Obama Signs JOBS Act

 John Walsh, Esq.

This spring small business owners have more to look forward to than just better weather on their off days. In early April, President Obama signed into law the JOBS Act, a bill that takes aim at improving small business growth.

The Jumpstart Our Business Startups (JOBS) Act, focuses on easing financial regulations on small businesses. The law rescinds prohibitions on small businesses from using advertising to attract investors and makes it easier for smaller companies to launch IPOs. The JOBS Act also allows small businesses to raise up to $1 million annually through “crowdfunding”, a technique used to gain capital from investors in exchange for small shares of stock, done typically over the internet.

Despite the popularity of the bill in the House and Senate, some investing groups and regulators are critical of the bill due to potential loopholes in its drafting. The language of the JOBS Act may allow for companies to secretly work out disagreements with regulators in private, before going public.

“While the JOBS Act is to be commended for increasing the funding for small businesses, great care should still be taken by companies and investors to comply with remaining security regulations,” said business attorney Walsh.

Any investor knows that disagreements with regulators and accounting troubles with the SEC are pieces of information that the public should know about prior to investing.

White House spokesman Jay Carney told reporters not to worry, stating "The president will ensure in the implementation of this (law) that investor protections are maintained."

If you have business or finance questions, contact John Walsh at (248) 380-0000.

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