Federal

Risk Disclosure and Investor Attestation Act

Source: Congress.gov · 373 words in original text

What This Bill Does

This bill amends the Securities Act of 1933 to allow individuals to invest in private companies after they sign a form acknowledging they understand the risks. The bill requires the Securities and Exchange Commission to create a rule establishing what this form must look like.

Who It Affects

Individuals who want to invest in private companies, private companies seeking investors, and the Securities and Exchange Commission.

Key Provisions

• Individuals can invest in private companies if they attest (formally acknowledge) to the company that they understand the risks of investing in private companies, using a form the SEC will create (Sec. 2(a)(15)(C)) • The form cannot be longer than 2 pages (Sec. 2(a)(15)(C)) • The Securities and Exchange Commission must create rules and establish the form for this attestation within 1 year from when the law takes effect (Sec. 2(b))

What Changes

If this bill becomes law, individuals will be able to invest in private companies after signing a short form stating they understand the investment risks, rather than being restricted from making these investments.

Important Definitions

None defined in the bill text.

I 118TH CONGRESS 1ST SESSION H. R. 1574 To amend the Securities Act of 1933 to permit an individual to invest in private issuers upon acknowledging the investment risks, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 14, 2023 Mr. DAVIDSON introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Securities Act of 1933 to permit an individual to invest in private issuers upon acknowledging the in- vestment risks, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Risk Disclosure and 4 Investor Attestation Act’’. 5 SEC. 2. INVESTOR ATTESTATION. 6 (a) IN GENERAL.—Section 2(a)(15) of the Securities 7 Act of 1933 (77b(a)(15)) is amended— 8 VerDate Sep 11 2014 02:40 Mar 25, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1574.IH H1574 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 1574 IH (1) by redesignating clause (i) as subparagraph 1 (A); 2 (2) in subparagraph (A), as so redesignated, by 3 striking ‘‘or’’ at the end; 4 (3) by redesignating clause (ii) as subparagraph 5 (B); 6 (4) in subparagraph (B), as so redesignated, by 7 striking the period at the end and inserting ‘‘; and’’; 8 and 9 (5) by adding at the end the following: 10 ‘‘(C) with respect to an issuer, any indi- 11 vidual that has attested to the issuer that the 12 individual understands the risks of investment 13 in private issuers, using such form as the Com- 14 mission shall establish, by rule, but which form 15 may not be longer than 2 pages in length.’’. 16 (b) RULEMAKING.—Not later than the end of the 1- 17 year period beginning on the date of enactment of this 18 Act, the Securities and Exchange Commission shall issue 19 rules to carry out the amendments made by subsection (a), 20 including establishing the form required under such 21 amendments. 22 Æ VerDate Sep 11 2014 02:40 Mar 25, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6301 E:\BILLS\H1574.IH H1574 kjohnson on DSK79L0C42PROD with BILLS

Important: This plain English summary was generated by AI and is provided for informational purposes only. It is not legal advice. Always consult the official bill text on Congress.gov or a qualified attorney for legal matters.