I 
114TH CONGRESS 
1ST SESSION H. R. 1173 
To amend the Securities Exchange Act of 1934 to prohibit trading on material 
inside information. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 27, 2015 
Mr. LYNCH 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 on material inside information. 
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 ‘‘Ban Insider Trading 
Act of 2015’’. 
SEC. 2. PROHIBITING TRADING ON MATERIAL INSIDE IN-
FORMATION. 
(a) IN GENERAL.—Section 10 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78j) is amended by insert-
ing after subsection (c) the following: 
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‘‘(d) TRADING
ON MATERIAL INSIDE INFORMA-
TION.— 
‘‘(1) IN GENERAL.—To purchase or sell any se-
curity, or any securities-based swap agreement, 
based on information that the person knows or, con-
sidering factors including financial sophistication, 
knowledge of and experience in financial matters, 
position in a company, and amount of assets under 
management, should know is material information 
and inside information. 
‘‘(2) RULES
OF
CONSTRUCTION.—Nothing in 
this subsection may be construed— 
‘‘(A) to affect liability under subsection 
(b); or 
‘‘(B) to require for an action under para-
graph (1) a personal benefit to any party. 
‘‘(3) DEFINITIONS.—In this subsection: 
‘‘(A) INSIDE INFORMATION.—The term ‘in-
side information’ means information that is— 
‘‘(i) nonpublic; and 
‘‘(ii) obtained— 
‘‘(I) illegally; 
‘‘(II) directly or indirectly from 
an issuer with an expectation of con-
fidentiality or that such information 
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will only be used for a legitimate busi-
ness purposes; or 
‘‘(III) in violation of a fiduciary 
duty. 
‘‘(B) MATERIAL INFORMATION.—The term 
‘material information’ means information that 
relates, directly or indirectly, to an issuer or a 
security, and that, if it were made public, would 
be likely to have a significant effect on the price 
of a security.’’. 
(b) LIABILITY FOR DISCLOSING MATERIAL INSIDE 
INFORMATION.—Section 20(e) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78t(e)) is amended— 
(1) by striking ‘‘(e)’’ and all that follows 
through ‘‘For’’ and inserting the following: 
‘‘(e) PROSECUTION
OF PERSONS WHO AID
AND 
ABET VIOLATIONS.— 
‘‘(1) IN GENERAL.—For’’; and 
(2) by adding at the end the following: 
‘‘(2) PROSECUTION OF PERSONS WHO FACILI-
TATE
VIOLATIONS
OF
SECTION 10(d).—A person 
shall be deemed to have violated section 10(d) if the 
person intentionally discloses without a legitimate 
business purpose to another person information that 
the discloser knows or, considering factors including 
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financial sophistication, knowledge of and experience 
in financial matters, position in a company, and 
amount of assets under management, should know is 
material information and inside information, as such 
terms are defined, respectively, in section 10(d)(3).’’. 
(c) TECHNICAL AMENDMENT.—Section 10 of the Se-
curities Exchange Act of 1934 (15 U.S.C. 78j) is amended 
in the matter preceding subsection (a) by striking ‘‘ex-
change—’’ and inserting ‘‘exchange:’’. 
Æ 
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