[ by Howard Haykin ] SEC Chairman Mary Schapiro gave the opening statement at Wednesday's open meeting of the Commission, which took up a proposed rule mandated by the JOBS Act to eliminate the current prohibition against general solicitation and general advertising in certain securities offerings – particularly offerings conducted under Rule 506 of Regulation D. Rule 506 and Registered Offerings are Comparable. Rule 506 is one of the exemptions that has been widely used by U.S. and foreign issuers to raise capital without registering their securities offerings.  In 2011, the estimated amount of capital raised in these types of exempt offerings was just over $1 trillion, which is comparable to the amount of capital raised in registered offerings during this same period. This underscores the importance of these exemptions for companies seeking capital in the U.S.  When the Commission adopted Rule 506 more than 3 decades ago, it said the issuer, or any person acting on its behalf, could use the exemption only if they were not offering or selling securities through general solicitation or general advertising. The JOBS Act directs ... the SEC to lift this prohibition as well as a similar prohibition contained in Rule 144A of the Securities Act.  The advertising ban is lifted for Rule 506 offerings, so long as all purchasers of the securities are accredited investors.  Toward this end, issuers are required "to take reasonable steps to verify” an investor’s accredited status, using such methods as determined by the SEC. Communications Technologies. The topic of prohibiting ads has been a hotly debated subject, particularly with the advances in communication technologies.  New technologies have caused many to question the feasibility and continued desirability of communication restrictions in private offerings - which is one of the reasons why, even before Congress enacted the JOBS Act, Ms. Schapiro instructed the SEC staff to take a fresh look at the prohibition in Rule 506 and develop ideas to reduce regulatory constraints on capital formation in a manner wholly consistent with investor protections. The Proposed Rule. The comments the SEC receives will be reviewed against today's proposed rule draft, which Ms. Schapiro believes has fulfilled Congress’s clear directive that issuers be given the ability to communicate freely to attract the capital they need, while obligating them to take steps to ensure that this ability is not used to sell securities to those who are not qualified to participate in such offerings. SEC Staff Credits. Ms. Schapiro expressed her appreciation to Meredith Cross, the Director of the Division of Corporation Finance, along with Ms. Cross's staff members, including: Lona Nallengara, Paula Dubberly, Tom Kim, Mauri Osheroff, Jonathan Ingram, Gerry Laporte, Paul Dudek, Ted Yu, Karen Wiedemann, Charles Kwon, and Heather Mackintosh. She also thanked the following people for their contributions:  Rich Levine, David Fredrickson, Aseel Rabie (Office of General Counsel); Craig Lewis, Kathleen Hanley, Scott Bauguess, Vlad Ivanov (Division of Risk, Strategy and Financial Innovation); Doug Scheidt, Dave Grim, Holly Hunter-Ceci, Sara Crovitz from the Division of Investment Management; David Blass, Joe Furey, Daniel Glen (Division of Trading and Markets); and Niya Vyas, Christine Sibille, and Marita Bartolini (Office of Compliance, Inspections and Examinations, or OCIE). For further details, go to:   [SEC Speeches, 8/29/12].