The panel deems the ban as ‘unnecessary’ and said that private offerings are only available to sophisticated "accredited" investors. Few critics also view the ban as a barrier to capital formation.
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The SEC advisory panel has also urged the agency to allow small companies and startups to widely publicize private offerings to solicit investments from HNWIs.
The recommendation comes two months after the House voted in rare bipartisan fashion to approve a roll back in the general solicitation ban.
The SEC’s advisory panel was formed in September 2011, and as part of a wide-ranging review of the agency, it is studying the impact of its regulations on capital formation for small businesses.
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