(1) by striking ‘‘(a) COMMISSION AUTHORITY TO 
ASSESS MONEY PENALTIES.—In any proceeding’’ 
and inserting the following: 
‘‘(a) COMMISSION AUTHORITY TO ASSESS MONEY 
PENALTIES.— 
‘‘(1) IN GENERAL.—In any proceeding’’; 
(2) by redesignating paragraphs (1) through (4) 
of such subsection as subparagraphs (A) through (D), 
respectively, and moving such redesignated subpara-
graphs and the matter following such subparagraphs 
2 ems to the right; and 
(3) by adding at the end of such subsection the 
following new paragraph: 
‘‘(2) CEASE-AND-DESIST PROCEEDINGS.—In any 
proceeding instituted pursuant to section 21C of this 
title against any person, the Commission may impose 
a civil penalty if it finds, on the record after notice 
and opportunity for hearing, that such person— 
‘‘(A) is violating or has violated any provi-
sion of this title, or any rule or regulation there-
under; or 
‘‘(B) is or was a cause of the violation of 
any provision of this title, or any rule or regula-
tion thereunder.’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00053
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(c) UNDER
THE INVESTMENT COMPANY ACT
OF 
1940.—Paragraph (1) of section 9(d) of the Investment 
Company Act of 1940 (15 U.S.C. 80a–9(d)(1)) is amend-
ed— 
(1) by striking ‘‘(1) AUTHORITY
OF
COMMIS-
SION.—In any proceeding’’ and inserting the fol-
lowing: 
‘‘(1) AUTHORITY OF COMMISSION.— 
‘‘(A) IN GENERAL.—In any proceeding’’; 
(2) by redesignating subparagraphs (A) through 
(C) of such paragraph as clauses (i) through (iii), re-
spectively, and by moving such redesignated clauses 
and the matter following such subparagraphs 2 ems 
to the right; and 
(3) by adding at the end of such paragraph the 
following new subparagraph: 
‘‘(B) CEASE-AND-DESIST
PROCEEDINGS.— 
In any proceeding instituted pursuant to sub-
section (f) against any person, the Commission 
may impose a civil penalty if it finds, on the 
record after notice and opportunity for hearing, 
that such person— 
‘‘(i) is violating or has violated any 
provision of this title, or any rule or regula-
tion thereunder; or 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00054
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
‘‘(ii) is or was a cause of the violation 
of any provision of this title, or any rule or 
regulation thereunder.’’. 
(d) UNDER
THE INVESTMENT ADVISERS ACT
OF 
1940.—Paragraph (1) of section 203(i) of the Investment 
Advisers Act of 1940 (15 U.S.C. 80b–3(i)(1)) is amended— 
(1) by striking ‘‘(1) AUTHORITY
OF
COMMIS-
SION.—In any proceeding’’ and inserting the fol-
lowing: 
‘‘(1) AUTHORITY OF COMMISSION.— 
‘‘(A) IN GENERAL.—In any proceeding’’; 
(2) by redesignating subparagraphs (A) through 
(D) of such paragraph as clauses (i) through (iv), re-
spectively, and moving such redesignated clauses and 
the matter following such subparagraphs 2 ems to the 
right; and 
(3) by adding at the end of such paragraph the 
following new subparagraph: 
‘‘(B) CEASE-AND-DESIST
PROCEEDINGS.— 
In any proceeding instituted pursuant to sub-
section (k) against any person, the Commission 
may impose a civil penalty if it finds, on the 
record after notice and opportunity for hearing, 
that such person— 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00055
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
‘‘(i) is violating or has violated any 
provision of this title, or any rule or regula-
tion thereunder; or 
‘‘(ii) is or was a cause of the violation 
of any provision of this title, or any rule or 
regulation thereunder.’’. 
SEC. 212. FORMERLY ASSOCIATED PERSONS. 
(a) MEMBER OR EMPLOYEE OF THE MUNICIPAL SECU-
RITIES RULEMAKING BOARD.—Section 15B(c)(8) of the Se-
curities Exchange Act of 1934 (15 U.S.C. 78o–4(c)(8)) is 
amended by striking ‘‘any member or employee’’ and insert-
ing ‘‘any person who is, or at the time of the alleged mis-
conduct was, a member or employee’’. 
(b) PERSON ASSOCIATED WITH A GOVERNMENT SECU-
RITIES BROKER OR DEALER.—Section 15C of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o–5) is amended— 
(1) in subsection (c)(1)(C), by striking ‘‘or seek-
ing to become associated,’’ and inserting ‘‘seeking to 
become associated, or, at the time of the alleged mis-
conduct, associated or seeking to become associated’’; 
(2) in subsection (c)(2)(A), by inserting ‘‘, seek-
ing to become associated, or, at the time of the alleged 
misconduct, associated or seeking to become associ-
ated’’ after ‘‘any person associated’’; and 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00056
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(3) in subsection (c)(2)(B), by inserting ‘‘, seek-
ing to become associated, or, at the time of the alleged 
misconduct, associated or seeking to become associ-
ated’’ after ‘‘any person associated’’. 
(c) PERSON ASSOCIATED WITH A MEMBER OF A NA-
TIONAL SECURITIES EXCHANGE OR REGISTERED SECURI-
TIES ASSOCIATION.—Section 21(a)(1) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78u(a)(1)) is amended by 
inserting ‘‘, or, as to any act or practice, or omission to 
act, while associated with a member, formerly associated’’ 
after ‘‘member or a person associated’’. 
(d) PARTICIPANT OF A REGISTERED CLEARING AGEN-
CY.—Section 21(a)(1) of the Securities Exchange Act of 
1934 (15 U.S.C. 78u(a)(1)) is amended by inserting ‘‘or, 
as to any act or practice, or omission to act, while a partic-
ipant, was a participant,’’ after ‘‘in which such person is 
a participant,’’. 
(e) OFFICER OR DIRECTOR OF A SELF-REGULATORY 
ORGANIZATION.—Section 19(h)(4) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78s(h)(4)) is amended— 
(1) by striking ‘‘any officer or director’’ and in-
serting ‘‘any person who is, or at the time of the al-
leged misconduct was, an officer or director’’; and 
(2) by striking ‘‘such officer or director’’ and in-
serting ‘‘such person’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00057
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(f) OFFICER OR DIRECTOR OF AN INVESTMENT COM-
PANY.—Section 36(a) of the Investment Company Act of 
1940 (15 U.S.C. 80a–35(a)) is amended— 
(1) by striking ‘‘a person serving or acting’’ and 
inserting ‘‘a person who is, or at the time of the al-
leged misconduct was, serving or acting’’; and 
(2) by striking ‘‘such person so serves or acts’’ 
and inserting ‘‘such person so serves or acts, or at the 
time of the alleged misconduct, so served or acted’’. 
(g) PERSON ASSOCIATED WITH A PUBLIC ACCOUNT-
ING FIRM.— 
(1) SARBANES-OXLEY
ACT
OF
2002
AMEND-
MENT.—Section 2(a)(9) of the Sarbanes-Oxley Act of 
2002 (15 U.S.C. 7201(9)) is amended by adding at 
the end the following new subparagraph: 
‘‘(C) INVESTIGATIVE
AND
ENFORCEMENT 
AUTHORITY.—For purposes of the provisions of 
sections 3(c), 101(c), 105, and 107(c) and Board 
or Commission rules thereunder, except to the ex-
tent specifically excepted by such rules, the terms 
defined in subparagraph (A) shall include any 
person associated, seeking to become associated, 
or formerly associated with a public accounting 
firm, except— 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00058
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(2) SECURITIES EXCHANGE ACT OF 1934 AMEND-
MENT.—Section 21(a)(1) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78u(a)(1)) is amended by 
striking ‘‘or a person associated with such a firm’’ 
and inserting ‘‘, a person associated with such a firm, 
or, as to any act, practice, or omission to act while 
associated with such firm, a person formerly associ-
ated with such a firm’’. 
(h) SUPERVISORY PERSONNEL OF AN AUDIT FIRM.— 
Section 105(c)(6) of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7215(c)(6)) is amended— 
(1) in subparagraph (A), by striking ‘‘the super-
visory personnel’’ and inserting ‘‘any person who is, 
or at the time of the alleged failure reasonably to su-
pervise was, a supervisory person’’; and 
(2) in subparagraph (B)— 
(A) by striking ‘‘No associated person’’ and 
inserting ‘‘No current or former supervisory per-
son’’; and 
(B) by striking ‘‘any other person’’ and in-
serting ‘‘any associated person’’. 
(i) MEMBER OF THE PUBLIC COMPANY ACCOUNTING 
OVERSIGHT BOARD.—Section 107(d)(3) of the Sarbanes- 
Oxley Act of 2002 (15 U.S.C. 7217(d)(3)) is amended by 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00060
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
striking ‘‘any member’’ and inserting ‘‘any person who is, 
or at the time of the alleged misconduct was, a member’’. 
SEC. 
213. 
SHARING 
PRIVILEGED 
INFORMATION 
WITH 
OTHER AUTHORITIES. 
Section 24 of the Securities Exchange Act of 1934 (15 
U.S.C. 78x) is amended— 
(1) by redesignating subsections (d) and (e) as 
subsections (e) and (f), respectively; 
(2) in subsection (e), as redesignated, by striking 
‘‘as provided in subsection (e)’’ and inserting ‘‘as pro-
vided in subsection (f)’’; and 
(3) by inserting after subsection (c) the following 
new subsection: 
‘‘(d) SHARING
PRIVILEGED
INFORMATION
WITH 
OTHER AUTHORITIES.— 
‘‘(1) PRIVILEGED
INFORMATION
PROVIDED
BY 
THE
COMMISSION.—The Commission shall not be 
deemed to have waived any privilege applicable to 
any information by transferring that information to 
or permitting that information to be used by— 
‘‘(A) any agency (as defined in section 6 of 
title 18, United States Code); 
‘‘(B) any foreign securities authority; 
‘‘(C) the Public Company Accounting Over-
sight Board; 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00061
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
‘‘(D) any self-regulatory organization; 
‘‘(E) any foreign law enforcement author-
ity; or 
‘‘(F) any State securities or law enforce-
ment authority. 
‘‘(2) NON-DISCLOSURE OF PRIVILEGED INFORMA-
TION
PROVIDED
TO
THE
COMMISSION.—Except as 
provided in subsection (f), the Commission shall not 
be compelled to disclose privileged information ob-
tained from any foreign securities authority, or for-
eign law enforcement authority, if the authority has 
in good faith determined and represented to the Com-
mission that the information is privileged. 
‘‘(3) NON-WAIVER OF PRIVILEGED INFORMATION 
PROVIDED TO THE COMMISSION.— 
‘‘(A) IN GENERAL.—Federal agencies, State 
securities and law enforcement authorities, self- 
regulatory organizations, and the Public Com-
pany Accounting Oversight Board shall not be 
deemed to have waived any privilege applicable 
to any information by transferring that informa-
tion to or permitting that information to be used 
by the Commission. 
‘‘(B) EXCEPTION WITH RESPECT TO CER-
TAIN ACTIONS.—The provisions of subparagraph 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00062
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(A) shall not apply to a self-regulatory organiza-
tion or the Public Company Accounting Over-
sight Board with respect to information used by 
the Commission in an action against such orga-
nization. 
‘‘(4) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) The term ‘privilege’ includes any 
work-product privilege, attorney-client privilege, 
governmental privilege, or other privilege recog-
nized under Federal, foreign, or State law. 
‘‘(B) The term ‘foreign law enforcement au-
thority’ means any foreign authority that is em-
powered under foreign law to detect, investigate 
or prosecute potential violations of law. 
‘‘(C) The term ‘State securities or law en-
forcement authority’ means the authority of any 
State or territory that is empowered under State 
or territory law to detect, investigate or pros-
ecute potential violations of law.’’. 
SEC. 214. EXPANDED ACCESS TO GRAND JURY MATERIAL. 
(a) IN GENERAL.—Title VI of the Sarbanes-Oxley Act 
of 2002 is amended by adding at the end the following new 
section: 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00063
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
‘‘SEC. 605. ACCESS TO GRAND JURY INFORMATION. 
‘‘(a) DISCLOSURE.— 
‘‘(1) IN GENERAL.—Upon motion of an attorney 
for the government, a court may direct disclosure of 
matters occurring before a grand jury during an in-
vestigation of conduct that may constitute a violation 
of any provision of the securities laws to the Commis-
sion for use in relation to any matter within the ju-
risdiction of the Commission. 
‘‘(2) SUBSTANTIAL
NEED
REQUIRED.—A court 
may issue an order under paragraph (1) only upon 
a finding of a substantial need in the public interest. 
‘‘(b) USE OF MATTER.—A person to whom a matter 
has been disclosed under this section shall not use such mat-
ter other than for the purpose for which such disclosure was 
authorized. 
‘‘(c) DEFINITIONS.—As used in this section, the terms 
‘attorney for the government’ and ‘grand jury information’ 
have the meanings given to those terms in section 3322 of 
title 18, United States Code.’’. 
(b) CONFORMING AMENDMENT.—The table of contents 
in section 1(b) of the Sarbanes-Oxley Act of 2002 is amend-
ed by inserting after the item relating to section 604 the 
following: 
‘‘Sec. 605. Access to grand jury information.’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00064
Fmt 6652
Sfmt 6213
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
SEC. 215. AIDING AND ABETTING STANDARD OF KNOWL-
EDGE SATISFIED BY RECKLESSNESS. 
Section 20(e) of the Securities Exchange Act of 1934 
(15 U.S.C. 78t(e)) is amended by inserting ‘‘or recklessly’’ 
after ‘‘knowingly’’. 
SEC. 216. EXTRATERRITORIAL JURISDICTION OF THE ANTI-
FRAUD PROVISIONS OF THE FEDERAL SECU-
RITIES LAWS. 
(a) UNDER THE SECURITIES ACT OF 1933.—Section 
22 of the Securities Act of 1933 (15 U.S.C. 77v(a)) is 
amended by adding at the end the following new subsection: 
‘‘(c) EXTRATERRITORIAL JURISDICTION.—The juris-
diction of the district courts of the United States and the 
United States courts of any Territory described under sub-
section (a) includes violations of section 17(a), and all suits 
in equity and actions at law under that section, involv-
ing— 
‘‘(1) conduct within the United States that con-
stitutes significant steps in furtherance of the viola-
tion, even if the securities transaction occurs outside 
the United States and involves only foreign investors; 
or 
‘‘(2) conduct occurring outside the United States 
that has a foreseeable substantial effect within the 
United States.’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00065
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(b) UNDER
THE SECURITIES EXCHANGE ACT
OF 
1934.—Section 27 of the Securities Exchange Act of 1934 
(15 U.S.C. 78aa) is amended— 
(1) by striking ‘‘The district’’ and inserting the 
following: 
‘‘(a) IN GENERAL.—The district’’; and 
(2) by inserting at the end the following new 
subsection: 
‘‘(b) EXTRATERRITORIAL JURISDICTION.—The juris-
diction of the district courts of the United States and the 
United States courts of any Territory or other place subject 
to the jurisdiction of the United States described under sub-
section (a) includes violations of the antifraud provisions 
of this title, and all suits in equity and actions at law under 
those provisions, involving— 
‘‘(1) conduct within the United States that con-
stitutes significant steps in furtherance of the viola-
tion, even if the securities transaction occurs outside 
the United States and involves only foreign investors; 
or 
‘‘(2) conduct occurring outside the United States 
that has a foreseeable substantial effect within the 
United States.’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00066
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(c) UNDER
THE INVESTMENT ADVISERS ACT
OF 
1940.—Section 214 of the Investment Advisers Act of 1940 
(15 U.S.C. 80b–14) is amended— 
(1) by striking ‘‘The district’’ and inserting the 
following: 
‘‘(a) IN GENERAL.—The district’’; and 
(2) by inserting at the end the following new 
subsection: 
‘‘(b) EXTRATERRITORIAL JURISDICTION.—The juris-
diction of the district courts of the United States and the 
United States courts of any Territory or other place subject 
to the jurisdiction of the United States described under sub-
section (a) includes violations of section 206, and all suits 
in equity and actions at law under that section, involv-
ing— 
‘‘(1) conduct within the United States that con-
stitutes significant steps in furtherance of the viola-
tion, even if the violation is committed by a foreign 
adviser and involves only foreign investors; or 
‘‘(2) conduct occurring outside the United States 
that has a foreseeable substantial effect within the 
United States.’’. 
SEC. 217. FIDELITY BONDING. 
Section 17(g) of the Investment Company Act of 1940 
(15 U.S.C. 80a–17(g)) is amended to read as follows: 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00067
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
‘‘(g) FIDELITY BONDING.— 
‘‘(1) IN GENERAL.—The Commission is author-
ized to require that a registered management com-
pany provide and maintain a fidelity bond against 
loss as to any officer or employee who has access to 
securities or funds of the company, either directly or 
through authority to draw upon such funds or to di-
rect generally the disposition of such securities (unless 
the officer or employee has such access solely through 
his position as an officer or employee of a bank), in 
such form and amount as the Commission may pre-
scribe by rule, regulation, or order for the protection 
of investors. 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) MANAGEMENT
COMPANY.—The term 
‘management company’ has the meaning given 
such term under section 4 of the Investment 
Company Act of 1940. 
‘‘(B) OFFICER
OR
EMPLOYEE.—The term 
‘officer or employee’ means— 
‘‘(i) any officer or employee of the 
management company; and; 
‘‘(ii) any officer or employee of any in-
vestment adviser to the management com-
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00068
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
pany, or of any affiliated company of any 
such investment adviser, as the Commission 
may prescribe by rule, regulation, or order 
for the protection of investors. 
‘‘(C) OTHER DEFINITIONS.—The terms ‘af-
filiated company’ and ‘investment adviser’ shall 
have the meaning given such terms under section 
2 of the Investment Company Act of 1940.’’. 
SEC. 218. ENHANCED SEC AUTHORITY TO CONDUCT SUR-
VEILLANCE AND RISK ASSESSMENT. 
(a) SECURITIES EXCHANGE ACT OF 1934 AMEND-
MENTS.—Section 17(b) of the Securities Exchange Act of 
1934 (15 U.S.C. 78q(b)) is amended by adding at the end 
the following new paragraph: 
‘‘(5) SURVEILLANCE AND RISK ASSESSMENT.— 
All persons described in subsection (a) of this section 
are subject at any time, or from time to time, to such 
reasonable periodic, special, or other information and 
document requests by representatives of the Commis-
sion as the Commission by rule or order deems nec-
essary or appropriate to conduct surveillance or risk 
assessments of the securities markets, persons reg-
istered with the Commission under this title, or other-
wise in furtherance of the purposes of this title.’’. 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00069
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS
(b) INVESTMENT COMPANY ACT
OF 1940 AMEND-
MENTS.—Section 31(b) of the Investment Company Act of 
1940 (15 U.S.C. 80a–30(b)), as amended by section 
106(a)(2), is further amended by adding at the end the fol-
lowing new paragraph: 
‘‘(5) SURVEILLANCE AND RISK ASSESSMENT.— 
All persons described in paragraph (1) are subject at 
any time, or from time to time, to such reasonable 
periodic, special, or other information and document 
requests by representatives of the Commission as the 
Commission by rule or order deems necessary or ap-
propriate to conduct surveillance or risk assessments 
of the securities markets, persons registered with the 
Commission under this title, or otherwise in further-
ance of the purposes of this title.’’. 
(c) INVESTMENT ADVISERS ACT
OF 1940 AMEND-
MENTS.—Section 204 of the Investment Advisers Act of 
1940 (15 U.S.C. 80b–4), as amended by section 106(b), is 
further amended by adding at the end the following new 
subsection: 
‘‘(e) SURVEILLANCE AND RISK ASSESSMENT.—All per-
sons described in subsection (a) are subject at any time, 
or from time to time, to such reasonable periodic, special, 
or other information and document requests by representa-
tives of the Commission as the Commission by rule or order 
VerDate Mar 15 2010 
22:39 Dec 17, 2010
Jkt 099200
PO 00000
Frm 00070
Fmt 6652
Sfmt 6203
E:\BILLS\H3817.RH
H3817
srobinson on DSKHWCL6B1PROD with BILLS