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The laws exist for a good reason, and it's because historically many folks with insufficient means lost their shirts due to such scams. A judgment was made that
by cycrutchfield 9y ago
The laws exist for a good reason, and it's because historically many folks with insufficient means lost their shirts due to such scams. A judgment was made that between restricting such risky schemes to those with the means to handle that risk ("the rich") and letting people lose their shirts, restricting such risky schemes was the lesser of two evils.
And I tend to agree.
- tptacek 9y agoCan we be clear that the law does not restrict "risky schemes", but rather "schemes that refuse to follow disclosure laws"? There are thousands of publicly traded companies and a lot of them are batshit. What allows them to trade without SEC molestation is that they (a) register, (b) publish audited financials, and (c) follow the SEC's rules about promotion. The difference between a restaurant review coupon ICO and a pink sheet biotech firm isn't risk. Both will almost certainly fail. The difference is that the ICO refuses to publish audited financials, and demands the right to shoot Youtube videos extolling a once-in-a-lifetime opportunity to 9x an investment. That's what the SEC is protecting retail investors from.