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

Requirements for Crowdfunding in Vermont

Crowdfunding is a method of raising capital through the internet by offering securities to a large number of people. In Vermont, crowdfunding is regulated by the Vermont Securities Regulations (V.S.R.) and the federal securities laws.

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

  1. Register with the Vermont Department of Financial Regulation: Issuers must register with the Vermont Department of Financial Regulation and file a notice of intent to offer securities under the Vermont Crowdfunding Exemption [1].
  2. Limit the amount of money raised: The maximum amount that can be raised through crowdfunding in Vermont is $5 million in a 12-month period [1].
  3. Limit the amount of investment: The maximum amount that an investor can invest in a crowdfunding offering is $10,000, unless the investor is an accredited investor [1].
  4. Disclose information: Issuers must provide investors with certain information, including financial statements, a description of the business, and the terms of the offering [1].
  5. Use a registered intermediary: Issuers must use a registered intermediary to conduct the offering [1].
  6. Comply with federal securities laws: Issuers must comply with federal securities laws, including the requirement to file a Form C with the Securities and Exchange Commission (SEC) [3].

Conclusion

To use crowdfunding to raise money in Vermont, you must comply with the requirements set forth in the Vermont Securities Regulations and federal securities laws. These requirements include registering with the Vermont Department of Financial Regulation, limiting the amount of money raised and investment, disclosing information, using a registered intermediary, and complying with federal securities laws.

Source(s):
Jurisdiction

Vermont