CrowdCheck releases its summary of Regulation A+
On March 25, 2015, the SEC adopted its final rules to implement Title IV of the JOBS Act of 2012. These rules are popularly known as “Regulation A+” and provide for two tiers of offerings under Regulation A. For more details on the new rules, check out CrowdCheck’s summary here, http://13.221.220.68/sites/default/files/Regulation%20A%20Memo%20FI….
Don’t forget to pay your franchise taxes
One of the things that any securities due diligence should look at is whether a company or investment vehicle is in good standing with its state of organization. Good standing indicates that the company is validly formed, exists as a separate legal entity, and is up to date with its obligations for that particular state. […]
Compliance challenges of intrastate crowdfunding
A recent Washington Post article by Steven Overly asked “Why has hardly anyone applied for equity crowdfunding in D.C.?” This is an important question. The DC Department of Insurance, Securities and Banking can be applauded for its efforts to promote the new rules. Representatives of the Department have spoken about the new exception at a […]
CrowdCheck guest blog post on Joe Wallin’s Blog
Rethinking Section 3(a)(11) for State Crowdfunding http://joewallin.com/2014/12/12/rethinking-section-3a11-state-crowdfunding/
Halloween blog special: Sometimes it’s the investors who are scary…
Securities laws in the United States are based around the idea of disclosure and protection of the naïve investor from unscrupulous practices by issuers of securities — the sophisticated guys duping the little guy. However, for many early-stage companies, the sophisticated guys at the table are the investors. Not only do they hold all the cards on the […]
Nobody is too big for Bad Actor Rule compliance
Previously, CrowdCheck has brought readers the message that no securities law violation is too small to bring on SEC enforcement. It is part of the “broken windows” theory of policing—if you let issuers and brokers get away with the small violations, it sends a message that compliance with securities laws is merely optional. But what happens if […]
Updated Summaries of Intrastate Crowdfunding Exemptions
Since March, when CrowdCheck first put together a summary of intrastate crowdfunding exemptions, there has been a significant amount of activity by various states to ease the regulatory process for companies to offer securities through the use of the intrastate exemption to SEC registration. The following two charts were produced as a collaboration by CrowdCheck, Anthony […]
Intrastate crowdfunding: Nice, but not a game changer
In recent months, a lot of excitement has built up surrounding the enactment and use of intrastate crowdfunding exemptions as an alternative to waiting for the SEC to finalize Regulation Crowdfunding at the federal level. Presently, at least thirteen states have introduced or enacted some form of exemption from state regulation for intrastate crowdfunding offerings. These exemptions […]
First crowdfunding fraud enforcement action by State Attorney General
As many in the crowdfunding space are now well aware, the Washington State Attorney General has brought a case against the sponsors of the Asylum Playing Card Kickstarter campaign. The lawsuit alleges the campaign made misrepresentations to project backers that constitute “unfair or deceptive acts in trade or commerce“. The basic facts alleged by the state are […]
Still do it right the first time: Delaware’s new mulligan for botched issuances of securities
An essential part of the due diligence on an offering of securities through Section 4(a)(6) crowdfunding or Rule 506(c) is ensuring that any previous issuances of securities (such as offerings to friends and family) are not defective. For instance, if the securities were not authorized by the company’s certificate of incorporation, or properly approved by […]