Accredited Investor Definition: Recommendations made by the SEC Advisory Committee on Small and Emerging Companies
Several weeks ago, the Advisory Committee on Small and Emerging Companies (the “Committee”) of the Securities and Exchange Commission (the “SEC”) set forth its rather limited recommendations regarding the definition of Accredited Investor (“AI”) as it applies to natural persons as found in Rule 501 under the Securities Act of 1933, as amended. In recommending that the existing income and net worth thresholds for AIs should remain unchanged, the Committee noted that smaller public companies and emerging companies play a significant role as drivers of U.S. economic activity, innovation and job creation, and that the ability of such companies to raise capital in the private markets is critical to the economic well-being of the United States.