The House Financial Services Committee voted 41-28 Wednesday to pass the Investor Protection Act, which gives the Securities and Exchange Commission more authority, some of which will be shared with the Financial Industry Regulatory Authority.
The bill gives the SEC more power and funding, creates a public right to sue for aiding and abetting violations of the securities laws and gives FINRA responsibility over the advisory arms of broker-dealers that are also investment advisers.
The bill also authorizes the SEC to bar mandatory arbitration in customer contracts with investment advisers and broker dealers, creates a fiduciary duty for every financial intermediary who offers advice and lets the SEC sue individuals for aiding and abetting financial fraud.
The committee also voted 37-32 to permanently exempt issuers with a market capitalization of under $75m from the auditing requirements of section 404(b) of the Sarbanes-Oxley Act of 2002.
In addition, the committee voted 39-30
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