RIA Compliance Blog
The President signed the Jumpstart Our Business Startups Act (JOBS Act) on April 5 during a Rose Garden signing ceremony. He called the bill a “game changer” that would remove barriers that prevent small businesses from growing and hiring. He stated that this bill was so important that he “called on Congress to remove a number of barriers that were preventing aspiring entrepreneurs from getting funding.” We have previously discussed the JOBS Act in JOBS Act Passes Both Chambers and Will be Sent to President and House of Representatives Pass Crowdfunding Bill for the Second Time in JOBS Act.
The purpose of the JOBS Act is to provide mechanisms for small businesses to raise capital more easily and efficiently, which proponents say would promote the creation of more jobs. The President stated “because of this bill, start-ups and small business will now have access to a big pool of potential investors – namely, the American people. For the first time, ordinary Americans will be able to go online and invest in entrepreneurs that they believe in.”
Critics of the bill are mainly concerned that it will lead to an increase in investor fraud and scams. The President addressed this issue by stating that it will be subject to “rigorous oversight.” He has instructed his administration to keep an eye on the law and provide him with regular updates. He also wants to ensure that the Securities and Exchange Commission (SEC) is properly funded in the future because “the SEC is going to play an important role in implementing this bill.”
At the signing ceremony, the President was surrounded by lawmakers from both political parties. The bill received significant bipartisan support which the President claims “represents the kind of bipartisan action we should be taking in Washington to help our economy.”
Parker MacIntyre provides legal and compliance services to investment advisers, broker-dealers, registered representatives, hedge funds and issuers of securities, among others. Our regulatory practice group assists financial service providers with the complex issues that arise in the course of their businesses, including compliance with federal and state laws and rules.