SEC Amends ‘Accredited Investor’ Definition Seeking to Expand Private Capital Raising
Highlights
The SEC expands categories of persons qualifying as “accredited investors”
The purpose is to increase private capital raising transactions
The new rules to become effective in the 4th quarter of 2020
On Aug. 26, 2020, the U.S. Securities and Exchange Commission (SEC) adopted amendments to the definition of “accredited investor” in Regulation D under the Securities Act of 1933, as amended (Securities Act), which are expected to expand the pool of investors eligible to invest in private securities offerings. The “accredited investor” definition is one of the principal tests for determining who is eligible to participate in private offerings, which are typically conducted by privately held companies and utilized to raise start-up capital for small businesses.
Keep Up to Date in a Changing World
