The Securities and Exchange Commission (SEC) recently issued a notice of a rule filing (the Rule Filing) to adopt the Financial Industry Regulatory Authority’s (FINRA) proposed Rule 5123 (the Proposed Rule). The SEC requests that comments be submitted by Monday, Nov. 14, 2011.
The Proposed Rule, among other things, would require FINRA members and associated persons to complete Notice filings of disclosure documents for private placements of securities and to provide disclosures to investors prior to sale concerning the anticipated use of offering proceeds. The Rule Filing would have a significant impact on the sale of hedge funds, private equity funds and venture capital funds through FINRA members (such as placement agents).
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