If the Commission finds, after notice and opportunity for hearing, that
any person is violating, has violated, or is about to violate any provision
of this title, or any rule or regulation thereunder, the Commission may publish
its findings and enter an order requiring such person, and any other person
that is, was, or would be a cause of the violation, due to an act or omission
the person knew or should have known would contribute to such violation, to
cease and desist from committing or causing such violation and any future
violation of the same provision, rule, or regulation. Such order may, in addition
to requiring a person to cease and desist from committing or causing a violation,
require such person to comply, or to take steps to effect compliance, with
such provision, rule, or regulation, upon such terms and conditions and within
such time as the Commission may specify in such order. Any such order may,
as the Commission deems appropriate, require future compliance or steps to
effect future compliance, either permanently or for such period of time as
the Commission may specify, with such provision, rule, or regulation with
respect to any security, any issuer, or any other person.
The notice instituting proceedings pursuant to subsection (a) of this
section shall fix a hearing date not earlier than 30 days nor later than 60
days after service of the notice unless an earlier or a later date is set
by the Commission with the consent of any respondent so served.
Whenever the Commission determines that the alleged violation or threatened
violation specified in the notice instituting proceedings pursuant to
subsection (a) of this section, or the continuation thereof, is likely
to result in significant dissipation or conversion of assets, significant
harm to investors, or substantial harm to the public interest, including,
but not limited to, losses to the Securities Investor Protection Corporation,
prior to the completion of the proceedings, the Commission may enter a
temporary order requiring the respondent to cease and desist from the
violation or threatened violation and to take such action to prevent the
violation or threatened violation and to prevent dissipation or conversion
of assets, significant harm to investors, or substantial harm to the public
interest as the Commission deems appropriate pending completion of such
proceeding. Such an order shall be entered only after notice and opportunity
for a hearing, unless the Commission determines that notice and hearing
prior to entry would be impracticable or contrary to the public interest.
A temporary order shall become effective upon service upon the respondent
and, unless set aside, limited, or suspended by the Commission or a court
of competent jurisdiction, shall remain effective and enforceable pending
the completion of the proceedings.
This subsection shall apply only to a respondent that acts, or, at
the time of the alleged misconduct acted, as a broker, dealer, investment
adviser, investment company, municipal securities dealer, government securities
broker, government securities dealer, or transfer agent, or is, or was
at the time of the alleged misconduct, an associated person of, or a person
seeking to become associated with, any of the foregoing.
Review of Temporary Orders
At any time after the respondent has been served with a temporary
cease-and-desist order pursuant to subsection (c) of this section, the
respondent may apply to the Commission to have the order set aside, limited,
or suspended. If the respondent has been served with a temporary cease-and-desist
order entered without a prior Commission hearing, the respondent may,
within 10 days after the date on which the order was served, request a
hearing on such application and the Commission shall hold a hearing and
render a decision on such application at the earliest possible time.
10 days after the date the respondent was served
with a temporary cease-and-desist order entered with a prior Commission
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
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.
No automatic stay of temporary order
The commencement of proceedings under paragraph (2) of this subsection
shall not, unless specifically ordered by the court, operate as a stay
of the Commission's order.
Section 9(a) shall not apply to a temporary
order entered pursuant to this section.
Authority to enter order requiring accounting and disgorgement
In any cease-and-desist proceeding under subsection (a)
of this section, the Commission may enter an order requiring accounting and
disgorgement, including reasonable interest. The Commission is authorized
to adopt rules, regulations, and orders concerning payments to investors,
rates of interest, periods of accrual, and such other matters as it deems
appropriate to implement this subsection.
Authority of the Commission to prohibit persons from
serving as officers or directors
In any cease-and-desist proceeding under subsection (a), the Commission
may issue an order to prohibit, conditionally or unconditionally, and permanently
or for such period of time as it shall determine, any person who has violated
section 17(a)(1) or the rules or regulations
thereunder, from acting as an officer or director of any issuer that has a
class of securities registered pursuant to section
12 of the Securities Exchange Act of 1934, or that is required to file
reports pursuant to section 15(d) of that
Act, if the conduct of that person demonstrates unfitness to serve as an officer
or director of any such issuer.
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