Washington, D.C. – In a letter to the House Committee on Financial Services and its subcommittee on Investor Protection, Entrepreneurship, and Capital Markets, CFA voiced its concern over the expansion of private offering exemptions. The letter was sent in anticipation of a hearing in the Investor Protection, Entrepreneurship, and Capital Markets Subcommittee on the topic of “Examining Private Market Exemptions as a Barrier to IPOs and Retail Investment.”

The letter highlights how U.S. public markets are in decline, how investors are harmed by the migration of capital raising from public to private markets, how further study of private market impact on public markets is needed, and how private offering exemptions are the primary cause of public market decline. The letter also calls on Congress to halt consideration of further exemptions that could expand private markets until the necessary studies are completed and to seriously consider measures to rein in private offering exemptions. Left unchecked, the promotion of private markets at public markets’ expense could recreate the conditions that led to the great crash of ’29.