Iowa Sen. Chuck Grassley has introduced a bill with Sen. Jack Reed (D-R.I.) to impose tougher penalties on firms and individuals convicted of financial fraud.
Currently, the Securities and Exchange Commission (SEC) can fine an individual up to $150,000 and a firm up to $720,000 for fraud, according to Bloomberg. Grassley and Reed's bill, the SEC Penalties Act of 2012, introduced today, would raise those caps to $1 million for an individual and $10 million for a corporation.
"If a fine is just decimal dust for a Wall Street firm, that's not a deterrent," Grassley said in a statement. "It's just the cost of doing business. A penalty should mean something, and it should get the recidivists' attention."
Grassley also said that if the law is passed, he hopes the SEC will use the tougher fines and that he likes a part of the bill that increases fines for repeat offenders by three times the original fine.
The legislation is in response to a request from SEC Chairman Mary Schapiro after a settlement by Citigroup Inc., according to Bloomberg.