Securities Blog

The 2017 Tax Cuts and Jobs Act established a section of the tax code that allows taxpayers to utilize a new investment vehicle called Opportunity Funds, in an effort to bring resources to low income communities known as Opportunity Zones. What is an Opportunity Zone? The Internal Revenue Service (“IRS”) describes the Opportunity Zones as…

Part 1: What is an Opportunity Zone? The 2017 Tax Cuts and Jobs Act established a section of the tax code that allows taxpayers to utilize a new investment vehicle called “Opportunity Funds”, in an effort to bring resources to low income communities known as Opportunity Zones. What is an Opportunity Zone? The Internal Revenue…

Preparing a Private Placement Memorandum(PPM) that provides full and fair disclosure of the material aspects of the offering is recommended when offering and selling a Regulation D investment. General solicitation includes websites, blast emails, and social networking media that can be viewed or accessed by the public. Thus, PPMs should not be made available on…

There are two different settings in which securities transactions occur. The first, the seller of securities trying to sell to investors to try and raise capital for their company. The second setting is a buy-sale transaction that happens when investors have already purchased securities and want to trade them. Regardless of the setting in which…

What to do When You Are Flagged by the SEC and Receive an SEC Subpoena By Whitney De Agostini, Esq. April 1, 2019 You are literally minding your business when you are slapped with a subpoena or inquiry from the SEC. Why is the SEC investigating me, and what happens now? The SEC reached out…

The Securities and Exchange Commission (“SEC”) charged a public company promoter and his company with conducting a scheme to manipulate trading in at least 97 penny stocks. According to the SEC’s complaint filed November 28, 2018, Eric Landis arranged with third party advertisers forpublicly traded, small, often relatively infrequently traded, companies (“microcap” companies) to distribute…

Alexis King On February 14, 1975, Commissioner of Corporations of the State of California, Willie R. Barnes, issued a release on Repurchase Offers that commented on Section 25507 (b) of the Corporate Securities Law of 1968.(link to release)This release also discussed Rule 260.507 of the California Code of Regulations in the context of the rule’s…

Alexis King A rescission offer takes place when an issuer offers to repurchase an investor’s securities and refund his purchase price plus interest. Most states provide that an issuer can offer those who invested in transactions that violate securities laws a chance to pre-emptively buy back their securities at the original purchase price plus interest.…

Under the securities definition stock is included as a security “unless the context otherwise requires” [Securities Act §2(a)(10)]. However not all instruments that are labeled “stock” are securities. The Supreme Court ruled that the definition of a security must indicated “economic reality.” In the 1980s the courts believed that when the majority of a stock…

On December 21, the SEC instituted its first enforcement actions against robo-advisers when they issued orders against Redwood City, a California-based Wealthfront Advisers LLC and Hedgeable Inc., a New York City-based robo-adviser. Robo-advisers provide software-based, automated portfolio management services. The enforcement actions took place because the advisers published misleading advertising and made false statements about…