[Federal Register Volume 85, Number 208 (Tuesday, October 27, 2020)]
[Notices]
[Page 68105]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-23747]


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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-654, OMB Control No. 3235-0704]


Submission for OMB Review; Comment Request

Upon Written Request Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 
20549-2736

Extension:
    Rule 506(e) of Regulation D Felons and Other Bad Actors 
Disclosure Statement

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') has submitted to the Office of Management 
and Budget the following request for an extension of the previously 
approved collection of information discussed below.
    Regulation 506(e) of Regulation D (17 CFR 230.506(e)) under the 
Securities Act of 1933 (15 U.S.C. 77a et seq.) requires the issuer to 
furnish to each purchaser, a reasonable time prior to sale, a 
description in writing of any matters that would have triggered 
disqualification under Rule 506(d)(1) of Regulation D, but occurred 
before September 23, 2013. The disclosure required by Rule 506(e) is 
not filed with the Commission, but serves as an important investor 
protection tool to inform investors of an issuer's and its covered 
persons, involvement in past ``bad actor'' disqualifying events such as 
pre-existing criminal convictions, court injunctions, disciplinary 
proceedings, and other sanctions enumerated in Rule 506(d). Without the 
mandatory written statement requirements set forth in Rule 506(e), 
purchasers may have the impression that all bad actors are disqualified 
from participation in Rule 506 offerings.
    We estimate there are 19,908 respondents that will conduct a one-
hour factual inquiry to determine whether the issuer and its covered 
persons have had pre-existing disqualifying events before September 23, 
2013. Of those 19,908 respondents, we estimate that 220 respondents 
with disqualifying events will spend ten hours to prepare a disclosure 
statement describing the matters that would have triggered 
disqualification under 506(d)(1) of Regulation D, except that these 
disqualifying events occurred before September 23, 2013, the effective 
date of the Rule 506 amendments. An estimated 2,200 burden hours are 
attributed to the 220 respondents with disqualifying events in addition 
to the 19,908 burden hours associated with the one-hour factual 
inquiry. In sum, the total annual increase in paperwork burden for all 
affected respondents to comply with the Rule 506(e) disclosure 
statement is estimated to be approximately 22,108 hours of company 
personnel time.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid control number.
    The public may view background documentation for this information 
collection at the following website: www.reginfo.gov. Find this 
particular information collection by selecting ``Currently under 30-day 
Review--Open for Public Comments'' or by using the search function. 
Written comments and recommendations for the proposed information 
collection should be sent within 30 days of publication of this notice 
to (i) www.reginfo.gov/public/do/PRAMain and (ii) David Bottom, 
Director/Chief Information Officer, Securities and Exchange Commission, 
c/o Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or by 
sending an email to: [email protected].

    Dated: October 22, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-23747 Filed 10-26-20; 8:45 am]
BILLING CODE 8011-01-P