Proposed Changes to Accredited Investor Definition

WHAT HAPPENED?

Recently, the Securities and Exchange Commission proposed changes to the definition of an “accredited investor.” Until this point, the accredited investor definition has been limited to evaluating only an individual’s income or net worth. With the proposed changes, the Commission hopes to increase access to investments in private capital markets.

Some of the new categories will include:

  • Any entity owning more than $5 million in investments, including Indian tribes and family offices
  • Individuals with certain certifications or credentials
  • “Knowledgeable employees” of private funds
  • Pooled finances qualifying as “spousal equivalents”

WHAT DOES THIS MEAN FOR ME?

The proposed rule has now entered a 60 period for public comment. Comments can be submitted directly to the Commission. Contact Fairview with questions about how changes to the accredited investor definition may affect you or your firm.

About the Author:

Fairview®
Founded in 2005 with the goal of developing streamlined solutions for investment advisers, Fairview® is now servicing investment advisers, foundations, and funds with over $200 billion in collective assets.