RIFA Act

This bill makes certain large private colleges and universities publicly report any investments tied to foreign adversaries. It applies to schools with very large endowments or holdings: more than $6 billion in assets, or at least $250 million in these types of investments. Reports would be posted in a public, searchable database run by the Department of Education. Countries and groups of concern include, for example, China, Russia, Iran, North Korea, and foreign terrorist organizations.

Schools must file a yearly report if they bought, sold, or held any such investments that year. The report is due each July 31 and must list the investments, the total value held at year’s end, the total value sold, and any capital gains. Pooled funds like ETFs count unless the Department certifies the fund isn’t holding a restricted investment. The Department must launch the public database by May 31 of the year after the law takes effect and add new reports within 30 days of receiving them. Each school must name a compliance officer who personally certifies the report is accurate.

• Who is affected: Private colleges and universities that meet the asset or investment thresholds.
• What changes: Annual disclosures of “investments of concern,” including those held through pooled funds; certain related organizations’ assets are counted; debt is valued at principal amount; a compliance officer must certify reports; reports go into a public, searchable database.
• When: Reports are due every July 31 for the prior year; the database must be live by May 31 of the year after enactment, with reports added within 30 days of receipt.
• Penalties: The Department can investigate and ask the Attorney General to sue to force compliance. Fines can be very large—50% to 100% of the relevant investment totals for a first offense, and 100% to 200% for later offenses. If a school violates the rules three years in a row, it can lose access to federal student aid programs until it proves compliance for two years. Schools can also be charged the government’s costs to enforce the law.