SR-FINRA-2011-057

Proposed Rule Change to Adopt New FINRA Rule 5123 (Private Placements of Securities)

Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to adopt new FINRA Rule 5123 (Private Placements of Securities).  Proposed FINRA Rule 5123 would require that members and associated persons that offer or sell applicable private placements, or participate in the preparation of private placement memoranda (“PPM”), term sheets or other disclosure documents in connection with such private placements, provide relevant disclosures to each investor prior to sale describing the anticipated use of offering proceeds, and the amount and type of offering expenses and offering compensation.