TechFlow news — According to Politico, the U.S. Securities and Exchange Commission (SEC) is finalizing amendments to a rule that would make it easier for investors to sue venture capital firms over misconduct, negligence, or reckless behavior. The proposal could be finalized as early as this quarter.
This rule change isn't limited to venture capital—it will also cover private investment funds such as private equity firms, hedge funds, and certain real estate investment companies that are already regulated by the SEC. Justin Field, Senior Vice President of Government Affairs at the National Venture Capital Association, said this would "expose venture capitalists to all kinds of litigation risks."Original link
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