SEC Reform and Restructuring Act

Key Points

• The bill requires the SEC to conduct rigorous cost-benefit analysis before issuing any new regulation, including assessing impacts on small businesses, market competition, investor choice, and market liquidity. The agency must prove that the benefits justify the costs and consider alternatives, including the option of not regulating at all.
• The independent Public Company Accounting Oversight Board (PCAOB) would be dissolved and absorbed into the SEC as a new Office of Public Accounting Oversight within 2 years of enactment. The SEC's Chief Accountant would lead the new office.
• The SEC would be required to provide at least 60 days for public comment on proposed rules, or at least 30 days if the rule addresses imminent investor harm. Federal holidays would not count toward those deadlines.
• The SEC Chair would have to testify before Congress every six months about the agency's activities, and all Commissioners would join at least once a year. This is meant to increase congressional oversight of the SEC.
• The GAO would audit the SEC's cybersecurity systems, IT spending, and data handling within one year, and would also study the actual costs and effects of the SEC's major rules every three years.
• The bill limits how the SEC can count violations when imposing penalties. Multiple acts of noncompliance from the same root cause, the same misstatement, or a continuing failure to comply would count as a single violation, potentially reducing fines against companies and individuals.