[Congressional Record Volume 142, Number 137 (Saturday, September 28, 1996)]
[House]
[Pages H12047-H12051]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CONFERENCE REPORT ON H.R. 3005, NATIONAL SECURITIES MARKETS IMPROVEMENT
ACT OF 1996
Mr. BLILEY. Mr. Speaker, I move to suspend the rules and agree to the
conference report on the bill (H.R. 3005) to amend the Federal
securities laws in order to promote efficiency and capital formation in
the financial markets, and to amend the Investment Company Act of 1940
to promote more efficient management of mutual funds, protect
investors, and provide more effective and less burdensome regulation.
The Clerk read the title of the bill.
(For conference report and statement see immediately preceding
proceedings of the House.)
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Virginia [Mr. Bliley] and the gentleman from Massachusetts [Mr. Markey]
each will control 20 minutes.
The Chair recognizes the gentleman from Virginia [Mr. Bliley].
(Mr. BLILEY asked and was given permission to revise and extend his
remarks.)
Mr. BLILEY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, it is with great pleasure that I rise in support of the
National Securities Markets Improvement Act of 1996 today. This
important legislation represents the most sweeping changes of the
securities laws since their enactment. This legislation will eliminate
unnecessary regulatory burdens and the costs that they impose on
American businesses and investors. This legislation, at long last,
makes sense of the regulatory responsibilities of the federal and state
governments. It also is a bipartisan reduction of the fees paid by
investors to the Treasury, which will reduce the size of our federal
government. This landmark bill has been achieved through the
cooperation of all of my colleagues of the House and Senate. Their
ability to set aside their differences and reach sensible compromises
is the reason we are here to mark this bipartisan legislative victory,
and for that I thank each one of them.
I am proud to say that this legislation represents an agreement that
reduces SEC fees through bipartisan support. The SEC currently collects
more than double the costs of running the agency. This is a tax on
capital that all investors pay, and a problem that this legislation
will solve by substantially reducing the registration fee over time
that is assessed on securities offerings. Not only will we put $850
million back into the pockets of American investors over the next 10
years, but we have eliminated the tax entirely starting in the 11th
year, saving investors over $800 million each year thereafter. This is
a vital step toward reigning in government spending and requiring
Congress to be more fiscally responsible while striving for maintaining
a balanced budget.
This legislation is the result of a long and difficult process, but
it is well worth the effort. By reducing unnecessary regulation, the
burdens and costs that businesses must overcome to access the capital
markets will be significantly reduced. The most significant change this
Act will effect is to create a national unified system of regulation.
Securities offerings that are national in character, including
securities offered by mutual funds and securities sold to sophisticated
investors, will now be regulated only by the SEC.
By streamlining the regulation of the mutual fund industry, funds
will benefit from significant administrative savings, which they can
pass on to their investors. This means that we are putting money back
in the pockets of nearly one third of American families This is real
savings that is long overdue and is a result of a more logical and
efficient approach to regulating the securities markets.
This legislation includes a creative new provision that will promote
the capital formation process by increasing opportunities for private
investment companies and venture capital firms. This new provision will
enable these companies to include an unlimited number of qualified
investors, rather than the 100 person limit they are subject to today.
By increasing the domestic venues available to investors, we will help
expand our investment capital. This will improve liquidity in this
valuable market that many small business depend on for the capital they
need to expand and create new jobs.
Furthermore, the National Securities Markets Improvement Act will
require the SEC to conduct meaningful cost-benefit analysis of proposed
rulemakings that directly affects all securities issuers. Under this
new provision, the SEC must weigh the cost of every rule they propose
against the burden those rules would impose on the engine of our
economy. This provision is simply common sense: meaningful regulation
should not impose unnecessary burdens and costs.
[[Page H12048]]
By passing this legislation today, we will be sending a bill to the
President that facilitates the American dream without compromising the
integrity of our markets. The cooperation and compromise that has led
us to this consensus legislation speaks volumes for every participant
in this process, and I urge you to support this legislation.
I would like to thank my friend Fritz Hollings for his assistance in
finding a solution of SEC funding, my colleagues in the House, Jack
Fields, John Dingell, Ed Markey, Mike Oxley, Billy Tauzin, Dan
Schaefer, Dan Frisa, Rick White, Nathan Deal, Rick Boucher, and Ron
Klink who have all worked hard to achieve this victory.
Mr. Speaker, this is the first major overhaul of securities law in 60
years. It is a good bill, it is a bipartisan bill, and I want to
commend, first of all, the chairman of the subcommittee, the gentleman
from Texas [Mr. Fields]. This will be his last bill on the floor. He
did yeoman work. And I want to commend the gentleman from Massachusetts
[Mr. Markey] without whose help we would not be here right now. He and
Mr. Fields worked together, we produced a bill that passed out of this
House with 408 votes, it went to the other body, they passed theirs. We
went to conference, and we did not get everything we wanted, as all of
us know in the legislative process we do not do.
But I must say this. The gentleman from Massachusetts, the gentleman
from Michigan, have been true statesmen. We have worked together. This
is good policy, it is good for the Nation, and while we did not get
everything we wanted, we have pulled together, and I would hope that we
would pass this bill overwhelmingly.
Mr. Speaker, I reserve the balance of my time.
Mr. MARKEY. Mr. Speaker, I yield myself as much time as I may
consume.
Mr. Speaker, I seek recognition at this time so that I can properly
recognize the work of the gentleman from Texas [Mr. Fields]. This is
Mr. Fields' last bill out here on the floor of Congress, and it is
indeed a historic bill. Paired with the telecommunications bill which
passed the Congress in February of this year, this historic securities
bill represents the other historic landmark legislation which has
passed the Congress and will be signed by the President during the 2-
year tenure of Mr. Fields as chairman of this committee.
Mr. Speaker, I would like all of the Members to pay recognition to
the gentleman from Texas [Mr. Fields] at this time for the tremendous
work which he has done.
{time} 2015
Mr. Speaker, Jack is more than a congressman and chairman to me; he
is my good friend as well. That is why the gentleman from Michigan [Mr.
Dingell] and I and all the Members on our side have had such a
wonderfully productive working relationship with him.
Mr. Speaker, there are a lot of good things in this bill, especially
in the mutual funds area, where we are overhauling 50 year's worth of
law, reforming it so it reflects now the new financial marketplace that
has been constructed over the last 10 or 15 years in this country and
around the globe.
It includes an 800 number that individual investors can call in order
to find out what the record is of the investment advisers that are
seeking the business of individuals with their life savings.
It includes much that is good, Mr. Speaker. That is largely a tribute
to the gentleman from Texas [Mr. Fields]. I know that I join with all
Members in standing here this evening in praise of his work, and in
knowing that this final bipartisan effort is something that is in fact
indicative of the way in which he conducted his subcommittee.
Mr. Speaker, I want to praise, as well, the gentleman from Virginia
[Mr. Bliley] and the gentleman from Ohio [Mr. Oxley]. They, along with
the Members on our side, worked together patiently over the last year
and a half toward the construction of this historic legislation, and I
cannot tell the Members tonight how proud I am to be part of the team
that brings it out here to the floor.
Mr. Speaker, I reserve the balance of my time.
Mr. FIELDS of Texas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, very seldom do I actually come to the floor; very seldom
have I, in the 16 years I have been in Congress. I have always enjoyed
working in the committee and making whatever contributions that I can.
I think it is somewhat ironic that tonight, the last night of my
legislative career here in the House, I am fortunate to have before the
body, with my colleagues, a piece of legislation that is truly
historic, that is truly landmark. I certainly appreciate the indulgence
of our colleagues as we pass this particular piece of legislation.
Mr. Speaker, I have to say this has been a long process. I want to
begin by thanking the staff. We usually tend to thank the staff at the
very end, but I want to thank Linda Rich, David Cavicke, Brian
McCullough, J.D., Charles, Steve Cope, Tim Forde, Jeff Duncan, Consuela
Washington, Christy Strawman on my staff.
Without all of these people, we would not have been able to put this
massive reform together, because this reforms the 1934 Securities Act
and the 1940 Investment Company Act, so this is truly landmark
legislation.
Mr. Speaker, I would be remiss if I did not begin by recognizing the
work of the chairman, the gentleman from Virginia, Mr. Bliley, saving
$850 million over a 10-year period in fees for the financial industry;
the work of the gentleman from Ohio, Mike Oxley; the work of the
gentleman from New York, Dan Frisa; the work of someone who I admire as
much as anyone in the House of Representatives, the person that many of
us consider to be our mentor, even though he is on the other side of
the aisle, the gentleman from Michigan, John Dingell.
I have really saved one person for last, Mr. Speaker. I am not, in my
last speech, going to be outgracioused by the gentleman from
Massachusetts [Mr. Markey]. But before I pay the accolades to the
gentleman from Massachusetts, it is important that this House have
perspective.
Eddie and I really began to work on this product last year. We
attempted to get some help from the other side of the Capitol. I have
to point out to my colleagues that we did not have much engagement from
the other side of the Capitol until this week, but it is important to
recognize that the foundation for this bill, and I think that it is an
example for the House, occurred several months ago, when the gentleman
from Massachusetts, Ed Markey, and I met in my office to talk about our
commonality, what was in a bill that had been introduced. We did not
focus on our differences. If we did, we could have stopped the process
right there.
But instead, we talked about what was good for the consumer, the
investing public, to make sure that the safeguards that have given us
the strongest financial markets in the world with the highest
integrity, that that would never be compromised. Everything that is in
this piece of legislation started that night.
From that night, we had improvements made at the subcommittee, made
at the full committee, even here on the floor. We did go into a
conference with the Senate. I think we are fortunate to be able to
report that that conference concluded. But again, I want to point out,
particularly to my colleagues on this side of the aisle, that if it had
not been for my friend and my colleague looking for commonality and
looking to do the right thing for the investing public, the gentleman
from Massachusetts, we would not be standing here.
I have to tell the Members, in all candor, the U.S. Senate was more
of an obstacle than an asset in this particular process. It would have
been very easy for my friends on this side of the aisle to say that an
agreement that we had originally reached, a good agreement, that
agreement was gone. But they did not walk away. None of us are
completely happy with everything that is in this bill, or some things
that are not here, but I know I have a commitment from my friend, and
in talking to my friends on this side of the aisle, to continue to work
next year for anything that we think needs to be added, any
deficiencies that might be there.
Having said that, Mr. Speaker, let me come back to the substance of
this particular piece of legislation. We bring the financial markets of
this country into the 21st century. We end regulation in its
duplicative sense that is
[[Page H12049]]
needless and costs money wastefully, but we do not compromise investor
protection.
What the chairman said just a moment ago, the gentleman from Virginia
[Mr. Bliley], this is a bipartisan consensus product. This is my final
legislative act. This will be one of my last votes. We all hope that it
is an oral vote. We plan for it to be an oral vote. But we are proud of
what we have been able to do in working together. Mr. Speaker, I am
very proud that this is my last legislative act that I bring to the
floor.
Mr. OXLEY. Mr. Speaker, will the gentleman yield?
Mr. FIELDS of Texas. I yield to the gentleman from Ohio.
(Mr. OXLEY asked and was given permission to revise and extend his
remarks.)
Mr. OXLEY. Mr. Speaker, I thank the chairman of the subcommittee for
yielding to me. Let me also heap praise on him and the gentleman from
Massachusetts [Mr. Markey]. Other than the fact that both gentlemen
have funny accents, they have very little in common, except for their
efforts to craft legislation that will last for a long, long time. In
both the telecommunications legislation, the first major
telecommunications legislation in 62 years, and now the Securities Act,
both gentlemen have shown terrific leadership on both these very
important issues.
Indeed, your legacy, Jack, will be with these two major pieces of
legislation. For that the gentleman from Texas [Mr. Fields] is to be
congratulated by all of the Members.
Mr. FRISA. Mr. Speaker, will the gentleman yield?
Mr. FIELDS of Texas. I yield to the gentleman from New York.
(Mr. FRISA asked and was given permission to revise and extend his
remarks.)
Mr. FRISA. Mr. Speaker, I would like to also, as a conferee on this
legislation, express my thanks to the gentleman from Texas [Mr. Fields]
and to the chairman, the gentleman from Virginia [Mr. Bliley], for
giving me the opportunity to participate as a new Member of this House
on such an important piece of legislation, as they both did on the
telecommunications act reform.
I support this legislation as well, and also extend my thanks to the
gentleman from Massachusetts, Mr. Markey, and the gentleman from
Michigan, Mr. Dingell, as well, I must say, to the chairman of the
Committee on Banking on the other side, Mr. D'Amato, who is my Senator,
and whom I represent, for his efforts on bringing this to final
closure. I support this legislation.
Mr. FIELDS of Texas. Mr. Speaker, I reserve the balance of my time.
Mr. MARKEY. Mr. Speaker, I yield such time as he may consume to the
gentleman from Michigan [Mr. Dingell], the ranking Democrat on the
Committee on Commerce.
Mr. DINGELL. Mr. Speaker, I thank my friend, the gentleman from
Massachusetts [Mr. Markey], for yielding time to me.
Mr. Speaker, I want to commend the gentleman for the outstanding job
he has done on this, and also our chairman, the gentleman from Virginia
[Mr. Bliley], and the gentleman from Ohio [Mr. Oxley].
I also want to express my particular affection and respect for the
distinguished gentleman from Texas [Mr. Fields] who is up, I think, for
the last time tonight. He is a superb Member of this body. He will be
missed. He has earned the respect and affection of his colleagues by
dint of his integrity, his honesty, and the way in which he has handled
legislation. I will miss him, although I will rejoice that he will
continue to be my friend.
This is a good bill. It represents a huge amount of hard work,
leadership, and effort. It is, as I mentioned, the last security bill
for our good friend, the gentleman from Texas [Mr. Fields], and a
fitting tribute to both him and to the gentleman from Massachusetts
[Mr. Markey], and to our chairman, the gentleman from Virginia [Mr.
Bliley], because of the way they have worked together to see to it that
this bill could come to fruition.
Mr. Speaker, the National Securities Improvements Act is an important
piece of legislation. It enjoys, and properly so, bipartisan support,
as well as the support of the industry. It is deregulatory in a proper
fashion, while at the same time preserving and enhancing investor
protections, something which is the real purpose of the American
securities market and the American securities law.
Mr. Speaker, I am, I will observe, deeply disappointed in the
investment advisers provisions. No fault attaches to my colleagues on
this side, but rather, the fault exists over in the other body. This
body and the other body, because of the impasse on this matter, have
passed up an opportunity to better police investment advisers,
financial planners, and to give the SEC the resources and regulatory
tools that are needed to put in jail or to put out of business a number
of scoundrels, crooks, swindlers, and others who, very frankly, are
advantaging themselves and enriching themselves at the expense of the
little investor. To do that is a great shame.
In that, there is one significant failure in this legislation. The
bill before us on these matters essentially maintains the status quo.
It does not contain the additional resources and investor protections
sought by the House in this matter. Indeed, these provisions were
passed by the House twice before. Nonetheless, no discredit attaches in
this matter to any of my colleagues on the committee. They did their
best in trying to protect and preserve these provisions, and they are
important, as I reiterate, to the little investors in this country, who
are being taken advantage of by a number of unprincipled,
irresponsible, and incompetent people who function in this industry to
their own great benefit and enrichment.
In any event, I urge the passing of this bill. I salute the gentleman
from Texas [Mr. Fields]. I salute my colleagues who have worked on it.
I do want to salute the staff, which has worked very hard to bring us
to where we are today.
Mr. MARKEY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would ask if I could engage in a colloquy with the
gentleman from Texas.
Mr. Speaker, I would ask the chairman, is it the manager's intention
not to limit, alter, expand, or otherwise affect in any way any State,
statutory, or common law with respect to fraud or deceit, including
broker-dealer sales practices, in connection with securities or
securities transactions?
Mr. FIELDS of Texas. Mr. Speaker, will the gentleman yield?
Mr. MARKEY. I yield to the gentleman from Texas.
Mr. FIELDS of Texas. Mr. Speaker, the gentleman is corrected in his
understanding.
Mr. MARKEY. Mr. Speaker, I thank the chairman very much for that
statement.
Mr. Speaker, we have come a long way in the last year and a half on
this legislation. I think many observers would have thought it was
impossible that we could have had such a historic overhaul of
securities laws.
At the beginning we were on different planets in terms of how we
viewed these issues. But back in March, the gentleman from Texas, Jack
Fields, and I, we went to his office for 2 hours, sat down and went
through each and every issue trying to find the common ground in each
and every one of them. The agreement in principle that we reached that
night is the core of this legislation.
It is altogether fitting that it be the last bill before the
continuing resolution that we in fact take up here, because when the
history of this Congress is written, there is no question that this
securities overhaul and the telecommunications overhaul will be at the
top of the list in terms of constructive, productive use of this
Congress. It is a tribute to Jack and his understanding of the need to
develop bipartisanship in the development of legislation which will
leave that legacy for him to look back at.
{time} 2030
We deal here with national securities offerings in a way that will
preempt duplicative State review of mutual funds and stocks and bonds.
We overhaul the margin provisions of this country.
The mutual fund company reforms that are included in this bill are
the greatest since 1940 that have come through this Congress. We have
gone
[[Page H12050]]
through months of discussion to reach this point. But it is, as
technical as it may be, as significant a piece of legislation as we
will have passed during this 2 years that the 104th Congress was
convened.
Let me join as well in praising Linda Dallas Rich and David Cavicke;
Steve Cope, who sits over there, J.D.; and on our side Consuela
Washington; and Jeff Duncan; and David Moulton; and especially, because
of his incredible efforts on this project over the last year and a
half, consuming enormous amounts of time, with his wife pregnant, or
just having had a baby, depending upon the circumstance a year and a
half ago or right now, Tim Ford.
We all know, most of the Members here, how humble we have to be at
moments like this with a continuing resolution and so much important
legislation coming through here, that without the work of the staff, it
would not be possible.
So let me finish again. Without question, the gentleman from New
York, Dan Frisa; and the gentleman from Virginia, Rick Boucher; so many
other Members, I see the gentleman from Michigan, Bart Stupak, here;
all participated in this bill.
Again, for me, it is a moment where I say good-bye legislatively to
my good friend, the gentleman from Texas, Jack Fields. And I say good-
bye because, in a sea of acrimony, there was an air of good feeling
that he was able to develop that produced historic legislation in two
areas that could have been intractable in the wrong hands.
For that, I salute you, Jack.
The statement of managers on this conference report notes that ``The
Managers agreed to include certain Amendments to the Investment
Advisers Act of 1940 to eliminate publication, promote efficiency and
protect investors.'' I would like to take just a few moments to
describe what these amendments do and the congressional intent
underlying them.
First, the bill provides a $20 million authorization for the
enforcement of the Investment Advisers Act of 1940, which regulates
investment advisers and financial planners. These funds are intended to
be used to beef up the SEC's inspections, examinations, supervision,
and enforcement of the Advisers Act. For too many years, the SEC has
not devoted adequate resources to this area, and this authorization is
intended to reverse that situation. I am committed to assuring that
funds are appropriated for this area, and intend to work closely with
the SEC and the administration to assure this is the case.
Second, the conference report provides for the establishment of a
toll-free 800 number that investors can call to check on the
disciplinary history of an investment adviser. This provision gives
investors the tools they need to protect themselves against dishonest,
unscrupulous, or shady individuals by letting them call a number to
check and see whether the person they are considering turning over
their life savings to has any history of previous disciplinary problems
relating to fraud, sales practice abuse, or other misconduct. I expect
the SEC to move quickly to assure that this 800 number is established,
and that it provides investors with all the information they need to
make informed decisions in this area. In this regard, I would expect
the Hotline to include the same types of information available--or
which is now slated to be made available--to investors over the
existing NASD hotline for broker dealers. In addition, I expect that
the new Hotline will also be supplemented by on-line services that will
allow investors to access this type of information over the Internet--
similar to what is now being planned for the current NASD broker-dealer
Hotline.
With respect to Federal-State jurisdiction, the conference compromise
assigns primary responsibility to the SEC for supervision of large
investment advisers while reserving for the states primary supervisory
responsibility for small advisers. At the same time, we agreed that the
States should continue to have authority to license the individual
representatives of investment advisers.
Finally, the bill provides for uniformity in State requirements in
books and records, capitol, and bonding requirements.
This is an equitable compromise in this important area. However, it
leaves unaddressed other issues that I continue to consider important
to assuring investors are fully protected against wrongdoing by their
investment advisers, such as enhanced disclosure of fees and conflicts-
of-interest. I intend to continue to press for these reforms in the
next Congress.
Mr. Speaker, I yield back the balance of my time.
Mr. FIELDS of Texas. Mr. Speaker, I yield myself such time as I may
consume, but let me inform the body that I will be very brief so that
we can move on. I know everyone wants to get to the continuing
resolution.
Mr. Speaker, I want to amplify something that my good friend, the
gentleman from Massachusetts, Ed Markey, said just a moment ago. We are
taking a few minutes to talk in very general terms about a very complex
piece of legislation, that is just as massive in reform as our reform
was of telecommunications, and we are certainly not doing justice in
this short time period to what we have done, and I want to acknowledge
that.
But, again, I want to emphasize to this House that while this is my
last speech, this is my last legislative act, the real magic here,
which I hope is demonstrable to the rest of the House, is the fact that
people who come from very different backgrounds, from different sides
of the aisle, different political persuasions, put aside differences
which we could have focused on and instead looked at what was best for
the American consuming public, and we focused there, and we found
commonality and looked for the best policy.
Again, this is not a singular effort. For 4 years, I have had the
opportunity to work with the gentleman from Massachusetts, Ed Markey,
in the last Congress as the senior Republican on the Subcommittee on
Telecommunication and Finance, and this year being fortunate to be its
chairman. I am going to say that I am a blessed Member that I had this
particular individual to work with for 4 years.
I also do not want to take away from the Members on my side. I know
there are a lot of people who feel they sit on the best subcommittee or
on the best committee, and certainly I do, in that particular regard.
Our Members are engaged, both sides of the aisle, they are very
intelligent, they are very focused, and I always feel that they are
motivated for the right reason.
So it is a great moment of pride that, as I close out my legislative
career, I am standing here tonight with a product that we all can be
proud of as a Congress as we go home, and it is something that we
should all talk about, but we should talk about this as a joint product
that occurred from both sides of the aisle.
Mr. MARKEY. Mr. Speaker, will the gentleman yeild?
Mr. FIELDS of Texas. I yield to the gentleman from Massachusetts.
Mr. MARKEY. Again, I thank the gentleman.
In conclusion, I also thank the gentleman from Virginia, Tom Bliley,
following the tradition of the gentleman from Michigan, John Dingell,
in creating the climate at our committee historically that has made it
possible. And Alan Roth and J.D. on this bill helped to create the
environment where the Members worked together to produce this bill.
Mr. FIELDS of Texas. Mr. Speaker, the gentleman makes an excellent
point. We would not be here if it had not been for the gentleman from
Michigan, John Dingell, and Chairman Bliley bringing all this to
closure.
With that, Mr. Speaker, I think it is appropriate that we now pass
the torch to the gentleman from Ohio [Mr. Oxley] and the gentleman from
Massachusetts [Mr. Markey] to continue the legacy of this particular
subcommittee, the legacy that we have enjoyed over many sessions.
Mrs. COLLINS of Illinois. Mr. Speaker, I rise in support of H.R.
3005, the Securities Amendment of 1996. During three hearings held on
securities amendments, the Commerce Committee of which I am a member,
heard support for sensible, targeted efforts to reform Federal
securities laws to promote greater efficiency and capital formation in
U.S. financial markets. We also heard from a number of witnesses,
including Securities and Exchange Commission Chairman Arthur Levitt,
who urged us to proceed carefully and cautiously, keeping in mind the
fact that investor confidence and consumer protection must not in any
way be compromised in this undertaking. I agree fully. I was extremely
pleased that a bipartisan agreement was reached that heeded Chairman
Levitt's sage advice.
As we all know, U.S. capital markets are the strongest financial
markets in the world. Today, nearly one-third of all families in the
Nation have a portion of their savings invested in stocks, bonds, and
mutual funds in order to ensure a better future for themselves and
their loved ones. These investors have trust in their investments
because our regulatory system has proven beneficial in protecting
individuals from fraud and abuse perpetuated by unscrupulous brokers
and dealers. We will be preserving and strengthening this trust with
the legislation we consider before us today.
[[Page H12051]]
This legislation will maintain the authority of State securities
regulators to police wrongdoing. In addition, the legislation ensures
that the SEC mandate to protect American investors and the public
interest as well as the long-term stability of our major markets
remains intact. This is a most important point. While there is room to
fine tune the regulatory functions of the SEC, reforms must never be
structured in such a way that they undermine consumer confidence.
This bill, H.R. 3005, does not seek to greatly limit inspections of
brokerage firms who have violated SEC rules or relieve firms of
liability for recommending unsuitably risky investments to
institutional clients. The bill also modifies previous language that
would have eliminated the requirement in current law that investors be
sent a prospectus and informed of the risks they face before they buy
newly offered securities by requiring the SEC to move forward with its
study of this issue.
Mr. Speaker, there is undoubtedly a need to monitor mutual fund
regulation to fully account for the constantly evolving size,
complexity, and investment opportunities of our Nation's financial
markets. While mutual funds have grown by more than 20 percent annually
throughout the 1980's and into the 1990's, Congress has not addressed
the issue of fund regulation since 1970. This bill updates our
securities laws and will support and improve the industry. I urge my
colleagues to approve the conference report on H.R. 3005. I yield back
the balance of my time.
Mr. FIELDS of Texas. Mr. Speaker, I yield back the balance of my
time.
The SPEAKER pro tempore (Mr. Dreier). The question is on the motion
offered by the gentleman from Texas [Mr. Fields] that the House suspend
the rules and agree to the conference report on the bill, H.R. 3005.
The question was taken; and (two-thirds having voted in favor
thereof) the rules were suspended and the conference report was agreed
to.
A motion to reconsider was laid on the table.
____________________