[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4620 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 4620
To amend the Investment Advisers Act of 1940 to limit the exemption
provided for family offices from the definition of an investment
adviser, and for other purposes.
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IN THE HOUSE OF REPRESENTATIVES
July 22, 2021
Ms. Ocasio-Cortez introduced the following bill; which was referred to
the Committee on Financial Services
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A BILL
To amend the Investment Advisers Act of 1940 to limit the exemption
provided for family offices from the definition of an investment
adviser, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. REGULATION OF FAMILY OFFICES.
(a) Family Office Size Limitation.--Section 202(a) of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)) is amended--
(1) in paragraph (11), by striking ``;; (G) any family
office, as defined by rule, regulation, or order of the
Commission, in accordance with the purposes of this title'' and
inserting ``; (G) any covered family office'';
(2) by redesignating the second paragraph (29) as paragraph
(31); and
(3) by adding at the end the following:
``(32) Covered family office.--
``(A) In general.--The term `covered family office'
means a family office with less than $750,000,000 in
assets under management.
``(B) Rulemaking.--The Commission shall further
define the term `covered family office', by rule, in
accordance with the purposes of this title. In issuing
such rule, the Commission--
``(i) shall exclude any person who is
subject to a final order described in section
15(b)(4)(H) of the Securities Exchange Act of
1934 (15 U.S.C. 78o(b)(4)(H)); and
``(ii) may include a family office with
fewer assets under management than the
threshold described under subparagraph (A), if
the Commission, by rule, determines the family
office is highly leveraged or engaged in high-
risk activities that the Commission determines
warrants inclusion, as appropriate to protect
investors.''.
(b) Exemption of and Reporting by Covered Family Offices.--Section
203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3) is amended
by adding at the end the following:
``(o) Exemption of and Reporting by Covered Family Offices.--
``(1) In general.--The Commission may provide an exemption
from the registration requirements under this section to any
covered family office.
``(2) Reporting.--The Commission shall require investment
advisers exempted by reason of this subsection to maintain such
records and provide to the Commission such annual or other
reports as the Commission determines necessary or appropriate
in the public interest or for the protection of investors.''.
(c) Removal of Grandfather Provision.--Section 409 of the Dodd-
Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 80b-2
note) is amended--
(1) in subsection (b)--
(A) in paragraph (1), by adding ``and'' at the end;
(B) in paragraph (2), by striking ``; and'' and
inserting a period; and
(C) by striking paragraph (3); and
(2) by striking subsection (c).
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