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House Passes Bill to Protect Investments of Hardworking Americans

Washington, Mar 20 -

On Wednesday, the House voted to pass H.R. 4566, the Alleviating Stress Test Burdens to Help Investors Act, with bipartisan support 395-19.

Introduced by Representative Bruce Poliquin (R-ME), H.R. 4566 amends one-size fits all, bank-centric capital-based stress testing requirements for nonbanks, such as mutual funds. More than 55% of American households use mutual fund investments to save for retirement, education, or a new home. This important, bipartisan bill protects those savers and investors by exempting nonbank financial institutions that are not under supervision by the Federal Reserve and whose primary regulator is the SEC or CFTC from the Dodd-Frank Act’s stress testing requirements.

“Applying a one-size-fits-all regulatory structure – in this case, a bank-centric model – is not only bad for the asset management industry, but far more importantly, for our constituents that they serve who choose to save and invest,” said House Financial Services Committtee Chairman Jeb Hensarling (R-TX). “This approach is commonsense: It is not one-size fits all; it recognizes that the primary regulator of nonbank financial companies is better-suited than a bank regulator to determine whether a stress test might be useful to address risks; and it recognizes that as a general matter, stress testing asset managers is difficult and often needless.”

Representative Poliquin said, “The ‘stress-test’ regulation is a well-intentioned idea, but it must be applied in the right way for each institution and not in a ‘one-size-fits-all’ approach, so that it can work as it was originally envisioned. My bill is an important and bipartisan fix that will make sure our regulations are applied properly and fairly.”