Sponsors (5)
The bill opens private securities markets to more knowledgeable retail investors via a free, SEC‑designed exam—expanding opportunity and investor education—but raises risks of retail losses, potential for weak implementation, and added administrative costs.
Middle‑class and other individual investors can qualify as 'accredited' by passing an SEC‑designed exam, giving more non‑wealthy investors access to private securities offerings that were previously limited to wealthy investors.
Individual investors will gain standardized education on disclosure differences, valuation risk, liquidity, and conflicts through an SEC‑designed exam, which could improve investor understanding and reduce some harms from complex private investments.
Requiring a national securities association to administer the exam free of charge increases public access to accreditation by removing direct testing fees.
Middle‑class and other retail investors who gain access to private, less‑regulated securities face higher risks of losses from illiquidity, opaque valuations, and information asymmetry despite passing an exam.
An exam‑based accreditation could be gamed or set at too low a standard, allowing individuals without true capacity to bear private‑market risks into complex investments.
Creating and administering the SEC exam will impose administrative and operational costs on the SEC and national securities associations, potentially diverting resources or increasing regulatory costs borne by taxpayers or market participants.
Based on analysis of 2 sections of legislative text.
Creates an SEC exam pathway so natural persons can qualify as accredited investors; exam must be adopted in 1 year and offered free by a national securities association within 180 days after establishment.
Requires the SEC to create an examination-based pathway so ordinary individuals can qualify as "accredited investors." The SEC must design and adopt the exam within one year; a registered national securities association must begin offering the exam for free to the public within 180 days after the exam is established. The exam must cover specified competencies about securities, private offerings, risks, governance, and disclosures.
Official title: To require certification examinations for accredited investors, and for other purposes.
Introduced May 13, 2025 by Mike Flood · Last progress July 22, 2025