Broker-dealers are offering clients a way to invest in hot, venture capital-backed companies long before their IPO through forward purchase agreements.
FINRA today issued an Investor Alert warning investors about the potential risks of participating in initial coin offerings, commonly referred to as ICOs.
Summary
FINRA has updated the form that members must use to file offering documents and information pursuant to FINRA Rules 5122 (Private Placements of Securities Issued by Members) and 5123 (Private Placements of Securities) (Filer Form). The updated Filer Form will be accessible in the FINRA Gateway beginning May 22, 2021, and includes new and updated questions that will facilitate review of
(a) Applicability
No person associated with a member shall participate in any manner in a private securities transaction except in accordance with the requirements of this Rule.
(b) Written Notice
Prior to participating in any private securities transaction, an associated person shall provide written notice to the member with which he is associated describing in detail the proposed transaction
No person associated with a capital acquisition broker shall participate in any manner in a private securities transaction as defined in FINRA Rule 3280(e).
Adopted by SR-FINRA-2015-054 eff. April 14, 2017.Selected Notice: 16-37.
WASHINGTON - The Financial Industry Regulatory Authority (FINRA) today announced it has sanctioned two firms and seven individuals for selling interests in private placements without conducting a reasonable investigation.