Today, the Senate passed the JOBS Action in a 73 to 26 vote. An amendment to increase investor protections in the crowdfunding section of the bill, Amendment 1884, also passed revising some provisions.
The Amendment increases restrictions on the money raising from individuals. It includes a sliding scale of investment caps. For example, someone making less than $40,000 a year will be limited to investing 2% of their annual income in startup companies. Those earning $100,000 can invest up to 10% of their annual income.
Additionally, the Amendment requires a three -week closing period before the company may collect and use the crowdfunded investments. The idea is that this period will allow parties to identify potential fraudulent.
Since the Act was amended, it now has to go back to the House of Representatives for a new vote. Since it originally passed 390 to 23, it is reasonable to assume it will pass this time around. President Obama has state that when the bill reaches his desk, he will sign it.
For more information about the JOBS Act and Amendment passed today click Here.
Author: Jennifer Trowbridge, Stoecklein Law Group