According to prepared SEC remarks, members examined foreign private issuer rules, VIE risks, and retail-access guardrails, with potential Reg D reforms and stronger registered-fund disclosures, valuation oversight, and liquidity guidance under consideration.
This is an official statement delivered at the SEC Investor Advisory Committee meeting. The remarks welcome new IAC members and set an agenda focused on (1) foreign private issuers (FPIs) and (2) retail access to private markets. On FPIs, the speaker references a recent SEC concept release, notes concerns that over half of Form 20-F filers trade only in the U.S., cites research by Professor Dan Taylor on foreign insiders exploiting Section 16, and flags risks from Variable Interest Entities (VIEs). The Commission has received 75+ comment letters. On private markets, the remarks express skepticism about using registered funds to hold illiquid assets, emphasize liquidity as a core ’40 Act feature, and support improved disclosures, including valuation practices, third-party appraisals, board oversight, and layered risk disclosures. The statement questions co-investment flexibility for open-end funds under Section 17(d)/Rule 17d-1 and urges caution on allowing certain closed-end funds to operate as series funds. For direct retail access, the Committee offers guardrails and stresses that sophistication requires information, referencing Ralston Purina and Hill York. The remarks call for reforms to Regulation D to mandate meaningful, scalable issuer information. References include Executive Order No. 14330 (Aug. 7, 2025) and the IAC’s Sept. 18, 2025 draft recommendations.