[alexmingoia]

The SEC has no way of knowing whether someone understands the risks of investing or not.

If the reasoning is to protect ignorant investors and prevent fraud, it would be more effective and equatable to have a test/certification to be a qualified/investor, rather than banning large swaths of the population from investing.

The current SEC rules are inherently discriminatory whereas the law should treat people equally.

[crooked-v]

From my experience working for a company in the real estate investment industry, the biggest gap in investor understanding is in risk vs projected return rate. Almost everyone including accredited investors gravitate towards anything with the highest potential return rate, even when there's great big up-front warnings about a given investment having X, Y, and Z risk factors.

With that in mind, even just forcing investors to pass a simple test about risk in different areas of investment (bonds, index funds, major real estate types, etc) would go a long way.