I'm interested in investing in private placements. What does Regulation
D mean to me?
When you invest in
private placements, you are essentially investing in unregistered securities. While the Securities
Act of 1933 means that most offers to sell securities must be registered
with the Securities & Exchange Commission, Regulation D contains the
SEC's rules for companies to sell securities without registering them
with the SEC. So, any company that wants to offer pre-IPO private placements
would have to meet exemptions outlined in Regulation D.
Investors should be very careful about investing in these kinds of Regulation
D offerings, as they can be extremely risky. For example, if you invest
in a private placement with a company, it could be impossible to sell
those shares later because they are not traded on any of the public stock
exchanges. If the company fails to complete an IPO offering, you could
lose everything you invested in the private placement.
To avoid the problems with private placements and Regulation D offerings,
be sure you understand how it works, who you are dealing with, and what
will happen with your money. If you feel that you have been taken in by
private placement investment fraud or have been the victim of stockbroker misconduct, contact
an experienced and respected investment fraud lawyer today.