Yesterday, the Securities and Exchange Commission issued this bulletin on the risks of investing in reverse merger companies. In this post from the week before, I wrote about a recent article that found that Nevada is second only to Delaware in attracting out-of-state publicly traded corporations. The article by Professors Michal Barzuza and David C. Smith looked at the number of accounting restatements and found:

“Our results suggest that Nevada corporate law attracts a certain class of firms that are prone to financial reporting failures and that these failures are followed by significant losses to shareholder value.”