What investors didn’t see until a month after the IPO were the letters that pushed Facebook to disclose in detail such key financial challenges as decelerating revenue growth, user count and its dependence on gaming company Zynga Inc. (ZNGA) -- all issues that arose in prominence after it became a public company.
Publishing the SEC letters beforehand would be “a better way to get the information to the market than an amended filing,” said Peter Henning, a former SEC lawyer who teaches at Wayne State University in Detroit. “The SEC is a better soap box than the filings.”
Christ, that sounds like a PR disaster if not the stuff of more class action suits.
Current SEC policy is to release correspondence no earlier than 20 business days after the IPO. The SEC doesn’t post correspondence “real time,” said John Nester, a spokesman, because “people could misinterpret our questions to companies about their disclosure before companies have had opportunities to provide a complete picture.” By law, “a company is responsible for its own disclosures,” he said.
The rules are the same for everyone... But only scrutinized when a company does poorly.
Publishing the SEC letters beforehand would be “a better way to get the information to the market than an amended filing,” said Peter Henning, a former SEC lawyer who teaches at Wayne State University in Detroit. “The SEC is a better soap box than the filings.”
Christ, that sounds like a PR disaster if not the stuff of more class action suits.