Legislation mandating the creation of an accredited investor certification exam by the SEC was approved by the full House on Wednesday, according to Think Advisor.
The Equal Opportunity for All Investors Act of 2023, which passed with majority support, will necessitate the SEC to develop an exam to certify individuals as accredited investors. This move aims to enhance investor qualifications and ensure greater transparency and protection in the investment industry.
“It is my firm belief that the accredited investor definition should not be tied exclusively to wealth,” said Rep Mike Flood (R-Neb.) “Instead, we should unlock opportunities for knowledgeable investors that may not come from means.”
Chairwoman of the House Financial Services Subcommittee on Capital Markets, Rep. Ann Wagner (R-Mo.), emphasized the importance of the bill, stating, “If you can demonstrate competency with these types of investments through an exam, then you qualify as an ‘accredited investor’… By expanding the pathways to qualify as an ‘accredited investor’ beyond wealth tests, this bill modernizes the outdated definition that has inappropriately sidelined sophisticated-but-not-wealthy individuals from high-growth asset classes historically reserved for the wealthiest individuals.”
This week, the full House is scheduled to vote on H.R. 1579, the Accredited Investor Definition Review Act, which aims to expand the definition of an accredited investor. The proposed legislation would encompass individuals who possess specific designations, certifications, and credentials in addition to the existing criteria.
This move intends to provide a broader range of qualified individuals with access to investment opportunities and promote inclusivity in the accredited investor framework.
The attorneys at Lewitas Hyman include former senior attorneys at the SEC whose legal experience and industry knowledge make them uniquely qualified to provide counsel on securities regulatory, compliance and enforcement matters. Our attorneys fully understand the regulatory scrutiny financial professionals and their firms face from the various regulators that oversee the financial services industry. If your firm is facing an investigation from a regulatory agency, please contact Lewitas Hyman at (888) 655-6002 or through our online contact form.