It would not seem difficult for regulators to block felons and other law-breakers from pitching private investment deals to unsophisticated customers, but nearly 20 months after proposing its "bad actor" rule, the U.S. Securities and Exchange Commission is having trouble finalizing it.
More than a year after the legal deadline for finishing its work on the rule, the agency is stymied by internal disagreements, limited resources and a heavy workload.
Now, state securities regulators, consumer groups and some legislators are saying that if the SEC does not move soon, the agency could open the door to shady late-night television pitches from convicted criminals.
That is because of possible interplay between the so-called bad actors rule and a second SEC proposal loosening restrictions on the advertising of these offerings.
But with SEC Chairman Mary Schapiro leaving on Dec. 14, the commission will be split between two Democrats and two Republicans, making it more
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