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ADISA Urges NASAA to Alter Proposed Statement of Policy

ADISA, a trade association representing the alternative and direct investment industry, submitted a comment letter to the North American Securities Administrators Association (NASAA) outlining concerns regarding its proposed statement of policy regarding the use of electronic offering documents and Electronic Signatures.

ADISA’s concerns are focused on the following areas:

1. Expanding the scope of the delivery of electronic documents to include not only offering documents and subscription agreements but also marketing materials. In addition, clarifying that the ability to deliver documents electronically includes not only the issuer but also the agents of the issuers, including, without limitation, broker-dealers and their registered representatives and registered investment advisers and their investment adviser representatives.

2. Making the guidance of the statement of policy consistent with existing Securities and Exchange Commission guidance regarding electronic delivery, including SEC Releases 33-7233 (October 6, 1995), 33-7288 (May 9, 1996) and 33-7856 (May 4, 2000), including the use of multi-offering subscription documents and investor consent from offering to offering.

3. Defining security breach and tailoring the consequences relating to the discovery of such security breach to the actual circumstances of the breach. There are many types of security breaches, not all of which should be treated the same, especially since some types of security breaches may not compromise any information or personal data. While any kind of breach is a cause for concern, the response to such breach should be tailored to its type, extent and scope.

The letter, signed by ADISA president Mike Bendix, DFPG Investments, was drafted by Deborah Froling of Kutak Rock and reviewed by ADISA’s drafting committee: John H. Grady, Fred Baerenz and Darryl Steinhause.

To read ADISA’s letter in its entirety, click here.

The Alternative and Direct Investment Securities Association bills itself as the largest national trade association serving alternative investment and securities industry professionals who are active in offering, managing and distributing private and public direct investments. The association was founded in 2003 and has approximately 4,000 members.

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