engagements that may lead to violations.
Instead, they should consider whether
they are prepared to bear the time and
expense of becoming broker-dealers.
If a capital raise was effected
through the distribution, sale, or
exchange of securities, the following
penalties may be assessed:
right. Investors solicited by an
unregistered broker-dealer have
the right to demand full repayment
of their contributed capital and
unwind the transaction.
•;Against;an;unregistered;broker-dealer: At the federal level, fines of
up to $5 million for individuals and
up to $25 million for entities may
be imposed under the Securities
Exchange Act, and cease and desist
orders, including accountings,
disgorgement, and prohibitions
on future securities offerings, may
be ordered, along with prison
terms of up to 20 years. At the state
level, fines, imprisonment, and
injunctions may be imposed.
Tom Goldblatt, CTP-D, runs Ravinia Capital LLC
and is a registered representative with broker-dealer
1st Worldwide Financial Partners LLC. He also has
worked in private equity and was a turnaround
consultant. Goldblatt has more than 15 years of
operating experience working inside manufacturing
companies in roles ranging from CEO to salesman.
He holds a law degree from University of Chicago
and an MBA from Northwestern University’s Kellogg
School of Management, and is a CPA. He speaks
regularly on alternative capital raises in challenging
situations, distressed investing, and business
development and networking. He can be reached at
773-336-2833 or firstname.lastname@example.org.
In addition, a registered broker-deal who relies on the services
of an unregistered finder may be
subject to FINRA sanctions.
Caution Is Warranted
There is great potential liability for
working as or with a non-registered
broker-dealer on a securities transaction.
The law on when a broker-dealer
is needed is not always clear and is
ever-evolving. Because the potential
consequences are so severe, great
caution should be exercised before
entering into a situation in which
concerns are raised regarding
whether a transaction may involve
effectuating a security transaction.
The information in this article is
general in nature. Because the issues
discussed in this article are complex
and subject to new developments,
readers should consult with qualified
legal counsel before acting on any
information in this article. J
YOUR SUCCESS COMES FIRST Reliable Asset-Based Financing Solutions
At First Business Capital Corp., we fuel turnaround, acquisition, and expansion opportunities with
innovative asset-based lending solutions. And because we do it with the same unmatched personal
service, flexibility, and integrity you’ve come to expect from the First Business family of companies,
you know we can be trusted to keep our word. That’s why small- to mid-market companies turn to
First Business Capital Corp. to find the capital they need, borrowing $1,000,000 to $7,000,000 and
more. We expertly help highly leveraged companies in transition make the transition.
FOR MORE INFORMATION
RICK BARFIELD (Chicago) at 312-924-2837
Turnaround Financing : Acquisitions : Debt Restructuring
Debtor-in-Possesion & Confirmation Financing : Rapid or Seasonal Growth