Columbia Law School
Sky Blog
On July 10, 2013, the Securities and Exchange Commission (“SEC”) adopted a final rule, available here, to implement the requirement in JOBS Act Section 201(a) to lift the historic ban on general solicitation and advertising in Rule 506 and Rule 144A offerings. The SEC also adopted a final rule, available here, to disqualify felons and other bad actors from utilizing Rule 506. The new rules are scheduled to go into effect in September 2013.
In addition, the SEC proposed new rules, available here, to increase investor protection and generate data with respect to these new changes.
Click here for the SEC’s recent press release.
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As a doctor and an investor, I think that it is a great idea to relax the solicitation ban via the JOBS Act and other countries should follow suit also. In the age of social media – FACEBOOK, TWITTER, LINKEDIN …etc, someone even talking about securities can be charged with an offense. A lifting of the solicitation ban can help for example raise funds to build a children’s hospital in Africa and not land us in front of a securities tribunal. (Example of my friend here: Solicitation of investors on the Internet – Dr. David Kam, MD is seeking philanthropist to help Africa) http://drdavidkam.wordpress.com/tag/solicitation-of-investors-on-the-internet/ In this day and age everyone is soliciting something, whether for love, garage sale, eyeballs, friends or something. People these days are smarter than you think and do not need to be govern by draconian caveman rules. As you can see, crowfunding via Kicksarter and Indiegogo is going pretty well; imagine if more goevernemnt red tape regulation was involved. Even the Internet would would cease to exist, if government paper pushers get their hands on it.