Article Title

Rule 15C2-12: A Flawed Regulatory Framework Creates Pitfalls for Municipal Issuers

Publication Title

Washington University Journal of Urban and Contemporary Law


Despite the increasing growth and complexity of the municipal bond market, it remains subject to minimal regulation. State regulation is non-uniform, and industry custom requires only voluntary disclosure. Although municipal issuers are subject to the anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934, they are exempt from the registration and disclosure requirements of the Acts. SEC Rule 15c2-12 and its amendments impose an initial disclosure requirement, periodic disclosure and secondary market reporting. The regulatory framework provided by Rule 15c2-12, however, is insufficient for both issuers and investors. This Article examines the disclosure requirements that issuers face in today's municipal bond market.