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SEC Warns Potential Investors About Initial Exchange Offerings

Janelle Fox

Summary: The SEC has released an investor alert on Tuesday warning potential investors about the level of risk involved with initial exchange offerings (IEO). The release, published by the Office of Investor Education and Advocacy, warned investors to "be cautious if considering an investment in an IEO" because the promises these offerings make "can be used ...

The SEC has released an investor alert on Tuesday warning potential investors about the level of risk involved with initial exchange offerings (IEO).

The release, published by the Office of Investor Education and Advocacy, warned investors to "be cautious if considering an investment in an IEO" because the promises these offerings make "can be used improperly to entice investors with the false promise of high returns in a new investment space."

The SEC also noted that IEOs might be conducted in violation of federal securities laws and likely lack the protections of registered and exempt securities offerings.

By Janelle Fox

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Link: SEC Warns Potential Investors About Initial Exchange Offerings   [Copy]
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