In the Senate of the United States, 
March 22, 2012. 
Resolved, That the bill from the House of Representa-
tives (H.R. 3606) entitled ‘‘An Act to increase American job 
creation and economic growth by improving access to the 
public capital markets for emerging growth companies.’’, do 
pass with the following 
AMENDMENT: 
Strike title III and insert the following: 
TITLE III—CROWDFUNDING 
SEC. 301. SHORT TITLE. 
This title may be cited as the ‘‘Capital Raising Online 
While Deterring Fraud and Unethical Non-Disclosure Act 
of 2012’’ or the ‘‘CROWDFUND Act’’. 
SEC. 302. CROWDFUNDING EXEMPTION. 
(a) SECURITIES ACT OF 1933.—Section 4 of the Secu-
rities Act of 1933 (15 U.S.C. 77d) is amended by adding 
at the end the following:
† HR 3606 EAS 
‘‘(6) transactions involving the offer or sale of se-
curities by an issuer (including all entities controlled 
by or under common control with the issuer), pro-
vided that— 
‘‘(A) the aggregate amount sold to all inves-
tors by the issuer, including any amount sold in 
reliance on the exemption provided under this 
paragraph during the 12-month period preceding 
the date of such transaction, is not more than 
$1,000,000; 
‘‘(B) the aggregate amount sold to any in-
vestor by an issuer, including any amount sold 
in reliance on the exemption provided under this 
paragraph during the 12-month period preceding 
the date of such transaction, does not exceed— 
‘‘(i) the greater of $2,000 or 5 percent 
of the annual income or net worth of such 
investor, as applicable, if either the annual 
income or the net worth of the investor is 
less than $100,000; and 
‘‘(ii) 10 percent of the annual income 
or net worth of such investor, as applicable, 
not to exceed a maximum aggregate amount 
sold of $100,000, if either the annual in-
† HR 3606 EAS 
come or net worth of the investor is equal 
to or more than $100,000; 
‘‘(C) the transaction is conducted through a 
broker or funding portal that complies with the 
requirements of section 4A(a); and 
‘‘(D) the issuer complies with the require-
ments of section 4A(b).’’. 
(b) REQUIREMENTS TO QUALIFY FOR CROWDFUNDING 
EXEMPTION.—The Securities Act of 1933 (15 U.S.C. 77a 
et seq.) is amended by inserting after section 4 the following: 
‘‘SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN 
SMALL TRANSACTIONS. 
‘‘(a) REQUIREMENTS ON INTERMEDIARIES.—A person 
acting as an intermediary in a transaction involving the 
offer or sale of securities for the account of others pursuant 
to section 4(6) shall— 
‘‘(1) register with the Commission as— 
‘‘(A) a broker; or 
‘‘(B) a funding portal (as defined in section 
3(a)(80) of the Securities Exchange Act of 1934); 
‘‘(2) register with any applicable self-regulatory 
organization (as defined in section 3(a)(26) of the Se-
curities Exchange Act of 1934); 
‘‘(3) provide such disclosures, including disclo-
sures related to risks and other investor education
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materials, as the Commission shall, by rule, deter-
mine appropriate; 
‘‘(4) ensure that each investor— 
‘‘(A) reviews investor-education informa-
tion, in accordance with standards established by 
the Commission, by rule; 
‘‘(B) positively affirms that the investor un-
derstands that the investor is risking the loss of 
the entire investment, and that the investor could 
bear such a loss; and 
‘‘(C) answers questions demonstrating— 
‘‘(i) an understanding of the level of 
risk generally applicable to investments in 
startups, emerging businesses, and small 
issuers; 
‘‘(ii) an understanding of the risk of 
illiquidity; and 
‘‘(iii) an understanding of such other 
matters as the Commission determines ap-
propriate, by rule; 
‘‘(5) take such measures to reduce the risk of 
fraud with respect to such transactions, as established 
by the Commission, by rule, including obtaining a 
background and securities enforcement regulatory his-
tory check on each officer, director, and person hold-