S. 1970 (112th): Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act of 2011

Introduced:
Dec 08, 2011 (112th Congress, 2011–2013)
Sponsor:
Sen. Jeff Merkley [D-OR]
Status:
Died (Referred to Committee)

The bill’s title was written by the bill’s sponsor. S. stands for Senate bill.

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Status

This bill was introduced on December 8, 2011, in a previous session of Congress, but was not enacted.

Progress
Introduced Dec 08, 2011
Referred to Committee Dec 08, 2011
Cosponsors
3 cosponsors (3D) (show)
Committees

Senate Banking, Housing, and Urban Affairs

The committee chair determines whether a bill will move past the committee stage.

Full Title

A bill to amend the securities laws to provide for registration exemptions for certain crowdfunded securities, and for other purposes.

Summary

No summaries available.

Text

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Last updated Dec 08, 2011.
15 pages

Primary Source

View on THOMAS (The Library of Congress)

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GovTrack’s Bill Summary

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Library of Congress Summary

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress.

12/8/2011--Introduced.
Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act of 2011 or CROWDFUND Act - Amends the Securities Act of 1933 (SA) to prescribe conditions under which transactions of $1 million or less involving the offer or sale of securities by an issuer through a broker or funding portal are exempt from certain registration requirements and prohibitions relating to interstate commerce and the mails (crowdfunding exemption).
(Crowdfunding is a method of capital formation by which groups of people pool money, typically composed of very small individual contributions, and often via Internet platforms, to invest in a company or otherwise support an effort by others to accomplish a specific goal.) Amends the Securities Exchange Act of 1934 (SEA) to define "funding portal" as any person engaged in the business of effecting securities transactions for the account of others, solely pursuant to the crowdfunding exemption under this Act, that does not:
(1) offer investment advice or recommendations;
(2) solicit purchases, sales, or offers to buy the securities offered or displayed on its website or portal;
(3) compensate employees, agents, or other third parties for such solicitation or based on the sale of securities displayed or references on its website or portal;
(4) hold, manage, possess, or otherwise handle investor funds or securities; or
(5) engage in other activities determined by the Securities and Exchange Commission (SEC). Amends the SA to set forth qualification requirements for such crowdfunding exemption, including those for intermediaries and issuers.
Sets forth restrictions on sales of such exempt securities.
Amends the SEA to authorize the SEC to exempt crowdfunding investors from certain shareholder caps under the Securities Act of 1933.
Requires the SEC to exempt funding portals from certain registration requirements, provided that they remain subject to examination by the SEC and a national securities association.
Directs the SEC to review periodically the effects of this Act upon investor protection.

House Republican Conference Summary

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No summary available.

House Democratic Caucus Summary

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The bill contains the following citations to other parts of U.S. law:

United States Code

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