Washington, D.C. — The Securities and Exchange Commission (SEC) approved a package of deregulatory rule changes on a 3-2 vote earlier today, dramatically expanding the ability of companies to raise money in private markets where basic rules of transparency and fair play do not apply. CFA’s Director of Investor Protection Barbara Roper issued the following statement.

“Today’s vote is evidence of an agency that has abandoned its investor protection mission and shirked its responsibility to protect both investors and the health and integrity of our capital markets,” Roper said. “While the rules voted on today are technical, their combined effect is clear: they will make it easier for even very large companies to conduct their securities offerings in the opaque and poorly supervised private markets, thus avoiding having to provide the essential facts needed to value their securities, and they will make it easier for these private issuers to aggressively market those supposedly ‘private’ offerings to the general public.”

“As usual, SEC Chairman Jay Clayton is promoting these rules as beneficial for small company capital formation. But, as he has with increasing frequency in recent months, Chairman Clayton chose to move forward with these rules without any evidence or meaningful analysis of their likely impact on either capital formation or investor protection. With this vote, he cements his reputation as the most partisan, deregulatory, and anti-investor SEC chairman in recent history,” Roper added.

Democratic Commissioners Allison Herren Lee and Caroline Crenshaw both opposed the rules and issued strong statements voicing their dissent. “We greatly appreciate Commissioners Lee and Crenshaw for continuing to champion investor protection at an agency that has clearly lost sight of, or lost interest in, its central investor protection mission,” Roper concluded.

Contact: Barbara Roper, 719-543-9468