FSI CEO Dale Brown says his group is now pushing for a Senate senior bill.

Bills to protect senior investors, amend new equity crowdfunding rules as well as expand investments in venture capital funds passed the full House late Tuesday.

Industry groups applauded passage of the SeniorSafe Act, H.R. 4538, which passed the House late Tuesday afternoon by voice vote. The bill now goes to the Senate for approval.

The bill provides that banks, credit unions, investment advisors, broker-dealers, insurance companies and certain supervisory, compliance and legal employees would be protected from civil or administrative liability as long as they received training in how to spot and report predatory activity and disclose any possible exploitation of senior citizens with reasonable care to state or federal regulatory and law enforcement entities. 

The North American Securities Administrators Association applauded the bill’s passage early Wednesday, noting that state securities regulators look forward to “working closely” with Sen. Susan Collins, R-Maine, and other members of the Senate to secure its passage.

Dale Brown, president and CEO of the Financial Services Institute, added that FSI is now working to gain co-sponsors for the Senate version of the bill and is “hopeful” that the Senate will quickly follow suit.

By providing civil and administrative immunity to financial services firms and advisors, “the legislation would allow financial professionals to report potential abuse to government organizations, without violating privacy laws,” Brown said.

The bill also “standardizes training” to help identify and report instances of suspected abuse.

NASAA president Judith Shaw added in the statement that “senior financial exploitation is a critical policy challenge,” noting that the SeniorSafe Act “will remove barriers that have frustrated efforts to report suspected cases of senior financial exploitation, and provide new tools to help financial services professionals recognize and report such exploitation to state securities regulators and other appropriate governmental authorities.”

Ken Bentsen, president and CEO of the Securities Industry and Financial Markets Association, noted that the legislation will allow firms “to disclose cases of potential senior financial exploitation without the fear of legal ramifications,” adding that “this type of legislation, paired with collaboration within the industry and beyond, allows us to tackle elder financial abuse head-on to better protect the investments of aging Americans.”

The Fix Crowdfunding Act, H.R. 4855, passed the House Tuesday by a vote of 394-4, but failed to include the provision to increase the amount of sales allowed during a 12-month period from $1 million to $5 million.

However, the bill allows “single purpose funds” to utilize crowdfunding.

Nicholas Tommarello, CEO of Wefunder, a funding portal that has funded 110 startups with $16 million from accredited investors since 2013, told members of the House Financial Services Committee in a June letter that one lesson learned from three years of offerings under Title II of the JOBS Act “is the importance of single-purpose-vehicles to protect investors.”

Since 2013, he said, “accredited investors have invested over $250 million in early-stage startups using single-purpose-vehicles,” which allow small investors to invest alongside a sophisticated lead investor with a fiduciary duty to advocate for their interests. “The lead investor may negotiate better terms, defend against unfair dilution by negotiating with venture capitalists during follow-on financing, mentor the company, and represent small investors on the board.”

The bill also amends Title III of the Jumpstart Our Business Startups Act by upping the limit of what a company can raise before triggering Securities and Exchange Commission registration and reporting obligations. The bill raises the cap from $25 million to $75 million for entities that have reported revenues, and from $25 million to $50 million for companies that do not yet have revenue.

Meanwhile, H.R. 4854, the Supporting America’s Innovators Act of 2016, raises from 100 to 250 the limit on the number of individuals who can invest in certain venture capital funds before those funds must register with the SEC as investment companies. 

The bill passed the House on Tuesday by a vote of 388-9.