SEC advisory panel concerned about crowdfunding
(Reuters) - An advisory committee urged U.S. securities regulators on Wednesday to relax outdated rules that trigger public financial reporting for companies, but it stopped short of backing a new capital-raising strategy known as "crowdfunding." In a public meeting, members of the Advisory Committee on Small and Emerging Companies voted on two proposed regulatory changes for the Securities and Exchange Commission to consider that would help private companies raise capital. However, they raised concerns with crowdfunding, a new capital-raising strategy that lets investors take small stakes in private start-ups over the Internet, even though the idea has received some support from President Barack Obama and Congress. The panel said it needed more time to study the issue to ensure it does not lead to investment scams. "This is just an opportunity for fraud in the extreme," said committee co-chair Stephen Graham, who advises on securities offerings as co-chair of Fenwick & West's Life Sciences Practice. "You can just imagine the unsophisticated investor that is just bombarded on the Internet." READ MORE...
| Posted by By Sarah N. Lynch on Feb 2, 2012 | ||
| 0 Comments |  Post A Comment |
|