I 
117TH CONGRESS 
1ST SESSION H. R. 4619 
To amend the Securities Exchange Act of 1934 to prohibit trading ahead 
by market makers, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 22, 2021 
Mr. GREEN of Texas introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To amend the Securities Exchange Act of 1934 to prohibit 
trading ahead by market makers, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. PROHIBITION ON TRADING AHEAD BY MARKET 
MAKERS. 
(a) IN GENERAL.—Section 15 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78o) is amended by adding 
at the end the following: 
‘‘(p) PROHIBITION ON TRADING AHEAD BY MARKET 
MAKERS.— 
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‘‘(1) IN GENERAL.—With respect to a person 
acting in the capacity of a market maker, if the per-
son accepts an order with respect to a security from 
a customer, including a broker or dealer— 
‘‘(A) the market maker has a duty of trust 
and loyalty to the customer arising from the re-
ceipt of such order; and 
‘‘(B) the information in such order is ma-
terial, non-public information that may be used 
only in furtherance of executing such cus-
tomer’s order. 
‘‘(2) ANNUAL CEO CERTIFICATION.—The Chief 
Executive Officer of each person that acts in the ca-
pacity of a market maker shall issue an annual cer-
tification to the Commission, in such form and man-
ner as the Commission may prescribe by rule, that 
certifies that— 
‘‘(A) the person has performed reasonable 
due diligence during the reporting period to en-
sure that the person has not violated the duty 
of trust and loyalty described under paragraph 
(1)(A) or used the information described under 
paragraph (1)(B) in a prohibited fashion; and 
‘‘(B) the person has not violated the duty 
of trust and loyalty described under paragraph 
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(1)(A) or used the information described under 
paragraph (1)(B) in a prohibited fashion during 
the reporting period. 
‘‘(3) PERSONAL LIABILITY.— 
‘‘(A) 
FINE
FOR
INDIVIDUAL
VIOLA-
TIONS.—Any associated person of a market 
maker who knowingly and willfully causes the 
market maker to violate paragraph (1) (or who 
directs another agent or associated person of 
the market maker to commit such a violation or 
engage in such acts that result in the associated 
person being personally unjustly enriched) shall 
be fined in an amount equal to the greater of— 
‘‘(i) two times the amount of profit 
realized by reason of such violation; or 
‘‘(ii) $50,000. 
‘‘(B) COURSE OF CONDUCT.—Any associ-
ated person of a market maker who knowingly 
and willfully causes the market maker to en-
gage in a course of conduct of knowingly and 
willfully violating paragraph (1) (or who directs 
another agent or associated person of the mar-
ket maker to commit such a violation or engage 
in such acts that result in the associated person 
being personally unjustly enriched) shall be— 
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‘‘(i) fined in an amount not to exceed 
200 percent of the compensation (including 
stock options awarded as compensation) 
received by such associated person from 
the market maker— 
‘‘(I) during the time period in 
which the violations occurred; or 
‘‘(II) in the one- to three-year 
time period preceding the date on 
which the violations were discovered; 
and 
‘‘(ii) imprisoned for not more than 5 
years. 
‘‘(C) ASSOCIATED PERSON DEFINED.—The 
term ‘associated person’ means an associated 
person of a broker or dealer. 
‘‘(4) RULEMAKING.—Not later than the end of 
the 90-day period beginning on the date of enact-
ment of this subsection, the Commission— 
‘‘(A) shall issue rules to carry out this sub-
section; and 
‘‘(B) may provide exemptions from the re-
quirements of this subsection, by rule, if the 
Commission determines that such exemptions 
would promote market integrity and are nec-
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essary or appropriate in the public interest or 
for the protection of investors.’’. 
(b) SENSE OF CONGRESS.—It is the sense of the 
Congress that the prohibitions added by this section 
should complement, and not replace, existing rules of self- 
regulatory organizations applicable to their members, in-
cluding brokers and dealers. 
(c) EFFECTIVE DATE.—Section 15(p) of the Securi-
ties Exchange Act of 1934, as added by subsection (a), 
shall take effect after the end of the 180-day period begin-
ning on the date of enactment of this Act. 
Æ 
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