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K&L Gates: SEC Issues Proposed Rules to Permit General Solicitation

On April 5, 2012, the Jumpstart Our Business Startups Act (“JOBS Act”) became effective.  The JOBS Act mandated, among other things, that the Securities and Exchange Commission amend Rule 506 of Regulation D and Rule 144A under the Securities Act of 1933, as amended to permit general solicitation and general advertising in connection with certain “private” offerings of securities.  The JOBS Act also mandated that the amendments to Rule 506 require issuers to take reasonable steps to verify that purchasers of the securities are accredited investors, using methods determined by the SEC.  The SEC proposed such amendments on August 29, 2012. Read the K&L Gates’ article.