Press Releases

WASHINGTON – Congressman French Hill (AR-02) released the following statement after the Financial Services Committee advanced his bill, the Small Business Audit Correction Act, that provides much-needed regulatory relief for small investment broker-dealers by providing an exception from certain audit requirements and reinstating previous regulations:

“Often when we discuss regulatory relief in the financial services arena, we are talking about it in the vein of community banking, but so many other types of financial institutions are in need of regulatory relief, including privately-held, small non-custodial broker- dealers, which are often the gateway to the markets for Main Street businesses. That is why I am pleased the Financial Services Committee advanced my bill to provide relief to these small businesses because the current regulatory one-size-fits-all requirements has heaped additional costs and has inhibited growth for these small firms with limited human and financial resources.”

Background

Current regulations require all investment broker-dealers, irrespective of size, to hire a PCAOB-registered audit firm to conduct audits using significantly more complex guidelines designed for larger, public companies.

Hill’s Small Business Audit Correction Act, H.R. 6021, would narrowly tailor for privately held, small non-custodial broker-dealers in good standing an exception from the requirement to hire a PCAOB-registered audit firm to meet their annual SEA Rule 17a-5 reporting obligation and would reinstate the previous regulatory audit requirements.

Senator Tom Cotton (R-AR) has the companion legislation in the U.S. Senate, S. 3004.