Wednesday, May 16, 2012

Mass. Securities Regulator Asks to Consult with SEC on Crowdfunding Regulations

The chief securities regulator for Massachusetts, William Galvin, has expressed a strong interest in consulting and collaborating with the Commission on the rulemaking for crowdfunding. In a letter to the Commission, he noted that, because crowdfunding presents opportunities for issuers to use innovative technologies and techniques to raise capital, state regulators expect the rulemaking to break new ground in securities regulation. They are in full accord with, and wish to emphasize, the statutory requirement that the Commission' s rules for crowdflmding must protect investors in these offerings.
The letter notes that the JOBS Act requires that state rules for crowdfunding issuers and for crowdfunding portals must be consistent with SEC rules. Mr. Galvin emphasized that good forward looking regulations will allow the SEC and the states to effectively use scarce regulatory resources both to protect investors and to help the crowdfunding initiative accomplish its goal of helping small issuers raise capital.