Earlier this week, FINRA published its annual priorities letter. Again, FINRA includes among the areas of concern private placements. FINRA cites particular issues relating to inadequate due diligence by broker-dealers in connection with private placements, inadequate suitability assessments, misleading offering documents, and deficiencies in procedures in offerings that use escrow accounts. The letter also raises heightened concerns in exempt offerings involving the use of general solicitation. See: http://www.finra.org/web/groups/industry/@ip/@reg/@guide/documents/industry/p602239.pdf.
Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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