I 

118TH CONGRESS 

2D SESSION H. R. 9736 

To ensure that irresponsible corporate executives, rather than shareholders, 

pay fines and penalties. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 20, 2024 

Ms. PORTER introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To ensure that irresponsible corporate executives, rather than 

shareholders, pay fines and penalties. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Corporate Manage5 ment Accountability Act of 2024’’. 

6 SEC. 2. FINE, PENALTY, AND SETTLEMENT ACCOUNT7 ABILITY. 

8 (a) DEFINITIONS.—In this section— 

9 (1) the term ‘‘Commission’’ means the Securi10 ties and Exchange Commission; 


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1 (2) the term ‘‘covered fine or similar pen2 alty’’— 

3 (A) means any amount— 

4 (i) that is denied a deduction under 

5 paragraph (1) of section 162(f) of the In6 ternal Revenue Code; or 

7 (ii) constituting restitution or paid to 

8 come into compliance with law as described 

9 in paragraph (2) of such section; and 

10 (B) includes any fine or similar penalty— 

11 (i) that is paid by a reporting com12 pany; and 

13 (ii) with respect to which the Commis14 sion determines disclosure under sub15 section (b)(1) is appropriate; 

16 (3) the term ‘‘issuer’’ has the meaning given 

17 the term in section 3(a) of the Securities Exchange 

18 Act of 1934 (15 U.S.C. 78c(a)); 

19 (4) the term ‘‘named executive officer’’— 

20 (A) means an individual for whom disclo21 sure is required under section 229.402(a)(3) of 

22 title 17, Code of Federal Regulations; and 

23 (B) includes any other employee of a re24 porting company with respect to whom the 


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1 Commission determines disclosure under sub2 section (b)(1) is appropriate; and 

3 (5) the term ‘‘reporting company’’ means an 

4 issuer— 

5 (A) the securities of which are registered 

6 under section 12 of the Securities Exchange 

7 Act of 1934 (15 U.S.C. 78l); or 

8 (B) that is required to file reports under 

9 section 15(d) of the Securities Exchange Act of 

10 1934 (15 U.S.C. 78o(d)). 

11 (b) REQUIREMENT TO ISSUE RULES.—Not later than 

12 360 days after the date of enactment of this Act, the Com13 mission shall issue final rules to require each reporting 

14 company, in each annual report submitted under section 

15 13 or section 15(d) of the Securities Exchange Act of 

16 1934 (15 U.S.C. 78m and 78o(d)), or in each proxy state17 ment filed pursuant to section 14(a) of the Securities Ex18 change Act of 1934 (15 U.S.C. 78n(a)) for an annual 

19 meeting of shareholders, to— 

20 (1) disclose whether the reporting company, in 

21 order to align the incentives of those managing the 

22 reporting company with the incentives of the share23 holders of the reporting company, has established 

24 procedures to recoup from compensation paid to, 

25 and to withhold from future compensation paid to, 


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1 any named executive officer all or a portion of the 

2 cost of any covered fine or similar penalty that has 

3 been paid by the reporting company; 

4 (2) if the reporting company has established 

5 procedures described in paragraph (1)— 

6 (A) provide a description of those proce7 dures; and 

8 (B) disclose the amount that the reporting 

9 company has recouped from each named execu10 tive officer under those procedures during each 

11 of the 3 most recent fiscal years; and 

12 (3) if the reporting company has not estab13 lished procedures described in paragraph (1), pro14 vide an explanation of why no such procedures are 

15 necessary for the benefit of the shareholders of the 

16 reporting company. 

Æ 


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