An interesting post at Linkedin's securities law group argues that the Senate version of the JOBS Act essentially killed the prospects for crowdfunding to become a reality:
I believe that if the current version of the crowdfunding exception becomes law, it will not be used often, if at all because all of the requirements will effectively cripple the exemption. Some requirements:
* All offerings will have to be made through a registered intermediary (registered broker or funding portal). This alone is probably the death of the exemption.
* The intermediary must "ensure" that each investor reviews investor-education information, "positively affirm" that the investor understands that the investor is risking the loss of the entire investment, take measures to reduce the risk of fraud as may be established by the SEC by rule, and "meet such other requirements" as the SEC establishes by rule.
* Issuers would be required to not less than annually filed with the SEC and provide to investors financial statements as the SEC shall determine appropriate.
* The SEC is required to issue rules as the SEC determines may be necessary or appropriate to carry out the crowdfunding act.
Given the SEC’s vocal opposition to the crowdfunding exemption, It seems very likely that crowdfunding will effectively be killed by whatever rules the SEC issues.
