Securities and Exchange Commission (SEC) Chairman Jay Clayton has re-affirmed his belief that retail investors should have a compliant path to access more private securities offerings.

While initial public offerings (IPOs) have morphed into an exit opportunity for big money where retail investors end up holding the bag, and most wealth is captured in private securities offerings, Chair Clayton is looking to right this societal wrong that disenfranchises much of the population.

In opening remarks at the SEC’s Investor Advisory Committee meeting, Clayton said:

“I believe it is our obligation to explore whether we can reduce cost and complexity, and increase opportunity for our Main Street investors in this important market, including through professionally managed funds, where Main Street investors are able to invest in the private market on terms similar to those available to institutional investors. Importantly, we must ensure appropriate investor protections for our long-term Main Street investors.”

This is not the first time Clayton has expressed his opinion on leveling the playing field when it comes to investment opportunity. For some months now, Clayton has messaged his ambition to create a regulated path for retail investors to gain access to promising early-stage firms that frequently raise growth capital under Reg D – currently the realm of VCs and the very wealthy.

In the past, Clayton has also expressed his goal of addressing the definition of an Accredited Investor, which is fundamentally flawed. The current definition is widely understood as a poor metric for financial acumen and sophistication.

Clayton’s comments come at a time during a regulatory review on exemption harmonization as encapsulated in a “Concept Release.” The consultation recently closed comments from interested parties in September.





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