‘‘(III) the amount of losses in-
curred by victims as a result of the 
act or omission. 
‘‘(ii) THIRD TIER ACT OR OMISSION.— 
For the purposes of this subparagraph, the 
term ‘third tier act or omission’ means an 
act or omission described in paragraph (1) 
that— 
‘‘(I) involved fraud, deceit, ma-
nipulation, or deliberate or reckless 
disregard of a regulatory requirement; 
and 
‘‘(II) directly or indirectly— 
‘‘(aa) resulted in substantial 
losses to other persons; 
‘‘(bb) created a significant 
risk of substantial losses to other 
persons; or 
‘‘(cc) resulted in substantial 
pecuniary gain to the person who 
committed the act or omission.’’. 
(2) MONEY
PENALTIES
IN
CIVIL
ACTIONS.— 
Section 42(e)(2) of the Investment Company Act of 
1940 (15 U.S.C. 80a–41(e)(2)) is amended— 
(A) in subparagraph (A)— 
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(i) by striking ‘‘$5,000’’ and inserting 
‘‘$10,000’’; and 
(ii) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; 
(B) in subparagraph (B)— 
(i) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; and 
(ii) by striking ‘‘$250,000’’ and in-
serting ‘‘$500,000’’; and 
(C) by striking subparagraph (C) and in-
serting the following: 
‘‘(C) THIRD TIER.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
subparagraphs (A) and (B), for a third 
tier violation, the amount of penalty for 
each such violation shall not exceed the 
greater of— 
‘‘(I) $1,000,000 for a natural 
person or $10,000,000 for any other 
person; 
‘‘(II) 3 times the gross amount of 
pecuniary gain to the person who 
committed the violation; or 
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‘‘(III) the amount of losses in-
curred by victims as a result of the 
violation. 
‘‘(ii) THIRD
TIER
VIOLATION.—For 
the purposes of this subparagraph, the 
term ‘third tier violation’ means a violation 
described in paragraph (1) that— 
‘‘(I) involved fraud, deceit, ma-
nipulation, or deliberate or reckless 
disregard of a regulatory requirement; 
and 
‘‘(II) directly or indirectly— 
‘‘(aa) resulted in substantial 
losses to other persons; 
‘‘(bb) created a significant 
risk of substantial losses to other 
persons; or 
‘‘(cc) resulted in substantial 
pecuniary gain to the person who 
committed the violation.’’. 
(d) INVESTMENT ADVISERS ACT OF 1940.— 
(1) MONEY PENALTIES IN ADMINISTRATIVE AC-
TIONS.—Section 203(i)(2) of the Investment Advis-
ers Act of 1940 (15 U.S.C. 80b–3(i)(2)) is amend-
ed— 
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(A) in subparagraph (A)— 
(i) by striking ‘‘$5,000’’ and inserting 
‘‘$10,000’’; and 
(ii) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; 
(B) in subparagraph (B)— 
(i) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; and 
(ii) by striking ‘‘$250,000’’ and in-
serting ‘‘$500,000’’; and 
(C) by striking subparagraph (C) and in-
serting the following: 
‘‘(C) THIRD TIER.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
subparagraphs (A) and (B), for a third 
tier act or omission, the amount of penalty 
for each such act or omission shall not ex-
ceed the greater of— 
‘‘(I) $1,000,000 for a natural 
person or $10,000,000 for any other 
person; 
‘‘(II) 3 times the gross amount of 
pecuniary gain to the person who 
committed the act or omission; or 
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‘‘(III) the amount of losses in-
curred by victims as a result of the 
act or omission. 
‘‘(ii) THIRD TIER ACT OR OMISSION.— 
For the purposes of this subparagraph, the 
term ‘third tier act or omission’ means an 
act or omission described in paragraph (1) 
that— 
‘‘(I) involved fraud, deceit, ma-
nipulation, or deliberate or reckless 
disregard of a regulatory requirement; 
and 
‘‘(II) directly or indirectly— 
‘‘(aa) resulted in substantial 
losses to other persons; 
‘‘(bb) created a significant 
risk of substantial losses to other 
persons; or 
‘‘(cc) resulted in substantial 
pecuniary gain to the person who 
committed the act or omission.’’. 
(2) MONEY
PENALTIES
IN
CIVIL
ACTIONS.— 
Section 209(e)(2) of the Investment Advisers Act of 
1940 (15 U.S.C. 80b–9(e)(2)) is amended— 
(A) in subparagraph (A)— 
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(i) by striking ‘‘$5,000’’ and inserting 
‘‘$10,000’’; and 
(ii) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; 
(B) in subparagraph (B)— 
(i) by striking ‘‘$50,000’’ and insert-
ing ‘‘$100,000’’; and 
(ii) by striking ‘‘$250,000’’ and in-
serting ‘‘$500,000’’; and 
(C) by striking subparagraph (C) and in-
serting the following: 
‘‘(C) THIRD TIER.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
subparagraphs (A) and (B), for a third 
tier violation, the amount of penalty for 
each such violation shall not exceed the 
greater of— 
‘‘(I) $1,000,000 for a natural 
person or $10,000,000 for any other 
person; 
‘‘(II) 3 times the gross amount of 
pecuniary gain to the person who 
committed the violation; or 
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‘‘(III) the amount of losses in-
curred by victims as a result of the 
violation. 
‘‘(ii) THIRD
TIER
VIOLATION.—For 
the purposes of this subparagraph, the 
term ‘third tier violation’ means a violation 
described in paragraph (1) that— 
‘‘(I) involved fraud, deceit, ma-
nipulation, or deliberate or reckless 
disregard of a regulatory requirement; 
and 
‘‘(II) directly or indirectly— 
‘‘(aa) resulted in substantial 
losses to other persons; 
‘‘(bb) created a significant 
risk of substantial losses to other 
persons; or 
‘‘(cc) resulted in substantial 
pecuniary gain to the person who 
committed the violation.’’. 
SEC. 3. PENALTIES FOR RECIDIVISTS. 
(a) SECURITIES ACT OF 1933.— 
(1) CEASE-AND-DESIST PROCEEDINGS.—Section 
8A(g)(2) of the Securities Act of 1933 (15 U.S.C. 
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pamtmann on DSKBFK8HB2PROD with BILLS
77h–1(g)(2)) is amended by adding at the end the 
following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), the maximum 
amount of penalty for each such act or omission 
shall be 3 times the otherwise applicable 
amount in such subparagraphs if, within the 5- 
year period preceding such act or omission, the 
person who committed the act or omission was 
criminally convicted for securities fraud or be-
came subject to a judgment or order imposing 
monetary, equitable, or administrative relief in 
any Commission action alleging fraud by that 
person.’’. 
(2) INJUNCTIONS
AND
PROSECUTION
OF
OF-
FENSES.—Section 20(d)(2) of the Securities Act of 
1933 (15 U.S.C. 77t(d)(2)) is amended by adding at 
the end the following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), the maximum 
amount of penalty for each such violation shall 
be 3 times the otherwise applicable amount in 
such subparagraphs if, within the 5-year period 
preceding such violation, the defendant was 
criminally convicted for securities fraud or be-
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came subject to a judgment or order imposing 
monetary, equitable, or administrative relief in 
any Commission action alleging fraud by that 
defendant.’’. 
(b) SECURITIES EXCHANGE ACT OF 1934.— 
(1) CIVIL ACTIONS.—Section 21(d)(3)(B) of the 
Securities Exchange Act of 1934 (15 U.S.C. 
78u(d)(3)(B)) is amended by adding at the end the 
following: 
‘‘(iv) 
FOURTH
TIER.—Notwithstanding 
clauses (i), (ii), and (iii), the maximum amount 
of penalty for each such violation shall be 3 
times the otherwise applicable amount in such 
clauses if, within the 5-year period preceding 
such violation, the defendant was criminally 
convicted for securities fraud or became subject 
to a judgment or order imposing monetary, eq-
uitable, or administrative relief in any Commis-
sion action alleging fraud by that defendant.’’. 
(2) ADMINISTRATIVE
PROCEEDINGS.—Section 
21B(b) of the Securities Exchange Act of 1934 (15 
U.S.C. 78u–2(b)) is amended by adding at the end 
the following: 
‘‘(4) FOURTH
TIER.—Notwithstanding para-
graphs (1), (2), and (3), the maximum amount of 
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pamtmann on DSKBFK8HB2PROD with BILLS
penalty for each such act or omission shall be 3 
times the otherwise applicable amount in such para-
graphs if, within the 5-year period preceding such 
act or omission, the person who committed the act 
or omission was criminally convicted for securities 
fraud or became subject to a judgment or order im-
posing monetary, equitable, or administrative relief 
in any Commission action alleging fraud by that per-
son.’’. 
(c) INVESTMENT COMPANY ACT OF 1940.— 
(1) INELIGIBILITY OF CERTAIN UNDERWRITERS 
AND
AFFILIATES.—Section 9(d)(2) of the Invest-
ment Company Act of 1940 (15 U.S.C. 80a–9(d)(2)) 
is amended by adding at the end the following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), the maximum 
amount of penalty for each such act or omission 
shall be 3 times the otherwise applicable 
amount in such subparagraphs if, within the 5- 
year period preceding such act or omission, the 
person who committed the act or omission was 
criminally convicted for securities fraud or be-
came subject to a judgment or order imposing 
monetary, equitable, or administrative relief in 
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pamtmann on DSKBFK8HB2PROD with BILLS
any Commission action alleging fraud by that 
person.’’. 
(2) ENFORCEMENT.—Section 42(e)(2) of the 
Investment Company Act of 1940 (15 U.S.C. 80a– 
41(e)(2)) is amended by adding at the end the fol-
lowing: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), the maximum 
amount of penalty for each such violation shall 
be 3 times the otherwise applicable amount in 
such subparagraphs if, within the 5-year period 
preceding such violation, the defendant was 
criminally convicted for securities fraud or be-
came subject to a judgment or order imposing 
monetary, equitable, or administrative relief in 
any Commission action alleging fraud by that 
defendant.’’. 
(d) INVESTMENT ADVISERS ACT OF 1940.—The In-
vestment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) 
is amended— 
(1) in section 203(i)(2) (15 U.S.C. 80b– 
3(i)(2)), by adding at the end the following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), the maximum 
amount of penalty for each such act or omission 
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