HR-9329-119
Placed on the Union Calendar, Calendar No. 694.
Sponsored by Ann Wagner (R-MO)
What it does
This bill would make nine categories of changes to federal securities regulation. It would require the SEC to conduct formal cost-benefit analyses before issuing rules, mandate semiannual testimony by the SEC Chairman to Congress, direct a GAO audit of SEC cybersecurity infrastructure, abolish the independent Public Company Accounting Oversight Board (PCAOB) and fold its functions into the SEC as an internal office, require the GAO to periodically review major SEC rules, set a minimum 60-day public comment period for proposed rules, limit how the SEC counts separate violations when calculating civil penalties, and direct the SEC Chairman to reduce the number of offices reporting directly to the Chairman.
Who benefits
Public companies and their executives who face SEC enforcement actions, as the penalty-counting rules would reduce maximum fines for related violations. Accounting firms registered with the PCAOB, which would now operate under a single regulator. Financial industry participants broadly, who would gain more time to comment on proposed rules and could challenge rules that lack adequate cost-benefit documentation. Smaller broker-dealers and investment advisers who may face lower compliance costs if cumulative regulatory burden analysis slows rulemaking. Investors who benefit from greater SEC transparency and congressional oversight. Taxpayers, if consolidating the PCAOB into the SEC reduces duplicative administrative overhead.
Who is hurt
Investors and the general public who rely on robust SEC enforcement, as reduced penalty counts could lower the deterrent effect of securities law violations. PCAOB employees whose positions may be eliminated or restructured in the transition. Whistleblowers and fraud victims, if reduced penalties make enforcement actions less financially consequential for violators. Consumer and investor advocacy groups that have supported the PCAOB's independence as a structural safeguard. Foreign auditor oversight authorities that have cooperative arrangements with the PCAOB, whose relationships would need to be renegotiated with the SEC. Parties who currently benefit from faster SEC emergency rulemaking, which would face new procedural hurdles.
Supporters argue
Supporters argue that the SEC has repeatedly issued major rules — including climate disclosure and equity market structure rules — without adequate economic analysis, leading to costly litigation and regulatory uncertainty. They contend that requiring rigorous cost-benefit analysis, cumulative regulatory burden review, and independent GAO audits would produce better-calibrated rules that actually achieve investor protection goals without unnecessary market disruption. On the PCAOB, supporters argue that consolidating it into the SEC eliminates a redundant layer of bureaucracy created in 2002, since the SEC already oversees the PCAOB and sets its budget, making the independent board structure an inefficiency rather than a safeguard.
Opponents argue
Opponents argue that the PCAOB was deliberately designed as an independent body after the Enron and WorldCom accounting scandals to insulate audit oversight from political and industry pressure — and that folding it into the SEC removes that structural firewall at a time when audit quality remains a systemic risk. They contend that mandatory cost-benefit requirements and extended comment periods would slow the SEC's ability to respond to fast-moving market risks, and that the penalty-counting provisions would allow firms to structure misconduct as a single "continuing failure" to dramatically reduce financial exposure, weakening deterrence precisely where it is most needed.
Constitutional context
The bill's most significant constitutional dimension involves agency authority post-Loper Bright v. Raimondo (2024): by codifying cost-benefit requirements and cumulative regulatory analysis directly in statute, Congress is responding to the end of Chevron deference, which now requires courts to independently assess whether agency rules stay within statutory bounds. The major questions doctrine from West Virginia v. EPA (2022) is also relevant — several recent SEC rules have been challenged on the grounds that the agency lacked clear congressional authorization for sweeping regulatory actions, and this bill attempts to tighten that authorization framework.
Checks and balances
Congress gains oversight authority through mandatory SEC testimony and GAO studies; the SEC gains consolidated control over audit oversight by absorbing the PCAOB, reducing the independence of that function from the executive branch.
Historical precedent
The Sarbanes-Oxley Act of 2002 created the PCAOB as an independent body in direct response to major accounting scandals; this bill would reverse that structural choice by reintegrating audit oversight into the SEC.