The Truth About Private Investments For Wealthy People
USA President Franklin D. Roosevelt’s New Deal created the Securities and Exchange commission as part of the 1933 Act. It was designed to prevent business people from raising capital from the general public. Under the guise of consumer protection, the regulation made it illegal for entrepreneurs to advertise the offering of new shares in a company. Except to wealthy insiders—called accredited investors. The regulation relied upon a four-part test called ‘Howey’ to define which offers are considered securities.