NASAA Wants to Return Power to States to Regulate Reg D Offerings
The North American Securities Administrators Association, the association
of state regulators, is advocating for the renewed power for states to review
and regulate Regulation D private placements.
In 1996, Congress passed the National Securities Markets Improvement Act,
which precluded states from regulating private placements. NASAA wants Congress to rescind Section
18(b)4(D) of the Securities Act of 1933 to allow state regulators the “ability
to scrutinize offerings for signs of potential abuse and to ensure that
disclosure is adequate before harm is done to investors.”
OUR TAKE: We remember the days when a fund sponsor would have to
reconcile PPM comments from multiple state regulators. Adding blue sky compliance requirements to
private offerings would be unnecessarily burdensome and expensive.