Crowdfunding Fraud

Crowdfunding is a method for raising capital whereby many individuals network and pool their funds, usually via the internet or social media. Crowdfunding methods are used in a variety of circumstances including,... more +
Crowdfunding is a method for raising capital whereby many individuals network and pool their funds, usually via the internet or social media. Crowdfunding methods are used in a variety of circumstances including, but not limited to, supporting charitable organizations, disaster relief, product development, artistic projects, and financing start-up companies. The passage of the JOBS Act of 2012 sought to broaden the use of crowdfunding in developing private capital for start-up companies by relaxing certain SEC investor registration requirements. less -
News & Analysis as of

FTC Takes Its First Action Against Crowdfunding Site

As the Federal Trade Commission (FTC) targets more FinTech (new and emerging financial technology) under the banner of protecting consumers from deceptive trade practices, the Commission finally turned its attention to the...more

FTC Eyes Kickstarter Campaigns for Consumer Protection

Most Kickstarter projects never reach the funding threshold, so funders never pay anything into the venture. However, as shown by recent enforcement action, agencies such as the FTC (Federal Trade Commission) have become...more

Crowdfunding Isn’t Charity

“How do I get backers for my project?” - You see this question asked frequently on social media sites. The projects are sometimes serious, but have often advanced little more than a dream. The person seeking funds may...more

Crowdfunding Project Creator Settles FTC Charges of Deception

In the FTC's first case involving crowdfunding, the agency took action against a project creator who was ostensibly raising money from consumers to produce a board game, but instead used most of the funds on himself....more

First fraud action against Kickstarter crowdfunding project - #crowdfunding

Washington Attorney General Robert Ferguson has brought an action against a Tennessee company that allegedly failed to deliver the products that were promised to backers of the company’s crowdfunding campaign on Kickstarter. ...more

Orrick's Financial Industry Week in Review - October 28, 2013

Joint Release on QM Fair Lending Risks - On October 22, the Fed, CFPB, FDIC, NCUA and OCC issued a joint statement to address industry questions on fair lending risks associated with offering only qualified mortgages. ...more

Crowdfunding And JOBS Act News Roundup – May 31, 2013

President Obama has nominated a pair of Senate aids to be SEC Commissioners. Dr. Michael Piwowar is the Chief Economist for the U.S. Senate Committee on Banking, Housing, and Urban Affairs, a position he has held since 2009. ...more

Crowdfunding And JOBS Act News Roundup – April 26, 2013

On Thursday the SEC sent out a press release captioned “SEC Seeks to Halt Scheme Raising Investor Funds Under Guise of JOBS Act.” The action doesn’t really have anything to do with the JOBS Act, as in the sense that it seeks...more

State Regulators Release List of Top Investor Frauds

The North American Securities Administrators Association (NASAA) recently revealed its annual list of financial products and practices that pose the highest risks to investors. The list includes several new threats as well as...more

The JOBS Act and Crowdfunding – Letting Go

President Obama is scheduled to sign the JOBS (Jump Start Online Business Startups) Act today that includes provisions to relax the rules on raising capital for equity to allow for crowdfunding. See, sometimes the...more

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