SEC reduces pool of accredited investors — What it might mean for your next securities offering

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Abstract: In December 2011, the SEC finalized a rule amending its “accredited investor” net worth standards. The rule doesn’t change the $1 million net worth threshold, but it excludes the value of an investor’s home (together with any debt secured by the home) from the equation. Although there are certain exceptions, the rule could affect a company’s plans for new securities offerings. This article discusses a popular safe harbor, along with the final rule in the context of 2010’s Dodd-Frank act.