On July 10, 2009, the Treasury released draft legislation,1 the Investor Protection Act of 2009 (the “Proposed IPA”), intended to provide new tools to the Securities and Exchange Commission to protect investors. The proposed legislation would implement some of the broad consumer protection recommendations contained in the Obama Administration’s White Paper on regulatory reform (the “White Paper”).2 The draft legislation, which has not yet been introduced in Congress, would amend various federal securities laws to, among other things, establish consistent standards for those who provide investment advice about securities, enhance whistleblower incentives, expand the scope of enforcement action for aiding and abetting violations and other violations of the securities laws, improve the timing and quality of disclosure and make permanent the SEC’s Investor Advisory Committee. Many legislative provisions will require the SEC to promulgate implementing regulations, so the full impact of this proposed legislation will not be felt for some time, even after its enactment.

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