Retail Investor Protection Act

Bill: 113-hr-2374
Sponsor: full_name: Rep. Wagner, Ann [R-MO-2]
Introduced: 2013-06-14
Policy area: Finance and Financial Sector
Subjects: Banking and financial institutions regulation

Department of Labor

Employee benefits and pensions

Financial services and investments

Government studies and investigations

Securities and Exchange Commission (SEC)
Latest action: action_date: 2013-10-30
text: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2013-06-14
action_desc: Introduced in House
text: <p>Retail Investor Protection Act - Prohibits the Secretary of Labor from prescribing any regulation under the Employee Retirement Income Security Act of 1974 (ERISA) defining the circumstances under which an individual is considered a fiduciary until 60 days after the Securities and Exchange Commission (SEC) issues a final rule governing standards of conduct for brokers and dealers under specified law.</p> <p>Amends the Securities Exchange Act of 1934 to prohibit the SEC from promulgating a rule establishing an investment advisor standard of conduct as the standard of conduct of brokers and dealers before it has ascertained: (1) if retail customers are systematically harmed or disadvantaged owing to the operation of brokers or dealers under different standards of conduct than those that apply to investment advisors under the Investment Advisers Act of 1940, and (2) whether adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access or availability to personalized investment advice and recommendations.</p> <p>Requires the SEC chief economist to assess the qualitative and quantitative costs and benefits of such a rule, and the SEC, based on that assessment, to make a cost-benefit determination, assess available alternatives considered, and ensure the rule: (1) is accessible, consistent, written in plain language, and easy to understand; and (2) shall measure and seek to improve the actual results of regulatory requirements.</p> <p>Requires the SEC: (1) to publish in the Federal Register formal findings that such rules would reduce retail customer confusion regarding standards of conduct applicable to brokers, dealers, and investment advisors; and (2) in proposing such rules, to consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors.</p>

action_date: 2013-09-25
action_desc: Reported to House amended, Part I
text: <p>Retail Investor Protection Act - (Sec. 2) Prohibits the Secretary of Labor from prescribing any regulation under the Employee Retirement Income Security Act of 1974 (ERISA) defining the circumstances under which an individual is considered a fiduciary until 60 days after the Securities and Exchange Commission (SEC) issues a final rule governing standards of conduct for brokers and dealers under specified law.</p> <p>(Sec. 3) Amends the Securities Exchange Act of 1934 to prohibit the SEC from promulgating a rule establishing an investment advisor standard of conduct as the standard of conduct of brokers and dealers before it has ascertained: (1) if retail customers are systematically harmed or disadvantaged owing to the operation of brokers or dealers under different standards of conduct than those that apply to investment advisors under the Investment Advisers Act of 1940, and (2) whether adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access or availability to personalized investment advice and recommendations.</p> <p>Requires the SEC: (1) to publish in the Federal Register formal findings that such rules would reduce retail customer confusion regarding standards of conduct applicable to brokers, dealers, and investment advisors; and (2) in proposing such rules, to consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors.</p>

action_date: 2013-10-29
action_desc: Passed House amended
text: <p><b>(This measure has not been amended since it was reported to the House on September 25, 2013. The summary of that version is repeated here.)</b></p> <p>Retail Investor Protection Act - Prohibits the Secretary of Labor from prescribing any regulation under the Employee Retirement Income Security Act of 1974 (ERISA) defining the circumstances under which an individual is considered a fiduciary until 60 days after the Securities and Exchange Commission (SEC) issues a final rule governing standards of conduct for brokers and dealers under specified law.</p> <p>(Sec. 3) Amends the Securities Exchange Act of 1934 to prohibit the SEC from promulgating a rule establishing an investment advisor standard of conduct as the standard of conduct of brokers and dealers before it has ascertained: (1) if retail customers are systematically harmed or disadvantaged owing to the operation of brokers or dealers under different standards of conduct than those that apply to investment advisors under the Investment Advisers Act of 1940, and (2) whether adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access or availability to personalized investment advice and recommendations.</p> <p>Requires the SEC: (1) to publish in the Federal Register formal findings that such rules would reduce retail customer confusion regarding standards of conduct applicable to brokers, dealers, and investment advisors; and (2) in proposing such rules, to consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors.</p>

tv_txt: I 113th CONGRESS 1st Session H. R. 2374 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. Short title This Act may be cited as the Retail Investor Protection Act . 2. Stay on rules defining certain fiduciaries After the date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1001 et seq. ) defining the circumstances under which an individual is considered a fiduciary until the date that is 60 days after the Securities and Exchange Commission issues a final rule relating to standards of conduct for brokers and dealers pursuant to the second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ). 3. Amendments to the Securities Exchange Act of 1934 The second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ), as added by section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301 et seq.), is amended by adding at the end the following: (3) Requirements prior to rulemaking The Commission shall not promulgate a rule pursuant to paragraph (1) before— (A) identifying if retail customers (and such other customers as the Commission may by rule provide) are being systematically harmed or disadvantaged due to brokers or dealers operating under different standards of conduct than those standards that apply to investment advisors under section 211 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–11); (B) identifying whether the adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access to personalized investment advice, recommendations about securities, or the availability of such advice and recommendations; (C) conducting an assessment by the chief economist of the Commission that assesses the qualitative and quantitative costs and benefits of the rule; and (D) the Commission, based on the assessment described in subparagraph (B)— (i) determines that the benefits of the rule justify its costs; (ii) identifies and assesses available alternatives to the rule that were considered, including modification of an existing regulation, simplification of disclosures regarding standards of care that apply to brokers or dealers and those that apply to investment advisors, together with an explanation of why the rule meets the regulatory objectives more effectively than the alternatives; and (iii) ensures that the rule is accessible, consistent, written in plain language, and easy to understand, and that the rule shall measure and seek to improve the actual results of regulatory requirements. (4) Requirements for promulgating a rule The Commission shall publish in the Federal Register alongside the rule promulgated pursuant to paragraph (1) formal findings that such rule would reduce the confusion of a retail customer (and such other customers as the Commission may by rule provide) about standards of conduct applicable to brokers, dealers, and investment advisors. (5) Requirements under Investment Advisers Act of 1940 In proposing rules under paragraph (1) for brokers or dealers, the Commission shall consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors. .

tv_txt: IB Union Calendar No. 168 113th CONGRESS 1st Session H. R. 2374 [Report No. 113–228, Part I] 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 September 25, 2013 Additional sponsor: Mr. Murphy of Florida September 25, 2013 Reported from the Committee on Financial Services with an amendment Strike out all after the enacting clause and insert the part printed in italic September 25, 2013 The Committee on Education and the Workforce discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed A BILL To amend the Securities Exchange Act of 1934 to provide protections for retail customers, and for other purposes.

1. Short title This Act may be cited as the Retail Investor Protection Act . 2. Stay on rules defining certain fiduciaries After the date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1001 et seq. ) defining the circumstances under which an individual is considered a fiduciary until the date that is 60 days after the Securities and Exchange Commission issues a final rule relating to standards of conduct for brokers and dealers pursuant to the second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ). 3. Amendments to the Securities Exchange Act of 1934 The second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ), as added by section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ), is amended by adding at the end the following: (3) Requirements prior to rulemaking The Commission shall not promulgate a rule pursuant to paragraph (1) before— (A) identifying if retail customers (and such other customers as the Commission may by rule provide) are being systematically harmed or disadvantaged due to brokers or dealers operating under different standards of conduct than those standards that apply to investment advisors under section 211 of the Investment Advisers Act of 1940 ( 15 U.S.C. 80b–11 ); (B) identifying whether the adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access to personalized investment advice, recommendations about securities, or the availability of such advice and recommendations; (C) conducting an assessment by the chief economist of the Commission that assesses the qualitative and quantitative costs and benefits of the rule; and (D) the Commission, based on the assessment described in subparagraph (B)— (i) determines that the benefits of the rule justify its costs; (ii) identifies and assesses available alternatives to the rule that were considered, including modification of an existing regulation, simplification of disclosures regarding standards of care that apply to brokers or dealers and those that apply to investment advisors, together with an explanation of why the rule meets the regulatory objectives more effectively than the alternatives; and (iii) ensures that the rule is accessible, consistent, written in plain language, and easy to understand, and that the rule shall measure and seek to improve the actual results of regulatory requirements. (4) Requirements for promulgating a rule The Commission shall publish in the Federal Register alongside the rule promulgated pursuant to paragraph (1) formal findings that such rule would reduce the confusion of a retail customer (and such other customers as the Commission may by rule provide) about standards of conduct applicable to brokers, dealers, and investment advisors. (5) Requirements under Investment Advisers Act of 1940 In proposing rules under paragraph (1) for brokers or dealers, the Commission shall consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors. .

1. Short title This Act may be cited as the Retail Investor Protection Act . 2. Stay on rules defining certain fiduciaries After the date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1001 et seq. ) defining the circumstances under which an individual is considered a fiduciary until the date that is 60 days after the Securities and Exchange Commission issues a final rule relating to standards of conduct for brokers and dealers pursuant to the second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ). 3. Amendments to the Securities Exchange Act of 1934 The second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ), as added by section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ), is amended by adding at the end the following: (3) Requirements prior to rulemaking The Commission shall not promulgate a rule pursuant to paragraph (1) before— (A) identifying if retail customers (and such other customers as the Commission may by rule provide) are being systematically harmed or disadvantaged due to brokers or dealers operating under different standards of conduct than those standards that apply to investment advisors under section 211 of the Investment Advisers Act of 1940 ( 15 U.S.C. 80b-11 ); and (B) identifying whether the adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access to personalized investment advice, recommendations about securities, or the availability of such advice and recommendations. (4) Requirements for promulgating a rule The Commission shall publish in the Federal Register alongside the rule promulgated pursuant to paragraph (1) formal findings that such rule would reduce the confusion of a retail customer (and such other customers as the Commission may by rule provide) about standards of conduct applicable to brokers, dealers, and investment advisors. (5) Requirements under Investment Advisers Act of 1940 In proposing rules under paragraph (1) for brokers or dealers, the Commission shall consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors. .

September 25, 2013 Reported from the Committee on Financial Services with an amendment September 25, 2013 The Committee on Education and the Workforce discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed

tv_txt: I 113th CONGRESS 1st Session H. R. 2374 IN THE HOUSE OF REPRESENTATIVES AN ACT To amend the Securities Exchange Act of 1934 to provide protections for retail customers, and for other purposes.

1. Short title This Act may be cited as the Retail Investor Protection Act . 2. Stay on rules defining certain fiduciaries After the date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1001 et seq. ) defining the circumstances under which an individual is considered a fiduciary until the date that is 60 days after the Securities and Exchange Commission issues a final rule relating to standards of conduct for brokers and dealers pursuant to the second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ). 3. Amendments to the Securities Exchange Act of 1934 The second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ), as added by section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ), is amended by adding at the end the following: (3) Requirements prior to rulemaking The Commission shall not promulgate a rule pursuant to paragraph (1) before— (A) identifying if retail customers (and such other customers as the Commission may by rule provide) are being systematically harmed or disadvantaged due to brokers or dealers operating under different standards of conduct than those standards that apply to investment advisors under section 211 of the Investment Advisers Act of 1940 ( 15 U.S.C. 80b–11 ); and (B) identifying whether the adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access to personalized investment advice, recommendations about securities, or the availability of such advice and recommendations. (4) Requirements for promulgating a rule The Commission shall publish in the Federal Register alongside the rule promulgated pursuant to paragraph (1) formal findings that such rule would reduce the confusion of a retail customer (and such other customers as the Commission may by rule provide) about standards of conduct applicable to brokers, dealers, and investment advisors. (5) Requirements under Investment Advisers Act of 1940 In proposing rules under paragraph (1) for brokers or dealers, the Commission shall consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors. .

Passed the House of Representatives October 29, 2013. Karen L. Haas, Clerk.

tv_txt: IIB 113th CONGRESS 1st Session H. R. 2374 IN THE SENATE OF THE UNITED STATES October 30, 2013 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To amend the Securities Exchange Act of 1934 to provide protections for retail customers, and for other purposes.

1. Short title This Act may be cited as the Retail Investor Protection Act . 2. Stay on rules defining certain fiduciaries After the date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1001 et seq. ) defining the circumstances under which an individual is considered a fiduciary until the date that is 60 days after the Securities and Exchange Commission issues a final rule relating to standards of conduct for brokers and dealers pursuant to the second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ). 3. Amendments to the Securities Exchange Act of 1934 The second subsection (k) of section 15 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(k) ), as added by section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ), is amended by adding at the end the following: (3) Requirements prior to rulemaking The Commission shall not promulgate a rule pursuant to paragraph (1) before— (A) identifying if retail customers (and such other customers as the Commission may by rule provide) are being systematically harmed or disadvantaged due to brokers or dealers operating under different standards of conduct than those standards that apply to investment advisors under section 211 of the Investment Advisers Act of 1940 ( 15 U.S.C. 80b–11 ); and (B) identifying whether the adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access to personalized investment advice, recommendations about securities, or the availability of such advice and recommendations. (4) Requirements for promulgating a rule The Commission shall publish in the Federal Register alongside the rule promulgated pursuant to paragraph (1) formal findings that such rule would reduce the confusion of a retail customer (and such other customers as the Commission may by rule provide) about standards of conduct applicable to brokers, dealers, and investment advisors. (5) Requirements under Investment Advisers Act of 1940 In proposing rules under paragraph (1) for brokers or dealers, the Commission shall consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors. .

Passed the House of Representatives October 29, 2013. Karen L. Haas, Clerk