I 

117TH CONGRESS 

1ST SESSION H. R. 2265 

To amend the Investment Company Act of 1940 to postpone the date of 

payment or satisfaction upon redemption of certain securities in the 

case of the financial exploitation of specified adults, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 26, 2021 

Mrs. WAGNER introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To amend the Investment Company Act of 1940 to postpone 

the date of payment or satisfaction upon redemption 

of certain securities in the case of the financial exploitation of specified adults, 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 ‘‘Financial Exploitation 

5 Prevention Act of 2021’’. 


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1 SEC. 2. REDEMPTION OF CERTAIN SECURITIES POST2 PONED. 

3 (a) IN GENERAL.—Section 22 of the Investment 

4 Company Act of 1940 (15 U.S.C. 80a–22) is amended by 

5 adding at the end the following: 

6 ‘‘(h) REDEMPTION OF CERTAIN SECURITIES POST7 PONED.— 

8 ‘‘(1) IN GENERAL.—Notwithstanding subsection 

9 (e), a registered open-end investment company or a 

10 transfer agent acting on behalf of such company 

11 may postpone the date of payment or satisfaction 

12 upon redemption of any redeemable security in ac13 cordance with its terms for more than seven days 

14 after the tender of such security to such company or 

15 its agent designated for that purpose for redemption 

16 if such company or agent reasonably believes that 

17 such redemption is requested through the financial 

18 exploitation of a security holder who is a specified 

19 adult. 

20 ‘‘(2) DURATION.— 

21 ‘‘(A) IN GENERAL.—Except as provided in 

22 subparagraphs (B) and (C), a registered open23 end investment company or a transfer agent 

24 acting on behalf of such company may postpone 

25 the date of payment or satisfaction upon re26 demption of a redeemable security under paraVerDate Sep 11 2014 01:28 May 26, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2265.IH H2265

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1 graph (1) for a period of not more than 15 

2 business days. 

3 ‘‘(B) EXTENSION UPON DETERMINATION

4 OF EXPLOITATION.—The period described in 

5 subparagraph (A) may be extended by an addi6 tional 10 business days if the registered open7 end investment company or a transfer agent 

8 acting on behalf of such company determines 

9 through an internal review that the redemption 

10 described in such subparagraph is requested 

11 through the financial exploitation of a security 

12 holder who is a specified adult. 

13 ‘‘(C) EXTENSION BY GOVERNMENT.—A 

14 State regulator, administrative agency of com15 petent jurisdiction, or court of competent juris16 diction may extend the period described in sub17 paragraph (A). 

18 ‘‘(3) SPECIFIED ADULT DEFINED.—In this sub19 section, the term ‘specified adult’ means— 

20 ‘‘(A) an individual age 65 or older; or 

21 ‘‘(B) an individual age 18 or older who a 

22 registered open-end investment company or a 

23 transfer agent acting on behalf of such com24 pany reasonably believes has a mental or physVerDate Sep 11 2014 01:28 May 26, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2265.IH H2265

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1 ical impairment that renders the individual un2 able to protect his or her own interests.’’. 

3 (b) RECOMMENDATIONS.— 

4 (1) IN GENERAL.—Not later than 1 year after 

5 the date of the enactment of this section, the Securi6 ties and Exchange Commission, in consultation with 

7 the entities specified in paragraph (2), shall submit 

8 to Congress a report that includes recommendations 

9 regarding the regulatory and legislative changes nec10 essary to address the financial exploitation of secu11 rity holders who are specified adults (as defined in 

12 subsection (h)(3) of section 22 of the Investment 

13 Company Act of 1940 (15 U.S.C. 80a–22), as added 

14 by this section). 

15 (2) CONSULTATION.—The entities specified in 

16 this paragraph are as follows: 

17 (A) The Commodity Futures Trading 

18 Commission. 

19 (B) The Director of the Bureau of Con20 sumer Financial Protection. 

21 (C) The Financial Industry Regulatory Au22 thority. 

23 (D) The North American Securities Ad24 ministrators Association. 


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1 (E) The Board of Governors of the Fed2 eral Reserve System. 

3 (F) The Comptroller of the Currency. 

4 (G) The Federal Deposit Insurance Cor5 poration. 

Æ 


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