View Full Version : Give Your Comments to the SEC About Their Definition of "Accredited Investors"

08-16-2013, 03:51 PM
In my opinion it doesn't make total sense that "Accredited Investors" are defined by how much money you make or how many liquid assets you hold. I mean, some of the richest people in the world have very bad investment know-how. Just ask some of the athletes and entertainers who have lost tens of millions of dollars in bad investments.

Anyway, this is your chance to leave feedback to the SEC about their definition of an "Accredited Investor". The Sec has opened this up to public comment. Simply go here and fill the form out to be heard:
http://www.sec.gov/cgi-bin/ruling-comments?ruling=s70613&rule_path=/comments/s7-06-13&file_num=S7-06-13&action=Show_Form&title=Amendments%20to%20Regulation%20D,%20Form%20D %20and%20Rule%20156%20under%20the%20Securities%20A ct

The exact questions they’re asking the public to provide input on are:

- Are the net worth test and the income test currently provided in Rule 501(a)(5) and Rule 501(a)(6), respectively, the appropriate tests for determining whether a natural person is an accredited investor? Do such tests indicate whether an investor has such knowledge and experience in financial and business matters that he or she is capable of evaluating the merits and risks of a prospective investment? If not, what other criteria should be considered as an appropriate test for investment sophistication?

- Are the current financial thresholds in the net worth test and the income test still the appropriate thresholds for determining whether a natural person is an accredited investor? Should any revised thresholds be indexed for inflation?

- Currently, the financial thresholds in the income test and net worth test are based on fixed dollar amounts (such as having an individual income in excess of $200,000 for a natural person to qualify as an accredited investor). Should the net worth test and the income test be changed to use thresholds that are not tied to fixed dollar amounts (for example, thresholds based on a certain formula or percentage)?

08-16-2013, 03:56 PM
Oh, here is the pdf that the SEC released earlier today describing exactly what they want comment on:

08-27-2013, 01:49 AM
thanks for the updates man , i am really delighted with the representations of yours, it would realy be appreciated a lot for us

11-29-2013, 07:58 PM
Personally I was hoping that they would have not imposed such stringent requirements for investors - if they didn't then man...a lot of things would change. The one downside is that you would get some people who would not know what they are doing, end up losing everything and then the industry would get bad press. I would hope in the future the requirements are relaxed a little, after all it really is no different than picking stocks, people pick bad ones all the time. If you can't handle risk then stick to index funds and bonds - but the don't complain about the lower returns.

12-01-2013, 10:24 PM
Well said. I do think they need to have some sort of precautions in place, however, they also need to let the free market work properly. This is going to create a ton of jobs if they don't over regulate things. In 2 months we will know a lot more!

12-07-2013, 12:39 PM
I agree, there does need to be some protection and backers certainly need to understand the risks of investing. But the current proposals do seem overly restrictive, and there is a risk of losing some of the value of crowdfunding, by minimising the potential pool of investors.

12-08-2013, 09:17 AM
The best thing the SEC can do is to put in play extremely relaxed rules on equity crowdfunding, and then add to the rules as real word issues occurs. If you look at the UK as an example, they have some pretty relaxed rules, and there has been very little fraud. The crowd kind of helps weed out the scammers by itself.