US Code
CHAPTER 2B— SECURITIES EXCHANGES
§ 78u–2. Civil remedies in administrative proceedings

(a) Commission authority to assess money penalties(1) In generalIn any proceeding instituted pursuant to sections 78o(b)(4), 78o(b)(6), 78o–6, 78o–4, 78o–5, 78o–7, or 78q–1 of this title against any person, the Commission or the appropriate regulatory agency may impose a civil penalty if it finds, on the record after notice and opportunity for hearing, that such penalty is in the public interest and that such person—(A) has willfully violated any provision of the Securities Act of 1933 [15 U.S.C. 77a et seq.], the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.], the Investment Advisers Act of 1940 [15 U.S.C. 80b–1 et seq.], or this chapter, or the rules or regulations thereunder, or the rules of the Municipal Securities Rulemaking Board;
(B) has willfully aided, abetted, counseled, commanded, induced, or procured such a violation by any other person;
(C) has willfully made or caused to be made in any application for registration or report required to be filed with the Commission or with any other appropriate regulatory agency under this chapter, or in any proceeding before the Commission with respect to registration, any statement which was, at the time and in the light of the circumstances under which it was made, false or misleading with respect to any material fact, or has omitted to state in any such application or report any material fact which is required to be stated therein; or
(D) has failed reasonably to supervise, within the meaning of section 78o(b)(4)(E) of this title, with a view to preventing violations of the provisions of such statutes, rules and regulations, another person who commits such a violation, if such other person is subject to his supervision; 11 So in original. The semicolon probably should be a period.
(2) Cease-and-desist proceedingsIn any proceeding instituted under section 78u–3 of this title against any person, the Commission may impose a civil penalty, if the Commission finds, on the record after notice and opportunity for hearing, that such person—(A) is violating or has violated any provision of this chapter, or any rule or regulation issued under this chapter; or
(B) is or was a cause of the violation of any provision of this chapter, or any rule or regulation issued under this chapter.
(b) Maximum amount of penalty(1) First tierThe maximum amount of penalty for each act or omission described in subsection (a) shall be $5,000 for a natural person or $50,000 for any other person.
(2) Second tierNotwithstanding paragraph (1), the maximum amount of penalty for each such act or omission shall be $50,000 for a natural person or $250,000 for any other person if the act or omission described in subsection (a) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement.
(3) Third tierNotwithstanding paragraphs (1) and (2), the maximum amount of penalty for each such act or omission shall be $100,000 for a natural person or $500,000 for any other person if—(A) the act or omission described in subsection (a) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and
(B) such act or omission directly or indirectly resulted in substantial losses or created a significant risk of substantial losses to other persons or resulted in substantial pecuniary gain to the person who committed the act or omission.
(c) Determination of public interestIn considering under this section whether a penalty is in the public interest, the Commission or the appropriate regulatory agency may consider—(1) whether the act or omission for which such penalty is assessed involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement;
(2) the harm to other persons resulting either directly or indirectly from such act or omission;
(3) the extent to which any person was unjustly enriched, taking into account any restitution made to persons injured by such behavior;
(4) whether such person previously has been found by the Commission, another appropriate regulatory agency, or a self-regulatory organization to have violated the Federal securities laws, State securities laws, or the rules of a self-regulatory organization, has been enjoined by a court of competent jurisdiction from violations of such laws or rules, or has been convicted by a court of competent jurisdiction of violations of such laws or of any felony or misdemeanor described in section 78o(b)(4)(B) of this title;
(5) the need to deter such person and other persons from committing such acts or omissions; and
(6) such other matters as justice may require.
(d) Evidence concerning ability to payIn any proceeding in which the Commission or the appropriate regulatory agency may impose a penalty under this section, a respondent may present evidence of the respondent’s ability to pay such penalty. The Commission or the appropriate regulatory agency may, in its discretion, consider such evidence in determining whether such penalty is in the public interest. Such evidence may relate to the extent of such person’s ability to continue in business and the collectability of a penalty, taking into account any other claims of the United States or third parties upon such person’s assets and the amount of such person’s assets.
(e) Authority to enter order requiring accounting and disgorgementIn any proceeding in which the Commission or the appropriate regulatory agency may impose a penalty under this section, the Commission or the appropriate regulatory agency may enter an order requiring accounting and disgorgement, including reasonable interest. The Commission is authorized to adopt rules, regulations, and orders concerning payments to investors, rates of interest, periods of accrual, and such other matters as it deems appropriate to implement this subsection.
(f) Security-based swaps(1) Clearing agencyAny clearing agency that knowingly or recklessly evades or participates in or facilitates an evasion of the requirements of section 78c–3 of this title shall be liable for a civil money penalty in twice the amount otherwise available for a violation of section 78c–3 of this title.
(2) Security-based swap dealer or major security-based swap participantAny security-based swap dealer or major security-based swap participant that knowingly or recklessly evades or participates in or facilitates an evasion of the requirements of section 78c–3 of this title shall be liable for a civil money penalty in twice the amount otherwise available for a violation of section 78c–3 of this title.

Structure US Code

US Code

Title 15— COMMERCE AND TRADE

CHAPTER 2B— SECURITIES EXCHANGES

§ 78a. Short title

§ 78b. Necessity for regulation

§ 78c. Definitions and application

§ 78c–1. Swap agreements

§ 78c–2. Securities-related derivatives

§ 78c–3. Clearing for security-based swaps

§ 78c–4. Security-based swap execution facilities

§ 78c–5. Segregation of assets held as collateral in security-based swap transactions

§ 78d. Securities and Exchange Commission

§ 78d–1. Delegation of functions by Commission

§ 78d–2. Transfer of functions with respect to assignment of personnel to chairman

§ 78d–3. Appearance and practice before the Commission

§ 78d–4. Additional duties of Inspector General

§ 78d–5. Deadline for completing enforcement investigations and compliance examinations and inspections

§ 78d–6. Report and certification of internal supervisory controls

§ 78d–7. Triennial report on personnel management

§ 78d–8. Annual financial controls audit

§ 78d–9. Report on oversight of national securities associations

§ 78e. Transactions on unregistered exchanges

§ 78f. National securities exchanges

§ 78g. Margin requirements

§ 78h. Restrictions on borrowing and lending by members, brokers, and dealers

§ 78i. Manipulation of security prices

§ 78j. Manipulative and deceptive devices

§ 78j–1. Audit requirements

§ 78j–2. Position limits and position accountability for security-based swaps and large trader reporting

§ 78j–3. Compensation committees

§ 78j–4. Recovery of erroneously awarded compensation policy

§ 78k. Trading by members of exchanges, brokers, and dealers

§ 78k–1. National market system for securities; securities information processors

§ 78l. Registration requirements for securities

§ 78l–1. Applications for unlisted trading privileges deemed filed under

§ 78m. Periodical and other reports

§ 78m–1. Reporting and recordkeeping for certain security-based swaps

§ 78m–2. Reporting requirements regarding coal or other mine safety

§ 78n. Proxies

§ 78n–1. Shareholder approval of executive compensation

§ 78n–2. Corporate governance

§ 78o. Registration and regulation of brokers and dealers

§ 78o–1. Brokers deemed to be registered

§ 78o–2. Liabilities arising prior to amendment unaffected

§ 78o–3. Registered securities associations

§ 78o–4. Municipal securities

§ 78o–4a. Commission Office of Municipal Securities

§ 78o–5. Government securities brokers and dealers

§ 78o–6. Securities analysts and research reports

§ 78o–7. Registration of nationally recognized statistical rating organizations

§ 78o–8. Universal ratings symbols

§ 78o–9. Study and rulemaking on assigned credit ratings

§ 78o–10. Registration and regulation of security-based swap dealers and major security-based swap participants

§ 78o–11. Credit risk retention

§ 78p. Directors, officers, and principal stockholders

§ 78q. Records and reports

§ 78q–1. National system for clearance and settlement of securities transactions

§ 78q–2. Automated quotation systems for penny stocks

§ 78r. Liability for misleading statements

§ 78s. Registration, responsibilities, and oversight of self-regulatory organizations

§ 78t. Liability of controlling persons and persons who aid and abet violations

§ 78t–1. Liability to contemporaneous traders for insider trading

§ 78u. Investigations and actions

§ 78u–1. Civil penalties for insider trading

§ 78u–2. Civil remedies in administrative proceedings

§ 78u–3. Cease-and-desist proceedings

§ 78u–4. Private securities litigation

§ 78u–5. Application of safe harbor for forward-looking statements

§ 78u–6. Securities whistleblower incentives and protection

§ 78u–7. Implementation and transition provisions for whistleblower protection

§ 78v. Hearings by Commission

§ 78w. Rules, regulations, and orders; annual reports

§ 78x. Public availability of information

§ 78y. Court review of orders and rules

§ 78z. Unlawful representations

§ 78aa. Jurisdiction of offenses and suits

§ 78aa–1. Special provision relating to statute of limitations on private causes of action

§ 78bb. Effect on existing law

§ 78cc. Validity of contracts

§ 78dd. Foreign securities exchanges

§ 78dd–1. Prohibited foreign trade practices by issuers

§ 78dd–2. Prohibited foreign trade practices by domestic concerns

§ 78dd–3. Prohibited foreign trade practices by persons other than issuers or domestic concerns

§ 78ee. Transaction fees

§ 78ff. Penalties

§ 78gg. Separability

§ 78hh. Effective date

§ 78hh–1. Effective date of certain sections

§ 78ii. Omitted

§ 78jj. Repealed. , ,

§ 78kk. Authorization of appropriations

§ 78ll. Requirements for the EDGAR system

§ 78mm. General exemptive authority

§ 78nn. Tennessee Valley Authority

§ 78oo. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Federal Home Loan Banks

§ 78pp. Investor Advisory Committee

§ 78qq. Small Business Capital Formation Advisory Committee

§ 78rr. Data standards for security-based swap reporting