# kaal:claim:2715083-033

**Claim.** The JOBS Act reform underdelivers on its own terms: because investor verification under Rule 506(c) is legally uncertain, hedge fund advisers have better incentives to launch retail alternative funds than to use their new freedom to advertise.

**Type.** failure  **Support.** argued

**Holds when.**

- Rule 506(c) offerings after the general solicitation ban was lifted
- also driven by path dependencies and peer pressure

**Source quote.**

> Investment advisers to hedge funds have better incentives to set up retail alternative funds that allow them to offer features that are attractive to retail investors rather than to advertise under the uncertain new regime (Rule 506(c))

**From.** Kaal, *Confluence of Mutual and Private Funds* (2016), V.3 Retail Alternative Fund Growth, page 19

**Cite as.** Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083

**Verify.** sha256 of source PDF `b5c92186260d4a8499a14f81ee24ace093b24e7740af3effcd1c526fa4fa221e` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202016%20-%20Confluence%20of%20Mutual%20and%20Private%20Funds.pdf

**Failure mode.** General solicitation nonadoption  (family: adoption-and-usability-barrier)

**Topics.** citation-and-knowledge

**Keywords.** jobs-act, rule-506c, investor-verification, general-solicitation, regulatory-uncertainty

**Related claims.**

- extends: https://wulfkaal.github.io/claims/2714974-018
- restated_by: https://wulfkaal.github.io/claims/2739479-014
- extends: https://wulfkaal.github.io/claims/2714974-019

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.