FINRA Updates Crowdfunding Bulletin
FINRA issued an updated Investor Alert on crowdfunding rules and processes (see previous coverage). The Alert was updated to provide additional information on the SEC's new inflation-adjusted investment limits, which became effective on May 5, 2017.
In the Alert, FINRA encouraged investors to be aware:
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that crowdfunding investments carry significant risks, since all or some of the investments can be lost;
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of limitations on how much can be invested, which depends on investors' net worth and annual income;
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that they will be limited in their ability to resell investments for the first year, and may need to hold investments for an indefinite period of time;
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of required disclosures under the JOBS Act by crowdfunding companies, their broker-dealers and their funding portals; and
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of the possibility of fraud.