The SEC Has Overhauled Its Rule Determining Which Companies Can And Cannot Be Quoted Over The Counter

Published Apr 06 2021 at 12:50 PM GMT
Key
Points
  • Retail investors will soon have newly added protections when trading and investing in over-the-counter (OTC) securities, according to a recent SEC rule change.
  • The changes apply to SEC Rule 15c2-11, the rule that governs when broker-dealers may publish electronic quotes in securities that are not traded on an exchange.
  • The amendments, according to the SEC, are designed to protect investors from fraud by restricting public quotes in the stock of companies that do not have up-to-date financial information available online.
  • Scope Of The SEC’s Amendments There are a few different facets of the rule change.
  • Among them: Companies that have not published “current” information - including financial statements from the last fiscal year and other information describing the company’s business - may not be eligible to have their securities publicly quoted by a broker-dealer.




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  • Published Apr 6, 2021 12:50 PM GMT