Legislation Drafted To Create An Investment Adviser Self-Regulatory Organization

Summary

In conjunction with a hearing held on September 13, 2011 by the House Financial Services Committee entitled "Ensuring Appropriate Regulatory Oversight of Broker-Dealers and Legislative Proposals to Improve Investment Adviser Oversight," a discussion draft of a bill was issued by Committee Chairman Spencer Bachus (R. Alabama) entitled the "Investment Adviser Oversight Act of 2011" (the "IA Oversight Act"). This bill, which has not been referred to the Committee, would amend the Investment Advisers Act of 1940 (the "Advisers Act") to require investment advisers registered either with the Securities and Exchange Commission ("SEC") under Section 203 of the Advisers Act or with a state authority under Section 203A to become a member of a registered national investment adviser association.¹