Coral Capital Partners looks at a recent SEC Litigation Release concerning the activities of a stock transfer who fraudulently issued itself shares in its client companies. Stock transfer agents operate at what we feel is a key point in the securities markets. As a result we are gate keepers who are in a position to help prevent and stop securities fraud. We believe that it is especially heinous when they commit fraud. We feel that our blog on this topic, along with the associated SEC Litigation Release and Complaint will be an interesting read.
Tag: Due diligence
Due diligence is a term used to describe the examination and investigation of a corporation’s books, records, management and other relevant areas in order to properly evaluate the business or investment opportunity. The process of conducting due diligence can require highly specialized skills and experience. The Financial Industry Regulatory Authority (FINRA) now requires that all broker/dealers that participate in private placements under Regulation D conduct a proper level of due diligence in accordance with FINRA Regulatory Notice 10-22
The Importance of a Financial Model
Coral Capital Partners discusses the importance of a proper financial model, the financial statements that need to be included and the expectations of potential investors. Far too often a financial model and business plan are two (2) items that easily overlooked or dismissed by business owners or management. Coral Capital Partners believes that a financial model and a business plan are two (2) critical items that every business needs.
A Look at the Penalties for Broker/Dealer Failure to Obtain Due Diligence Under FINRA 10-22
FINRA Regulatory Notice 10-22 requires broker/dealers to conduct or obtain reasonable due diligence on companies whose securities they sell in private placement transactions through the Regulation D exemption. Coral Capital Partners looks at the penalties FINRA recently imposed upon broker/dealers and registered individuals for their failure to conduct reasonable due diligence in accordance with FINRA Regulatory Notice 10-22 on companies for which they are raising funds through a private placement offering.