What are the laws governing the issuance of asset-backed securities?

In Massachusetts, asset-backed securities (ABSs) are subject to Alternative Investment Law. ABSs are a form of investment, in which cash flows from a pool of pre-specified assets are used to pay interest and principal payments on the securities. This form of security is used to raise funds from investors and is typically seen in the residential mortgage market. The Alternative Investment Law is intended to provide greater investor protection when it comes to investing in asset-backed securities in Massachusetts. The law requires investment advisors to disclose information about the underlying assets and potential risks to the investor. This includes information about the type of asset being securitized, the expected cash flows from the asset-backed security, and the ratings assigned to the asset-backed security. The Alternative Investment Law also requires that asset-backed securities be registered with the Massachusetts Securities Division. In order to successfully register the security, the issuer must provide a registration statement containing information about the issuer, the asset-backed security, and the terms of the offering. Additionally, the issuer must provide any marketing materials used to promote the asset-backed security to prospective investors. This includes providing a prospectus, which contains complete information about the asset-backed security, including the risks and rewards of investing. By complying with these regulations, issuers of asset-backed securities in Massachusetts can ensure investor protection and comfort in knowing that all information pertaining to the security is disclosed and registered with the state.

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What are the laws governing the issuance of asset-backed securities?

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