Adjustments to Civil Monetary Penalty Amounts, 1970-1972 [2024-00378]
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1970
Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange neither solicited nor
received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 29 and paragraph (f) of Rule
19b–4 30 thereunder. At any time within
60 days of the filing of the proposed rule
change, the Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
ddrumheller on DSK120RN23PROD with NOTICES1
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include file number SR–
CboeEDGX–2024–002 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to file
number SR–CboeEDGX–2024–002. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
29 15
30 17
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f).
VerDate Sep<11>2014
17:31 Jan 10, 2024
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–CboeEDGX–2024–002 and should be
submitted on or before February 1, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.31
Christina Z. Milnor,
Assistant Secretary.
[FR Doc. 2024–00385 Filed 1–10–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release Nos. 33–11263; 34–99276; IA–
6521; IC–35085]
Adjustments to Civil Monetary Penalty
Amounts
Securities and Exchange
Commission.
ACTION: Notice of annual inflation
adjustment of civil monetary penalties.
AGENCY:
The Securities and Exchange
Commission (‘‘Commission’’) is
publishing this notice (‘‘Notice’’)
pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements
Act of 2015 (‘‘2015 Act’’). This Act
requires all agencies to annually adjust
for inflation the civil monetary penalties
that can be imposed under the statutes
administered by the agency and publish
the adjusted amounts in the Federal
Register. This Notice sets forth the
annual inflation adjustment of the
maximum amount of civil monetary
penalties (‘‘CMPs’’) administered by the
Commission under the Securities Act of
1933, the Securities Exchange Act of
1934 (‘‘Exchange Act’’), the Investment
Company Act of 1940, the Investment
SUMMARY:
31 17
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PO 00000
CFR 200.30–3(a)(12).
Frm 00096
Fmt 4703
Sfmt 4703
Advisers Act of 1940, and certain
penalties under the Sarbanes-Oxley Act
of 2002. These amounts are effective
beginning on January 15, 2024, and will
apply to all penalties imposed after that
date for violations of the
aforementioned statutes that occurred
after November 2, 2015.
FOR FURTHER INFORMATION CONTACT:
Stephen M. Ng, Senior Special Counsel,
Office of the General Counsel, at (202)
551–7957, or Hannah W. Riedel, Senior
Counsel, Office of the General Counsel,
at (202) 551–7918.
SUPPLEMENTARY INFORMATION:
I. Background
This Notice is being published
pursuant to the 2015 Act,1 which
amended the Federal Civil Penalties
Inflation Adjustment Act of 1990
(‘‘Inflation Adjustment Act’’).2 The
Inflation Adjustment Act previously had
been amended by the Debt Collection
Improvement Act of 1996 (‘‘DCIA’’) 3 to
require that each Federal agency adopt
regulations at least once every four years
that adjust for inflation the CMPs that
can be imposed under the statutes
administered by the agency. Pursuant to
this requirement, the Commission
previously adopted regulations in 1996,
2001, 2005, 2009, and 2013 to adjust the
maximum amount of the CMPs that
could be imposed under the statutes the
Commission administers.4
The 2015 Act replaces the inflation
adjustment formula prescribed in the
DCIA with a new formula for calculating
the inflation-adjusted amount of CMPs.
The 2015 Act requires that agencies use
this new formula to re-calculate the
inflation-adjusted amounts of the
penalties they administer on an annual
basis and publish these new amounts in
1 Public Law 114–74 Sec. 701, 129 Stat. 599–601
(Nov. 2, 2015), codified at 28 U.S.C. 2461 note.
2 Public Law 101–410, 104 Stat. 890–892 (1990),
codified at 28 U.S.C. 2461 note.
3 Public Law. 104–134, title III, section
31001(s)(1), 110 Stat. 1321–373 (1996), codified at
28 U.S.C. 2461 note.
4 See Release Nos. 33–7361, 34–37912, IA–1596,
IC–22310, dated Nov. 1, 1996 (effective Dec. 9,
1996), previously found at 17 CFR 201.1001 and
Table I to Subpart E of Part 201; Release Nos. 33–
7946, 34–43897, IA–1921, IC–24846, dated Jan. 31,
2001 (effective Feb. 2, 2001), previously found at 17
CFR 201.1002 and Table II to Subpart E of Part 201;
Release Nos. 33–8530, 34–51136, IA–2348, IC–
26748, dated Feb. 9, 2005 (effective Feb. 14, 2005),
previously found at 17 CFR 201.1003 and Table III
to Subpart E of Part 201; Release Nos. 33–9009, 34–
59449, IA–2845, IC–28635, dated Feb. 25, 2009
(effective Mar. 3, 2009), previously found at 17 CFR
201.1004 and Table IV to Subpart E of Part 201; and
Release Nos. 33–9387, 34–68994, IA–3557, IC–
30408, dated Feb. 27, 2013 (effective Mar. 5, 2013),
previously found at 17 CFR 201.1005 and Table V
to Subpart E of Part 201. The penalty amounts
contained in these releases have now been
consolidated into Table I to 17 CFR 201.1001.
E:\FR\FM\11JAN1.SGM
11JAN1
1971
Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices
the Federal Register by January 15 of
each year.5 The Commission previously
published the first annual adjustment
required by the 2015 Act on January 6,
2017 (‘‘2017 Adjustment’’).6 As part of
the 2017 Adjustment, the Commission
promulgated 17 CFR 201.1001(a) and
Table I to § 201.1001, which lists the
penalty amounts for all violations that
occurred on or before November 2,
2015. For violations occurring after
November 2, 2015, § 201.1001(b)
provides that the applicable penalty
amounts will be adjusted annually
based on the formula set forth in the
2015 Act. Section 201.1001(b) further
provides that these adjusted amounts
will be published in the Federal
Register and on the Commission’s
website. The Commission published the
two most recent annual adjustments on
January 6, 2022 (‘‘2022 Adjustment’’),7
and January 6, 2023 (‘‘2023
Adjustment’’).8
A CMP is defined in relevant part as
any penalty, fine, or other sanction that:
(1) is for a specific amount, or has a
maximum amount, as provided by
Federal law; and (2) is assessed or
enforced by an agency in an
administrative proceeding or by a
Federal court pursuant to Federal law.9
This definition applies to the monetary
penalty provisions contained in four
statutes administered by the
Commission: the Securities Act, the
Exchange Act, the Investment Company
Act, and the Investment Advisers Act.
In addition, the Sarbanes-Oxley Act
provides the Public Company
Accounting Oversight Board (‘‘PCAOB’’)
authority to levy civil monetary
penalties in its disciplinary proceedings
pursuant to 15 U.S.C. 7215(c)(4)(D).10
The definition of a CMP in the Inflation
Adjustment Act encompasses such civil
monetary penalties.11
II. Adjusting the Commission’s Penalty
Amounts for Inflation
This Notice sets forth the annual
inflation adjustment required by the
2015 Act for all CMPs under the
Securities Act, the Exchange Act, the
Investment Company Act, and the
Investment Advisers Act, and certain
civil monetary penalties under the
Sarbanes-Oxley Act.
2023
Adjustment
penalty
amounts
U.S. Code citation
Civil monetary penalty description
15 U.S.C. 77h–1(g) (Securities Act Sec. 8A(g)) ...................
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others or gains to self.
For any other person/fraud/substantial losses or risk of
losses to others or gain to self.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others.
For any other person/fraud/substantial losses or risk of
losses to others.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others or gains to self.
For any other person/fraud/substantial losses or risk of
losses to others or gain to self.
Insider Trading—controlling person ......................................
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
15 U.S.C. 77t(d) (Securities Act Sec. 20(d)) .........................
15 U.S.C. 78u(d)(3) (Exchange Act Sec. 21(d)(3)) ...............
15 U.S.C. 78u–1(a)(3) (Exchange Act Sec. 21A(a)(3)) ........
15 U.S.C. 78u–2 (Exchange Act Sec. 21B) ..........................
5 28
ddrumheller on DSK120RN23PROD with NOTICES1
Pursuant to the 2015 Act, the penalty
amounts in the 2024 Adjustment are
adjusted for inflation by increasing them
by the percentage change between the
Consumer Price Index for all Urban
Consumers (‘‘CPI–U’’) for October 2022
and the October 2023 CPI–U.12 OMB has
provided its calculation of this
multiplier (‘‘CPI–U Multiplier’’) to
agencies.13 The new penalty amounts
are determined by multiplying the
amounts in the 2024 Adjustment by the
CPI–U Multiplier and then rounding to
the nearest dollar.
For example, the CMP for certain
insider trading violations by controlling
persons under Exchange Act section
21A(a)(3) 14 was readjusted for inflation
as part of the 2023 Adjustment to
$2,479,282. To determine the new CMP
under this provision, the Commission
multiplies this amount by the CPI–U
Multiplier of 1.03241, and rounds to the
nearest dollar. Thus, the new CMP for
Exchange Act section 21A(a)(3) is
$2,559,636.
Below is the Commission’s
calculation of the new penalty amounts
for the penalties it administers:
U.S.C. 2461 note Sec. 4.
Nos. 33–10276; 34–79749; IA–4599; IC–
32414 (effective Jan. 18, 2017).
7 Release Nos. 33–11021; 34–93925; IA–5938; IC–
34466 (effective Jan. 15, 2022).
8 Release Nos. 33–11143; 34–96605; IA–6212; IC–
34797) (effective Jan. 15, 2023).
9 28 U.S.C. 2461 note Sec. 3(2).
10 15 U.S.C. 7215(c)(4)(D).
11 The Commission may by order affirm, modify,
remand, or set aside sanctions, including civil
6 Release
VerDate Sep<11>2014
17:31 Jan 10, 2024
Jkt 262001
monetary penalties, imposed by the PCAOB. See
section 107(c) of the Sarbanes-Oxley Act of 2002,
15 U.S.C. 7217. The Commission may enforce such
orders in Federal district court pursuant to section
21(e) of the Exchange Act. As a result, penalties
assessed by the PCAOB in its disciplinary
proceedings are penalties ‘‘enforced’’ by the
Commission for purposes of the Inflation
Adjustment Act. See Adjustments to Civil Monetary
Penalty Amounts, Release No. 33–8530 (Feb. 4,
2005) [70 FR 7606 (Feb. 14, 2005)].
12 28 U.S.C. 2461 note Sec. 5.
PO 00000
Frm 00097
Fmt 4703
Sfmt 4703
CPI–U
Multiplier
2024
Adjusted
penalty
amounts
$10,219
102,193
102,193
510,962
204,385
1.03241
1.03241
1.03241
1.03241
1.03241
$10,550
105,505
105,505
527,522
211,009
987,860
1.03241
1,019,877
11,162
111,614
111,614
558,071
223,229
1,116,140
1.03241
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,152,314
11,162
111,614
111,614
558,071
223,229
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,116,140
1.03241
1,152,314
2,479,282
11,162
111,614
111,614
558,071
1.03241
1.03241
1.03241
1.03241
1.03241
2,559,636
11,524
115,231
115,231
576,158
13 Office of Management and Budget,
Implementation of Penalty Inflation Adjustments
for 2024, Pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015
(Dec. 19, 2023), available at https://
www.whitehouse.gov/wp-content/uploads/2023/12/
M-24-07-Implementation-of-Penalty-InflationAdjustments-for-2024.pdf. This multiplier
represents the percentage increase between the Oct.
2022 CPI–U and the Oct. 2023 CPI–U, plus 1.
14 15 U.S.C. 78u–1(a)(3).
E:\FR\FM\11JAN1.SGM
11JAN1
1972
Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices
U.S. Code citation
15 U.S.C. 78ff(b) (Exchange Act Sec. 32(b)) .......................
15 U.S.C. 78ff(c)(1)(B) (Exchange Act Sec. 32(c)(1)(B)) .....
15 U.S.C. 78ff(c)(2)(B) (Exchange Act Sec. 32(c)(2)(B)) .....
15 U.S.C. 80a–9(d) (Investment Company Act Sec. 9(d)) ...
15 U.S.C. 80a–41(e) (Investment Company Act Sec. 42(e))
15 U.S.C. 80b–3(i) (Investment Advisers Act Sec. 203(i)) ...
15 U.S.C. 80b–9(e) (Investment Advisers Act Sec. 209(e))
15 U.S.C. 7215(c)(4)(D)(i) (Sarbanes-Oxley Act Sec.
105(c)(4)(D)(i)).
15 U.S.C. 7215(c)(4)(D)(ii) (Sarbanes-Oxley Act Sec.
105(c)(4)(D)(ii)).
ddrumheller on DSK120RN23PROD with NOTICES1
Pursuant to the 2015 Act and 17 CFR
201.1001, the adjusted penalty amounts
in this Notice (and all penalty
adjustments performed pursuant to the
2015 Act) apply to penalties imposed
after the date the adjustment is effective
for violations that occurred after
November 2, 2015, the 2015 Act’s
enactment date. These penalty amounts
supersede the amounts in the 2023
Adjustment.15 For violations that
occurred on or before November 2,
2015, the penalty amounts in Table I to
17 CFR 201.1001 continue to apply.16
15 The penalty amounts in this Notice are being
published in the Federal Register and will not be
added to the Code of Federal Regulations in
accordance with the 2015 Act and 17 CFR
201.1001(b). See 28 U.S.C. 2461 note Sec. 4(a)(2);
17 CFR 201.1001(b). In addition to being published
in the Federal Register, the penalty amounts in this
Notice will be made available on the Commission’s
website at https://www.sec.gov/enforce/civilpenalties-inflation-adjustments.htm, as detailed in
17 CFR 201.1001(b). This website also lists the
penalty amounts for violations that occurred on or
before Nov. 2, 2015.
16 17 CFR 201.1001(a).
VerDate Sep<11>2014
17:31 Jan 10, 2024
Jkt 262001
2023
Adjustment
penalty
amounts
Civil monetary penalty description
For natural person/fraud/substantial losses or risk of losses
to others.
For any other person/fraud/substantial losses or risk of
losses to others.
Exchange Act/failure to file information documents, reports
Foreign Corrupt Practices—any issuer .................................
Foreign Corrupt Practices—any agent or stockholder acting
on behalf of issuer.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others or gains to self.
For any other person/fraud/substantial losses or risk of
losses to others or gain to self.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others.
For any other person/fraud/substantial losses or risk of
losses to others.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others or gains to self.
For any other person/fraud/substantial losses or risk of
losses to others or gain to self.
For natural person ................................................................
For any other person ............................................................
For natural person/fraud .......................................................
For any other person/fraud ...................................................
For natural person/fraud/substantial losses or risk of losses
to others.
For any other person/fraud/substantial losses or risk of
losses to others.
For natural person ................................................................
For any other person ............................................................
For natural person ................................................................
For any other person ............................................................
III. Small Business Regulatory
Enforcement Fairness Act Status
The Office of Management and Budget
(‘‘OMB’’) has concurred in our
recommendation that this Notice is not
a ‘‘major rule’’ as defined by section 251
of the Small Business Regulatory
Enforcement Fairness Act (‘‘SBREFA’’),
5 U.S.C. 804(2), because (1) it will not
have an annual effect of $100 million
dollars or more on the economy, (2) it
does not present a major increase in
prices for consumers or individual
industries, and (3) it does not have
significant adverse effects on
competition, investment, or
innovation.17
By the Commission.
Dated: January 5, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–00378 Filed 1–10–24; 8:45 am]
BILLING CODE 8011–01–P
17 See generally SBREFA, Public Law 104–121
(1996).
PO 00000
Frm 00098
Fmt 4703
Sfmt 4703
CPI–U
Multiplier
2024
Adjusted
penalty
amounts
223,229
1.03241
230,464
1,116,140
1.03241
1,152,314
659
24,793
24,793
1.03241
1.03241
1.03241
680
25,597
25,597
11,162
111,614
111,614
558,071
223,229
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,116,140
1.03241
1,152,314
11,162
111,614
111,614
558,071
223,229
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,116,140
1.03241
1,152,314
11,162
111,614
111,614
558,071
223,229
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,116,140
1.03241
1,152,314
11,162
111,614
111,614
558,071
223,229
1.03241
1.03241
1.03241
1.03241
1.03241
11,524
115,231
115,231
576,158
230,464
1,116,140
1.03241
1,152,314
164,373
3,287,477
1,232,803
24,656,067
1.03241
1.03241
1.03241
1.03241
169,700
3,394,024
1,272,758
25,455,170
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–99279; File No. SR–
NYSEARCA–2023–37]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Withdrawal of a
Proposed Rule Change To List and
Trade Shares of the COtwo Advisors
Physical European Carbon Allowance
Trust Under NYSE Arca Rule 8.201–E
January 5, 2024.
On May 23, 2023, NYSE Arca, Inc.
(‘‘NYSE Arca’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to list and trade shares of the
COtwo Advisors Physical European
Carbon Allowance Trust under NYSE
Arca Rule 8.201–E (Commodity-Based
1 15
2 17
E:\FR\FM\11JAN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
11JAN1
]]>Agencies
[Federal Register Volume 89, Number 8 (Thursday, January 11, 2024)]
[Notices]
[Pages 1970-1972]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-00378]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release Nos. 33-11263; 34-99276; IA-6521; IC-35085]
Adjustments to Civil Monetary Penalty Amounts
AGENCY: Securities and Exchange Commission.
ACTION: Notice of annual inflation adjustment of civil monetary
penalties.
-----------------------------------------------------------------------
SUMMARY: The Securities and Exchange Commission (``Commission'') is
publishing this notice (``Notice'') pursuant to the Federal Civil
Penalties Inflation Adjustment Act Improvements Act of 2015 (``2015
Act''). This Act requires all agencies to annually adjust for inflation
the civil monetary penalties that can be imposed under the statutes
administered by the agency and publish the adjusted amounts in the
Federal Register. This Notice sets forth the annual inflation
adjustment of the maximum amount of civil monetary penalties (``CMPs'')
administered by the Commission under the Securities Act of 1933, the
Securities Exchange Act of 1934 (``Exchange Act''), the Investment
Company Act of 1940, the Investment Advisers Act of 1940, and certain
penalties under the Sarbanes-Oxley Act of 2002. These amounts are
effective beginning on January 15, 2024, and will apply to all
penalties imposed after that date for violations of the aforementioned
statutes that occurred after November 2, 2015.
FOR FURTHER INFORMATION CONTACT: Stephen M. Ng, Senior Special Counsel,
Office of the General Counsel, at (202) 551-7957, or Hannah W. Riedel,
Senior Counsel, Office of the General Counsel, at (202) 551-7918.
SUPPLEMENTARY INFORMATION:
I. Background
This Notice is being published pursuant to the 2015 Act,\1\ which
amended the Federal Civil Penalties Inflation Adjustment Act of 1990
(``Inflation Adjustment Act'').\2\ The Inflation Adjustment Act
previously had been amended by the Debt Collection Improvement Act of
1996 (``DCIA'') \3\ to require that each Federal agency adopt
regulations at least once every four years that adjust for inflation
the CMPs that can be imposed under the statutes administered by the
agency. Pursuant to this requirement, the Commission previously adopted
regulations in 1996, 2001, 2005, 2009, and 2013 to adjust the maximum
amount of the CMPs that could be imposed under the statutes the
Commission administers.\4\
---------------------------------------------------------------------------
\1\ Public Law 114-74 Sec. 701, 129 Stat. 599-601 (Nov. 2,
2015), codified at 28 U.S.C. 2461 note.
\2\ Public Law 101-410, 104 Stat. 890-892 (1990), codified at 28
U.S.C. 2461 note.
\3\ Public Law. 104-134, title III, section 31001(s)(1), 110
Stat. 1321-373 (1996), codified at 28 U.S.C. 2461 note.
\4\ See Release Nos. 33-7361, 34-37912, IA-1596, IC-22310, dated
Nov. 1, 1996 (effective Dec. 9, 1996), previously found at 17 CFR
201.1001 and Table I to Subpart E of Part 201; Release Nos. 33-7946,
34-43897, IA-1921, IC-24846, dated Jan. 31, 2001 (effective Feb. 2,
2001), previously found at 17 CFR 201.1002 and Table II to Subpart E
of Part 201; Release Nos. 33-8530, 34-51136, IA-2348, IC-26748,
dated Feb. 9, 2005 (effective Feb. 14, 2005), previously found at 17
CFR 201.1003 and Table III to Subpart E of Part 201; Release Nos.
33-9009, 34-59449, IA-2845, IC-28635, dated Feb. 25, 2009 (effective
Mar. 3, 2009), previously found at 17 CFR 201.1004 and Table IV to
Subpart E of Part 201; and Release Nos. 33-9387, 34-68994, IA-3557,
IC-30408, dated Feb. 27, 2013 (effective Mar. 5, 2013), previously
found at 17 CFR 201.1005 and Table V to Subpart E of Part 201. The
penalty amounts contained in these releases have now been
consolidated into Table I to 17 CFR 201.1001.
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The 2015 Act replaces the inflation adjustment formula prescribed
in the DCIA with a new formula for calculating the inflation-adjusted
amount of CMPs. The 2015 Act requires that agencies use this new
formula to re-calculate the inflation-adjusted amounts of the penalties
they administer on an annual basis and publish these new amounts in
[[Page 1971]]
the Federal Register by January 15 of each year.\5\ The Commission
previously published the first annual adjustment required by the 2015
Act on January 6, 2017 (``2017 Adjustment'').\6\ As part of the 2017
Adjustment, the Commission promulgated 17 CFR 201.1001(a) and Table I
to Sec. 201.1001, which lists the penalty amounts for all violations
that occurred on or before November 2, 2015. For violations occurring
after November 2, 2015, Sec. 201.1001(b) provides that the applicable
penalty amounts will be adjusted annually based on the formula set
forth in the 2015 Act. Section 201.1001(b) further provides that these
adjusted amounts will be published in the Federal Register and on the
Commission's website. The Commission published the two most recent
annual adjustments on January 6, 2022 (``2022 Adjustment''),\7\ and
January 6, 2023 (``2023 Adjustment'').\8\
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\5\ 28 U.S.C. 2461 note Sec. 4.
\6\ Release Nos. 33-10276; 34-79749; IA-4599; IC-32414
(effective Jan. 18, 2017).
\7\ Release Nos. 33-11021; 34-93925; IA-5938; IC-34466
(effective Jan. 15, 2022).
\8\ Release Nos. 33-11143; 34-96605; IA-6212; IC-34797)
(effective Jan. 15, 2023).
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A CMP is defined in relevant part as any penalty, fine, or other
sanction that: (1) is for a specific amount, or has a maximum amount,
as provided by Federal law; and (2) is assessed or enforced by an
agency in an administrative proceeding or by a Federal court pursuant
to Federal law.\9\ This definition applies to the monetary penalty
provisions contained in four statutes administered by the Commission:
the Securities Act, the Exchange Act, the Investment Company Act, and
the Investment Advisers Act. In addition, the Sarbanes-Oxley Act
provides the Public Company Accounting Oversight Board (``PCAOB'')
authority to levy civil monetary penalties in its disciplinary
proceedings pursuant to 15 U.S.C. 7215(c)(4)(D).\10\ The definition of
a CMP in the Inflation Adjustment Act encompasses such civil monetary
penalties.\11\
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\9\ 28 U.S.C. 2461 note Sec. 3(2).
\10\ 15 U.S.C. 7215(c)(4)(D).
\11\ The Commission may by order affirm, modify, remand, or set
aside sanctions, including civil monetary penalties, imposed by the
PCAOB. See section 107(c) of the Sarbanes-Oxley Act of 2002, 15
U.S.C. 7217. The Commission may enforce such orders in Federal
district court pursuant to section 21(e) of the Exchange Act. As a
result, penalties assessed by the PCAOB in its disciplinary
proceedings are penalties ``enforced'' by the Commission for
purposes of the Inflation Adjustment Act. See Adjustments to Civil
Monetary Penalty Amounts, Release No. 33-8530 (Feb. 4, 2005) [70 FR
7606 (Feb. 14, 2005)].
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II. Adjusting the Commission's Penalty Amounts for Inflation
This Notice sets forth the annual inflation adjustment required by
the 2015 Act for all CMPs under the Securities Act, the Exchange Act,
the Investment Company Act, and the Investment Advisers Act, and
certain civil monetary penalties under the Sarbanes-Oxley Act.
Pursuant to the 2015 Act, the penalty amounts in the 2024
Adjustment are adjusted for inflation by increasing them by the
percentage change between the Consumer Price Index for all Urban
Consumers (``CPI-U'') for October 2022 and the October 2023 CPI-U.\12\
OMB has provided its calculation of this multiplier (``CPI-U
Multiplier'') to agencies.\13\ The new penalty amounts are determined
by multiplying the amounts in the 2024 Adjustment by the CPI-U
Multiplier and then rounding to the nearest dollar.
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\12\ 28 U.S.C. 2461 note Sec. 5.
\13\ Office of Management and Budget, Implementation of Penalty
Inflation Adjustments for 2024, Pursuant to the Federal Civil
Penalties Inflation Adjustment Act Improvements Act of 2015 (Dec.
19, 2023), available at https://www.whitehouse.gov/wp-content/uploads/2023/12/M-24-07-Implementation-of-Penalty-Inflation-Adjustments-for-2024.pdf. This multiplier represents the percentage
increase between the Oct. 2022 CPI-U and the Oct. 2023 CPI-U, plus
1.
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For example, the CMP for certain insider trading violations by
controlling persons under Exchange Act section 21A(a)(3) \14\ was
readjusted for inflation as part of the 2023 Adjustment to $2,479,282.
To determine the new CMP under this provision, the Commission
multiplies this amount by the CPI-U Multiplier of 1.03241, and rounds
to the nearest dollar. Thus, the new CMP for Exchange Act section
21A(a)(3) is $2,559,636.
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\14\ 15 U.S.C. 78u-1(a)(3).
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Below is the Commission's calculation of the new penalty amounts
for the penalties it administers:
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2023 2024
Civil monetary penalty Adjustment CPI-U Adjusted
U.S. Code citation description penalty Multiplier penalty
amounts amounts
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15 U.S.C. 77h-1(g) (Securities Act Sec. For natural person........... $10,219 1.03241 $10,550
8A(g)). For any other person......... 102,193 1.03241 105,505
For natural person/fraud..... 102,193 1.03241 105,505
For any other person/fraud... 510,962 1.03241 527,522
For natural person/fraud/ 204,385 1.03241 211,009
substantial losses or risk
of losses to others or gains
to self.
For any other person/fraud/ 987,860 1.03241 1,019,877
substantial losses or risk
of losses to others or gain
to self.
15 U.S.C. 77t(d) (Securities Act Sec. For natural person........... 11,162 1.03241 11,524
20(d)).
For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk 1,116,140 1.03241 1,152,314
of losses to others.
For any other person/fraud/
substantial losses or risk
of losses to others.
15 U.S.C. 78u(d)(3) (Exchange Act Sec. For natural person........... 11,162 1.03241 11,524
21(d)(3)). For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others or gains
to self.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others or gain
to self.
15 U.S.C. 78u-1(a)(3) (Exchange Act Sec. Insider Trading--controlling 2,479,282 1.03241 2,559,636
21A(a)(3)). person.
15 U.S.C. 78u-2 (Exchange Act Sec. 21B)... For natural person........... 11,162 1.03241 11,524
For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
[[Page 1972]]
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others.
15 U.S.C. 78ff(b) (Exchange Act Sec. Exchange Act/failure to file 659 1.03241 680
32(b)). information documents,
reports.
15 U.S.C. 78ff(c)(1)(B) (Exchange Act Sec. Foreign Corrupt Practices-- 24,793 1.03241 25,597
32(c)(1)(B)). any issuer.
15 U.S.C. 78ff(c)(2)(B) (Exchange Act Sec. Foreign Corrupt Practices-- 24,793 1.03241 25,597
32(c)(2)(B)). any agent or stockholder
acting on behalf of issuer.
15 U.S.C. 80a-9(d) (Investment Company Act For natural person........... 11,162 1.03241 11,524
Sec. 9(d)). For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others or gains
to self.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others or gain
to self.
15 U.S.C. 80a-41(e) (Investment Company For natural person........... 11,162 1.03241 11,524
Act Sec. 42(e)). For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others.
15 U.S.C. 80b-3(i) (Investment Advisers For natural person........... 11,162 1.03241 11,524
Act Sec. 203(i)). For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others or gains
to self.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others or gain
to self.
15 U.S.C. 80b-9(e) (Investment Advisers For natural person........... 11,162 1.03241 11,524
Act Sec. 209(e)). For any other person......... 111,614 1.03241 115,231
For natural person/fraud..... 111,614 1.03241 115,231
For any other person/fraud... 558,071 1.03241 576,158
For natural person/fraud/ 223,229 1.03241 230,464
substantial losses or risk
of losses to others.
For any other person/fraud/ 1,116,140 1.03241 1,152,314
substantial losses or risk
of losses to others.
15 U.S.C. 7215(c)(4)(D)(i) (Sarbanes-Oxley For natural person........... 164,373 1.03241 169,700
Act Sec. 105(c)(4)(D)(i)). For any other person......... 3,287,477 1.03241 3,394,024
15 U.S.C. 7215(c)(4)(D)(ii) (Sarbanes- For natural person........... 1,232,803 1.03241 1,272,758
Oxley Act Sec. 105(c)(4)(D)(ii)). For any other person......... 24,656,067 1.03241 25,455,170
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Pursuant to the 2015 Act and 17 CFR 201.1001, the adjusted penalty
amounts in this Notice (and all penalty adjustments performed pursuant
to the 2015 Act) apply to penalties imposed after the date the
adjustment is effective for violations that occurred after November 2,
2015, the 2015 Act's enactment date. These penalty amounts supersede
the amounts in the 2023 Adjustment.\15\ For violations that occurred on
or before November 2, 2015, the penalty amounts in Table I to 17 CFR
201.1001 continue to apply.\16\
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\15\ The penalty amounts in this Notice are being published in
the Federal Register and will not be added to the Code of Federal
Regulations in accordance with the 2015 Act and 17 CFR 201.1001(b).
See 28 U.S.C. 2461 note Sec. 4(a)(2); 17 CFR 201.1001(b). In
addition to being published in the Federal Register, the penalty
amounts in this Notice will be made available on the Commission's
website at https://www.sec.gov/enforce/civil-penalties-inflation-adjustments.htm, as detailed in 17 CFR 201.1001(b). This website
also lists the penalty amounts for violations that occurred on or
before Nov. 2, 2015.
\16\ 17 CFR 201.1001(a).
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III. Small Business Regulatory Enforcement Fairness Act Status
The Office of Management and Budget (``OMB'') has concurred in our
recommendation that this Notice is not a ``major rule'' as defined by
section 251 of the Small Business Regulatory Enforcement Fairness Act
(``SBREFA''), 5 U.S.C. 804(2), because (1) it will not have an annual
effect of $100 million dollars or more on the economy, (2) it does not
present a major increase in prices for consumers or individual
industries, and (3) it does not have significant adverse effects on
competition, investment, or innovation.\17\
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\17\ See generally SBREFA, Public Law 104-121 (1996).
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By the Commission.
Dated: January 5, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024-00378 Filed 1-10-24; 8:45 am]
BILLING CODE 8011-01-P
