Final Report Of SEC Forum On Small Capital Formation

The SEC recently posted on its website the Final Report from the 2012 SEC Government-Business Forum on Small Capital Formation, which was held in the fall of 2012.  The report may be accessed at http://www.sec.gov/info/smallbus/sbforum.shtml.  The report includes 35 recommendations from the Forum, with quite a number of these focused on crowdfunding.  Setting aside those related to crowdfunding, not surprisingly, the Forum recommends that the SEC finalize the Rule 506 rulemaking; address the Section 3(b)(2) (or Reg A+) exemption; implement the bad actor provisions that were required to be adopted some time ago; and relax the eligibility criteria for use of Form S-3.  The Forum also recommends retaining the current income and net worth levels in the "accredited investor" definition.  The definition of "accredited investor" has come under close scrutiny in recent months and many commentators have advocated adding a financial literacy prong, as well as an invested assets