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Putting Investors First Act of 2023
12/7/2023, 5:05 PM
Summary of Bill S 1799
One key provision of the bill is the requirement for investment advisors to act in the best interests of their clients, known as a fiduciary duty. This means that advisors must prioritize the financial well-being of their clients over their own interests, ensuring that investment recommendations are made with the client's best interests in mind.
Additionally, the Putting Investors First Act of 2023 seeks to improve disclosure requirements for investment products, ensuring that investors are provided with clear and accurate information about the risks and potential returns associated with their investments. This increased transparency aims to empower investors to make informed decisions and protect them from fraudulent or misleading practices in the financial industry. Overall, the Putting Investors First Act of 2023 aims to strengthen investor protections and promote a more fair and transparent financial system. By prioritizing the interests of investors and enhancing disclosure requirements, the bill seeks to ensure that investors are able to make informed decisions and protect their financial well-being.
Congressional Summary of S 1799
Putting Investors First Act of 2023
This bill requires a proxy advisory firm to register with the Securities and Exchange Commission and prohibits an unregistered proxy advisory firm from using interstate commerce to provide proxy-voting advice, research, analysis, or recommendations to any client.
With respect to these firms, the bill (1) establishes procedures for both registration and termination of registration; (2) requires each firm to employ an ombudsman, designate a compliance officer, and publicly disclose conflicts of interest; (3) allows issuers to assess and comment on proxy voting recommendations; and (4) prohibits unfair, coercive, or abusive practices.
The bill establishes a private right of action against a proxy advisory firm that endorses an approved proposal that is not supported by the issuer and is found to be illegal.
