Neither obvious remedy for the increased sales pressure created by the Rule 506 amendment works well: added disclosure obligations such as filing all Rule 506 sales documents with FINRA or the SEC may burden issuers inappropriately, while litigation based enforcement may not reach all offenders equally or appropriately.
Source quote, verbatim
Litigation-based enforcement, on the other hand, may not encapsulate all offenders equally and/or appropriately.
From
Kaal and Oesterle, The History of Hedge Fund Regulation in the United States (2016), Hedge Funds Can Advertise Generally, p. 19 https://ssrn.com/abstract=2714974 · source PDF
Cite as
Kaal and Oesterle, The History of Hedge Fund Regulation in the United States (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2714974
Holds when
applies to private placements where commissions exceed those on other investments
Classification
failuresupport: arguedfailure: Both remedies for sales pressure underperformfamily: investor-protection-gapcompliancedisclosure
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