I 
112TH CONGRESS 
2D SESSION 
H. R. 4002 
To amend the Securities Investor Protection Act of 1970 to provide one- 
time payments from the SIPC Fund for customers during a pending 
lawsuit by the Securities and Exchange Commission against the Securi-
ties Investor Protection Corporation, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 9, 2012 
Mr. CASSIDY (for himself, Mr. DEUTCH, Mr. HARPER, Mr. DUNCAN of Ten-
nessee, Mr. ALEXANDER, Mr. WEST, Mr. BOUSTANY, Mr. CULBERSON, 
Mr. MCCAUL, Mr. LANDRY, Mr. SESSIONS, Mr. GRIFFIN of Arkansas, 
and Mr. HASTINGS of Florida) introduced the following bill; which was 
referred to the Committee on Financial Services 
A BILL 
To amend the Securities Investor Protection Act of 1970 
to provide one-time payments from the SIPC Fund for 
customers during a pending lawsuit by the Securities 
and Exchange Commission against the Securities Inves-
tor Protection Corporation, 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. SHORT TITLE. 
This Act may be cited as the ‘‘Improving Security 
for Investors and Providing Closure Act of 2012’’ or the 
‘‘Improving SIPC Act of 2012’’. 
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SEC. 2. CUSTOMER PAYMENT DURING PENDING ACTION. 
(a) IN GENERAL.—Section 11 of the Securities Inves-
tor Protection Act of 1970 (15 U.S.C. 78ggg) is amend-
ed— 
(1) by redesignating subsections (c) and (d) as 
subsections (d) and (e), respectively; and 
(2) by inserting after subsection (b) the fol-
lowing: 
‘‘(c) CUSTOMER PAYMENT DURING PENDING AC-
TION.— 
‘‘(1) ONE-TIME PAYMENT PERMITTED.— 
‘‘(A) IN GENERAL.—At the time that an 
action is initiated under subsection (b), SIPC 
may choose to allow all customers of the debtor 
to elect to receive a one-time payment from the 
SIPC Fund to settle their net equity claims 
against the debtor. 
‘‘(B) CUSTOMER ELECTION.—If SIPC al-
lows customers to make the election described 
under subparagraph (A), each customer choos-
ing to make such election— 
‘‘(i) must make such election during 
the action brought under subsection (b), 
but in no case later than the 180-day pe-
riod beginning on the date that SIPC 
chooses to allow such election; and 
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‘‘(ii) shall forgo all other possible pro-
tections under this Act with respect to the 
debtor. 
‘‘(2) METHOD OF PAYMENT.— 
‘‘(A) IN GENERAL.—To the extent prac-
ticable, one-time payments made under this 
subsection shall be made in the same manner as 
payments of net equity claims of customers of 
a debtor are made under the other provisions of 
this Act. 
‘‘(B) PAYMENT
AMOUNT
LIMITED
TO 
CLAIMS.—The amount paid to a customer 
under this subsection may not exceed the cus-
tomer’s net equity claims against the debtor. 
‘‘(3) CAP
ON
ONE-TIME
PAYMENTS.—At the 
time the action is initiated under subsection (b), 
SIPC shall set a cap on the amount of one-time pay-
ments that can be made under this subsection, and 
such cap— 
‘‘(A) shall not exceed $500,000; and 
‘‘(B) shall apply equally to all customers of 
the debtor. 
‘‘(4) EFFECT OF ELECTION.—With respect to 
any customer who receives a one-time payment 
under this subsection, SIPC shall be subrogated to 
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