Doug Cornelius on compliance for private equity real estate
If the investment is a “security”, you have to comply with the Securities and Exchange Commission regulations. The seminal case is Howey, where a sponsor was selling interests in an orange grove in Florida. The sponsor was not just selling the small land parcels with orange trees on them, but also his management, harvesting and … Read more »
With the onset of the crypto winter, the Securities and Exchange Commission is continuing to bring cases against crypto companies. The latest is against a funding model for animated series: Stoner Cats. The producers wanted to try finding a crypto method to fund the production. It started off as Kickstarter mixed with Non-Fungible Tokens. The … Read more »
The Second Circuit put the leveraged loan market at ease and ruled that those notes are not securities. The Court had asked the Securities and Exchange Commission to offer its opinion on whether they were securities and the SEC declined to do so. The Second Circuit followed the four factors of the Reeves “family resemblance” … Read more »
Notes are securities and loans are not securities. Simple enough. Except, our financial system doesn’t operate in such a black and white manner. Syndicated loans kind of fall in the middle. Your traditional loan is a single lender who holds and controls the debt. Notes and bonds get issued into a more fungible format to … Read more »
The big challenge with crypto is how it fits into regulatory schemes that were drafted almost a century a go. Add in the politically driven split between the regulation of commodities by the CFTC and the regulation of securities by the SEC and you get a mess. Slap in the variable structures used by crypto … Read more »
Accept at face value that Profit Connect is not a scam. That is a stretch given the purported high returns, coupled with a money back guarantee. • 15% to 20% Fixed APR• High-Net-Worth 30% APR• APR is Locked-In• 100% Money Back Guarantee No such thing as high returns with no risk. Of course, if the … Read more »
Jeff and Paulette Carpoff had what sounds like a great idea to me: mobile solar generator units. These are solar generators that would be mounted on trailers that could provide emergency power to cellphone towers and lighting at sporting events. Plus there were generous federal tax credits due to the solar nature of the generators. … Read more »
Thomas M. Maney had a 1000-acre parcel of undeveloped, vacant, desert land in Kern County, California. He decided to find other interested in owning part of it and helping with the development decisions. He split it into 4000 undivided, fractional ownership interests. So far, that’s just a time-share and not a security. Then Silver Saddle … Read more »
I had to scratch my head for a moment when reading the case against Jan Atlas. The SEC accused the lawyer of issuing legal opinions in which he falsified or omitted important facts in connection with an unregistered, fraudulent offering. “At the time he drafted the May 17 opinion letter, Atlas knew that certain facts … Read more »
The Security and Exchange Commission filed a complaint alleges that Mark Ray, a Denver resident, was the mastermind of a scheme for the purported purchase and immediate resale of large numbers of cattle. I don’t recall cattle showing up in the definition of a “security.” The first part of the scheme is labeled a Ponzi … Read more »