15 USC 77h-1 - Cease-and-desist proceedings

U.S Code last checked for updates: Nov 22, 2024

§ 77h–1.

Cease-and-desist proceedings

(a)

Authority of Commission

(b)

Hearing

(c)

Temporary order

(1)

In general

(2)

Applicability

(d)

Review of temporary orders

(1)

Commission review

(2)

Judicial review

Within—

(A)

10 days after the date the respondent was served with a temporary cease-and-desist order entered with a prior Commission hearing, or

(B)

10 days after the Commission renders a decision on an application and hearing under paragraph (1), with respect to any temporary cease-and-desist order entered without a prior Commission hearing,

the respondent may apply to the United States district court for the district in which the respondent resides or has its principal place of business, or for the District of Columbia, for an order setting aside, limiting, or suspending the effectiveness or enforcement of the order, and the court shall have jurisdiction to enter such an order. A respondent served with a temporary cease-and-desist order entered without a prior Commission hearing may not apply to the court except after hearing and decision by the Commission on the respondent’s application under paragraph (1) of this subsection.

(3)

No automatic stay of temporary order

(4)

Exclusive review

(e)

Authority to enter order requiring accounting and disgorgement

(f)

Authority of the Commission to prohibit persons from serving as officers or directors

(g)

Authority to impose money penalties

(1)

Grounds

In any cease-and-desist proceeding under subsection (a), the Commission may impose a civil penalty on a person if the Commission finds, on the record, after notice and opportunity for hearing, that—

(A)

such person—

(i)

is violating or has violated any provision of this subchapter, or any rule or regulation issued under this subchapter; or

(ii)

is or was a cause of the violation of any provision of this subchapter, or any rule or regulation thereunder; and

(B)

such penalty is in the public interest.

(2)

Maximum amount of penalty

(A)

First tier

(B)

Second tier

(C)

Third tier

Notwithstanding subparagraphs (A) and (B), the maximum amount of penalty for each such act or omission shall be $150,000 for a natural person or $725,000 for any other person, if—

(i)

the act or omission described in paragraph (1) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and

(ii)

such act or omission directly or indirectly resulted in—

(I)

substantial losses or created a significant risk of substantial losses to other persons; or

(II)

substantial pecuniary gain to the person who committed the act or omission.

(3)

Evidence concerning ability to pay

(May 27, 1933, ch. 38, title I, § 8A, as added Pub. L. 101–429, title I, § 102, Oct. 15, 1990, 104 Stat. 933; amended Pub. L. 107–204, title XI, § 1105(b), July 30, 2002, 116 Stat. 809; Pub. L. 111–203, title IX, § 929P(a)(1), July 21, 2010, 124 Stat. 1862.)

cite as: 15 USC 77h-1