December 31, 2012
I also read the comments of Jaimie Davis. While I'm sorry he lost all his money, I'm sure he has heard of the word diversification. Perhaps it should have been a red flag when his advisor advised him to put all of his money into Reg D offerings. Also, it appears the Reg D offerings in which he invested and lost money were offered illegally. This brings to focus the point that anyone interested in defrauding someone is going to find a way to do so. This clearly demonstrates that a ban on general solicitation of Reg D offerings does not help prevent fraud. All it does is keep legitimate businesses from accessing capital in a cost effective and efficient manner and limits investor choice. If someone is willing to defraud someone, does anyone really think they care about the legality of their methods for reaching their victims? They are going to find a way to reach their victims even if they need to do so illegally, as general solicitation was illegal before the passage of the JOBS Act. Now that Congress has passed a law lifing the ban on general soliciation, it is time for the SEC to also obey the law and implement the rules as mandated by Congress.