Because private fund advertisements will reach all investors, there is a tremendous potential for investor confusion. The fact that sales are limited to accredited investors offers no protection in this regard, because it can only occur after the fact. To address this problem, it is critical that the Commission require all advertisements for private funds to include a clear, conspicuous, and prominent legend that the advertisement is not an offer, that investments are restricted to investors who qualify, and that the advertised fund is not registered with the Commission and should not be confused with mutual funds, closed-end funds,.
