{"id":318,"date":"2013-12-05T12:41:47","date_gmt":"2013-12-05T17:41:47","guid":{"rendered":"http:\/\/www.accreditedinvestorleads.com\/?p=318"},"modified":"2020-01-22T11:11:59","modified_gmt":"2020-01-22T15:11:59","slug":"sec-considering-revising-criteria","status":"publish","type":"post","link":"https:\/\/www.accreditedinvestorleads.com\/sec-considering-revising-criteria\/","title":{"rendered":"SEC is Considering Revising Accredited Investor Criteria"},"content":{"rendered":"

According to a letter from SEC\u00a0Chairman Mary Jo White to\u00a0Rep. Scott Garrett, R-N.J., and Rep. Patrick McHenry, R-N.C, the SEC is considering revising accredited investor criteria for becoming an accredited investor<\/a>. This could be monumental for businesses trying to raise capital. \u00a0If the SEC changed the criteria, and allowed more investors to qualify, the pool of potential investors would increase dramatically as would the available capital.<\/p>\n

In her letter Chairman White wrote,\u00a0\u201cProfessional certifications, such as a [certified public account] or a [chartered financial analyst], are among the possible supplemental or alternative criteria for qualifying as an accredited investor that commission staff will consider as part of its review. Such a certification may position an individual to be able to analyze more comprehensively a company’s financial condition and results of operations.\u201d<\/p>\n

Include People with Professional Certifications, such as CPA’s<\/strong><\/p>\n

The statement by Chairman White makes sense. \u00a0The SEC is tasked with protecting the public from bad investments which is why the Accredited Investor Rule exists in the first place. The belief is that people with a higher net worth will be more financially astute and able to analyze the risk associated with an investment. \u00a0Adjusting the criteria to include people with professional certifications in the financial industry simply makes logical sense. \u00a0These professionals understand how to analyze investment risk perhaps far better than an Accredited Investor that makes more money working in a different field, such as a doctor. \u00a0They are dealing with financial calculations on a daily basis and therefore should be considered financially savvy enough to invest.<\/p>\n

Using a Financial\u00a0<\/strong>Advisor<\/b><\/p>\n

The SEC also appears to be considering the effectiveness of using a financial advisor to make an investment decision and whether or not this could provide enough value for someone to be considered an Accredited Investor. \u00a0In her letter Chairman White went on to say, \u201cObtaining the advice of a professional adviser may enhance an investor’s ability to make an informed investment decision and therefore strengthen investor protection in [private] offerings. \u00a0An investor’s use of such an adviser, however, may not necessarily measure the investor’s understanding of the risks of the investment.\u201d<\/p>\n

\"Using<\/a><\/p>\n

Investment Equality<\/strong><\/p>\n

Many investors have complained for years over the Accredited Investor rule and the accredited investor criteria because it prevents people that have investment knowledge from participating in private offerings that only the rich have access to. \u00a0Not allowing smart professionals to participate in private offerings because they have not yet made enough money will potentially prolong the time it takes for them to make that money. It also does not mean that they do not have the understanding to be a sophisticated investor.<\/p>\n

Warning from Consumer Advocacy Groups<\/strong><\/p>\n

The Director of the\u00a0Consumer Federation of America, Barbara Roper, made this statement, “It just does not work. \u00a0We have been down that road before. It led to the Great Depression.” \u00a0Those in consumer advocacy, like Director Roper, are concerned that the existing qualifications for being an Accredited Investor may be too lax to protect investors now. \u00a0Opening the door to expanding the definition of sophisticated investors could only lead to more fraud and investors losing capital.<\/p>\n

SEC Taking Comments<\/strong><\/p>\n

The SEC is accepting comments from all sides and weighing out whether or not it is wise to change the definition of Accredited Investor and the accredited investor criteria in any way. \u00a0Your voice counts so send your comments to the SEC<\/a>.<\/p>\n

For more information please visit our mother site at<\/b> Salesleads.tv<\/b><\/a><\/h2>\n","protected":false},"excerpt":{"rendered":"

According to a letter from SEC\u00a0Chairman Mary Jo White to\u00a0Rep. Scott Garrett, R-N.J., and Rep. Patrick McHenry, R-N.C, the SEC is considering revising accredited investor criteria for becoming an accredited investor. This could be monumental for businesses trying to raise capital. \u00a0If the SEC changed the criteria, and allowed more investors to qualify, the pool<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[63],"tags":[],"yoast_head":"\nSEC Considering Revising Accredited Investor Criteria<\/title>\n<meta name=\"description\" content=\"The SEC is considering revising accredited investor criteria for becoming an accredited investor. 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