SEC Chair White Says the SEC is Investigating Accredited Investor Due Diligence
In a recent speech, SEC Chair Mary Jo White announced that the SEC has opened investigations relating to private placements where issuers failed to properly vet accredited investors. Responding to a question about crowdfunding, Ms. White said that the SEC has “open investigations” into the “reasonable efforts that issuers have to make to determine that who they’re selling to are accredited investors and either just not doing it at all or doing a job that clearly doesn’t pass muster.”
OUR TAKE: We had warned that the SEC would enhance efforts to scrutinize accredited investor due diligence (see http://blog2.cipperman.com/2015/04/private-offering-sponsors-failed-to-ensure-that-investors-were-accredited/). It appears that more enforcement actions are on the way.
http://www.sec.gov/news/speech/securities-regulation-institute-keynote-white.html