News Flash- Bill Would Strengthen SEC Powers to Detect Fraud
March 8, 2004
The House Financial Services Committee passed The Securities Fraud Deterrence and Investor Restitution Act (H.R. 2179), which would permit the SEC to more easily collect fines and funds from those who have broken the law. It would also increase the amount of funds the SEC would be able to return to injured investors.
State laws would no longer be able to be used to protect ill-gotten gains, and the SEC would be able to obtain bank records in securities violations cases, as well as increase the Commission's access to grand jury information. Finally, its powers of subpoena would be enhanced.
The legislation's "anti-Spitzer" clause, which would have diluted states regulators' powers, was reported to have been eliminated and replaced with a strengthening of the SEC's rights.
The bill also includes amendments that would increase communication between the SEC and the states and prohibit funds closed to new investments to collect 12b-1 fees.
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