I
119THCONGRESS
1
STSESSION H. R. 216
To amend the Securities Act of 1933, the Securities Exchange Act of 1934,
the Investment Company Act of 1940, and the Investment Advisors
Act of 1940 with respect to the determination of violations.
IN THE HOUSE OF REPRESENTATIVES
JANUARY7, 2025
Mr. S
ESSIONSintroduced the following bill; which was referred to the
Committee on Financial Services
A BILL
To amend the Securities Act of 1933, the Securities Ex-
change Act of 1934, the Investment Company Act of
1940, and the Investment Advisors Act of 1940 with
respect to the determination of violations.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Securities Enforcement 4
Clarity Act of 2025’’ or the ‘‘SEC Act of 2025’’. 5
SEC. 2. DETERMINATION OF THE NUMBER OF VIOLATIONS. 6
(a) S
ECURITIESACT OF1933.—The Securities Act 7
of 1933 is amended— 8
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(1) in section 8A(g) (15 U.S.C. 77h–1(g)), by 1
adding at the end the following: 2
‘‘(4) D
ETERMINATION OF NUMBER OF VIOLA -3
TIONS.—For purposes of determining the number of 4
violations for which to impose penalties under para-5
graph (1), separate acts of noncompliance are a sin-6
gle violation when the acts are the result of— 7
‘‘(A) a common or a substantially overlap-8
ping originating cause; 9
‘‘(B) the same misstatement or omission; 10
or 11
‘‘(C) a continuing failure to comply.’’; and 12
(2) in section 20(d) (15 U.S.C. 77t(d)), by add-13
ing at the end the following: 14
‘‘(5) D
ETERMINATION OF NUMBER OF VIOLA -15
TIONS.—For purposes of determining the number of 16
violations for which to impose penalties under para-17
graph (1), separate acts of noncompliance are a sin-18
gle violation when the acts are the result of— 19
‘‘(A) a common or a substantially overlap-20
ping originating cause; 21
‘‘(B) the same misstatement or omission; 22
or 23
‘‘(C) a continuing failure to comply.’’. 24
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(b) SECURITIESEXCHANGEACT OF1934.—The Se-1
curities Exchange Act of 1934 is amended— 2
(1) in section 21(d)(3) (15 U.S.C. 78u(d)(3)), 3
by adding at the end the following: 4
‘‘(E) D
ETERMINATION OF NUMBER OF VIOLA -5
TIONS.—For purposes of determining the number of 6
violations for which to impose penalties under sub-7
paragraph (A)(i), separate acts of noncompliance are 8
a single violation when the acts are the result of— 9
‘‘(i) a common or a substantially overlap-10
ping originating cause; 11
‘‘(ii) the same misstatement or omission; 12
or 13
‘‘(iii) a continuing failure to comply.’’; 14
(2) in section 21B(a) (15 U.S.C. 78u–2(b)), by 15
adding at the end the following: 16
‘‘(3) D
ETERMINATION OF NUMBER OF VIOLA -17
TIONS, ACTS, OR OMISSIONS.—For purposes of de-18
termining the number of violations, acts, or omis-19
sions for which to impose penalties under this sub-20
section, separate acts of noncompliance are a single 21
violation, act, or omission when the acts are the re-22
sult of— 23
‘‘(A) a common or a substantially overlap-24
ping originating cause; 25
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•HR 216 IH
‘‘(B) the same misstatement or omission; 1
or 2
‘‘(C) a continuing failure to comply.’’; and 3
(3) in section 32 (15 U.S.C. 78ff), by adding at 4
the end the following: 5
‘‘(d) D
ETERMINATION OF NUMBER OF VIOLA-6
TIONS.—For purposes of determining the number of viola-7
tions for which to impose penalties under subsection (c), 8
separate acts of noncompliance are a single violation when 9
the acts are the result of— 10
‘‘(1) a common or a substantially overlapping 11
originating cause; 12
‘‘(2) the same misstatement or omission; or 13
‘‘(3) a continuing failure to comply.’’. 14
(c) I
NVESTMENTCOMPANYACT OF1940.—The In-15
vestment Company Act of 1940 is amended— 16
(1) in section 9(d) (15 U.S.C. 80a–9(d)), by 17
adding at the end the following: 18
‘‘(5) D
ETERMINATION OF NUMBER OF VIOLA -19
TIONS, ACTS, OR OMISSIONS.—For purposes of de-20
termining the number of violations, acts, or omis-21
sions for which to impose penalties under paragraph 22
(1), separate acts of noncompliance are a single vio-23
lation, act, or omission when the acts are the result 24
of— 25
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‘‘(A) a common or a substantially overlap-1
ping originating cause; 2
‘‘(B) the same misstatement or omission; 3
or 4
‘‘(C) a continuing failure to comply.’’; and 5
(2) in section 42(e) (15 U.S.C. 80a–41(e)), by 6
adding at the end the following: 7
‘‘(5) D
ETERMINATION OF NUMBER OF VIOLA -8
TIONS.—For purposes of determining the number of 9
violations for which to impose penalties under para-10
graph (1), separate acts of noncompliance are a sin-11
gle violation when the acts are the result of— 12
‘‘(A) a common or a substantially overlap-13
ping originating cause; 14
‘‘(B) the same misstatement or omission; 15
or 16
‘‘(C) a continuing failure to comply.’’. 17
(d) I
NVESTMENTADVISORSACT OF1940.—The In-18
vestment Advisers Act of 1940 is amended— 19
(1) in section 203(i) (15 U.S.C. 80b–3(i)), by 20
adding at the end the following: 21
‘‘(5) D
ETERMINATION OF NUMBER OF VIOLA -22
TIONS, ACTS, OR OMISSIONS.—For purposes of de-23
termining the number of violations, acts, or omis-24
sions for which to impose penalties under paragraph 25
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(1), separate acts of noncompliance are a single vio-1
lation, act, or omission when the acts are the result 2
of— 3
‘‘(A) a common or a substantially overlap-4
ping originating cause; 5
‘‘(B) the same misstatement or omission; 6
or 7
‘‘(C) a continuing failure to comply.’’; and 8
(2) in section 209(e) (15 U.S.C. 80b–9(e)), by 9
adding at the end the following: 10
‘‘(5) D
ETERMINATION OF NUMBER OF VIOLA -11
TIONS.—For purposes of determining the number of 12
violations for which to impose penalties under para-13
graph (1), separate acts of noncompliance are a sin-14
gle violation when the acts are the result of— 15
‘‘(A) a common or a substantially overlap-16
ping originating cause; 17
‘‘(B) the same misstatement or omission; 18
or 19
‘‘(C) a continuing failure to comply.’’. 20
Æ
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