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ARTICLE · 29 JULY 2010

Changes to Accredited Investor Standard

Mayer Brown
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Now that President Obama has signed the Dodd-Frank Wall Street Reform Act (the "Act"), the net worth test for meeting the "Accredited Investor" standard has changed.

United StatesFinance and Banking
Scott Anenberg
Scott Anenberg
Charles Horn
Charles Horn
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Originally published July 21, 2010

Keywords: net worth test, Dodd-Frank, Regulation D, Securities Act, accredited investor

Now that President Obama has signed the Dodd-Frank Wall Street Reform Act (the "Act"), the net worth test for meeting the "Accredited Investor" standard has changed.

Regulation D, promulgated under the Securities Act of 1933, as amended (the "Securities Act"), creates several safe harbors from the registration requirements of the Securities Act for transactions in securities by an issuer not involving a public offering. In many Regulation D offerings, the "accredited investor" status of the offerees is an important element in determining the availability of the safe harbor. "Accredited investors" include, among other categories, any natural person whose individual net worth, or net worth with the person's spouse, at the time of purchase, exceeds $1 million (known as the "net worth test").

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