I
117th CONGRESS
1st Session
H. R. 4620
IN THE HOUSE OF REPRESENTATIVES
July 22, 2021
Ms. Ocasio-Cortez introduced the following bill; which was referred to the Committee on Financial Services
A BILL
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.
Regulation of family offices
Family office size limitation
Section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)) is amended—
in paragraph (11), by striking ;; (G) any family office, as defined by rule, regulation, or order of the Commission, in accordance with the purposes of this title
and inserting ; (G) any covered family office
;
by redesignating the second paragraph (29) as paragraph (31); and
by adding at the end the following:
Covered family office
In general
The term covered family office
means a family office with less than $750,000,000 in assets under management.
Rulemaking
The Commission shall further define the term covered family office
, by rule, in accordance with the purposes of this title. In issuing such rule, the Commission—
shall exclude any person who is subject to a final order described in section 15(b)(4)(H) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)(4)(H)); and
may include a family office with fewer assets under management than the threshold described under subparagraph (A), if the Commission, by rule, determines the family office is highly leveraged or engaged in high-risk activities that the Commission determines warrants inclusion, as appropriate to protect investors.
.
Exemption of and reporting by covered family offices
Section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3) is amended by adding at the end the following:
Exemption of and reporting by covered family offices
In general
The Commission may provide an exemption from the registration requirements under this section to any covered family office.
Reporting
The Commission shall require investment advisers exempted by reason of this subsection to maintain such records and provide to the Commission such annual or other reports as the Commission determines necessary or appropriate in the public interest or for the protection of investors.
.
Removal of grandfather provision
Section 409 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 80b–2 note) is amended—
in subsection (b)—
in paragraph (1), by adding and
at the end;
in paragraph (2), by striking ; and
and inserting a period; and
by striking paragraph (3); and
by striking subsection (c).
