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Category Archives: Private Placements

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What FINRA Is Doing About Private Placements

Posted in Broker-Dealer Regulation, Financial Industry Trends, FINRA Compliance, Private Placements

FINRA recently censured and fined a broker-dealer $175,000.00 for failing to perform appropriate due diligence and supervision regarding private placements that the firm and its registered representatives offered. This penalty should serve as a wake-up call that FINRA is taking a sharp look at the due diligence that firms perform before and after offering a… Continue Reading

FINRA’s Private Placement Concerns

Posted in FINRA Compliance, FINRA Enforcement, Private Placements, Uncategorized

FINRA is beginning investigations into private placements.  New FINRA Rule 5123 requires member firms involved in a private stock offerings to provide investors with detailed information on the transaction prior to the sale, and to file that information with FIRNA within 15 days after the first sale. The rule went into effect in December 2012…. Continue Reading

Broker-Dealers Have to Start Filing Offering Documents

Posted in Broker-Dealer Regulation, Private Placements

With the recently adopted FINRA Rule 5123, broker-dealers selling private placements will have to file a copy of any private placement memorandum, term sheet, or other offering document with FINRA.  Further, if there are any material amendments, those amended versions of the documents will also have to be filed.  These filings must be made electronically within 15 calendar days… Continue Reading

You Gotta Be A Big Boy To Play In The Private Investment Transaction Game

Posted in Capital Formation, Corporate Financing, Private Placements, SEC Enforcement, Securities Associations, Securities Litigation

“Big Boy Letters” are usually used to identify that the buyer in a transaction has made its own independent assessment of certain risks involved and that certain information has not been disclosed to the buyer by the seller.  In particular, this means that a party is not relying upon certain representations or the lack of representations. The… Continue Reading