Marc Indeglia, President of the Small Public Company Coalition (SPCC), issued a statement today in response to the 11thCircuit Court of Appeals decision in the Securities and Exchange Commission v. Ibrahim Almagarby.
“The Eleventh Circuit’s decision that Ibrahim Almagarby, a college student, was a “dealer” under the federal securities laws is a step in the wrong direction and only serves to further bolster this runaway Commission and its novel and radically expansive view of its authority. Mr. Almagarby, like so many others that the SEC has decided to target, was a small investor investing in small businesses under the widely-accepted understanding, in effect for decades, that his investment activity did not require registration as a broker-dealer.
“SPCC members, as well as family offices, hedge funds, and even venture capital funds across the country, are now subject to regulation by enforcement under an entirely novel understanding of what constitutes a securities dealer. Small businesses, now more than ever, at risk of losing access to vital capital because investors simply do not want to risk engaging in onerous lawfare with the Commission.
“The SPCC, in tandem with partners across various industries, stands ready to support a legislative solution to codify the definition of dealer as has been understood for decades and allow law-abiding market participants to inject capital where it is needed most: American small businesses.”
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The Small Public Company Coalition represents small businesses and investors in the small and microcap markets.