Crowdentials, a startup offering regulatory compliance software, is launching its new Certified Accredited Investors program on July 25, in response to the Securities and Exchange Commission's ruling to lift the ban on general solicitation.
"There are two sides to this ruling," says Richard Rodman, CEO of Crowdentials. "On one side, the bar for advertising has been lowered. On the flip side, the bar for verifying accredited investors has been raised dramatically."
Under the SEC's new provisions, issuers are responsible for verifying their accreditation and will be required to take reasonable steps to do so. Failure to do so will result in legal and financial pitfalls for issuers. According to Rodman, Crowdentials created its CAI platform to make this easier.
The CAI program is a third party service that allows accredited investors to verify their status through an online form. Unlike most other investor accreditation products and processes on the market, the CAI program does not require the disclosure of tax forms or other sensitive financial information. This makes CAI the fastest and most secure investor accreditation program available.
Crowdentials is a FlashStarts accelerator company that offers regulatory compliance software. Its equity crowdfunding program enables businesses, investors and crowdfunding platforms to comply with the Securities and Exchange Commission's regulations.