{"id":241,"date":"2013-08-20T01:35:29","date_gmt":"2013-08-20T06:35:29","guid":{"rendered":"http:\/\/www.accreditedinvestorleads.com\/?p=241"},"modified":"2020-01-22T12:12:50","modified_gmt":"2020-01-22T16:12:50","slug":"disqualification-under-reg-d","status":"publish","type":"post","link":"https:\/\/www.accreditedinvestorleads.com\/disqualification-under-reg-d\/","title":{"rendered":"Disqualification under Regulation D"},"content":{"rendered":"

On July 31st<\/sup>, in what many are hailing as a landmark change, the Securities and Exchange Commission (SEC) adopted amendments to the rules governing the Regulation D waivers. The major thrust of these changes were based on the Jumpstart Our Business Startups (JOBS Act) signed into law by President Obama on April 5th<\/sup>, 2012. The SEC simultaneously adopted amendments designed to implement section 926 of the Dodd Frank Wall Street Reform Act, which disqualifies certain individuals from participating in exempt securities offerings. These \u201cbad actors\u201d being banned from participation is good news for investors and potentially sends a serious message about ethical behavior to the entire community.<\/p>\n

Section 926 of the Dodd-Frank Act requires the SEC to adopt rules that would make the Rule 506 exemption unavailable for any securities offering in which certain \u201cfelons\u201d or other \u201cbad actors\u201d are involved. The new provisions generally track those in Section 926 of the Dodd-Frank Act and Rule 262 of Regulation A under the Securities Act. Any \u201ccovered person\u201d under the provisions of Rule 506 (d)(1) would be automatically bared from participating in exempt securities offering, regardless of the making of a public offering or not. The definition of a \u201ccovered person\u201d has been extended significantly and now includes \u2013<\/p>\n