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Senate Proposes Substantial Increases In SEC Fines For Fraudsters

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Friday, July 10, 2015.

The price for being a securities fraudster may be increasing substantially. The U.S. Senate proposed substantial increases in SEC fines, up to ten fold the current amounts, for securities fraudsters. The bill would allow the Securities and Exchange Commission to levy fines of up to $1 million per offense by individuals and $10 million for each violation by firms for the most serious offenses, which would include fraud, deceit, manipulation and deliberate disregard for regulations. The proposed increased ceilings on fines represent substantial increases from current maximum fines which range from $160,000.00 for individuals to $775,000.00 for firms. And the proposal calls for triple fines for individuals and firms who have committed other securities law violations in the past five years.

Under current law, the SEC can assign penalties equal to the amount of investor harm, but only when the case is taken to court. The proposal, however, would allow the SEC to assess the fines in cases brought in federal court as well as those heard by SEC administrative judges.

The authors of the bill are  Sen. Charles Grassley, R-Iowa, and Sen. Jack Reed, D-R.I.  According to co-sponsor Charles Grassley, ““If a fine is just decimal dust for a Wall Street firm, that's not a deterrent, It's just the cost of doing business. A penalty should mean something, and it should get the recidivists' attention.”

Something to take into account when considering a career as a securities fraudster.

Shustak Reynolds & Partners, P.C. has extensive expertise and experience in the expungement process.  For more information on how to expunge negative items from your FINRA CRD records, contact Erwin J. Shustak, Esq, Managing Partner, at 619.696.9500 or via email at [email protected]

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