Original Securities and Exchange Atonement Act of 2025
Summary
The Original Securities and Exchange Atonement Act of 2025 (H.R. 4925) aims to amend the Securities Act of 1933. It mandates covered issuers to conduct racial equity audits every two years. These audits would assess policies on civil rights, equity, diversity, and inclusion, including historical ties to slavery.
Expected Effects
The bill would require companies to disclose steps taken to reconcile ties to slavery, potentially including investments in underserved communities and HBCUs. It also establishes an Office of Minority Low to Moderate Income Programs within the Treasury Department. This office would provide grants for startup capital and savings programs in minority communities.
Potential Benefits
- Increased transparency regarding corporate ties to slavery.
- Potential investment in low-to-moderate income minority communities.
- Support for Historically Black Colleges and Universities (HBCUs).
- Creation of an Office of Minority Low to Moderate Income Programs.
- Financial penalties for non-compliance, with funds directed to relevant programs.
Most Benefited Areas:
Potential Disadvantages
- Increased compliance costs for covered issuers.
- Potential for frivolous lawsuits due to the private right of action.
- Risk of inaccurate or misleading audit reports.
- Possible challenges in determining and quantifying historical ties to slavery.
- Potential for the program to be used for political purposes.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's constitutionality is debatable. Congress has broad power to regulate interstate commerce under Article I, Section 8, which could justify regulating securities and requiring disclosures. However, the atonement provisions and the establishment of a specific office within the Treasury Department could raise questions under the Equal Protection Clause of the Fourteenth Amendment if they are deemed to be discriminatory or not narrowly tailored to address a compelling government interest. The First Amendment implications regarding compelled speech through audit requirements also warrant consideration.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).