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Lifting the Ban on General Solicitation

From a securities compliance perspective, when you see an advertisement or an email seeking capital for an investment opportunity there is most likely a problem. Now there is a bill in Congress that would change that view. When selling a security, you need to register the security or find an appropriate...

Rep. McCarthy (R-CA) Introduces Legislation to Eliminate Ban on General Solicitation for Private Placements

Representative Kevin McCarthy (R-CA and House Majority Whip) recently introduced the Access to Capital for Job Creators Act (H.R. 2940) , which would remove the ban on general solicitation for securities offering conducted under Rule 506 of Regulation D. Rule 506 is a safe harbor regulation which...

Lifting the Ban on General Solicitation and General Advertising

On Thursday afternoon, the US Senate passed the Jumpstart Our Business Startups Act, a bill designed to make it easier for small companies to raise capital. The centerpiece of the legislation is the crowdfunding provision. However, the Senate passed an amendment to that section of the legislation...

EB-5 Practice under the JOBS Act

Since the Jumpstart Our Business Startups Act (JOBS Act) was passed by Congress this past April, the EB-5 community has waited in anticipation for the Securities Exchange Commission (SEC) to revise its rul es to remove the prohibition on general solicitation and general advertising under Regulation...

New Era in Private Capital Raising – Opening Up General Solicitation and General Advertising

by David Carroll The next few years may be the largest watershed event in opening up private equity capital since the 1980s when Regulation D was first published by the Securities and Exchange Commission (“SEC”). By allowing general solicitation and general advertising in private offerings...

Why You Can’t Really Include Non-Accredited Investors in Rule 506 Offerings

One common misconception I encounter among startups is the idea that companies raising capital can include non-accredited investors in Rule 506[1] offerings. While it is technically true that a Rule 506 offering may include up to 35 non-accredited investors, what is often missed is that it is not really...

General Solicitation Restrictions for Private Placement Issuers

On August 6, 2015, the Securities and Exchange Commission (the "SEC") issued a number of Compliance and Disclosure Interpretations (" CDIs ") related to the issue of “general solicitation” (or “general advertising”) as it pertains to issuers seeking to raise...