With a new government taking power in the U.S., investor advocates, academics and regulators are warning the new administration against weakening investor protection in an effort to ignite economic growth.

In a letter to the new Biden-Harris administration, the North American Securities Administrators Association (NASAA), the Consumer Federation of America, the Healthy Markets Association along with various other groups and law professors caution against weakening securities laws, particularly by expanding access to private markets.

The letter acknowledges the importance of economic stimulus legislation, but noted “the premise that relaxation of the securities laws will encourage investment in small and emerging companies has time-and-again proven incorrect.”

“Instead of repeating the mistakes of the past and pursuing further deregulation of private or small-sized quasi-private securities offerings without evaluating the risks or benefits of these actions, your Administration should immediately place a ‘pause’ on the further expansion and deregulation of the private offering marketplace,” the letter said.

The letter also called on policymakers to study the impact of expanding access to private markets on investor protection, the condition of public markets and the overall economy.

“As you undertake critically important efforts to stimulate the economy, we urge you to actively oppose the inclusion of any provisions that would expand or codify any proposed or adopted securities registration exemptions, and instead focus on restoring market information and efficiency,” the letter said.

Additionally, the letter recommended that the new administration reverse recent efforts at deregulation that has harmed “transparency, market efficiency and ultimately most ‘mom and pop’ investors.”

“In developing its policy response,” warned the letter, “your Administration should commit, from Day 1, to giving at least equal consideration and attention to the expectations and needs of retail investors who, because of the expansion of private markets, are increasingly directly exposed to the risks of these markets.”