Firms Must Begin Filing PPMs with FINRA on December 3
Commencing December 3, 2012, all FINRA member firms must file each private placement memorandum for any private offering sold by the firm. A firm must make the filing within 15 days of sale pursuant to new FINRA Rule 5123, which was approved by the SEC in June. The filings are notice filings that do not require firms to wait for a FINRA response. FINRA has indicated that all filings must be submitted through FINRA’s Firm Gateway electronic filing system. Filings must include any amendments to PPMs. Offerings to institutional accounts, qualified purchasers, qualified institutional buyers, and investment companies are exempt.
OUR TAKE: We are not really sure what FINRA intends to do with all these PPMs. Presumably, it will develop some sort of review process to identify targets for exams.
Leave a Reply
You must be logged in to post a comment.