Ask Reggi Your Question Now

Reggi is the free generative AI assistance for regulatory compliance
Ask a Question

Can I use crowdfunding to raise money without violating securities laws in North Dakota? What are the requirements?

Crowdfunding in North Dakota

Crowdfunding is an online money-raising strategy that allows businesses to raise capital from a large number of investors, often through social networking websites [1]. In North Dakota, crowdfunding is allowed under certain conditions.

Requirements for Crowdfunding in North Dakota

To use crowdfunding to raise money without violating securities laws in North Dakota, you must comply with the following requirements:

  1. Register with the Securities and Exchange Commission (SEC) as a funding portal [1].
  2. Disclose all material facts and risks to investors, including federal and state securities laws regarding disclosures [1].
  3. Comply with the requirements of the North Dakota Securities Department, which regulates capital formation involving the offer and sale of securities [3].
  4. Contact the North Dakota Securities Department to learn about the different options for raising capital [5](Crowdfunding).

Exemptions to Facilitate Intrastate and Regional Crowdfunding

The SEC has adopted exemptions to facilitate intrastate and regional crowdfunding, which allow businesses to raise money from investors within their state or region without registering with the SEC [4]. However, these exemptions have their own set of requirements and limitations.

Therefore, to use crowdfunding to raise money without violating securities laws in North Dakota, it is important to consult with legal and financial professionals who can guide you through the process and ensure compliance with all applicable laws and regulations.

[1]: Small Business Advisory - North Dakota Securities Department [3]: Home | Securities Department, North Dakota [4]: Final Rule: Exemptions to Facilitate Intrastate and Regional …

Source(s):
Jurisdiction

North Dakota