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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.

12/31/2022, 5:05 AM

Summary of Bill HR 4620

Bill 117 hr 4620 aims to amend the Investment Advisers Act of 1940 in order to restrict the exemption granted to family offices from being classified as investment advisers. The bill seeks to impose limitations on the activities of family offices in order to ensure that they are subject to the same regulations and oversight as other investment advisers.

The bill is designed to address concerns that family offices, which manage the investments of wealthy families, may not be subject to the same level of scrutiny and regulation as other investment advisers. By limiting the exemption provided to family offices, the bill aims to ensure that these entities are held to the same standards of transparency and accountability as other investment advisers.

In addition to restricting the exemption for family offices, the bill also includes provisions for other purposes related to the regulation of investment advisers. The specific details of these provisions are not outlined in the summary, but it can be inferred that they are intended to strengthen oversight and regulation of the investment advisory industry. Overall, Bill 117 hr 4620 represents an effort to ensure that all investment advisers, including family offices, are subject to appropriate levels of regulation and oversight in order to protect investors and maintain the integrity of the financial markets.

Congressional Summary of HR 4620

This bill limits the exemption for family offices from the Securities and Exchange Commission's (SEC's) regulations applicable to investment advisers. A family office is a privately held company that manages a single family's wealth. Currently, a family office is generally not considered an investment adviser for purposes of SEC regulation regardless of the amount of managed assets, and is therefore not subject to regulations relating to duties, recordkeeping, and disclosures.

The bill limits the exemption to include only family offices with less than $750 million in managed assets. Furthermore, the SEC must exclude from the exemption certain persons subject to a final order regarding fraudulent conduct, among other activities.

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Current Status of Bill HR 4620

Bill HR 4620 is currently in the status of Bill Introduced since July 22, 2021. Bill HR 4620 was introduced during Congress 117 and was introduced to the House on July 22, 2021.  Bill HR 4620's most recent activity was Ordered to be Reported in the Nature of a Substitute (Amended) by the Yeas and Nays: 27 - 22. as of July 29, 2021

Bipartisan Support of Bill HR 4620

Total Number of Sponsors
1
Democrat Sponsors
1
Republican Sponsors
0
Unaffiliated Sponsors
0
Total Number of Cosponsors
2
Democrat Cosponsors
2
Republican Cosponsors
0
Unaffiliated Cosponsors
0

Policy Area and Potential Impact of Bill HR 4620

Primary Policy Focus

Finance and Financial Sector

Potential Impact Areas

- Business records
- Financial services and investments
- Securities
- Small business

Alternate Title(s) of Bill HR 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.
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.

Comments

Sponsors and Cosponsors of HR 4620

Alexandria Ocasio-Cortez
Alexandria Ocasio-Cortez
New YorkDemocrat
Al Green
Al Green
TexasDemocrat

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