Popular With Retail Investors, Shell Companies That Raise Capital Through Own IPOs Can Be Risky  

The Financial Industry Regulatory Authority (FINRA) has started a thorough examination of the activities of brokerage firms in relation to special purpose acquisition companies (SPACs). These shell companies raise funds through their own IPOs and have up to two years to select and acquire a private company that will go public via merger. They are popular among retail investors seeking to make money from private companies whose shares they otherwise wouldn’t be able to buy because they don’t satisfy certain wealth or income thresholds.

However, SPACs have come under increasing scrutiny from FINRA in the wake of their growing popularity, because of the risks and potential harm they can pose for retail investors. Our skilled SPAC investment attorneys at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) are investigating claims of losses by investors whose brokerage firm unsuitably recommended a special purpose acquisition vehicle or did not fully apprise them of the risks involved. Contact SSEK Law Firm at (800) 259-9010 today 

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