II 117th CONGRESS 2d Session S. 3921 IN THE SENATE OF THE UNITED STATES March 24, 2022 Mr. Tillis (for himself and Mr. Scott of South Carolina ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Securities Act of 1933 to expand the definition of a qualifying accredited investor, and for other purposes.

1. Short title This Act may be cited as the Equal Opportunity for all Investors Act . 2. Certification examinations for accredited investors (a) Examination alternative Section 2(a)(15) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(15) ) is amended— (1) by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively; (2) in subparagraph (A), as so redesignated, by striking adviser; or and inserting adviser; ; (3) in subparagraph (B), as so redesignated, by striking the period at the end and inserting ; or ; and (4) by adding at the end the following: (C) any individual who is certified as an accredited investor through an examination established or approved by the Commission, the securities commission (or any agency or office performing like functions) of any State, or any self-regulatory organization as defined in the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(26) ) that— (i) measures whether an individual certified as an accredited investor pursuant to such examination understands and appreciates the risks and opportunities of investing in securities; (ii) is designed to ensure that an individual with financial sophistication or training would be unlikely to fail; and (iii) may be designed and/or administered by any other person approved by the Commission, such securities commission, or such self-regulatory organization. . (b) Effective date The amendments made by subsection (a) shall take effect on the date of the enactment of this Act. (c) Examination The Commission shall establish or approve an examination that complies with subsection (a) no later than 18 months after the date of enactment of this Act. 3. Accredited investor self-certification Section 4(b) of the Securities Act of 1933 ( 15 U.S.C. 77d(b) ) is amended by inserting Unless the issuer knows, or has a reckless disregard for whether, the purchaser is not an accredited investor, obtaining a self-certification from the purchaser that the purchaser meets the income or net worth requirements of Rule 501 of Regulation D shall constitute reasonable steps to verify that purchasers of the securities are accredited investors. after the period at the end. 4. Modification of rules (a) In general Not later than 9 months after the date of the enactment of this Act, the Securities and Exchange Commission shall revise its rules issued in section 230.501(a) of title 17, Code of Federal Regulations, to make parallel changes set forth in Section 2 and to add to the definition of accredited investor the following categories: (1) Any natural person with at least $500,000 worth of investments. (2) Any natural person with total transactions during a 12-month period under section 230.506 of title 17, Code of Federal Regulations, and under section 4(a)(6) of the Securities Act of 1933 ( 15 U.S.C. 77d(a)(6) ) that are not greater than the highest amount of the following— (A) 10 percent of the total investments of the person; (B) 10 percent of the annual income of the person or 10 percent of the annual combined income with that person’s spouse; or (C) 10 percent of the net worth of the person excluding the value of the person’s principal place of residence. (b) Definitions (1) Definitions In this subsection: (A) Cash and cash equivalents The term cash and cash equivalents includes— (i) bank deposits, certificates of deposit, bankers acceptances and similar bank instruments held for investment purposes; and (ii) the net cash surrender value of an insurance policy. (B) Commodity interests The term commodity interests means commodity futures contracts, options on commodity futures contracts, and options on physical commodities traded on or subject to the rules of— (i) any contract market designated for trading such transactions under the Commodity Exchange Act ( 7 U.S.C. 1 et seq. ) and the rules issued under that Act; or (ii) any board of trade or exchange outside the United States, as described in part 30 of title 17, Code of Federal Regulations. (C) Digital assets The term digital assets — (i) means a digital representation of value that— (I) is used as a medium of exchange, unit of account, or store of value; and (II) is not legal tender, whether or not denominated in legal tender; and (ii) does not include— (I) a transaction in which a merchant grants, as part of an affinity or rewards program, value that cannot be taken from or exchanged with the merchant for legal tender, bank credit, or virtual currency; or (II) a digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform. (D) Investment purposes The term investment purposes — (i) includes— (I) real estate owned by a prospective purchaser who is engaged primarily in the business of investing, trading, or developing real estate in connection with such business; and (II) a commodity interest or physical commodity owned, or a financial contract entered into, by the prospective purchaser who is engaged primarily in the business of investing, reinvesting, or trading in commodity interests, physical commodities, or financial contracts in connection with such business; and (ii) does not include real estate held for investment purposes by a prospective purchaser if the real estate is used by the prospective purchaser, a sibling, spouse or former spouse, a direct lineal descendant by birth or adoption, or spouse of such lineal descendant or ancestor for personal purposes or as a place of business, or in connection with the conduct of the trade or business of the prospective purchaser or such related person. (E) Investments The term investments means— (i) securities, as defined in section 2(a) of the Securities Act of 1933 ( 15 U.S.C. 77b(a) ), other than securities issued by an issuer that is controlled by the prospective purchaser that owns such securities; (ii) real estate held for investment purposes; (iii) commodity interests held for investment purposes; (iv) physical commodities held for investment purposes; (v) digital assets held for investment purposes; (vi) to the extent not securities, financial contracts (as such term is defined in section 3(c)(2)(B)(ii) of the Investment Company Act of 1940 ( 15 U.S.C. 80a3(c)(2)(B)(ii) )) entered into for investment purposes; and (vii) cash and cash equivalents (including foreign currencies) held for investment purposes. (F) Personal purposes The term personal purposes does not include residential real estate if deductions with respect to such real estate are not disallowed by section 280A of the Internal Revenue Code of 1986. (G) Physical commodities The term physical commodities means any physical commodity with respect to which a commodity interest is traded on a market described in subparagraph (B)(i). (c) Self-execution If the Securities and Exchange Commission does not revise its rules in accordance with the deadline set forth in subsection (a), then any person described in subsection (b) shall be deemed to be an accredited investor for all purposes under the Federal securities laws (including regulations). 5. Adjusting the accredited investor standard Section 413 of the Private Fund Investment Advisers Registration Act of 2010 ( 15 U.S.C. 77b note) is amended by striking subsection (b) and inserting the following: (b) Review and adjustment (1) In general The Commission may undertake a review of the definition of the term accredited investor , as such term applies to natural persons, to determine whether the requirements of the definition, excluding the requirement relating to the net worth standard described in subsection (a), should be adjusted or modified for the protection of investors, in the public interest, and in light of the economy. (2) Adjustment or modification Upon completion of a review under paragraph (1), the Commission may, by notice and comment rulemaking, make such adjustments to the definition of the term accredited investor , excluding adjusting or modifying the requirement relating to the net worth standard described in subsection (a), as such term applies to natural persons, as the Commission may deem appropriate for the protection of investors, in the public interest, and in light of the economy. .