Seedinvest has submitted comments to the SEC regarding the accredited investor definition. They have an online petition form for those interested in signing and submitting to the SEC. I highly recommend it, but you need to do so BEFORE JULY 29, which is when the comment period closes.
I submitted my comments and wanted to share them below.
I agree with the comment submitted by Kiran Lingam at SeedInvest on July 8, 2014 available at http://www.sec.gov/comments/s7-06-13/s70613-546.pdf that raising the accredited investor thresholds would be disastrous for startups, job creation and the U.S. economy. I believe the SEC should refrain from increasing these thresholds and should also adopt knowledge/experience based standards for an individual to become an accredited investor.
Under the current rules and definitions, I am not considered an accredited investor. I am a young working professional with a degree in economics and finance and yet the “accredited investor” rules have precluded me from having the opportunity to invest in numerous opportunities. While I can appreciate and understand the concern to protect investors, I absolutely cannot reconcile the use of what equates to financial discrimination as an appropriate tool to achieve such results. The thresholds for income and wealth, at best, seem arbitrary and biased towards those who already have wealth.
In an environment where many Americans already feel like the deck is stacked against them, where wealth begets special privileges, where markets and the government rules that control it seem less and less egalitarian; this rule only exacerbates the sentiment. The right to invest in private companies should be just that, not a privilege available only to those with means.
Again, I kindly urge you to consider in earnest the comment submitted by Kiran Lingam at SeedInvest on July 8, 2014 and with particular attention to those related to adopting knowledge/experience based standards for an individual to become an accredited investor. Protecting investors is an important function of the SEC, excluding many Americans from investing in private companies is not.
Jose Lionel Velez