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Duane Morris Alert: SEC Proposes Disqualifying "Bad Actors" from Rule 506 Offerings

Proposed "bad actor" rules are likely to increase the risks and costs associated with Rule 506 offerings. The U.S. Securities and Exchange Commission (SEC) has announced proposed rules 1 that would deny the safe-harbor exemption provided by Rule 506 of Regulation D to securities for any...

Rule 506(d) “Bad Actor” Disqualifications: Who’s a Bad Actor and Why are They Bad? - Part I

Rule 506 is by far the most widely used Regulation D exemption for conducting private placements. According to the SEC, about 90-95% of all private placements are conducted pursuant to Rule 506. This Rule permits sales of an unlimited dollar amount of securities without Securities Act registration, provided...