Bill · H.R. 4098· House(119-HR-4098)
Stopping Proxy Advisor Racketeering Act
- Introduced
- 6/24/2025
- Last activity
- 6/24/2025 — Referred to the House Committee on Financial Services.
- Sponsored by
- Scott Fitzgerald
- Cosponsors
- - 1 - 0
- Introduced
- In Committee
What this bill would do
This bill, titled the "Stopping Proxy Advisor Racketeering Act," aims to amend the Securities Exchange Act of 1934. It focuses on regulating the conduct of proxy advisory firms. The legislation seeks to prohibit these firms from providing proxy voting advice if they possess a direct or indirect conflict of interest. Specifically, it targets conflicts involving consulting services, modified recommendations based on subscriptions, and certain stewardship or engagement services. The bill also establishes administrative civil penalties that the Commission may impose for violations.
Yes
Does this give people more protection from unfair business practices?+5
The bill enhances investor protection by preventing conflicts of interest in proxy voting advice.
Does this make what the government does easier for the public to see?+4
The bill promotes transparency by restricting conflict-of-interest-driven advice in the proxy process.
Does this give the federal government more power?+3
The bill increases federal power by granting the Commission authority to impose civil penalties.
The opposite
Would business owners be better off under this?-2
The bill imposes new regulatory compliance and potential penalty risks for advisory firms.
Who it would affect, and how
Potential Positive Impacts for People
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Prohibition of conflicts of interest (Section 2, subsection a): This could benefit people by preventing proxy advisory firms from providing advice while they have a conflict of interest, such as when they provide consulting services to the company they are advising on.
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Protection of methodology (Section 2, subsection a, clause 2): This provision prevents firms from changing their voting recommendations or departing from their established procedures based on whether a company subscribes to their services or products.
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Prevention of simultaneous service conflicts (Section 2, subsection a, clause 3): This prohibits firms from giving advice while they are also providing stewardship or engagement services related to the same matter.
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Elimination of organizational bias (Section 2, subsection a, clause 4): This prevents firms from being members of organizations that support the same shareholder-sponsored proposals they are providing advice on.
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Enforcement through penalties (Section 2, subsection b): The Commission can impose civil penalties on firms that violate these rules, which may act as a deterrent against misconduct.
Potential Negative Impacts for People
- Increased regulatory oversight (Section 2, subsection b): The Commission is granted the authority to institute proceedings and impose civil penalties, which imposes new administrative and legal requirements on proxy advisory firms.
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Governance And Ideology
- Improves Government Transparency+4Increases Federal Power+3
- Economy And Finance
- Improves Consumer Protection+5
- Demographic And Interest Groups
- Good For Business Owners-2
- 7/2/2025
- 1 Cosponsor added.
- 6/24/2025
- Referred to the House Committee on Financial Services.
- Introduced in House
Tony WiedRepublican · Wisconsin