House Financial Services Committees Holds Second Mark-Up for Capital Formation, Accredited Investor Legislation

The House Financial Services Committee advanced 15 legislative measures, many on a bipartisan basis. The bills touched on the definition of an accredited investor, disclosure of financial statements by smaller companies, capital formation, and initial public offerings (IPOs), among others. Two bills, the “CFPB Transparency and Accountability Reform Act” and the “Expanding Access to Capital Act” did not receive bipartisan support. The “Expanding Access to Capital Act” (H.R. 2799) is a package of several legislative measures, including the “Increasing Investor Opportunities Act” which would allow a closed-end fund (CEF) to increase their investments in private investment funds and restrict the number of CEF shares that activist investors and their affiliates could acquire to no more than 10 percent. While it was just reintroduced as a stand-alone, bipartisan bill by Representative Ann Wagner (R-MO) and Representative Greg Meeks (D-NY) days before the hearing, the package that was advanced (which includes this bill as stated previously) did not receive any Democratic support. The hearing was contentious at points with a robust discussion of a financial statements e-delivery bill, as well as Ranking Member Maxine Waters (D-CA) rebuking the Chairman for considering legislation that had not been agreed to prior to the hearing. Committee Chairman Patrick McHenry (R-NC) noted in his opening that many of the bills being considered are bipartisan and that “I look forward to moving those to the floor immediately.” It is unclear whether Chair McHenry will advocate for a House vote on the Republican package, or whether he will encourage Republican leadership and Speaker McCarthy to consider the bipartisan parts of the package separately.

Click here to review the list of bills the Committee considered.