Statement by the President Upon Signing the Small Business Investment Act Amendments.
I AM HAPPY to sign into law a bill which will materially strengthen the regulatory authority of the Small Business Administration over small business investment companies.
The Congress in 1958 enacted the Small Business Investment Act, providing for the establishment of small business investment companies to stimulate the flow of private funds into small businesses.
The investment companies that have been formed as a result of that act occupy a special position under Federal law. Their honest and efficient management is essential if they are to fulfill their purpose successfully.
This bill will help assure the kind of sound management that will keep faith with the small business community and the public trust. It gives the Small Business Administration new regulatory powers, with proper safeguards, to revoke the licenses of small business investment companies that knowingly breach the law, to remove officials of those companies for violations of the law or for personal dishonesty, and to issue cease and desist orders against those officials who violate the provisions of the act. It bars dishonest persons from participating in the management of these companies.
It is fitting that the 89th Congress passed both this bill and the Financial Institutions Supervisory Act, which gives to the Government's financial agencies similar regulatory authorities over banks and savings and loan associations. These new laws are significant steps forward in the protection of the public.
Note: As enacted, the Small Business Investment Act Amendments is Public Law 89-779 (80 Stat. 1359.
The statement was released at San Antonio, Texas.
Lyndon B. Johnson, Statement by the President Upon Signing the Small Business Investment Act Amendments. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/238496