To permit certain funds assessed for securities laws violations to be used to compensate employees who are victims of excessive pension fund investments in the securities of their employers, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Justice for Victims of Corporate 
Fraud Act''.

SEC. 2. SECURITIES AND EXCHANGE COMMISSION AUTHORITY TO PROVIDE RELIEF.

    (a) Proceeds of S.E.C. Enforcement Actions.--If in any 
administrative or judicial proceeding brought by the Securities and 
Exchange Commission against--
            (1) a corporation, or any officer, director, or principal 
        shareholder of such corporation, for any violation of the 
        securities laws; or
            (2) the accounting firm performing audit services for such 
        corporation, any subsidiary or affiliate of such firm, or any 
        general or limited partner of such firm, subsidiary, or 
        affiliate, for any violation of the securities laws with 
        respect to any audit services performed for or in relation to 
        the corporation described in paragraph (1);
the Commission obtains an order providing for an accounting and 
disgorgement of funds, such disgorgement fund (including any addition 
to such fund required or permitted under this section) shall be 
allocated in accordance with the requirements of this section.
    (b) Priority for Former Employees of Corporation.--The Commission 
shall, by rule, establish an allocation system for the disgorgement 
fund. Such system shall provide that, in allocating the disgorgement 
fund amount to the victims of the securities laws violations, the first 
priority shall be given to individuals who were employed by the 
corporation described in subsection (a)(1) or a subsidiary or affiliate 
of such corporation, and who were participants in an individual account 
plan established by such corporation, subsidiary, or affiliate. Such 
allocations among such individuals shall be in proportion to the extent 
to which the nonforfeitable accrued benefit of each such individual 
under the plan was invested in the securities of such corporation, 
subsidiary, or affiliate.
    (c) Addition of Civil Penalties.--Any civil penalty assessed and 
collected in any proceeding described in subsection (a) shall be added 
to and become part of the disgorgement fund pursuant to section 308 of 
the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246), and shall be allocated 
pursuant to subsection (b) of this section.
    (d) Acceptance of Federal Campaign Contributions.--
            (1) In general.--Section 313 of the Federal Election 
        Campaign Act of 1971 (2 U.S.C. 439a) is amended by inserting 
        before ``or may be used'' the following: ``may be transferred 
        to any disgorgement fund which is required to be allocated in 
        accordance with the requirements of the ``Justice for Victims 
        of Corporate Fraud Act''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply with respect to any amounts received by a candidate 
        at any time before, on, or after the date of the enactment of 
        this Act.
    (e) Acceptance of Additional Donations.--The Commission is 
authorized to accept, hold, administer, and utilize gifts, bequests, 
and devises of property, both real and personal, to the United States 
for the disgorgement fund. Gifts, bequests, and devises of money and 
proceeds from sales of other property received as gifts, bequests, or 
devises shall be deposited in the disgorgement fund and shall be 
available for allocation in accordance with subsection (b).
    (f) Definitions.--As used in this section:
            (1) Commission.--The term ``Commission'' means the 
        Securities Exchange Commission.
            (2) Securities laws.--The term ``securities laws'' means 
        the Securities Act of 1933 (15 U.S.C. 78a et seq.), the 
        Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), the 
        Trust Indenture Act of 1939 (15 U.S.C. 77aaa 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 et seq.), the 
        Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et 
        seq.), and the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201 et 
        seq.).
            (3) Disgorgement fund.--The term ``disgorgement fund'' 
        means a disgorgement fund established in any administrative or 
        judicial proceeding described in subsection (a).
            (4) Subsidiary or affiliate.--The term ``subsidiary or 
        affiliate'' when used in relation to a person means any entity 
        that controls, is controlled by, or is under common control 
        with such person.
            (5) Officer, director, or principal shareholder.--The term 
        ``officer, director, or principal shareholder'' means any 
        person that is subject to the requirements of section 16 of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78p) in relation to 
        the corporation described in section 2(a), or any subsidiary or 
        affiliate of such corporation.
            (6) Nonforfeitable; accrued benefit; individual account 
        plan.--The terms ``nonforfeitable'', ``accrued benefit'', and 
        ``individual account plan'' have the meanings provided such 
        terms, respectively, in paragraphs (19), (23), and (34) of 
        section 3 of the Employee Retirement Income Security Act of 
        1974 (29 U.S.C. 1002(19), (23), (34)).

Summary: Justice for Victims of Corporate Fraud Act - Directs the Securities Exchange Commission to establish an allocation system for any disgorgement fund that has been established pursuant to an order for an accounting and disgorgement of funds, and which is designated for victims of securities laws violations committed by either a corporation or its auditing firm. Grants first priority to former employees of the corporation who participated in an individual account plan established by such corporation. Declares that civil penalties collected in the SEC enforcement proceeding shall be added to the disgorgement fund. Amends the Federal Election Campaign Act of 1971 to permit transfer of certain Federal campaign contributions into the disgorgement fund as well.