I 

108TH CONGRESS 

2D SESSION H. R. 3863 

To improve the access of investors to regulatory records with respect to 

securities brokers, dealers, and investment advisers. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 26, 2004 

Mr. SHADEGG introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To improve the access of investors to regulatory records 

with respect to securities brokers, dealers, and investment advisers. 

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 ‘‘Realtime Investor Pro5 tection Act’’. 

6 SEC. 2. CONSTITUTIONAL AUTHORITY. 

7 The constitutional authority on which this Act rests 

8 is the power of Congress to regulate commerce as enumer9 ated in article I, section 8 of the United States Constitu10 tion. 
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1 SEC. 3. METHOD OF MAINTAINING BROKER/DEALER REG2 ISTRATION, DISCIPLINARY, AND OTHER 

3 DATA. 

4 Subsection (i) of section 15A of the Securities Ex5 change Act of 1934 (15 U.S.C. 78o–3(i)) is amended to 

6 read as follows: 

7 ‘‘(i) OBLIGATION TO MAINTAIN REGISTRATION, DIS8 CIPLINARY AND OTHER DATA.— 

9 ‘‘(1) MAINTENANCE OF SYSTEM TO RESPOND

10 TO INQUIRIES.—A registered securities association 

11 shall— 

12 ‘‘(A) establish and maintain a system for 

13 collecting and retaining registration informa14 tion; 

15 ‘‘(B) establish and maintain a toll-free 

16 telephone listing, and a readily accessible elec17 tronic or other process, to receive and promptly 

18 respond to inquiries regarding— 

19 ‘‘(i) registration information on its 

20 members and their associated persons; and 

21 ‘‘(ii) registration information on the 

22 members and their associated persons of 

23 any registered national securities exchange 

24 that uses the system described in subpara25 graph (A) for the registration of its mem26 bers and their associated persons; and 
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1 ‘‘(C) adopt rules governing the process for 

2 making inquiries and the type, scope, and pres3 entation of information to be provided in re4 sponse to such inquiries in consultation with 

5 any registered national securities exchange pro6 viding information pursuant to subparagraph 

7 (B)(ii). 

8 ‘‘(2) RECOVERY OF COSTS.—Such an associa9 tion may charge persons making inquiries, other 

10 than individual investors, reasonable fees for re11 sponses to such inquiries. 

12 ‘‘(3) PROCESS FOR DISPUTED INFORMATION.— 

13 Such an association shall adopt rules establishing an 

14 administrative process for disputing the accuracy of 

15 information provided in response to inquiries under 

16 this subsection in consultation with any registered 

17 national securities exchange providing information 

18 pursuant to paragraph (1)(B)(ii). 

19 ‘‘(4) LIMITATION OF LIABILITY.—Such an asso20 ciation, or exchange reporting information to such 

21 an association, shall not have any liability to any 

22 person for any actions taken or omitted in good 

23 faith under this subsection. 

24 ‘‘(5) DEFINITION.—For purposes of this sub25 section, the term ‘registration information’ means 
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1 the information reported in connection with the reg2 istration or licensing of brokers and dealers and 

3 their associated persons, including disciplinary ac4 tions, regulatory, judicial, and arbitration pro5 ceedings, and other information required by law, or 

6 exchange or association rule, and the source and sta7 tus of such information.’’. 

8 SEC. 4. FILING DEPOSITORIES FOR INVESTMENT ADVIS9 ERS. 

10 (a) AMENDMENT.—Section 204 of the Investment 

11 Advisers Act of 1940 (15 U.S.C. 80b–4) is amended— 

12 (1) by striking ‘‘Every investment’’ and insert13 ing the following: 

14 ‘‘(a) IN GENERAL.—Every investment’’; and 

15 (2) by adding at the end the following: 

16 ‘‘(b) FILING DEPOSITORIES.—The Commission may, 

17 by rule, require an investment adviser— 

18 ‘‘(1) to file with the Commission any fee, appli19 cation, report, or notice required to be filed by this 

20 title or the rules issued under this title through any 

21 entity designated by the Commission for that pur22 pose; and 

23 ‘‘(2) to pay the reasonable costs associated with 

24 such filing and the establishment and maintenance 

25 of the systems required by subsection (c). 
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1 ‘‘(c) ACCESS TO DISCIPLINARY AND OTHER INFOR2 MATION.— 

3 ‘‘(1) MAINTENANCE OF SYSTEM TO RESPOND

4 TO INQUIRIES.—The Commission shall require the 

5 entity designated by the Commission under sub6 section (b)(1) to establish and maintain a toll-free 

7 telephone listing, and a readily accessible electronic 

8 or other process, to receive and promptly respond to 

9 inquiries regarding registration information (includ10 ing disciplinary actions, regulatory, judicial, and ar11 bitration proceedings, and other information re12 quired by law or rule to be reported) involving in13 vestment advisers and persons associated with in14 vestment advisers. 

15 ‘‘(2) RECOVERY OF COSTS.—An entity des16 ignated by the Commission under subsection (b)(1) 

17 may charge persons making inquiries, other than in18 dividual investors, reasonable fees for responses to 

19 inquiries made under paragraph (1). 

20 ‘‘(3) LIMITATION ON LIABILITY.—An entity 

21 designated by the Commission under subsection 

22 (b)(1) shall not have any liability to any person for 

23 any actions taken or omitted in good faith under 

24 this subsection.’’. 

25 (b) CONFORMING AMENDMENTS.— 
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1 (1) Section 203A of the Investment Advisers 

2 Act of 1940 (15 U.S.C. 80b–3a) is amended— 

3 (A) by striking subsection (d); and 

4 (B) by redesignating subsection (e) as sub5 section (d). 

6 (2) Section 306 of the National Securities Mar7 kets Improvement Act of 1996 (15 U.S.C. 80b–10, 

8 note; Public Law 104–290; 110 Stat. 3439) is re9 pealed. 

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