Reported by Rob Silverblatt, US News, the Securities and Exchange Commission has recently put forth proposed rules that, if approved, would govern hedge fund advertising. The rules are a direct response to the JOBS Act, which contained a provision requiring that hedge funds, along with various other types of private offerings, be allowed to market their products to all types of investors.
Prior to the JOBS Act, hedge funds that took advantage of certain SEC registration exemptions were banned from engaging in general solicitations. But because of the bill, the question in front of the SEC is not whether such hedge funds will be allowed to undertake such advertisements. Rather, it is how to best regulate the advertisements once they are allowed.