Instructions: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
Input: SECTION 1. SHORT TITLE.

This Act may be cited as the ''Equitable Treatment of Investors
Act''.

SEC. 2. SECURITIES INVESTOR PROTECTION ACT OF 1970 AMENDMENTS.

(a) Net Equity Based on Last Statement.--Section 16(11) of the
Securities Investor Protection Act of 1970 (15 U.S.C. 78lll(11)) is
amended to read as follows:
''(11) Net equity.--
''(A) In general.--The term 'net equity' means the
dollar amount of the account or accounts of a customer,
to be determined by--
''(i) calculating the sum which would have
been owed by the debtor to such customer if the
debtor had liquidated, by sale or purchase on
the filing date--
''(I) all securities positions of
such customer (other than customer name
securities reclaimed by such customer);
and
''(II) all positions in futures
contracts and options on futures
contracts held in a portfolio margining
account carried as a securities account
pursuant to a portfolio margining
program approved by the Commission,
including all property collateralizing
such positions, to the extent that such
property is not otherwise included
herein; minus
''(ii) any indebtedness of such customer to
the debtor on the filing date; plus
''(iii) any payment by such customer of
such indebtedness to the debtor which is made
with the approval of the trustee and within
such period as the trustee may determine (but
in no event more than sixty days after the
publication of notice under section 8(a)).
''(B) Treatment of certain commodity futures
contracts.--A claim for a commodity futures contract
received, acquired, or held in a portfolio margining
account pursuant to a portfolio margining program
approved by the Commission or a claim for a security
futures contract, shall be deemed to be a claim with
respect to such contract as of the filing date, and
such claim shall be treated as a claim for cash.
''(C) Treatment of accounts held by a customer in
separate capacities.--In determining net equity under
this paragraph, accounts held by a customer in separate
capacities shall be deemed to be accounts of separate
customers.
''(D) Reliance on final customer statement.--
''(i) In general.--In determining net
equity under this paragraph, the positions,
options, and contracts of a customer held by
the debtor, and any indebtedness of the
customer to the debtor, shall be determined
based on--
''(I) the information contained in
the last statement received by the
customer from the debtor before the
filing date; and
''(II) any additional specific
confirmations of the customer's
positions, options, contracts, or
indebtedness received after such last
statement but before the filing date.
''(ii) Fraud exception.--The provisions of
this subparagraph shall not apply to any
customer that--
''(I) knew the debtor was involved
in fraudulent activity with respect to
any customer of the debtor; or
''(II) was a person that--
''(aa) was, or was required
to be, registered with the
Securities and Exchange
Commission under the securities
laws (as such term is defined
under section 3(a) of the
Securities Exchange Act of 1934
(15 U.S.C. 78c(a)));
''(bb) knew, or should have
known, that the debtor was
involved in fraudulent activity
with respect to any customer of
the debtor; and
''(cc) did not notify SIPC,
the Commission, or law
enforcement personnel that the
debtor was involved in such
fraudulent activity.''.
(b) Prohibition on Certain Recoveries.--Section 8 of the Securities
Investor Protection Act of 1970 (15 U.S.C. 78fff-2) is amended by
adding at the end the following new subsection:
''(g) Prohibition on Certain Recoveries.--Notwithstanding any other
provision of this Act, a trustee may not recover any property
transferred by the debtor to a customer before the filing date unless,
at the time of such transfer, such customer--
''(1) knew the debtor was involved in fraudulent activity
with respect to any customer of the debtor; or
''(2) was a person that--
''(A) was, or was required to be, registered with
the Securities and Exchange Commission under the
securities laws (as such term is defined under section
3(a) of the Securities Exchange Act of 1934 (15 U.S.C.
78c(a)));
''(B) knew, or should have known, that the debtor
was involved in fraudulent activity with respect to any
customer of the debtor; and
''(C) did not notify SIPC, the Commission, or law
enforcement personnel that the debtor was involved in
such fraudulent activity.''.
(c) Appointment of Trustees.--
(1) In general.--Section 5(b)(3) of the Securities Investor
Protection Act of 1970 (15 U.S.C. 78eee(b)(3)) is amended to
read as follows:
''(3) Appointment of trustee and attorney.--
''(A) In general.--If the court issues a protective
decree under paragraph (1), such court shall forthwith
appoint, as trustee for the liquidation of the business
of the debtor and as attorney for the trustee, such
persons as the court determines best fit to serve as
trustee and as attorney from among the persons selected
by the Commission pursuant to subparagraph (B). The
persons appointed as trustee and as attorney for the
trustee may be associated with the same firm.
''(B) Commission candidates.--With respect to a
debtor and upon the court issuing a protective decree
under paragraph (1), the Commission shall forthwith
provide the court with a list of candidates for the
position of trustee and attorney for the trustee for
such debtor.
''(C) Disinterest requirement.--No person may be
appointed to serve as trustee or attorney for the
trustee if such person is not disinterested within the
meaning of paragraph (6), except that for any specified
purpose other than to represent a trustee in conducting
a liquidation proceeding, the trustee may, with the
approval of SIPC and the court, employ an attorney who
is not disinterested.
''(D) Qualification.--A trustee appointed under
this paragraph shall qualify by filing a bond in the
manner prescribed by section 322 of title 11, United
States Code.''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect with respect to trustees and attorneys
appointed after the date of the enactment of this Act.

SEC. 3. EFFECTIVE DATE.

Except as provided under section 2(c)(2), the amendments made by
section 2 shall take effect with respect to a liquidation proceeding
under the Securities Investor Protection Act of 1970 that--
(1) was in progress on the date of the enactment of this
Act; or
(2) is initiated after the date of the enactment of this
Act.
Output:
Equitable Treatment of Investors Act - Amends the Securities Investor Protection Act of 1970 to revise the definition of "net equity."

Declares also that, in determining net equity, the positions, options, and contracts of a customer held by the debtor, and any indebtedness of the customer to the debtor, shall be determined based on: (1) the information contained in the last statement received by the customer from the debtor before the filing date; and (2) any additional specific confirmations of the customer's positions, options, contracts, or indebtedness received after such last statement but before the filing date.

Prohibits reliance on the final statement of the debtor to customer, however, if the customer: (1) knew the debtor was involved in fraudulent activity with respect to any of its customers; or (2) as a registrant under the securities laws, or a person required to be so registered, knew, or should have known, that the debtor was involved in such a fraudulent activity and did not notify the Securities Investor Protection Corporation (SIPC), the Securities Exchange Commission (SEC), or law enforcement personnel that the debtor was so involved.

Prohibits a trustee in a liquidation proceeding from recovering any property transferred by the debtor to a customer before the filing date unless, at the time of such transfer, the customer meets the same critieria.

Transfers from SIPC to the SEC authority to nominate to a court persons for appointment as trustee for the liquidation of a debtor's business and as attorney for the trustee.