# What This Bill Actually Does

This bill changes who gets to invest in certain private investment opportunities that are normally off-limits to regular people. Right now, the government restricts access to risky private investments (like startup companies or private equity funds) to people it considers "accredited investors"—basically, wealthy or financially sophisticated people. This bill codifies and clarifies exactly who qualifies, making the rules clearer and more consistent.

The bill establishes five main ways someone can become an accredited investor. First, you qualify if your net worth (excluding your primary home) exceeds $1 million, either on your own or combined with your spouse. The bill specifically says your house doesn't count toward this number, and mortgage debt on your home doesn't count against you either—though if you've taken out extra loans against your home in the last two months, those do count as debt. Second, you qualify if you've earned more than $200,000 individually (or $300,000 jointly with a spouse) for the last two years and reasonably expect to hit that income level again this year. Third, if you're currently licensed as a broker or investment adviser in good standing, you're automatically accredited. Fourth, the bill creates a pathway for people with specialized professional knowledge—like engineers investing in tech startups or doctors investing in medical devices—to qualify if the Securities and Exchange Commission (SEC) creates rules recognizing their expertise and a financial industry organization verifies it.

The practical effect is that more people might gain access to private investment opportunities, particularly professionals with relevant expertise who wouldn't otherwise meet the wealth or income thresholds. The bill also requires the SEC to update its investment rules within six months to match these new definitions. The $1 million and $200,000 income thresholds will be adjusted every five years for inflation, so they'll gradually increase over time. For most people, this won't change much—you still need to be fairly wealthy or high-earning to access these private investments—but it does open doors for certain professionals and clarifies the rules so there's less confusion about who qualifies.

Fair Investment Opportunities for Professional Experts Act

Hill, J. French

Fair Investment Opportunities for Professional Experts ActThis bill expands the eligibility criteria for an accredited investor for purposes of participating in private offerings of securities to include an individual determined by the Securities and Exchange Commission (SEC) to have qualifying professional knowledge through educational or professional experience. (Certain unregistered securities may only be offered to accredited investors.)The bill also provides statutory authority for certain existing criteria for an accredited investor, including licensure or registration in good standing as a broker or investment adviser, specified annual salary, and specified net worth.Further, the SEC is directed to revise the definition of accredited investor in Regulation D (which exempts certain offerings from SEC registration requirements) to conform to changes in this bill.