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SEC will focus on crowdfunding, general solicitation, Chairman Walter tells Senate

Feb 15 2013 Emmanuel Olaoye, Regulatory Intelligence

The Securities and Exchange Commission is working to issue a crowdfunding proposal in the next few months, SEC Chairman Elisse Walter told a Senate panel Thursday. Crowdfunding, a key provision in the Jumpstart Our Business Startups, or JOBS, Act, is a way for issuers to raise up to $1 million annually by soliciting investors through the issuers' websites or through an intermediary's portal. Proponents of crowdfunding have asked for exemptions from SEC registration rules to help early-stage companies raise capital, but some observers are concerned that any exemptions would present an opportunity for fraudsters to target vulnerable investors. "[W]e are working in the next few months putting together a crowdfunding proposal. I will say that although we very much regret not meeting the statutory deadline, we've learned a lot from meeting with people from this community and from abroad who have engaged in crowdfunding in the securities sphere, and I think that will help to illuminate

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