Maxine Waters

Ms. WATERS

Ms. WATERS. Mr. Chair, I yield myself such time as I may consume. Mr. Chair, I rise today in strong opposition to H.R. 3383, the INVEST Act, which is an end-of-year holiday gift to Wall Street, paid for by the hard-earned savings of teachers, nurses, seniors, and other hardworking Americans. While several of the provisions in the INVEST Act could support capital formation, the bill contains three poison pill provisions that make voting for the overall bill untenable. These provisions will raise costs and increase fees for people all across America. At a time when the President's disastrous tariff policies are causing many Americans to struggle just to pay the bills, the INVEST Act would reduce Federal investor protections, jeopardizing the retirement savings of millions of regular, hardworking Americans, but it didn't have to be this way. I worked closely with the Capital Markets Subcommittee chairwoman, Mrs. Wagner, and the full committee chairman, Mr. Hill, just to get to ``yes'' on this bill, and 19 of the provisions in this bill would pass overwhelmingly through this House. Unfortunately, Republicans could not resist the demands of their Wall Street, and they threw in three poison pills at the last minute that would make Wall Street richer and retirement more unaffordable. Mr. Chair, I will tell you about these poison pill provisions and what they will do. The first section, 202, would remove the 403(b) retirement plans relied on by millions of teachers, nurses, and nonprofit workers from the protections and oversight of the Federal securities laws. This massive $1 trillion deregulation of 403(b) plans would allow Wall Street middlemen and unlicensed, so-called retirement consultants to free themselves of SEC's rules to always keep the planholders' best interests in mind. It is not surprising that, while those Wall Street middlemen are heavily lobbying this bill, the groups and unions representing the teachers, nurses, and other workers who would be affected strongly oppose. The National Education Association, representing over 3 million educators all across the country; the American Federation of Teachers, representing over 1.5 million teachers and healthcare professionals; National Nurses United, representing over 200,000 registered nurses; and the American Federation of State, County, and Municipal Employees, representing 1.3 million public service workers, all oppose this bill. Mr. Chair, that is not all. Let's look at the second poison pill, section 205. This provision will make electronic delivery of financial documents the default for all investors, including seniors, even though the majority of seniors prefer and rely on paper delivery. The bill would automatically switch investors from the preferred paper delivery to electronic delivery, even if the investor has recently declined to receive statements. Millions of seniors still don't have access to reliable internet or an email account. As a result of this provision, they would now be in the dark about their finances and investments. This means that they would be less likely to notice junk fees and unnecessary trades executed by their financial professional. Not surprisingly, the AARP, representing 110 million Americans, strongly opposed this provision when it was considered in the committee during this Congress. Finally, the third poison pill, section 206, allows Wall Street to vastly increase the amount of risky, opaque private assets they sell to Main Street investors. It does so by allowing what is known as closed- end funds, which is similar to mutual funds and used by many everyday investors to invest up to 100 percent of their assets in shares of private equity and venture capital funds and directly into the unregistered shares of private companies. Current law limits these kinds of private assets to only 15 percent of a fund's total assets. This is because private assets are very different from the publicly traded stocks and bonds that most folks are used to investing in. Unlike publicly traded stocks, private assets are not registered with the SEC, meaning Wall Street's cop on the block and all of the ensuing protections that come from its oversight are not in place. They are also harder to value, contain far fewer disclosures around risk, and are very hard for investors to get their money back due to withdrawal limits and long lockup periods. For these reasons, our securities laws have guardrails on Wall Street so that they don't peddle junky assets to investors who can't understand the financial risks. These various provisions and the bill as a whole are opposed by the groups who are fighting on behalf of everyday Americans, including, again, the AFL-CIO; American Federation of Teachers; Americans for Financial Reform; Public Citizen; the Service Employees International Union; Communication Workers of America; American Federation of State, County, and Municipal Employees; National Education Association; National Nurses United; and the United Auto Workers. The State securities regulators also came out against the bill just this morning. No one cares more about capital formation than our State governments, but they also care that deregulation does not lead to harming investors and small businesses. Mr. Chair, we support capital formation. We tried so hard to get an agreement, and we thought we had one because of the provisions that we could be bipartisan on because we, too, support capital formation. What we don't support is these poison pills that will just do the kind of deregulation that would put so many hardworking people at risk. As I mentioned, the teachers and the nurses and all of the other labor unions, et cetera, are really, really worried that these poison pills will do so much harm that we had to plea but walk away from what we thought we could get as a bipartisan operation because of the poison pills at the last minute. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chairman, I have no further speakers, and I am prepared to close if the gentlewoman from Missouri has no further speakers.

Ms. WATERS. Mr. Chair, I yield myself such time as I may consume. Now, this so-called e-delivery provision makes electronic delivery the default communication method for all investors, whether they like it or not. AARP research indicates that a majority of American investors, 80 percent of which are 55 years of age or older, prefer to receive their documents in paper. However, under this provision, investors who prefer to receive information about their investments by paper will need to opt in to paper delivery by computer even if they previously opted for paper statements. This is why the e-delivery provision is opposed by the AARP and most major unions and investor protection organizations, including, again: Americans for Financial Reform; American Federation of Labor and Congress of Industrial Organizations, AFL-CIO; Communications Workers of America, CWA; Consumer Federation of America, CFA; National Education Association, NEA; the American Federation of Teachers, AFT; National Nurses United, NNU; Public Citizen; Service Employees International Union, SEIU; The Academy of Financial Education, AFE; United Auto Workers, UAW; the North American Securities Administrators Association, NASAA; and the American Federation of State, County, and Municipal Employees, AFSCME. Now, I have two big problems with this provision. Number one: Investors who previously told their adviser that they had to have paper statements should still be able to receive them because investors should be the ones in charge of how they monitor their own money. Number two: Any savings advisers earn because they are not sending paper notices should be refunded to the investor as a credit on their statement. Financial advisers should not be able to make a profit by providing fewer services to their investors, especially a service that most investors want and demand. However, Republicans flatly refuse to include either provision, demonstrating what this section really is: a holiday gift to Wall Street. Financial firms will save potentially billions of dollars by making it harder for American investors to access information about their own accounts. For these reasons, I strongly encourage you to vote against H.R. 3383. Let me just say to the Members of this House of Representatives that if, in fact, we were working on a bipartisan agreement on this INVEST Act and we found that we could agree on maybe 19 out of 22, that they would literally walk away from the negotiations. They would walk away from our chance to be bipartisan rather than have a bill that would actually be a bill that we all want, understanding what our businesses need for capital improvement, et cetera, because Wall Street wants these three poison pills. They would walk away from all the work that we have done. It does not make good sense. Mr. Chair, for that reason, we can't vote for it. We cannot vote for it with these poison pills. They are too harmful. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I yield myself such time as I may consume. Mr. Chair, Republicans claim that section 202 purports to modernize retirement options for nurses, teachers, and nonprofit workers. Let me be clear: It does not. In reality, this provision opens these workers' retirement accounts called 403(b) plans to complex, high-fee products like collective investment trusts and variable annuities. It also removes these plans from the protections and oversight of our Federal securities laws. I cannot imagine why we would want to make it more difficult and dangerous for some of the most valuable members of our community to save for retirement, but that is exactly what section 202 does. We did not debate this section. We did not have a hearing on it. No one has asked questions about it. I have to wonder, why is it here? Is it because those whose savings are in 403(b) plans, the teachers and nurses, asked for it? No, they did not. They do not support this provision. In fact, this section is opposed by major unions and investor protection groups. Let me make sure that it is very well understood who is opposing these poison pills: American Federation of Labor and Congress of Industrial Organizations, AFL-CIO; Communications Workers of America, CWA; Consumer Federation of America, CFA; National Education Association, NEA; American Federation of Teachers, AFT; National Nurses United, NNU; Public Citizen; Service Employees International Union, SEIU; The Academy of Financial Education, AFE; the United Auto Workers, UAW; North American Securities Administrators Association, NASAA; and American Federation of State, County and Municipal Employees, AFSCME. To be clear, this provision is in this bill because Wall Street asked for it. They want to be able to spend the retirement savings of public employees on these most expensive, riskier assets so they can get richer. Voting for this bill means choosing Wall Street over the interests of the American people, and I cannot imagine doing that. That is why I urge my colleagues to vote against this bill with these poison pills in it that I have described over and over again. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I continue to reserve my time.

Ms. WATERS. Mr. Chair, I yield myself the balance of my time. Mr. Chair, I have heard a lot from Republicans about how the INVEST Act will expand access to capital and increase investor opportunity. The inclusion of three poison pills in this bill shows they are not serious about protecting the investors. They care more about funneling their money to Wall Street. If the Republicans are serious about increasing investment in small business and expanding opportunities for investors to participate in new markets, we could have passed a clean bill with nearly unanimous support. Instead, the Republicans, unable to say ``no'' to Wall Street, have jammed in three bills that hurt workers and those saving for a dignified retirement. Don't just take my word for it. These provisions are opposed by the actual people who would be harmed. Again, these are teachers, nurses, seniors, and others. The bill is opposed by the AFL-CIO; the American Federation of Teachers; the Americans for Financial Reform; Public Citizen; Service Employees International Union; Communications Workers of America Union; American Federation of State, County, and Municipal Employees; National Education Association; National Nurses United; and the United Auto Workers. These unions represent over 20 million Americans. Other organizations are fighting for the interests of everyday Americans, and so should everyone in this Chamber. Mr. Chair, let me close by saying, oftentimes we hear from both sides of the aisle how much they care about our seniors and how they want to do so much for our seniors. Here they have the opportunity to resist a poison pill that would absolutely be opposed to what seniors have said they want and they don't want. I want Members of this Chamber to ask their grandmothers and their great-grandmothers and others who are investors, who have spent their time working and earning and making sure that they have retirement, et cetera: Do they want to receive their information on the internet or on a computer they don't have or they don't use or they haven't learned how to use? Would my colleagues on the opposite side of the aisle simply try and understand why getting paper information about their investments is what seniors want? If they want to support seniors, why would they allow Wall Street to stop sending the paper information and make billions of dollars and not even talk about making them spend the billions of dollars on seniors in some way? I don't get it. Mr. Chair, I am raising the question. My colleagues on the other side of the aisle should raise the question. If they want to help seniors, this poison pill does not help them in any way. It denies them the opportunity to understand what is happening to their investments on paper that they can read, because they don't have access to or don't engage with the digital platform offered to all of us. They cannot engage because they are not ready to. Mr. Chair, I yield back the balance of my time.

Ms. WATERS. Mr. Chairman, I rise in opposition to the amendment.

Ms. WATERS. Mr. Chair, I yield myself such time as I may consume. Mr. Chair, I oppose Mr. Self's amendment to strike section 307 of the INVEST Act. Section 307 is identical to H.R. 3357 sponsored by guess who? It is sponsored by Mr. Meeks. It closes gaps in the disclosures made to investors where there are multi-class government structures. Companies that use these structures offer different share classes, such classes having different rights like voting rights. These structures can allow corporate insiders to retain an outsize amount of voting power relative to their shares. For instance, Mark Zuckerberg has been able to consolidate control over Facebook, and now Meta, primarily due to the dual-class share structure that he established. This structure allows him and a small group of insiders to hold class B shares which have 10 times the voting power of the class A shares sold on the open market. As a result, Zuckerberg has maintained nearly 60 percent of the voting power in Facebook, even though his shares account for only about 18 percent of shares. Mr. Meeks' provision was recommended by the SEC's Investors Advisory Committee and passed out of committee with unanimous support, and it has also passed both this Congress and the prior two nearly unanimously. Investors should have the clearest information available to make the best decision for themselves, but Mr. Self's amendment would deny them that. Mr. Chair, I therefore encourage all Members to vote against this amendment, and I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I yield 2 minutes to the gentlewoman from Missouri (Mrs. Wagner) to speak in opposition to Mr. Self's amendment.

Ms. WATERS. Mr. Chairman, I have the greatest respect for the gentlewoman from Missouri and have enjoyed working with her, but she tends not only to agree with me on this amendment but she feels very strongly about it. I urge my colleagues to reject this amendment so that investors have the basic information they need about a company's governing structure to make the best investment decisions for themselves. Mr. Chair, I yield back the balance of my time.

Ms. WATERS. Mr. Chair, I claim the time in opposition.

Ms. WATERS. Mr. Chair, I yield myself such time as I may consume. I oppose Mr. Self's amendment to limit the ability of the SEC to carry out its mandate in section 105. Section 105, which is identical to H.R. 4449, sponsored by Mr. Vicente Gonzalez and Mr. Garbarino, directs the SEC to promote and protect small businesses by creating a small business office within each rulemaking division of the SEC, ensuring that the SEC has small business experts across the agency. Mr. Gonzalez' provision will ensure that the SEC rules are tailored to the needs of small businesses. Mr. Self's amendment makes this provision impossible to implement by blocking the SEC from hiring any new employees to carry out the work. At a time when small businesses are struggling to stay afloat due to the impacts of Trump's harmful tariffs and disastrous economic policies, it is crucial that small businesses are represented through every step of the regulatory process. If we are serious about helping small businesses, we must make sure our regulators have the expertise needed to support them. I, therefore, encourage all Members to vote ``no'' on this amendment. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, with costs soaring and small businesses struggling to weather the impacts of the Trump tariffs and his administration's war on small businesses, it is crucial that we do what we can to make sure government is working for them, not against them. I urge my colleagues to vote ``no'' on this amendment. Mr. Chair, I yield back the balance of my time.

Ms. WATERS. Mr. Chair, as the designee of Ms. Garcia of Texas, I have an amendment at the desk.

Ms. WATERS. Mr. Chair, I rise in support of this amendment originally offered by my colleague, Representative Garcia. Ms. Garcia's amendment would make law an important requirement that was already carefully considered and made final by FinCEN, but which has been delayed potentially indefinitely under this administration. Her amendment requires foreign hedge funds to put in place anti-money laundering policies that will ensure the safety of our markets and prevent bad actors from using these funds to launder criminal profits. During a time when our markets are seeing unprecedented fraud and abuse, we should not wait to increase AML protections. We should not wait for FinCEN. We should do what we can to strengthen our markets now. Mr. Chair, I reserve the balance of my time.

Ms. WATERS. Mr. Chair, I reserve the right to close.

Ms. WATERS. Mr. Chair, I reserve the right to close.

Ms. WATERS. Mr. Chairman, I believe I have the right to close. Are you indicating that I do not have the right to close?

Ms. WATERS. I have the right to close?

Ms. WATERS. Mr. Chair, if I don't have the right to close, I am prepared to close, and I yield myself the balance of my time.

Ms. WATERS. Mr. Chair, I encourage all Members to vote ``yes'' on Ms. Garcia's amendment to strengthen the Bank Secrecy Act and anti-money laundering requirements for foreign investment advisers. This reasonable and well-considered provision will ensure increased safety for our markets from abuse by terrorists, prohibited entities, and other bad actors abroad. Mr. Chairman, I yield back the balance of my time.

Ms. WATERS. Mr. Chair, I demand a recorded vote.