Fair Investment Opportunities for Professional Experts Act

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, H.R. 2201 would create an unnecessary and potentially dangerous loophole in Federal and State securities laws by allowing companies to sell unregistered securities without important safeguards that normally apply to such transactions. Specifically, the bill would allow a company to raise up to $500,000 from 35 or fewer investors, subject only to the requirement that each of these investors has a substantive preexisting relationship with the company.

Currently, before a company can offer or sell its securities, it must either register the offering with the Securities and Exchange Commission--that is the SEC--or qualify for at least one of several existing exemptions from registration. These exemptions provide reduced regulatory requirements for businesses conducting the offerings, but are limited to investors who have the financial sophistication to understand the risks, or enough assets to bear losses without the full protections of the securities laws.

Additionally, unlike H.R. 2201, these existing exemptions include several critical investor protections, such as notice to regulators, limitations on advertising, and restrictions on resale. For example, securities offered pursuant to rule 506 of regulation D are restricted, meaning they cannot be resold for at least a year without registering them; that is, re-registering them.

Additionally, the re-registration exemptions available under the crowdfunding rules and regulation A impose limitations on the amounts an individual can invest in a year, thereby placing a cap on potential losses.

H.R. 2201's lack of basic safeguards would leave investors vulnerable to an array of investment scams. For example, a purchaser of securities offered pursuant to H.R. 2201 would be able to immediately resell the securities in secondary transactions. In the past, the failure to restrict the resale of unregistered securities has exposed secondary investors to ``pump and dump'' schemes, a form of fraud that involves hyping up cheap junk stock in order to resell it at a higher price to unwitting investors.

Additionally, investor and consumer advocates, like Americans for Financial Reform, Center for American Progress, and Public Citizen, oppose H.R. 2201 because it would enable a particularly deceptive scam known as ``affinity fraud.'' Bad actors perpetrating affinity fraud could use H.R. 2201 to prey upon religious communities, ethnic groups, and the elderly.

Just a few years ago, the SEC shut down a scheme targeting the Hispanic community in southern California. The perpetrators raised more than $800,000 by representing to close friends and family members that their investment would be used to develop a financial services firm serving the Hispanic community.

The SEC found that, instead of developing the purported business, the scammers ``used a large part of the investors' money to engage unsuccessfully in high risk `day-trading' of stocks; pay personal living, travel, and entertainment expenses; or make other unexplained expenditures with no connection to the purported startup business activities.''

H.R. 2201 would provide a roadmap for bad actors to similarly rip off investors. The bill's $500,000 cap on offerings does not eliminate the need for robust safeguards against fraud and abuse. In fact, these protections are even more important for offerings of this size, given the proliferation of investment schemes in the smaller offering space.

The SEC has found that ``fraud in the micro cap stock markets is of increasing concern to regulators, as such markets have proven to be fertile grounds for fraud and abuse.''

While $500,000 may not seem like a lot on Wall Street, for Main Street Americans, losing even a fraction of that amount would destroy the hope of one day retiring with dignity. Existing exemptions such as those available under the SEC's regulation D, regulation A, and crowdfunding rules provide ample opportunities for companies to raise capital while also protecting investors.

H.R. 2201 would only expose hardworking Americans to a new and wholly unnecessary risk. For these reasons, I urge my colleagues to vote ``no'' on H.R. 2201, and I reserve the balance of my time.

General Leave

Mr. Speaker, I yield such time as he may consume to the gentleman from Rhode Island (Mr. Cicilline).

Mr. Speaker, may I inquire as to how much time I have remaining.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, we have laid out this morning exactly how vulnerable groups and individuals can be taken advantage of with legislation like this. I don't know exactly where this legislation originated, but I can almost guarantee you that we are creating opportunities for individuals who don't have the best interest of our constituents at heart to literally get small groups together, 35, I guess, or less, and sell them on ideas where they are raising funds that probably will not result in profits as expected by those who are investing in these schemes.

No, there are no protections. There is no notice. The SEC will not know when and where these schemes are arising. So I would say to my colleagues on the opposite side of the aisle: When are we going to act as if we have the best interests of our constituents at heart? When are we going to be about protecting consumers rather than opening up opportunities for them to be the victims of fraud?

We have fraudulent schemes that are directed at the most vulnerable people. I know where those people who are organizing these schemes will go. They will go to our churches where well-meaning ministers and parishioners will be taken advantage of.

In these vulnerable communities that are always taken advantage of, we have people who are the victims of payday loans where they are paying 400 percent for moneys that they are borrowing when they are desperate in between paychecks. We have rent-to-own schemes. We have all kinds of schemes where these convenience stores, in places where we have food deserts, are charging extremely high prices for food that is basically being sold for regular, ordinary, good prices in other communities.

In some communities, even in California, the gas taxes are rising. We have the rental market that is going off the scale all over this country with people not being able to afford a decent lease or a decent rental space, and so here we are just opening up another opportunity for folks to be ripped off.

It is going to happen; I can guarantee you that. When you have something like this that is passed by the Congress of the United States, it is going to be taken advantage of, and the way that this is constructed, it almost begs to be taken advantage of.

So do you know what happens when this kind of thing takes place and Members of Congress put their reputations on passing this kind of legislation? When the rip-offs start and people are harmed a few years later, then they are going to come back with legislation talking about how they are correcting the fraud and the rip-offs that we caused in the first place.

When is this going to stop? We have a Consumer Financial Protection Bureau that is struggling every day to protect our consumers. Prior to Dodd-Frank, we had our oversight agencies with the responsibility of protecting consumers, but they didn't have any real protection. So Dodd-Frank reforms helped to create opportunities for Members of Congress to be able to protect their consumers and not to be involved in these kinds of schemes.

But the opposite side of the aisle has spent an inordinate amount of time trying to kill off the Consumer Financial Protection Bureau, and they have done it in so many ways. Not only do they come up with amendments time and time again to try and shut down the Consumer Financial Protection Bureau, they treat the Director of the Consumer Financial Protection Bureau so badly that they almost deny him the opportunity to come before our committee and to be heard.

So I don't know whose side legislators are on who create this kind of crap. I don't understand why it is deemed to be important to open up the opportunity for schemes and to not give the SEC the ability to know when they are getting started, to have the

kind of disclosures, and to have the kind of oversight that would protect the most vulnerable people in our society.

Mr. Speaker, yes, this legislation will probably pass today. The Republicans have the majority votes in this Congress, and I suppose they are going to get all of their people to vote for this bill that is going to rip off some of their constituents, and, again, we won't be able to stop it because, again, they have the majority votes.

But I want the people of this country to know and understand what is happening, who is doing it to them, and why they are having a difficult time. At a time when the rental market is going off the scale and they can't afford to pay the first and the last month's rent to get into a place, I want them to know who is creating the difficulties in their lives when their jobs have not increased their pay, they are still trying to have a decent quality of life for their families, despite the fact that the pay does not match the job that they are doing, and they haven't had the pay increases.

When are we going to show that we stand up for the least of these? When your churches get ripped off--and we are working on some of those schemes now where, even with the responsibilities that the SEC has, we have people who are getting ripped off, and here we come with another piece of legislation. Then what we do is we shade it in terms of this is for small business development. Then we hear from the opposite side about all the other companies who started as little-bitty companies in their garage. Well, they all started without this bill. They didn't need this bill to start.

So why are you doing this? Yeah, you are right; there are a lot of companies, and you have named them, particularly in the high tech industries that started, and they had some of their own money to get started with, and maybe the family helped them, I don't know, but they didn't have this legislation. They didn't need this legislation. Nobody needs this legislation.

This legislation is harmful, and I would ask my colleagues to vote against the bill. If there are any Members on the opposite side of the aisle who really are concerned about their constituents, I would ask them to defy their leadership and vote against this bill.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, by allowing entities to sell unregistered securities based solely on a preexisting relationship with the investor, H.R. 2201 would create a road map for affinity fraud.

Affinity fraud is a type of investment scam where swindlers prey upon members of identifiable groups such as ethnic or religious communities or the elderly. Often, affinity fraudsters take advantage of preexisting relationships to engender trust and convince victims that a dubious investment is legitimate.

The Securities and Exchange Commission has found that such frauds pose heightened risks to investors because they can be difficult for regulators or law enforcement officials to detect, particularly where the fraudsters have used respected community or religious leaders to convince others to join the investment.

The following cases represent a sampling of recent affinity fraud actions from around the United States.

In August, 2013, the SEC halted an offering fraud scheme where Steven Bruce Heinz, a Utah resident purporting to be an investment adviser, sold phony investment contracts to more than 15 of his former clients, family members, and friends. According to the SEC's complaint, Heinz raised $4 million in investor funds he used to engage in high-risk trading of future contracts and to pay his own personal expenses such as family vacations to Mexico and a $600,000 loan.

Among the investors taken in by Heinz scam was ``the recent widow of a church associate of Heinz who invested with Heinz after he volunteered to assist her with her finances and investments after her spouse died.''

In 2012, the SEC stopped a $7.5 million fraud operation targeting the Persian-Jewish community in Los Angeles. The SEC's assistant regional director stated that Shervin Neman ``deceived members of his own community to raise money in this fraudulent Ponzi scheme. By exploiting investors' trust in him, Neman was continually able to raise more money to pay back existing investors and finance an extravagant lifestyle.''

According to the SEC's complaint, among other things, Neman spent investor funds to pay for his wedding and honeymoon, his wife's engagement ring, luxury cars, and VIP tickets to entertainment venues.

In 2015, the SEC permanently barred John Allan Russell from the securities industry after Russell pled guilty to securities fraud in Colorado State court. The SEC's administrative law judge found that Russell obtained almost $300,000 by selling debt securities to an elderly victim who suffered from dementia and Alzheimer's disease. The ALJ also determined that ``Russell's scheme may have involved affinity fraud because the misconduct began a few years after the victim acted as Russell's godfather at his baptism.''

These cases demonstrate that H.R. 2201's preexisting relationship requirement would not provide any meaningful deterrent against abuse. On the contrary, it would encourage opportunistic conduct targeting communities.

Mr. Speaker, I urge my colleagues to join me in voting ``no'' for this bill.

Given all that the SEC is able to do, they can't keep up with these schemes, and now you are going to open up the door for them to have to wrestle with trying to help people who are victims of these kinds of schemes.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, the North American Securities Administrators Association sent this letter of concern. They said that H.R. 2201 would result in an overly broad Federal exemption that would allow public solicitation and sales to any investor, regardless of sophistication or financial wherewithal, subject only to the requirement that there be a previously existing relationship, a standard that is not difficult to establish.

In practical terms, this means that Main Street investors could be solicited and sold up to $500,000 in private security by bad actors, including persons having been convicted of crimes or subject to one or more previous State enforcement actions, without any disclosure to the investor and without any notice to State or Federal regulators.

There is no valid basis for Congress to prevent State officials charged with protecting their constituents from making decisions about purely local or regional issues that would rely on the exemption established by H.R. 2201.

Further, preemption of State review or even notification for the type of small, localized offerings contemplated by H.R. 2201 would effectively handcuff the regulators best positioned to oversee such offerings.

Public Citizen said this bill ``would permit small offerings with no investor protections, such as notice of the offerings. It will enable a type of affinity fraud, where the seller can unload dubious securities, provided there is some relationship between seller and purchaser. This bill assumes that a preexisting relationship will deter abuse, which is a tenuous foundation, at best. Further, the relationship can begin with the offer.''

They don't have to have a previous relationship. It would start when the offer takes place.

Public Citizen further stated that ``the bill says the relationship must only exist before the purchase.''

Mr. Speaker, I include in the Record letters from these groups, as well as a letter from Americans for Financial Reform.

North American Securities

Administrators Association, Inc.,

Washington, DC, November 7, 2017.

Re H.R. 2201--The Micro-Offering Safe Harbor Act.

Hon. Paul Ryan,

Speaker, House of Representatives,

Washington, DC.

Hon. Nancy Pelosi,

Democratic Leader, House of Representatives,

Washington, DC.

Dear Speaker Ryan and Leader Pelosi: On behalf of the North

American Securities Administrators Association (``NASAA''), I

write to express concern and raise specific objections to

certain provisions of H.R. 2201, The Micro-Offering Safe

Harbor Act, which is scheduled to be considered by the House

of Representatives this week. The legislation would amend

securities laws in ways that could be profoundly detrimental

to investors, and detract from the viability of the

marketplace for offerings from new or smaller issuers that

are compliant with securities law.

The Micro-Offering Safe Harbor Act amends Section 4 of the

Securities Act of 1933 to create a new exemption from

registration. To qualify for the exemption, an offering would

have to meet certain criteria regarding the number of

purchasers, their relationship to the issuer, and the amount

of capital raised. However, as more fully discussed below,

the legislation fails to include critical investor protection

measures and would preempt state regulatory authority.

State securities regulators understand the need of small

businesses to efficiently raise capital and the role strong

investor protection plays in facilitating this goal.

Unfortunately, the changes embodied in H.R. 2201, while well

intended, are ill-advised and potentially quite dangerous.

For example, unregistered securities purchased under the

exemption established by H.R. 2201 would not be

``restricted,'' and could thus be sold immediately, exposing

investors to classic ``pump and dump'' schemes. Furthermore,

NASAA is aware of no evidence to support the proposition that

Congress should create a ``safe harbor'' to permit

unregistered securities offerings to be offered and sold,

including through general solicitation, regardless of

investor sophistication or financial wherewithal. Even as the

bill stands to introduce new and totally unnecessary risk

into securities markets--failing to even disqualify ``bad

actors'' from these markets--the goal of the legislation

remains unclear and its necessity is, at best, not well-

established. It is clear, however, from the terms of the

exemption, and its failure to impose even the modicum of

regulatory oversight that exists for similar ``private''

offerings under SEC Regulation D Rule 506, that offerings

made under the new exemption are likely to be

disproportionately risky and illiquid. This fact alone should

be cause for concern by Congress.

Beyond stark new risks to investors, this legislation

threatens to jeopardize the continued viability of

established markets geared to smaller issuers, many of which

operate lawfully within existing federal and state securities

laws. Such markets include securities sold pursuant to SEC

Rule 506, new federal exemptions established by the JOBS Act,

and exemptions adopted in many states to permit intrastate

crowdfunding. Without effective investor protection measures

a potential effect of H.R. 2201 could be to cause investors

to abandon the markets for smaller issues.

In closing, NASAA reiterates strong opposition to the

preemption of state registration and notice filing authority

in H.R. 2201. There is no valid basis for Congress to prevent

states from making decisions about the local or regional

issues that H.R. 2201 seeks to encourage. Failure to register

or at the very least, to notice file with state regulators

results in unknown sales, by unknown actors of unknown

enterprises and result in no gatekeeper function to protect

retail investors whose only source of recourse for fraudulent

sales are the state securities regulators. At a minimum H.R.

2201 should:

1) Include bad actor disqualifications;

2) Establish a holding period to reduce the likelihood of

``pump and dump'' schemes;

3) Provide at least a notice filing with state regulators

so that in the event of a fraudulent offering, state

regulators can begin an investigation to try and protect

retail investors;

4) Limit the sale amount to retail investors so that

investors are not ``encouraged'' to place all their eggs in

one basket; and

5) Prohibit or restrict general solicitation of what are

clearly high risk securities.

Thank you for your consideration of NASAA's views.

Sincerely,

Joseph P. Borg,

NASAA President and Alabama

Securities Director.

Mr. Speaker, I don't understand why Members of Congress would disregard what the State regulators are saying. State regulators are saying: Don't do this. Don't preempt us. Don't pass legislation that would undermine our ability to protect your constituents.

Yet they are ignoring this altogether. I know that they received this information. I know that they know that the association had cautioned against this legislation. Let me just make sure that everybody knows. It is the North American Securities Administrators Association. They represent all of the States in cautioning against this legislation.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

For my colleagues on the opposite side of the aisle who are bemoaning the fact that small businesses don't have access to capital, they have these relationships with all of these big banks.

Why don't they get to the big banks and tell them they ought to be making loans to small businesses?

I don't hear them, as a part of, you know, their rhetoric, talking about how many of the big banks are not being responsible. And so my colleague on the opposite side of the aisle and my friend talk about what is common sense. I tell you what is common sense. Common sense is not to place vulnerable people in a position where they are going to get ripped off.

Mr. Speaker, H.R. 2201 is a harmful bill that would simply serve as an invitation for investment scams. The bill fails to take into account the numerous other exemptions we have for small-dollar offerings, including under regulation D, regulation A, and crowdfunding rules. These exemptions already permit small businesses to raise capital while also protecting against fraud.

In light of these exemptions, there seems to be no reasonable explanation for the amount of legislative effort that has been wasted on this bill. Instead of H.R. 2201, which is unwarranted and may actually harm investors and the integrity of our markets, the House should be focused on passing legislation that can actually improve the lives of the Americans whom we serve.

Mr. Speaker, I urge my colleagues to vote ``no'' on H.R. 2201. Don't be a part of enacting one more scheme that is going to rip off our constituents, and then, you know, a few years later, come back here and talk about what a terrible thing it is that people are being ripped off by these investors, some of them who are criminals, but nobody knows it. The disclosure does not have to take place. They don't know that they have people who have already been involved in crimes who are coming to them talking about: let me help you earn some profits on this investment.

We know better. Common sense tells us better. If, in fact, we are committed to the proposition that we have a responsibility to protect our constituents from rip-offs, from fraud, from being taken advantage of, we will not support this bill. And I would hope that my friends on the opposite side of the aisle, despite how far they have gone in trying to represent that this bill is something that it is not, would at least change their minds today and support their constituents and vote ``no'' on this bill.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I claim the time in opposition to the amendment, even though I am not opposed.

Mr. Speaker, under the current language of H.R. 2201, investors could be sold private securities by persons who have committed fraud or have violated security laws. Representative Emmer's amendment purports to add a layer of investor protections by adding a provision to so-called disqualify certain bad actors from utilizing the exemption.

While I applaud Mr. Emmer's attempt to add this most basic guardrail to a bill that otherwise creates an unmitigated safe harbor for fraudsters, I wonder why this provision was dropped from a similar bill that Mr. Emmer introduced last Congress.

Unfortunately, this amendment is woefully inadequate to address the otherwise dangerous new exemption created by H.R. 2201. Because the underlying bill requires no disclosure to investors and imposes no obligation to notify regulators of the offering, even if amended, H.R. 2201 would lead convicted fraudsters and lawbreakers to police themselves.

Moreover, the bill ties the hands of State securities regulators, who are the primary watchdogs over small, local securities offerings. If enacted, H.R. 2201 would leave a gaping hole in oversight of the very offerings it permits.

H.R. 2201 is a misguided attempt to support small businesses that is not meaningfully improved by the meager protections of this amendment. For these reasons, I continue to oppose this bill, and I urge all of my colleagues to vote ``no'' on H.R. 2201.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I would like to warn the Members of this House not to take the compliments seriously that are being given by the gentleman who would have you believe that somehow I have totally embraced this amendment because I think it is going to change the fact that there is no disclosure to those who would be investing and no notice to the SEC.

So don't take him seriously when he talks about thanking me for encouraging and embracing. I have not done that. I am going to tolerate this amendment. It is late. It doesn't do what he says it is going to do. The bill is still a bad bill. It is a bill that is going to harm people. It is a bill that targets the most vulnerable people in our society. It is a bill where fraudsters are going to go into churches and convince ministers and parishioners that they are out to help them.

Members of Congress, do the right thing. Today, stand up against another attempt by misguided folks who would have you believe that they are helping people when, in fact, they are opening up opportunities for them to be ripped off one more time, ripped off in ways that could have been avoided.

Mr. Speaker, I oppose this bill. I ask everybody to vote against this bill.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, while government isn't meant to create jobs, with the help of the President, Congress can set Federal policies that establish a pro-worker, pro-business environment that lifts people out of poverty, helps families, and drives our country forward.

One problem today that is impeding job growth is access to capital for small businesses. American businessmen and -women are often unable to get the loans they need to start a new enterprise or to grow an existing one.

Additionally, if a firm would like to publicly sell stock to raise money, it must register with the Securities and Exchange Commission, which costs $2.5 million, on average; an amount most small businesses simply cannot afford.

Small and emerging businesses are a key to the economic engine in America. The Small Business Administration found that these businesses create over half of the new jobs on an annual basis in this country. More importantly, today's small businesses are tomorrow's success story.

Just think of all the great businesses in this country that started with a dream in a garage: Amazon, Apple, Microsoft, Disney, Harley- Davidson, and Minnesota's own Medtronic. We want to empower the entrepreneurs in this country to dream, innovate, and create jobs that grow our economy.

That is why I introduced the Micro Offering Safe Harbor Act. This bill will make it easier for entrepreneurs and

small businesses to raise money from family, friends, and their personal network without running afoul of the vague and undefined ``private offering'' safe harbor provisions in the Securities Act of 1933.

Thus, the Micro Offering Safe Harbor Act helps bring clarity to existing law so that our current and future job creators can easily raise capital within the confines of an easy-to-understand provision without the help of an expert.

This legislation requires three specific criteria to be met simultaneously in order to trigger a safe harbor exemption for a security offering instead of just one or more. These criteria ensure that: one, each purchaser has a substantive preexisting relationship with an owner; two, there are no more than 35 purchasers of securities from the issuer that are sold in reliance on the exemption during the 12 months proceeding; and, three, the aggregate amount of all securities sold by the issuers does not exceed $500,000 during the 12- month period preceding the offering. The bill also exempts any of the aforementioned security offerings from blue-sky laws, while maintaining antifraud provisions at the Federal and State level.

These provisions protect Americans from criminals trying to swindle them out of their hard-earned money, while making capital more accessible to businesses by investors from around the country.

In fact, I will be offering an amendment to enhance these antifraud provisions. This amendment, which incorporates the suggestions made by my colleagues on the other side of the aisle during a legislative hearing in the last Congress, will ensure that individuals who have been disqualified under the ``bad actor'' disqualification standard, as is listed under current law, are prohibited from using the exemption provided under H.R. 2201, establishing yet an additional layer of investor protection.

Entrepreneurs and small-business owners need access to capital in order to achieve the American Dream. Although small businesses accounted for 99.7 percent of all the businesses in the United States last year, only half of them will survive longer than 5 years, according to our Bureau of Labor Statistics.

Lack of capital or difficulty accessing capital is one of the main causes of failure for many of these small businesses. A 2015 survey conducted by BlueVine found that 75 percent of small and emerging businessowners reported their primary source of funding comes from their own personal finances, followed by banks at 16 percent and family and friends at 6 percent.

While banks and credit unions do their best to offer the funding these businesses need to grow and thrive, there are still 3 million fewer small business loans made annually, today, than there were before the 2008 financial crisis. H.R. 2201 seeks to build off the success of the Jumpstart Our Business Startups Act of 2012, better known as the JOBS Act, and will continue to spur capital formation for the true job creators and drivers of our country's economy.

The Micro Offering Safe Harbor Act helps small and emerging companies add another tool to the toolkit, enabling them to confidently find alternative ways of raising these funds without having to pay for costly securities experts and without the fear of lawsuits if they operate within these easy-to-understand parameters.

That is why the Micro Offering Safe Harbor Act is endorsed by the National Small Business Association; the Small Business & Entrepreneurship Council; the National Federation of Independent Business; the Chamber of Commerce; Heritage Action; and Engine, ``The Voice of Startups in Government.''

The House approved an identical version of this legislation during the 114th Congress as part of the Accelerating Access to Capital Act, and language similar to H.R. 2201 was included in the Financial CHOICE Act, which was adopted by this Chamber in June.

Mr. Speaker, the time has come for Congress to come together and help small businesses help themselves by making this important update and improvement to the Securities Act of 1933.

I want to thank Chairman Hensarling; Capital Markets, Securities, and Investment Subcommittee Chairman Huizenga; and all of the staff on the Financial Services Committee for their hard work on this legislation.

Mr. Speaker, I urge my colleagues to support this legislation and hope that both parties will use H.R. 2201 as a way to show their support for more opportunities and better lives for our job creators.

Mr. Speaker, I include in the Record letters from the National Small Business Association, the Small Business & Entrepreneurship Council, the United States Chamber of Commerce, Heritage Action for America, and Engine.

National Small Business Association.

Hon. Tom Emmer,

House of Representatives,

Washington, DC.

Dear Representative Emmer: On behalf of the National Small

Business Association (NSBA), the nation's first small-

business advocacy organization, with more than 65,000 small-

business members representing every state and every industry

across the country, I commend your leadership for introducing

the Micro Offering Safe Harbor Act (H.R. 2201) as it will

have an immediate and direct impact on small businesses

looking to raise capital. NSBA has long supported the kind of

simplification this legislation would bring for small

businesses.

Capital is the lifeblood of any small business, and often

small-business owners need capital at various stages; some at

their startup and others later when they are looking to

expand. Despite this ongoing need, small-business lending

from banks has decreased over the last decade and many small

businesses have few options for obtaining capital. According

to NSBA's 2016 Year-End Economic Report, small-business

access to capital remains stubbornly unchanged since the

previous year, with just 69 percent of small firms reporting

they are able to get adequate financing. This drop has real-

world implications: 41 percent said lack of capital is

hindering their ability to grow their business or expand

operations, and 20 percent said they had to reduce the number

of employees as a result of tight credit.

Therefore, raising capital though securities is an

attractive alternative option for many small-business owners.

However, the current regulatory requirements are quite

onerous for small businesses, often requiring expensive

specialized counsel for even very small securities offerings.

NSBA supports this targeted legislation that creates a safe

harbor for small securities offerings which meet requirements

clearly identified in the legislation. Under the legislation,

these exemptions include offerings in which each purchaser

has a substantive pre-existing relationship with the owners,

where the issuer has less than 35 purchasers utilizing the

exemption in the preceding 12 month period, or where the

total amount raised during the preceding 12 month period is

less than $500,000. By creating three safe harbor exemptions

for ``non-public offerings,'' businesses can operate with

clarity and a clear conscience knowing that they would be

exempted from registering with the Securities and Exchange

Commission (SEC). Additionally, the legislation also exempts

transactions meeting the specified requirements from state

registration requirements, commonly referred to as ``blue sky

laws.''

Raising capital for small businesses from friends and

family already takes place on a regular basis, except those

transactions often lack the legal protections and structure

of securities law. In addition to expanding access to capital

for small businesses, this legislation will bring those

transactions under a recognized legal framework, and make

resolving disputes that arise much more efficient. Finally,

bringing these existing transactions under an existing legal

framework will provide a sound legal basis for subsequent

larger offerings requiring registration with the SEC.

Access to capital continues to be one of the most pressing

issues facing the small-business community. All small

businesses need an injection of capital at one point or

another, unfortunately in the past several years it has

become difficult for small businesses to get the funds they

need to grow and expand. NSBA is pleased to support the Micro

Offering Safe Harbor Act as it will help small businesses

around the country expand and create new jobs in their

communities.

Sincerely,

Todd McCracken,

President & CEO.

Mr. Speaker, I have an amendment at the desk.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, the amendment I am offering today will enhance antifraud and consumer protections for small businesses and startups seeking to take advantage of the micro offering exemption outlined in the underlying bill.

While the legislation itself requires three specific criteria to be met simultaneously in order to trigger a safe harbor exemption for a security offering, my amendment adds an additional layer of protection to further safeguard investors from bad actors.

Specifically, my amendment prohibits the exemption from being available for those who have been disqualified under the bad actor disqualification standard established by the SEC. This language was included with the support of my colleagues from both sides of the aisle during consideration in committee in the 114th Congress, and I am hopeful they will support its inclusion again in the 115th.

I want to reiterate that nothing in the base text of this bill erodes or limits the ability of Federal or State regulators to prosecute fraud, nor would it prevent private common law causes of action for fraud or breach of contract between the interested parties.

This amendment builds upon these existing protections and drives home the point that the Micro Offering Safe Harbor Act is purely focused on helping our small businesses and entrepreneurs access the tools they need to grow and create jobs in an orderly and legal manner.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I will close at this point.

Mr. Speaker, I want to thank the ranking member for her encouragement and her compliments, and I want to just point out that the Micro Offering Safe Harbor Act was actually improved as a direct result of the ranking member's suggestions.

So, again, I want to thank her for her compliments here today, her encouragement in helping us make this an even better bill for entrepreneurs and small businesses across the country. At this point, I would encourage support for the amendment.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, pursuant to House Resolution 609, I call up the bill (H.R. 2201) to amend the Securities Act of 1933 to exempt certain micro-offerings from the registration requirements of such Act, and for other purposes, and ask for its immediate consideration in the House.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, we know that, unfortunately, after 8 years of bad economic policies from the Obama administration, working people did not receive a pay increase. We know that we had one of the lowest labor participation rates in modern history. We know that the economy was limping along at 1\1/2\ to 2 percent economic growth.

But, fortunately, Mr. Speaker, a new day has dawned and now, all of a sudden, we see that, with the policies of Republicans in Congress, with the policies of the Trump administration, we are seeing promising signs. What we are seeing all of a sudden now is 2 quarters, Mr. Speaker, of 3-plus percent economic growth. This means a difference to working families. They are finally seeing increases in their paychecks, increases in their take-home pay.

That is why one of the most exciting policies that are being worked upon today that we hope to see soon is fundamental, pro-growth tax reform for the entire American economy; one that would grow our economy and that makes a Tax Code fairer, flatter, simpler, more competitive; one that would lower rates for families and allow 90 percent of Americans to fill out their forms on something akin to a postcard; something that would help our small businesses and entrepreneurs.

I look forward, Mr. Speaker, to having that legislation on the floor soon. But we have legislation today that is also important to our small businesses and our entrepreneurs, H.R. 2201, by the gentleman from Minnesota.

What is so important about this legislation, Mr. Speaker, is that it would allow our entrepreneurs and our small businesses to more effectively be able to reach out to family and friends to get the needed capital to start their businesses.

A 2014 survey by the Kauffman Foundation found out that over 28 percent of startups raise their funding from their personal network. Mr. Speaker, we have a challenge, and that is the Securities Act does not clearly define what is a public offering or, conversely, a nonpublic offering. So this makes it very difficult for our early-stage entrepreneurial growth companies to go out and do any kind of private placement to raise funds from friends and family.

Now, we know that a private placement is already something that is established in law. But what isn't established is a bright line, safe harbor for these business enterprises to go out and raise these funds.

So what we also know, unfortunately, from our Securities and Exchange Commission is that a registered offering is simply not economically

feasible for a small business, an entrepreneur, an issuer who is seeking to raise less than $1 million.

So too often, Mr. Speaker, we have a number of these enterprises that, frankly, just never get jump-started because they don't have the opportunity for a private offering. That is why it is so important.

I want to thank the gentleman from Minnesota (Mr. Emmer) for his leadership in bringing this legislation to the House floor today.

So it is a simple piece of legislation. Again, it simply allows a bright line, safe harbor for very small offerings. It requires that each purchaser has a substantive preexisting relationship with an officer, director, or shareholder of the issuer.

The issuer must reasonably believe that there are no more than 35 purchasers of the securities, and the aggregate amount of all securities sold by the issuer cannot exceed $500,000 in a 12-month period.

So, Mr. Speaker, we are talking about a very small portion of startups, but a very vitally important section of our startups that need capital.

Mr. Speaker, a few decades ago there was a company where a gentleman borrowed money from his father to import Japanese sports shoes, and he purchased 200 pairs of these Japanese sports shoes. He started a business called Blue Ribbon Sports, and today we know it as Nike.

A few decades ago there was an investor out in Omaha, Nebraska, who borrowed money from seven friends and family members, including his sister Doris and Aunt Alice. Over the next 9 years, this initial investment grew, and this gentleman purchased something called Berkshire Hathaway, the textile company that has now led to the Berkshire Hathaway empire.

In 1994, there was a gentleman who took a loan from his parents, moved to a two-bedroom, small apartment, and launched a company called Amazon.

We want to make sure that the next Berkshire Hathaway, the next Amazon get launched, and that is why it is so critical we enact H.R. 2201.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and submit extraneous material on the bill under consideration.

Mr. Speaker, I yield 5 minutes to the gentleman from Minnesota (Mr. Emmer), the sponsor of the legislation and an outstanding member of the Financial Services Committee.

Mr. Speaker, I yield an additional 30 seconds to the gentleman from Minnesota.

Mr. Speaker, I yield myself 30 seconds, just to say, as I listen to the gentleman from Rhode Island and the ranking member, their comments are very interesting, but everything they described is already illegal. Their remarks acknowledge that the SEC can and does bring actions to enforce the securities laws and shut down fraud when they discover the fraud.

Nothing in H.R. 2201 eliminates the DOJ's ability to pursue criminal prosecutions or fraud. Nothing in it impacts the SEC's ability to pursue civil actions against issuers who engage in fraud under section 17(a) of the Securities Act of 1933. It is just a red herring. It is one of the reasons we have had such poor economic growth under the Democratic regime.

Mr. Speaker, I yield 3 minutes to the gentleman from Missouri (Mr. Luetkemeyer), chairman of the Financial Institutions and Consumer Credit Subcommittee of our committee.

Mr. Speaker, number one, I was very pleased to hear one of the most compelling indictments of 8 years of the Obama administration I have ever heard on the House floor, and I thank the ranking member for it.

Mr. Speaker, I yield 3 minutes to the gentleman from Pennsylvania (Mr. Rothfus), who is the vice chairman of the Financial Institutions and Consumer Credit Subcommittee.

Mr. Speaker, I yield 3 minutes to the gentleman from Colorado (Mr. Tipton), who is the vice chairman of the Oversight and Investigations Subcommittee.

Mr. Speaker, I yield myself 10 seconds just to say I heard the word ``protection'' often used by my friend, the ranking member, but she and her friends on the other side of the aisle had 10 years to protect paychecks, protect savings, and protect economic opportunity and the American Dream, and they failed miserably.

Mr. Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Davidson), a member of the Financial Services Committee.

Mr. Speaker, I yield 2 minutes to the gentleman from Indiana (Mr. Hollingsworth), another member of the Financial Services Committee.

Mr. Speaker, I yield 2 minutes to the gentleman from South Carolina (Mr. Norman), he is not a member of the Financial Services Committee, but we would be proud if he were.

Mr. Speaker, I yield 1 minute to the gentleman from Wisconsin (Mr. Duffy), the chairman of the Housing and Insurance Subcommittee.

Mr. Speaker, I yield an additional 30 seconds to the gentleman from Wisconsin.

Mr. Speaker, I yield myself the balance of my time.

Mr. Speaker, as always, I listen very carefully to my friend, the ranking member. I know that she started off her closing remarks by saying: We don't need this bill, H.R. 2201, because the big banks can loan to the small businesses.

Well, that is fascinating to me, Mr. Speaker, because of the Dodd- Frank Act, which she so jealously supports, all of a sudden, the risk- based capital standards say that the banks have to reserve more for small business loans than they do for sovereign debt and municipal debt.

So all of a sudden, it is because of Dodd-Frank. In addition, we know that the ranking member supports the Federal Reserve policy of paying interest on excess reserves where the Federal Reserve takes taxpayer money to pay the big banks not to loan money. So if the ranking member was curious why the big banks aren't loaning to the small businesses, which they aren't--and prior to the Trump administration, we know that small business lending by banks was at a 25-year low--it is the very reason, Mr. Speaker, that we need the bill, the legislation of the gentleman from Minnesota (Mr. Emmer) so that we can unlock this.

Again, there is no surprise why, after 8 years of Obamanomics and the thinking from my friends on the other side of the aisle, small businesses have languished and why the economy has dropped down to a 1\1/2\ to 2 percent GDP growth. In fact, I think President Obama is one of the few Presidents in American history never to enjoy a year of 3 percent economic growth.

Now, he may personally have enjoyed it, but the American people didn't, Mr. Speaker. But the good news is that there is a change in administration and a change of attitude. That is why it is so important that we be able to get capital to our entrepreneurs, to our small businesses. Let them thrive again on Main Street.

We hear so often the ranking member decry Wall Street. We are talking about offerings of a half a million dollars. No on in Wall Street would touch that with a 10-foot pole. This is about Main Street, not Wall Street, Mr. Speaker.

It is interesting, as I listen to my friend, the ranking member, decry the fact that someone might be able to raise capital under this particular set of circumstances. Well, I have a news flash for all my colleagues. Already the SEC can grant a private offering for exactly the set of circumstances that my friend, the gentleman from Minnesota, puts into his bill. All the gentleman is doing is creating a bright line, safe harbor, so that the next Nike or the next Amazon isn't stopped from launching their enterprise by having to spend a million dollars on lawyers and accountants trying to navigate this uncertain murky labyrinth of SEC waters trying to determine what is a private offering and what is a public offering. That is all he is doing.

Again, this is already legal. It simply is discretionary to decide what is a private offering and what is a public offering by the Securities and Exchange Commission.

We now, Mr. Speaker, have had two quarters of 3-plus percent economic growth. We are seeing working Americans. We are seeing their paychecks increase yet again. We are seeing hope and resilience in the American Dream yet again, but we have so much more work to do, and that is why H.R. 2201 is so critical.

It takes small businesses today to be the big businesses of tomorrow. They are the creators. They are the job engine of America. They are the drivers of increased paychecks, greater economic opportunity, and a bigger, bolder American Dream. I thank the gentleman from Minnesota for this great legislation. I encourage all of my colleagues to adopt it.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I move to suspend the rules and pass the bill (S. 488) to increase the threshold for disclosures required by the Securities and Exchange Commission relating to compensatory benefit plans, and for other purposes, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill.

Mr. Speaker, I yield myself as much time as I may consume.

Mr. Speaker, two things that are vital to the American economy: number one, 3 percent economic growth, and number two, competing with China.

Three percent economic growth, Mr. Speaker, is so important because, when you look at the history of America, if you look at jobs that are created, if you look at increasing incomes, if you look at decreasing unemployment, this happens in our 3 percent-plus growth years, and that is why it is so great that America is once again seeing 3 percent-plus economic growth.

But, Mr. Speaker, can we keep it?

There are some alarming trends that we have to arrest, and that is that, unfortunately, entrepreneurship, that is, launching new businesses, recently hit a generational low. Companies that are going public--and 90 percent of the jobs that a company creates happen after they go public, IPOs, initial public offerings--they have been in a decline, a 20-year decline, and they have reached a new low.

If we look at what China is trying to do with their 2025 program, Mr. Speaker, and dominate the world in high tech and then we turn around and we see that China has over a third of the world's IPOs, America-- our decline is now down to 11 percent--has got to change.

So thus, today, we are taking up the JOBS and Investor Confidence Act, also known as the JOBS Act 3.0.

What we are trying to do, Mr. Speaker, number one, we are doing it on a bipartisan basis, but we are trying to ensure that our entrepreneurs at least don't face the challenge of having the capital they need to launch their companies, because, Mr. Speaker, when we have more small businesses that are launching new enterprises and going public and staying public, these are the Amazons and the Googles and the Microsofts of the future.

So, again, Members on both sides of the aisle have come together because, historically, capital formation has been a bipartisan issue here. We have come together, Democrat and Republican, to make sure that these small

businesses get this start. And we try to treat the whole capital formation ecosystem, from venture capital with the HALOS Act and helping accredited investors be able to bring their capital to the table, to early growth companies and how they have to handle the very expensive 404(b) Sarbanes-Oxley provision, to the stages of companies going public, but once they go public, Mr. Speaker, the ability to stay public, and so we have a venture exchange bill to make sure that they can concentrate their liquidity in one area.

So this is important. It is important to keep 3 percent economic growth. It is important that America's garages have fewer old cars, more new startups.

I want to thank Members on both sides of the aisle, but I especially want to thank the ranking member, the gentlewoman from California, working so strongly and fervently and on a good, bipartisan, cooperative basis to produce the JOBS and Investor Confidence Act.

Mr. Speaker, I expect that we can have a strong bipartisan vote on the floor, and I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr. Huizenga), the chairman of the Capital Markets, Securities, and Investments Subcommittee, the real leader of this capital formation package on the Republican side of the aisle, and also the sponsor of two provisions of the bill: H.R. 477, the Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification Act, and H.R. 6139, the Improving Investment Research for Small and Emerging Issuers Act.

Mr. Speaker, I yield 1 minute to the gentleman from Ohio (Mr. Chabot), who is the chairman of the House Small Business Committee and who has sponsored a very important provision in the package, H.R. 79, the Helping Angels Lead Our Startups Act.

Mr. Speaker, I yield 1 minute to the gentlewoman from Missouri (Mrs. Wagner), the chair of our Oversight and Investigations Subcommittee, also the lead sponsor of an important provision in this package of bills, H.R. 5970, the Modernizing Disclosure for Investors Act.

Mr. Speaker, I yield 1 minute to the gentleman from Kentucky (Mr. Barr), the chair of our Monetary Policy and Trade Subcommittee.

Mr. Speaker, I yield 1 minute to the gentleman from Illinois (Mr. Hultgren), who is the vice-chairman of our Capital Markets, Securities, and Investment Subcommittee.

Mr. Hultgren is the lead sponsor of two provisions of the bill, H.R. 5749, the Options Market Stability Act, and H.R. 6319, the Expanding Investment in Small Businesses Act.

Mr. Speaker, I yield 1 minute to the gentleman from Wisconsin (Mr. Duffy), who is the chairman of our Housing and Insurance Subcommittee. Mr. Duffy is the sponsor of a provision of this bill, H.R. 4537, the International Insurance Standards Act.

Mr. Speaker, I yield 1 minute to the gentleman from North Carolina (Mr. Pittenger), who is the vice-chairman of the Financial Services Subcommittee on Terrorism and Illicit Finance.

Mr. Speaker, I yield 1 minute to the gentleman from Pennsylvania (Mr. Rothfus), the vice chairman of our Financial Institutions Subcommittee, who is also the lead Republican sponsor of one of the bills in the package, H.R. 6069, the Fight Illicit Networks and Detect Trafficking Act.

Mr. Speaker, I yield 1 minute to the gentleman from California (Mr. Sherman), a senior Democrat on the committee and the lead sponsor of the bill.

Mr. Speaker, I yield 1 minute to the gentleman from Texas (Mr. Williams), the vice chairman of the Financial Services Subcommittee on Monetary Policy and Trade.

Mr. Speaker, I yield 1 minute to the gentleman from Arkansas (Mr. Hill), the majority whip of the committee and also the lead sponsor of H.R. 5783, the Cooperate with Law Enforcement Agencies and Watch Act, and who worked, also, extensively on H.R. 1585, the Fair Investment Opportunities for Professional Experts Act.

Mr. Speaker, I yield 1 minute to the gentleman from Minnesota (Mr. Emmer), who is the lead sponsor of a very important provision in the package, H.R. 5877, the Main Street Growth Act.

Mr. Speaker, I yield 1 minute to the gentleman from Georgia (Mr. Loudermilk), who is the lead sponsor of two provisions in the package: H.R. 3555, the Exchange Regulatory Improvement Act, and H.R. 5953, the earlier referenced BUILD Act.

Mr. Speaker, I yield 1 minute to the gentleman from North Carolina (Mr. Budd), the lead sponsor of one of the provisions in the bill, H.R. 3903, the Encouraging Public Offerings Act.

Mr. Speaker, I yield the gentlewoman from California an additional 30 seconds.

Mr. Speaker, may I inquire how much time I have remaining.

Mr. Speaker, I yield myself the balance of my time.

Indeed, Mr. Speaker, some would say the ranking member and I can't agree even on the time of day. I was told when this debate started that thunderstorms came over Washington, D.C., it was that monumental of an achievement.

But in seriousness, I do want to offer my thanks and my gratitude to the ranking member. She and her staff worked very constructively with us on this bill and the preceding important bill, the CFIUS reform, which we are still trying to work out our differences on with the Senate. But, long story short, we came together.

This is going to be an important day for small business. It is an important day for 3 percent economic growth, which is so important to American families.

I, too, want to echo how important the work of our staffs is. Particularly on the majority side, I wish to thank Kevin Edgar and Fritz Vaughan and their staff for their contribution.

This is going to make a difference, ultimately, because small businesses one day become big businesses. This will make a difference in economic growth for all Americans.

Mr. Speaker, I urge all Members to support the JOBS and Investor Confidence Act of 2018, and I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, this bill is an example of true bipartisanship. I want to thank Chairman Hensarling, the members of the Financial Services Committee, and the staff on both sides of the aisle for their work on this legislative package.

S. 488, the JOBS and Investor Confidence Act of 2018, is evidence that Democrats and Republicans can come together to strengthen our Nation's small businesses and entrepreneurs, bolster investor confidence, protect consumers, promote financial stability, and counter human and drug trafficking.

S. 488 helps small businesses grow by encouraging capital formation and requires the Securities and Exchange Commission to consider unique issues facing rural small businesses and small investment advisers. When entrepreneurs are looking to retire, S. 488 allows them to easily sell their businesses.

The bill also requires several rulemakings and studies to encourage small businesses to go public, including by protecting them from excessive underwriting fees.

Main Street investors and consumers also benefit from S. 488. One provision, which I authored, cracks down on corporate insiders engaged in illegal insider trading.

Democrats also led provisions to enhance disclosures about outsized insider voting power.

The bill also creates a task force at the SEC to protect seniors and their financial best interests.

Additionally, the bill helps nonprofits, like Habitat for Humanity, continue to extend affordable mortgages to low-income families aspiring to the dream of homeownership.

Thanks to Mr. Ellison, the legislation enables millions of Americans with thin credit files to improve and build their credit by allowing alternative types of data, like the on-time payment of rent and utilities, to be included in their credit reports without preempting State law.

S. 488 also improves financial stability. The bill directs regulators to improve the calculation for bank capital held to offset risk in the options and derivatives markets so that riskier products are covered by more capital

Finally, S. 488 strengthens our government's efforts to stop drug and human trafficking by preventing criminals who engage in these unconscionable acts from accessing the financial system.

There are several provisions that we did not reach bipartisan agreement on in time, including reforms to private offerings under regulation D that requires issuers to file disclosures before their first sell and after the termination of the offering. I am pleased that the chairman has offered to continue working on this and other issues with me, and I hope that the Senate has its own chance to make these and other changes.

Throughout my work on this legislation, I insisted that nothing could be included that would weaken Dodd-Frank's financial reforms, harm consumers, or provide giveaways to Wall Street. Instead, building on the bipartisan work of the Financial Services Committee, S. 488 includes measures that will help small businesses grow and protect hardworking Americans who entrust their savings to the capital markets.

Mr. Speaker, I again thank my colleagues for their strong bipartisan support on this legislation, and I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentlewoman from New York (Mrs. Carolyn B. Maloney), the ranking member of our Capital Markets, Securities, and Investment Subcommittee of the Financial Services Committee, and the leading sponsor and Democratic cosponsor of several of the bills in this package.

Mr. Speaker, I yield 2 minutes to the gentleman from Georgia (Mr. David Scott), a senior member of the Financial Services Committee and the leading Democratic cosponsor of several of the bills in this package.

Mr. Speaker, I yield an additional 30 seconds to the gentleman.

Mr. Speaker, I yield 2 minutes to the gentleman from Connecticut (Mr. Himes), a member of the Financial Services Committee, the chair of the New Democrat Coalition, and the author of one of the bills in this package that ensures companies aren't paying excessive fees to go public.

Mr. Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Foster), who is a member of the Financial Services Committee and a leading Democratic cosponsor on several of the bills in this package.

Mr. Speaker, I yield the gentleman from Illinois an additional 20 seconds.

Will the Speaker please check the minutes again? We have calculated differently, and we think I have 9 minutes.

I am sorry. What is the Chair saying about the time that I have remaining?

Mr. Speaker, I yield 2 minutes to the gentlewoman from Ohio (Mrs. Beatty), who is a member of the Financial Services Committee who helped ensure that this bill cracks down on the use of digital currency in human trafficking.

Mr. Speaker, I yield 2 minutes to the gentleman from New Jersey (Mr. Gottheimer), who is a member of the Financial Services Committee and author of one of the bills in this package.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I continue to reserve the balance of my time.

Mr. Speaker, I have no further requests for time, and I yield myself the remainder of my time to close.

I once again thank my colleagues for their outstanding bipartisan work on this carefully crafted bipartisan legislation. S. 488, the JOBS and Investor Confidence Act of 2018, is an example of Members on both sides of the aisle working together to support our Nation's small businesses and investors.

S. 488 facilitates access to capital for small businesses, increases protections for consumers and investors, fights the scourge of drug and human trafficking, and promotes financial stability.

S. 488 is supported by institutional investors, angel investors, venture capitalists, biotech companies, credit unions, small businesses, entrepreneurs, and exchanges. This bill will help entrepreneurs, small businesses, and investors to thrive in our economy.

Finally, I would like to thank Mr. Hensarling for his foresight in knowing that this was possible because both sides of the aisle really support small businesses. It was Mr. Hensarling who said: Given that we do both support small businesses, why can't we come together around a package where we have already shown our support on individual bills either in committee or on the floor and put it all together?

He did that. He provided that leadership. I joined with him.

Our staffs are to be congratulated because they worked very hard on both sides of the aisle to work out any concerns that we may have, any differences that we may have. They did a magnificent job, and they are responsible for helping us to understand what certainly is and was possible.

So despite this, if I may say, there are many onlookers who never thought this could happen. There are many pundits, those who come from special interests, those who come from right here in the House on both sides of the aisle, who are still questioning.

Mr. Speaker, I had one inquiry from one of the magazines, I believe it was, who said: Tell me what happened in the background, what was really going on. How did this all come together?

I want the gentleman from Texas to know I told him it is none of his business. It really happened, and we are pleased about it. We worked very hard on that.

Mr. Speaker, I thank Mr. Hensarling and all of the members who worked so hard to make this happen, and I yield back the balance of my time.