Haynes and Boone, LLP Partner Ricardo Davidovich talked with Pensions & Investments magazine about the Securities and Exchange Commission’s proposed new definition of accredited investor that would allow more individual investors to participate in private markets.
Here is an excerpt:
The proposal, based on SEC staff recommendations, would add categories of who could qualify as accredited investors based on their professional knowledge, experience or certifications, or whether they meet an investments test, as well as knowledgeable employees of private funds. There is also a "catch-all" category for any entity owning more than $5 million in investments, and limited liability companies are eligible if they meet a $100 million investment threshold.
"The current rules use wealth as a proxy for sophistication and it appears that the commission is amenable to considering additional ways to measure that sophistication to make these investments," said Ricardo Davidovich, a partner with Haynes and Boone, LLP's investment management group in New York.
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