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The broker-dealer division of Chicago-based Zacks Investment Research, has been charged by the Securities and Exchange Commission for failure to supervise staff who traded on non-public material information. The action is a blow to the nascent Reg A research market, where Zacks has been the first and only traditional sell-side broker to offer equity research on Reg A issuers.
A judge ruled that the Securities and Exchange Commission can not use its own administrative court to pursue its securities law charges against emerging growth company financier Ironridge Global Partners, dealing a setback to the SEC’s frequent use of administrative law proceedings that some argue are unconstitutional. The Nov. 17 ruling by Judge Leigh Martin May, of the U.S. District Court in Atlanta, forced the commission to withdraw subpoenas and cancel an administrative law hearing that had been scheduled for Dec. 7. The SEC has 60 days to file with the 11th Circuit Court of Appeals in Atlanta to try to overturn Judge May’s ruling.
Companies that offer sex-related products, alcohol, marijuana or gamlbing have historically faced heightened challenges in attracting investments.
The proposal by the SEC would increase the amount of capital that emerging growth companies could raise in unregistered securities offerings under Rule 504.
