[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6204 Introduced in House (IH)]

112th CONGRESS
  2d Session
                                H. R. 6204

    To amend the Investment Advisers Act of 1940 to require certain 
 investment advisers to pay fees to help cover the costs of inspecting 
           and examining investment advisers under such Act.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 25, 2012

 Ms. Waters (for herself, Mr. Frank of Massachusetts, and Mr. Capuano) 
 introduced the following bill; which was referred to the Committee on 
                           Financial Services

_______________________________________________________________________

                                 A BILL


 
    To amend the Investment Advisers Act of 1940 to require certain 
 investment advisers to pay fees to help cover the costs of inspecting 
           and examining investment advisers under such Act.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Investment Adviser Examination 
Improvement Act of 2012''.

SEC. 2. SENSE OF CONGRESS.

    It is the sense of the Congress that the Securities and Exchange 
Commission should increase the number and frequency of examinations of 
investment advisers.

SEC. 3. INSPECTION AND EXAMINATION FEES.

    Section 204 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
4) is amended by adding at the end the following new subsection
    ``(e) Inspection and Examination Fees.--
            ``(1) In general.--The Commission shall collect an annual 
        fee from investment advisers that are subject to inspection or 
        examination by the Commission under this title to defray the 
        cost of such inspections and examinations.
            ``(2) Exemptions for certain state-regulated investment 
        advisers.--No fees shall be collected under this subsection 
        from any investment adviser that is prohibited from registering 
        with the Commission under section 203 by reason of section 
        203A.
            ``(3) Fee amounts.--
                    ``(A) Amount to be collected.--
                            ``(i) In general.--The Commission shall 
                        seek to ensure that the aggregate amount of 
                        fees collected under this subsection with 
                        respect to a specific fiscal year are equal to 
                        the estimated cost of the Commission in 
                        carrying out additional inspections and 
                        examinations for such fiscal year.
                            ``(ii) Additional inspections and 
                        examinations defined.--For purposes of this 
                        subparagraph and with respect to a fiscal year, 
                        the term `additional inspections and 
                        examinations' means those inspections and 
                        examinations of investment advisers under this 
                        title for such fiscal year that exceed the 
                        number of inspections and examinations of 
                        investment advisers under this title conducted 
                        during fiscal year 2011.
                    ``(B) Fee calculation formula.--The Commission 
                shall establish by rulemaking a formula for determining 
                the fee amount to be assessed against individual 
                investment advisers, which shall take into account the 
                following factors:
                            ``(i) The anticipated costs of conducting 
                        inspections and examinations of investment 
                        advisers under this title, including the 
                        anticipated frequency of such inspections and 
                        examinations.
                            ``(ii) The investment adviser's size, 
                        including the assets under management of the 
                        investment adviser (excluding any assets under 
                        management attributable to any of the adviser's 
                        clients that are a registered investment 
                        company).
                            ``(iii) The number and type of clients of 
                        the investment adviser.
                            ``(iv) Such other objective factors, such 
                        as risk characteristics, as the Commission 
                        determines to be appropriate.
                    ``(C) Adjustment of formula.--Prior to the end of 
                each fiscal year, the Commission shall review the fee 
                calculation formula and, if, after allowing for a 
                period of public comment, the Commission determines 
                that the formula needs to be revised, the Commission 
                shall revise such formula before fees are assessed for 
                the following fiscal year.
            ``(4) Public disclosures.--The Commission shall make the 
        following information publicly available, including on the Web 
        site of the Commission:
                    ``(A) The formula used to determine the fee amount 
                to be assessed against individual investment advisers, 
                and any adjustment made to such formula.
                    ``(B) The factors used to determine such formula, 
                including any additional objective factors used by the 
                Commission pursuant to paragraph (3)(B)(iv).
            ``(5) Audit.--
                    ``(A) In general.--The Comptroller General of the 
                United States shall, every 2 years, conduct an audit of 
                the use of the fees collected by the Commission under 
                this subsection, the reviews of the formula used to 
                calculate such fees, and any adjustments made by the 
                Commission to such formula.
                    ``(B) Report.--After conducting each audit required 
                under subparagraph (A), the Comptroller General shall 
                issue a report on such audit to the Committee on 
                Financial Services of the House of Representatives and 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate.
            ``(6) Treatment of fees.--
                    ``(A) In general.--Funds derived from fees assessed 
                under this subsection shall be available to the 
                Commission, without further appropriation or fiscal 
                year limitation, to pay any costs associated with 
                inspecting and examining investment advisers that are 
                subject to inspection and examination under this title.
                    ``(B) Funds not public funds.--Funds derived from 
                fees assessed under this subsection shall not be 
                construed to be Government or public funds or 
                appropriated money. Notwithstanding any other provision 
                of law, funds derived from fees assessed under this 
                subsection shall not be subject to apportionment for 
                the purpose of chapter 15 of title 31, United States 
                Code, or under any other authority.
                    ``(C) Funds supplemental to other amounts.--Funds 
                derived from fees assessed under this subsection shall 
                supplement, and be in addition to, any other amounts 
                available to the Commission, under a regular 
                appropriation or otherwise, for the purpose described 
                in subparagraph (A).''.
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