I 

113TH CONGRESS 

1ST SESSION H. R. 2374 

To amend the Securities Exchange Act of 1934 to provide protections for 

retail customers, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 14, 2013 

Mrs. WAGNER introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committee on Education and the Workforce, for a period to be subsequently determined by 

the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Securities Exchange Act of 1934 to provide 

protections for retail customers, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Retail Investor Protec5 tion Act’’. 

6 SEC. 2. STAY ON RULES DEFINING CERTAIN FIDUCIARIES. 

7 After the date of enactment of this Act, the Secretary 

8 of Labor shall not prescribe any regulation under the Em9 ployee Retirement Income Security Act of 1974 (29 


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1 U.S.C. 1001 et seq.) defining the circumstances under 

2 which an individual is considered a fiduciary until the date 

3 that is 60 days after the Securities and Exchange Com4 mission issues a final rule relating to standards of conduct 

5 for brokers and dealers pursuant to the second subsection 

6 (k) of section 15 of the Securities Exchange Act of 1934 

7 (15 U.S.C. 78o(k)). 

8 SEC. 3. AMENDMENTS TO THE SECURITIES EXCHANGE ACT 

9 OF 1934. 

10 The second subsection (k) of section 15 of the Securi11 ties Exchange Act of 1934 (15 U.S.C. 78o(k)), as added 

12 by section 913(g)(1) of the Dodd-Frank Wall Street Re13 form and Consumer Protection Act (12 U.S.C. 5301 et 

14 seq.), is amended by adding at the end the following: 

15 ‘‘(3) REQUIREMENTS PRIOR TO RULEMAKING.— 

16 The Commission shall not promulgate a rule pursu17 ant to paragraph (1) before— 

18 ‘‘(A) identifying if retail customers (and 

19 such other customers as the Commission may 

20 by rule provide) are being systematically 

21 harmed or disadvantaged due to brokers or 

22 dealers operating under different standards of 

23 conduct than those standards that apply to in24 vestment advisors under section 211 of the InVerDate Mar 15 2010 02:47 Jun 21, 2013 Jkt 029200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2374.IH H2374

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1 vestment Advisers Act of 1940 (15 U.S.C. 80b– 

2 11); 

3 ‘‘(B) identifying whether the adoption of a 

4 uniform fiduciary standard of care for brokers 

5 or dealers and investment advisors would ad6 versely impact retail investor access to personal7 ized investment advice, recommendations about 

8 securities, or the availability of such advice and 

9 recommendations; 

10 ‘‘(C) conducting an assessment by the 

11 chief economist of the Commission that assesses 

12 the qualitative and quantitative costs and bene13 fits of the rule; and 

14 ‘‘(D) the Commission, based on the assess15 ment described in subparagraph (B)— 

16 ‘‘(i) determines that the benefits of 

17 the rule justify its costs; 

18 ‘‘(ii) identifies and assesses available 

19 alternatives to the rule that were consid20 ered, including modification of an existing 

21 regulation, simplification of disclosures re22 garding standards of care that apply to 

23 brokers or dealers and those that apply to 

24 investment advisors, together with an ex25 planation of why the rule meets the reguVerDate Mar 15 2010 02:47 Jun 21, 2013 Jkt 029200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2374.IH H2374

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1 latory objectives more effectively than the 

2 alternatives; and 

3 ‘‘(iii) ensures that the rule is acces4 sible, consistent, written in plain language, 

5 and easy to understand, and that the rule 

6 shall measure and seek to improve the ac7 tual results of regulatory requirements. 

8 ‘‘(4) REQUIREMENTS FOR PROMULGATING A

9 RULE.—The Commission shall publish in the Fed10 eral Register alongside the rule promulgated pursu11 ant to paragraph (1) formal findings that such rule 

12 would reduce the confusion of a retail customer (and 

13 such other customers as the Commission may by 

14 rule provide) about standards of conduct applicable 

15 to brokers, dealers, and investment advisors. 

16 ‘‘(5) REQUIREMENTS UNDER INVESTMENT AD17 VISERS ACT OF 1940.—In proposing rules under 

18 paragraph (1) for brokers or dealers, the Commis19 sion shall consider the differences in the registration, 

20 supervision, and examination requirements applica21 ble to brokers, dealers, and investment advisors.’’. 

Æ 


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