, Indiana (PRWEB) August 22, 2012
Scott Starr, of the Indiana law firm of Starr Austen & Miller, announced an alert to the public today regarding the recently introduced Senate Bill S.3416, entitled the Stronger Enforcement of Civil Penalties Act of 2012. This bill has gotten bi-partisan sponsorship from Senators Jack Reed (D-RI) and Chuck Grassley (R-IA), and it is designed to enhance the civil penalties under the federal securities laws.
In November 2011 SEC Chairperson Mary Schapiro called on Congress to pass new legislation which would authorize the agency to seek larger penalties than those allowed, as a maximum, under previous federal securities laws, and which were more closely based on the scope of investor losses. The Senate listened, and proposed this legislation on July 23, 2012, which would cap the fines against individuals at $1 million per violation instead of $150,000, and cap fines against firms at $10 million from $725,000 for each violation. The goal for the bill is to help the SEC deter individuals and forms from repeatedly violating securities laws. Read the full story at: http://www.businessweek.com/news/2012-07-23/two-u-dot-s-dot-senators-propose-letting-sec-impose-bigger-penalties.
As Starr explains, “It’s high time that these maximum penalties be raised. The laws that this bill seeks to amend include the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Company Act of 1940. At the time those laws were written the maximum penalties listed within them served as much heftier deterrents than they do today. Not only has there been inflation since that time, but the magnitude of the money at stake, and the profits to be gained from securities fraud are all much higher than ever before imagined. Firms and individuals need to understand that the fines on the books for violating securities laws in this country are not just a cost of doing business, merely cutting into, but not depleting the profits made from such fraud. Instead, those who break the law should be fined sufficiently so they not only do not profit from such wrongdoing, but are worse off for it. That is the only way to truly deter businesspeople, concerned only with bottom line, from defrauding the public of their hard earned retirement incomes.”
The full proposed text of the bill can be found at http://www.govtrack.us/congress/bills/112/s3416/text.