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In a structure commonly referred to as an “up‑C,” an existing LLC or other partnership form undertakes a public offering through a newly formed corporation, which is structured as a holding company that owns an interest in the LLC.  Traditionally, if the owners wanted to undertake a public offering of the entity’s securities, the owners would re-organize the LLC or partnership as a corporation and offer and sell that company’s common stock to the public…
On January 22, 2016, the North American Securities Administrators Association (“NASAA”) adopted a model act, entitled “An Act to Protect Vulnerable Adults from Financial Exploitation.” This act seeks to facilitate coordination among securities regulators, broker-dealers, and adult protective services agencies in dealing with the financial exploitation of seniors and other vulnerable adults. The model act reflects the collective views of the NASAA membership, which consists of 67 state, provincial, and territorial securities administrators from the…
In April 2015, the Financial Industry Regulatory Authority (“FINRA”) launched its Securities Helpline for Seniors™ (the “Helpline”). The Helpline seeks to enhance investor protection by serving as a resource to seniors making investment decisions. FINRA reports that, since its launch, the Helpline has fielded over 2,500 calls. The Helpline has received calls from persons ranging in age from 22 to 100; the average age of callers was 70 years old. Over the course of this…
Avoiding financial exploitation of older investors has been on our regulators’ radar screens for several years. With new rules proposed in October 2015, FINRA seeks to make investing safer for seniors and other vulnerable adults. The proposed new rules would permit (but not require) a broker to place a temporary hold on a disbursement of funds or securities from customer accounts. They would also require brokers to obtain for each non-institutional account holder the name…