Is the SEC Helping or Hurting Intrastate Crowdfunding?

I have written a great deal since May 2014 as to my concerns over recent SEC interpretations regarding the use of the Internet and social media in intrastate crowdfunded offerings relying on SEC Rule 147 – an exemption from federal registration for securities offerings made by a local company to investors within its states borders. A dozen or so states have enacted local crowdfunding legislation which is based upon this federal exemption from the Securities Act of 1933.

Recent SEC rulings have put a damper on the use of the internet and social media in intrastate crowdfunding by requiring that internet and social media solicitation be made available only to residents of the state, and not visible by persons outside the state.

Though the New York Times has recently argued that the SEC’s inaction on JOBS Act Title III rules has unintentionally given a boost to intrastate crowdfunding, some states are seeing a different picture as a result of a second SEC ruling on the subject issued in October 2014, which supplements a ruling issued in April 2014.

Here are the two articles on the subject which appeared this week. I would love to hear your point of view!

New York Times:

The View from Michigan:

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