To provide the Commodity Futures Trading Commission with clear antimarket manipulation authority.

SA 3786. Ms. CANTWELL (for herself, Mr. Whitehouse, and Mr. Sanders)
submitted an amendment intended to be proposed to amendment SA 3739
proposed by Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to
the bill S. 3217, to promote the financial stability of the United
States by improving accountability and transparency in the financial
system, to end ``too big to fail,'' to protect the American taxpayer by
ending bailouts, to protect consumers from abusive financial services
practices, and for other purposes; which was ordered to lie on the
table; as follows:

On page 762, between lines 5 and 6, insert the following:

SEC. ___. ANTIMARKET MANIPULATION AUTHORITY.

(a) Prohibition Regarding Manipulation and False
Information.--Subsection (c) of section 6 of the Commodity
Exchange Act (7 U.S.C. 9, 15) is amended to read as follows:
``(c) Prohibition Regarding Manipulation and False
Information.--
``(1) Prohibition against manipulation.--It shall be
unlawful for any person, directly or indirectly, to use or
employ, or attempt to use or employ, in connection with any
swap, or a contract of sale of any commodity in interstate
commerce, or for future delivery on or subject to the rules
of any registered entity, any manipulative or deceptive
device or contrivance, in contravention of such rules and
regulations as the Commission shall promulgate by not later
than 1 year after the date of enactment of the Restoring
American Financial Stability Act of 2010.
``(A) Special provision for manipulation by false
reporting.--Unlawful manipulation for purposes of this
paragraph shall include, but not be limited to, delivering,
or causing to be delivered for transmission through the mails
or interstate commerce, by any means of communication
whatsoever, a false or misleading or inaccurate report
concerning crop or market information or conditions that
affect or tend to affect the price of any commodity in
interstate commerce, knowing, or acting in reckless disregard
of the fact, that such report is false, misleading or
inaccurate.

[[Page S3101]]

``(B) Effect on other law.--Nothing in this paragraph shall
affect, or be construed to affect, the applicability of
section 9(a)(2).
``(2) Prohibition regarding false information.--It shall be
unlawful for any person to make any false or misleading
statement of a material fact to the Commission, including in
any registration application or any report filed with the
Commission under this Act, or any other information relating
to a swap, or a contract of sale of a commodity, in
interstate commerce, or for future delivery on or subject to
the rules of any registered entity, or to omit to state in
any such statement any material fact that is necessary to
make any statement of a material fact made not misleading in
any material respect, if the person knew, or reasonably
should have known, the statement to be false or misleading.
``(3) Enforcement.--
``(A) Authority of commission.--If the Commission has
reason to believe that any person (other than a registered
entity) is violating or has violated this subsection, or any
other provision of this Act (including any rule, regulation,
or order of the Commission promulgated in accordance with
this subsection or any other provision of this Act), the
Commission may serve upon the person a complaint.
``(B) Contents of complaint.--A complaint under
subparagraph (A) shall--
``(i) contain a description of the charges against the
person that is the subject of the complaint; and
``(ii) have attached or contain a notice of hearing that
specifies the date and location of the hearing regarding the
complaint.
``(C) Hearing.--A hearing described in subparagraph
(B)(ii)--
``(i) shall be held not later than 3 days after service of
the complaint described in subparagraph (A);
``(ii) shall require the person to show cause regarding
why--

``(I) an order should not be made--

``(aa) to prohibit the person from trading on, or subject
to the rules of, any registered entity; and
``(bb) to direct all registered entities to refuse all
privileges to the person until further notice of the
Commission; and

``(II) the registration of the person, if registered with
the Commission in any capacity, should not be suspended or
revoked; and

``(iii) may be held before--

``(I) the Commission; or
``(II) an administrative law judge designated by the
Commission, under which the administrative law judge shall
ensure that all evidence is recorded in written form and
submitted to the Commission.

``(4) Subpoena.--For the purpose of securing effective
enforcement of the provisions of this Act, for the purpose of
any investigation or proceeding under this Act, and for the
purpose of any action taken under section 12(f) of this Act,
any member of the Commission or any Administrative Law Judge
or other officer designated by the Commission (except as
provided in paragraph (6)) may administer oaths and
affirmations, subpoena witnesses, compel their attendance,
take evidence, and require the production of any books,
papers, correspondence, memoranda, or other records that the
Commission deems relevant or material to the inquiry.
``(5) Witnesses.--The attendance of witnesses and the
production of any such records may be required from any place
in the United States, any State, or any foreign country or
jurisdiction at any designated place of hearing.
``(6) Service.--A subpoena issued under this section may be
served upon any person who is not to be found within the
territorial jurisdiction of any court of the United States in
such manner as the Federal Rules of Civil Procedure prescribe
for service of process in a foreign country, except that a
subpoena to be served on a person who is not to be found
within the territorial jurisdiction of any court of the
United States may be issued only on the prior approval of the
Commission.
``(7) Refusal to obey.--In case of contumacy by, or refusal
to obey a subpoena issued to, any person, the Commission may
invoke the aid of any court of the United States within the
jurisdiction in which the investigation or proceeding is
conducted, or where such person resides or transacts
business, in requiring the attendance and testimony of
witnesses and the production of books, papers,
correspondence, memoranda, and other records. Such court may
issue an order requiring such person to appear before the
Commission or member or Administrative Law Judge or other
officer designated by the Commission, there to produce
records, if so ordered, or to give testimony touching the
matter under investigation or in question.
``(8) Failure to obey.--Any failure to obey such order of
the court may be punished by the court as a contempt thereof.
All process in any such case may be served in the judicial
district wherein such person is an inhabitant or transacts
business or wherever such person may be found.
``(9) Evidence.--On the receipt of evidence under paragraph
(3)(C)(iii), the Commission may--
``(A) prohibit the person that is the subject of the
hearing from trading on, or subject to the rules of, any
registered entity and require all registered entities to
refuse the person all privileges on the registered entities
for such period as the Commission may require in the order;
``(B) if the person is registered with the Commission in
any capacity, suspend, for a period not to exceed 180 days,
or revoke, the registration of the person;
``(C) assess such person--
``(i) a civil penalty of not more than an amount equal to
the greater of--

``(I) $140,000; or
``(II) triple the monetary gain to such person for each
such violation; or

``(ii) in any case of manipulation or attempted
manipulation in violation of this subsection or section
9(a)(2), a civil penalty of not more than an amount equal to
the greater of--

``(I) $1,000,000; or
``(II) triple the monetary gain to the person for each such
violation; and

``(D) require restitution to customers of damages
proximately caused by violations of the person.
``(10) Orders.--
``(A) Notice.--The Commission shall provide to a person
described in paragraph (9) and the appropriate governing
board of the registered entity notice of the order described
in paragraph (9) by--
``(i) registered mail;
``(ii) certified mail; or
``(iii) personal delivery.
``(B) Review.--
``(i) In general.--A person described in paragraph (9) may
obtain a review of the order or such other equitable relief
as determined to be appropriate by a court described in
clause (ii).
``(ii) Petition.--To obtain a review or other relief under
clause (i), a person may, not later than 15 days after notice
is given to the person under clause (i), file a written
petition to set aside the order with the United States Court
of Appeals--

``(I) for the circuit in which the petitioner carries out
the business of the petitioner; or
``(II) in the case of an order denying registration, the
circuit in which the principal place of business of the
petitioner is located, as listed on the application for
registration of the petitioner.

``(C) Procedure.--
``(i) Duty of clerk of appropriate court.--The clerk of the
appropriate court under subparagraph (B)(ii) shall transmit
to the Commission a copy of a petition filed under
subparagraph (B)(ii).
``(ii) Duty of commission.--In accordance with section 2112
of title 28, United States Code, the Commission shall file in
the appropriate court described in subparagraph (B)(ii) the
record theretofore made.
``(iii) Jurisdiction of appropriate court.--Upon the filing
of a petition under subparagraph (B)(ii), the appropriate
court described in subparagraph (B)(ii) shall have
jurisdiction to affirm, set aside, or modify the order of the
Commission, and the findings of the Commission as to the
facts, if supported by the weight of evidence, shall in like
manner be conclusive.''.
(b) Cease and Desist Orders, Fines.--Section 6(d) of the
Commodity Exchange Act (7 U.S.C. 13b) is amended to read as
follows:
``(d) If any person (other than a registered entity),
directly or indirectly, is using or employing, or attempting
to use or employ, in connection with a swap, or a contract of
sale of a commodity, in interstate commerce, or for future
delivery on or subject to the rules of any registered entity,
any manipulative or deceptive device or contrivance, in
contravention of such rules and regulations as the Commission
shall promulgate by not later than 1 year after the date of
enactment of the Restoring American Financial Stability Act
of 2010, is violating or has violated any of the provisions
of this Act or of the rules, regulations, or orders of the
Commission thereunder, the Commission may, upon notice and
hearing, and subject to appeal as in other cases provided for
in subsection (c), make and enter an order directing that
such person shall cease and desist therefrom and, if such
person thereafter and after the lapse of the period allowed
for appeal of such order or after the affirmance of such
order, shall fail or refuse to obey or comply with such
order, such person shall be guilty of a misdemeanor and, upon
conviction thereof, shall be fined not more than the higher
of $140,000 or triple the monetary gain to such person, or
imprisoned for not less than six months nor more than one
year, or both, except that if such failure or refusal to obey
or comply with such order involves any offense within
subsection (a) or (b) of section 9 of this Act, such person
shall be guilty of a felony and, upon conviction thereof,
shall be subject to the penalties of said subsection (a) or
(b): Provided, That any such cease and desist order under
this subsection against any respondent in any case of
manipulation shall be issued only in conjunction with an
order issued against such respondent under subsection (c).
Each day during which such failure or refusal to obey or
comply with such order continues shall be deemed a separate
offense.''.
(c) Manipulations; Private Rights of Action.--Section
22(a)(1) of the Commodity Exchange Act (7 U.S.C. 25(a)(1)) is
amended by striking subparagraph (D) and inserting the
following:
``(D) who purchased or sold a contract referred to in
subparagraph (B) hereof if the violation constitutes the use
or employment of, or an attempt to use or employ, in
connection with a swap, or a contract of sale of a commodity,
in interstate commerce, or for future delivery on or subject
to the rules of any registered entity, any manipulative
device or contrivance in contravention of such rules and
regulations as the Commission

[[Page S3102]]

shall promulgate by not later than 1 year after the date of
enactment of the Restoring American Financial Stability Act
of 2010.''.
(d) Effective Date.--The amendments made by this section
shall take effect on the date on which the final rule
promulgated by the Commodity Futures Trading Commission
pursuant to this Act takes effect.
______