Survival After the Reg FD Earthquake: Three Years Later, Pros Learn How to Cope.(Regulation Fair Disclosure)

Traders, May, 2003 by Mehta, Nina

The end of the world never came.

But financial professionals were predicting dire consequences almost three years ago when a controversial new rule went into effect.

Now Regulation Fair Disclosure (Reg FD), which was enacted into law in October 2000, has achieved many of its goals. Reg FD banned public companies from making selective and unfair disclosures of material nonpublic information to securities analysts, favored investors and other market pros.

Material information now is simultaneously disclosed to all investors. In a record comment period, 6,000 letters were received by the Securities and Exchange Commission.

Much of the controversy has been forgotten. Nevertheless, some critics still claim that Reg FD reduces the flow of...

Read the rest of this article with a Free Trial at HighBeam Research.

Premium Content Partnership | HighBeam Research provides an in-depth online archive library of reference works.