The SEC’s recent charges against private securities issuers highlights the importance of securities compliance. On December 20, 2024, the Securities and Exchange Commission (“SEC”) announced charges against several entities for failing to file Form D for their offerings. These charges resulted in substantial civil penalties totaling $430,000. What is Form D? Form D is a...
Business Transactions
Fund managers and syndicators should consider forming a brand new entity rather than using an existing entity or managing the fund or syndication individually. Here’s why: Liability Protection: The primary and most important reason to form a new entity to manage your fund or syndication is for liability protection purposes. First, utilizing an entity (rather...
With the holidays quickly approaching, so is an important regulatory requirement that likely affects your business. The deadline for filing Beneficial Information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN) for entities formed before January 1, 2024, is January 1, 2025. Before commencing your New Year’s Eve celebration, be sure to file your BOI...
Aug72024
Once a private securities offering is ready to launch, issuers and fund managers must tackle the challenge of raising capital. Registered broker-dealers play a significant role in securities offerings by connecting issuers with potential investors. However, an increasing number of unregistered capital raisers, finders, agents, and individuals with similar titles claim they can assist issuers...
In private fund formation, fund managers face a critical decision: whether to structure their fund as a traditional blind pool fund or a deal-by-deal fund. Each structure offers distinct benefits and challenges, catering to different issuers, investors, and strategies. Understanding the key characteristics, advantages, and disadvantages is crucial for fund managers to select the vehicle...
The Social Security Administration (SSA) issues Social Security Numbers (SSNs) and cards to U.S. citizens, immigrant visa holders, and certain nonimmigrant visa holders residing in the U.S. with work authorization from the U.S. Department of Homeland Security (DHS). Applying for an SSN is free. SSNs are used for reporting earnings and taxes to the IRS,...
When raising capital, establishing meaningful relationships with investors is essential for success. For private offerings under Rule 506(b) of Regulation D of the Securities Act, this concept is especially imperative. Rule 506(b) exempts issuers of private offerings from the extensive disclosure requirements in public offerings. Unlike Rule 506(c), which permits general solicitation, Rule 506(b) allows...
At the beginning of the new year, the Corporate Transparency Act (“CTA”) went into effect, burdening 32 million businesses to submit certain beneficial ownership information (“BOI”) in reports filed with the Financial Crimes Enforcement Network (“FinCEN”). You can find a detailed summary of the CTA and BOI reporting requirements here. Many affected parties have voiced...