SIE practice questioneasyRegulation D and Account Types
An investor wishes to participate in a private placement under Regulation D. Which statement is TRUE?
- AAll investors in private placements must be FINRA members.
- BOnly publicly traded companies may offer private placements.
- CPrivate placements are registered with the SEC.
- DThe investor must generally be an accredited investor to participate.✓ Correct answer
Explanation
Why D — The investor must generally be an accredited investor to participate.
Reg D private placements are generally limited to accredited investors. B is false—private placements can be offered by non-public companies. C is false—they are exempt from SEC registration. D is incorrect—investors don't need to be FINRA members.
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