Washington—Senator Dianne Feinstein (D-Calif.) released a statement following Senate passage of the Reopening American Capital Markets to Emerging Growth Companies Act (H.R. 3606), a bill that would eliminate many investor protections.
Senator Feinstein said:
“Congress’s recent track record on financial deregulation isn’t very good. Supporters of this bill insist it will help small businesses looking to raise capital, but instead its primary effect would be to strip away critical investor protections.
“The House-passed bill applies to more than just small businesses. It also exempts large corporations—those with annual revenues up to $1 billion—from important financial reporting requirements.
“There are many good reasons why public companies are required to undergo periodic examinations and disclose financial information, and this bill undercuts those protections.
“It is a shame this process has unfolded in this manner and at this breakneck speed. There are some merits to the underlying goal of the bill. Reducing compliance costs on actual small businesses seeking to go public is a laudable goal, but we should take the time to truly understand the ramifications of this bill for the marketplace, small businesses and investors.