SANCTIONS AGAINST BROKER OR DEALER, ASSOCIATED PERSONS, OR PERSONS SEEKING ASSOCIATION.

SEC. 203. SANCTIONS AGAINST BROKER OR DEALER, ASSOCIATED PERSONS, OR PERSONS SEEKING ASSOCIATION. (a) Authority of the Commission To Sanction Brokers and Dealers for Foreign Violations.— Section 15(b) (15 U.S.C. 78o(b)) of the Securities Exchange Act of 1934 is amended— (1) in paragraph (4)(B), by inserting after “misdemeanor” the following: “or of a substantially equivalent crime by a foreign court of competent jurisdiction”; 104 STAT. 2716 (2) in paragraph (4)(B)(i), by inserting after “burglary,” the following: “any substantially equivalent activity however denominated by the laws of the relevant foreign government,”; (3) in paragraph (4)(B)(ii)— (A) by inserting after “transfer agent,” the following: “foreign person performing a function substantially equivalent to any of the above,”; (B) by inserting after “(7 U.S.C. 1 et seq.)” the following: “or any substantially equivalent foreign statute or regulation”; (4) in paragraph (4)(B)(iii), by inserting after “securities” the following: “, or substantially equivalent activity however denominated by the laws of the relevant foreign government”; (5) in paragraph (4)(B)(iv), by inserting after “United States Code” the following: “, or a violation of a substantially equivalent foreign statute”; (6) in paragraph (4)(C)— (A) by inserting after “transfer agent,” the following: “foreign person performing a function substantially equivalent to any of the above,”; (B) by inserting after “Commodity Exchange Act” each time it appears the following: “or any substantially equivalent foreign statute or regulation”; and (C) by inserting after “insurance company,” the following: “foreign entity substantially equivalent to any of the above,”; and (7) by inserting after subparagraph (F) of paragraph (4) the following: “(G) has been found by a foreign financial regulatory authority to have— “(i) made or caused to be made in any application for registration or report required to be filed with a foreign financial regulatory authority, or in any proceeding before a foreign financial regulatory authority with respect to registration, any statement that was at the time and in the light of the circumstances under which it was made false or misleading with respect to any material fact, or has omitted to state in any application or report to the foreign financial regulatory authority any material fact that is required to be stated therein; “(ii) violated any foreign statute or regulation regarding transactions in securities, or contracts of sale of a commodity for future delivery, traded on or subject to the rules of a contract market or any board of trade; “(iii) aided, abetted, counseled, commanded, induced, or procured the violation by any person of any provision of any statutory provisions enacted by a foreign government, or rules or regulations thereunder, empowering a foreign financial regulatory authority regarding transactions in securities, or contracts of sale of a commodity for future delivery, traded on or subject to the rules of a contract market or any board of trade, or has been found, by a foreign financial regulatory authority, to have failed reasonably to supervise, with a view to preventing violations of such statutory provisions, rules, and regulations, another person who commits such a violation, if such other person is subject to his supervision.”. 104 STAT. 2717 (b) Extension of Definition of Statutory Disqualification To Include Foreign Violations.— Section 3(a)(39) of such Act (15 U.S.C. 78c(a)(39)) is amended— (1) in subparagraph (A)— (A) by inserting after “self-regulatory organization,” the following: “foreign equivalent of a self-regulatory organization, foreign or international securities exchange,”; (B) by inserting after both “(7 U.S.C. 7),” and “(7 U.S.C. 21),”, the following: “or any substantially equivalent foreign statute or regulation,”; and (C) by inserting after “contract market”, the following: “or foreign equivalent”; (2) by striking subparagraph (B) and inserting the following: “(B) is subject to— “(i) an order to the Commission, other appropriate regulatory agency, or foreign financial regulatory authority— “(I) denying, suspending for a period not exceeding 12 months, or revoking his registration as a broker, dealer, municipal securities dealer, government securities broker, or government securities dealer or limiting his activities as a foreign person performing a function substantially equivalent to any of the above; or “(II) barring or suspending for a period not exceeding 12 months his being associated with a broker, dealer, municipal securities dealer, government securities broker, government securities dealer, or foreign person performing a function substantially equivalent to any of the above; “(ii) an order of the Commodity Futures Trading Commission denying, suspending, or revoking his registration under the Commodity Exchange Act (7 U.S.C. 1 et seq.); or “(iii) an order by a foreign financial regulatory authority denying, suspending, or revoking the person’s authority to engage in transactions in contracts of sale of a commodity for future delivery or other instruments traded on or subject to the rules of a contract market, board of trade, or foreign equivalent thereof;”; (3) by redesignating subparagraphs (D) and (E) as subparagraphs (E) and (F), respectively; (4) by inserting after subparagraph (C) the following: “(D) by his conduct while associated with any broker, dealer, municipal securities dealer, government securities broker, government securities dealer, or any other entity engaged in transactions in securities, or while associated with an entity engaged in transactions in contracts of sale of a commodity for future delivery or other instruments traded on or subject to the rules of a contract market, board of trade, or foreign equivalent thereof, has been found to be a cause of any effective suspension, expulsion, or order by a foreign or international securities exchange or foreign financial regulatory authority empowered by a foreign government to administer or enforce its laws relating to financial transactions as described in subparagraph (A) or (B) of this paragraph;”; (5) in subparagraph (E) (as redesignated by paragraph (3) of this subsection) by striking “(A), (B), or (C)” and inserting “(A), (B), (C), or (D)”; and 104 STAT. 2718 (6) in subparagraph (F) (as redesignated) by striking “(D) or (E)” and inserting “(D), (E), or (G)” and by inserting after “such paragraph (4)” the first place it appears the following: “or any other felony”. (c) Conforming Amendments.— The Securities Exchange Act of 1944 (15 U.S.C. 78a et seq.) is amended— (1) in sections 15(b)(6), 15B(c)(2), 15B(c)(4), 15C(c)(1)(A), 15C(c)(1)(C), 17A(c)(3)(A), and 17A(c)(4)(C), by striking “(A), (D), or (E)” and inserting “(A), (D), (E), or (G)”; and (2) in section 15C(f)(2), by striking “or the rules or regulations under any such other provision” and inserting “the rules or regulations under any such other provision, or investigations pursuant to section 21(a)(2) of this title to assist a foreign securities authority”.