Summary

Requires the Securities and Exchange Commission to create a certification exam that lets a natural person qualify as an “accredited investor” by passing the test. The SEC must set up the exam within one year of enactment and a registered national securities association must make the exam available to the public for free within 180 days after the SEC creates it.

Key Points

• SEC must create an accredited-investor certification exam for natural persons within 1 year of enactment.
• A registered national securities association must offer the exam free to the public within 180 days after the SEC establishes it.
• Passing the exam is an alternate route for a natural person to qualify as an accredited investor, alongside existing wealth or income tests.
• The exam must cover finance and securities topics specified by the statute, but the law leaves many technical details (passing score, retest rules) to implementation.
• The law sets deadlines but does not allocate specific federal funding or lay out administrative procedures for exam delivery and recordkeeping.
• More individuals could gain access to private securities offerings if they pass the exam, potentially expanding the pool of investors for issuers.
• The change raises investor protection questions because knowledge does not necessarily equal the financial capacity to bear private-investment risk.
• Registered industry associations will bear responsibility for offering the exam free, which may create implementation costs and logistical needs for those organizations.

Categories & Tags