Sponsors (3)
The bill expands access to private investment opportunities for people who receive personalized advice while reducing issuer uncertainty — at the cost of greater investor exposure to risky, illiquid investments and higher compliance and litigation burdens for financial firms and issuers.
Investors who receive personalized advice from SEC-registered broker-dealers or investment advisers can qualify as accredited investors, giving them direct access to private securities offerings (e.g., venture, private equity, hedge funds) they otherwise couldn't buy.
Issuers and small businesses get clearer, standardized criteria to rely on when determining who is an accredited investor, reducing legal uncertainty and making capital-raising decisions more predictable.
Individuals newly qualifying as accredited based on advice may be exposed to higher‑risk, less‑liquid private investments for which they lack sophistication or loss tolerance, increasing the chance of significant financial losses.
Broker‑dealers and registered investment advisers will face increased compliance and supervisory burdens to document and verify interactions that support accredited‑investor claims, raising operational costs.
Issuers that rely on a reasonable‑belief standard about whether an investor received qualifying personalized advice may face more disputes or litigation over accredited status, increasing legal risk and compliance costs.
Based on analysis of 2 sections of legislative text.
Expands the accredited‑investor definition to include natural persons whom issuers reasonably believe receive personalized investment advice or recommendations from SEC-registered advisers or brokers, and directs the SEC to conform its rules.
Official title: To amend the definition of an accredited investor to include individuals receiving advice from certain professionals, and for other purposes.
Introduced July 2, 2026 by Troy Downing · Last progress July 2, 2026
Changes the legal definition of "accredited investor" to include any natural person an issuer reasonably believes is receiving personalized investment advice or recommendations from an SEC-registered investment adviser or broker. It instructs that the meanings of "investment advice" and "recommendation" follow existing statutes and SEC rules, and directs the SEC to update its rules to match the statutory change. The change affects who can qualify to buy certain private offerings by adding a conduct-based pathway (receipt of personalized advice) rather than relying solely on income or net-worth tests. The SEC must revise its rules to conform to the new statutory language.