SEC Chairwoman Mary Jo White. (Photo: AP)

The Securities and Exchange Commission plans to discuss on May 18 during its meeting of the Advisory Committee on Small and Emerging Companies the agency’s recently released report on ways to “modernize” the accredited investor definition as well as unregistered securities offerings under Regulation D.

As the SEC states, under the federal securities laws, certain securities offerings are exempt from SEC registration if the securities are sold to accredited investors. 

The Advisory Committee on Small and Emerging Companies provides a formal mechanism for the SEC to receive advice and recommendations on privately held small businesses and publicly traded companies with a market capitalization less than $250 million.

The definition of accredited investor determines which investors are allowed to participate in private securities offerings not registered with the SEC.

The committee plans to discuss developments in unregistered securities offerings under Reg D.

Starting May 16, companies will be allowed to use crowdfunding to offer and sell securities to the investing public. Funding portals could begin registering with the SEC in late January. 

Equity crowdfunding rules were approved by the SEC in October, completing the agency’s last major rulemakings under the JOBS Act.

The SEC released in mid-February an Investor Alert detailing the parameters – and potential risks — associated with crowdfunding.

Meanwhile, a bill passed Feb. 1 by the U.S. House of Representatives would expand the definition of “accredited investor” to include a knowledge and education category.

The Fair Investment Opportunities for Professional Experts Act (H. R. 2187) was introduced by Rep. David Schweikert, R-Ariz., in April and passed by a vote of 347 to 8.

The bill is now under consideration by the Senate Committee on Banking, Housing and Urban Affairs.