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New York Securities Law Questions & Answers
1 Answer | Asked in Securities Law for New York on
Q: Can I do royalties crowdfunding (profit sharing) for only a single property inside the company (LLC)?

We are a holdings company with many daughter-brands, each an independent venture, but only the holdings company is a registered LLC. We’d like to sell royalties (percentage of the profit) from these ventures in a crowdfunding campaign. Is that legal?

Michael Gilman
Michael Gilman answered on Jul 6, 2021

Selling royalties to passive investors takes you into the realm of securities regulation, and this would have to be a registered offering or have an exemption from registration. For crowd funding, most offerings will utilize 506(c) which allows general solicitation but requires investors to be... Read more »

1 Answer | Asked in Criminal Law, Civil Litigation, Securities Law and Stockbroker Fraud for New York on
Q: Do I have civil or criminal liability if I unknowingly referred someone to an investment that turned out to be a scam?

The person I referred lost money. I did not receive any money from the person I referred or the investor.

Tim Akpinar
Tim Akpinar answered on Mar 26, 2021

There are attorneys on this board who are knowledgeable in securities-related matters who could best advise, but your post remains open for two weeks. As a GENERAL premise, for someone to be liable for scamming or defrauding someone, it usually has to be shown that they had an intent to deceive or... Read more »

2 Answers | Asked in Securities Law for New York on
Q: A company disclosed material non-public information in a closed invite only industry conference. Does it make it public?

The company disclosed a slide that was released 2 months after and also heavily inclined about in an investor conference 2 weeks after. Does trading on the expectation of the release of something described in the slide is legal in this time period?

Kevin Abessi
Kevin Abessi answered on Dec 29, 2020

The SEC may deem this "selective" or "privileged" disclosure, which would fall under the umbrella of insider trading. The concern here is the fact that it's an invite-only event, and SEC rules tend to distinguish between open settings and those to which "the little... Read more »

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1 Answer | Asked in Criminal Law and Securities Law for New York on
Q: Can i carry a 4" blade pocket knife in public if i have a felony in New York State?
Michael J Stachowski
Michael J Stachowski answered on Dec 28, 2020

Section 265.01 prohibits gravity knives and switchblades or any knife intended to be used against another. It does not fro hi it Foldable knives or pocket knives. There is no specific prohibition of a felon in possession. That is limited to guns of any type possessed by a felon which is prohibited... Read more »

1 Answer | Asked in Securities Law for New York on
Q: I have questions regarding securities and exchange commission laws.

I own a options trading website where I provide trade ideas of specific stock tickers based on fundamental and technical analysis. I charge subscribers monthly fees. I do not provide investment advice of any sort, just trade ideas of good stock setups. I don’t tell my subscribers what to do from... Read more »

Kevin Abessi
Kevin Abessi answered on Nov 16, 2020

Given the facts at hand, you appear to be on the right track. A seminal case is Lowe v. SEC, 472 U.S. 181 (1985), which essentially declared that an exclusion from the definition of investment adviser is available to any publisher of a newsletter as long as remains entirely impersonal and does not... Read more »

1 Answer | Asked in Securities Law for New York on
Q: Who notifies SEC when employment is terminated from an RIA with ~$200 million in assets under management?

I recently quit a job I was at for 9 months. Do I notify the SEC that I left or do they? and if I do, how do I go about doing this?

Robert W. Pearce
Robert W. Pearce answered on Oct 10, 2020

Both of you have the responsibility to make sure the IARD is accurate but you are the one that may have consequences. Go to the SEC website for the forms and guidance. https://www.sec.gov/divisions/investment/iard/iardfaq.shtml

1 Answer | Asked in Securities Law for New York on
Q: Does sending startup pitch decks to investors break Securities law? What should we be aware of?

We are free service that sends decks to investors on behalf of startups that are raising funds.

Investors are a mix of professional investors e.g VCs and angel/HNWI and are all over the USA

Robert W. Pearce
Robert W. Pearce answered on Jul 28, 2020

A pitch book could be considered to be created "in connection with" an "offer" and/or "sale" of securities and subject you to liability under Federal and state securities laws.

1 Answer | Asked in Securities Law for New York on
Q: In New Jersey, can a security guard from a major Amusement Park Six Flags question a minor in a room with just them two?

My son was caught taking a hat from six flags over the summer. Yes he was wrong. They revoked him pass for a year. I’m fine with that. I’m not fine that he was questioned alone at first before they brought his older brother in and another security officer. A few months later we received a fine... Read more »

Tim Akpinar
Tim Akpinar answered on Jan 17, 2020

I'm sorry for your family's ordeal. A possible reason your post remains open for two weeks might be that it may have gone unnoticed under Securities Law, which is more about transactions dealing with financial assets like stocks and bonds. At this point, you could seek the opinion of a... Read more »

1 Answer | Asked in Securities Law for New York on
Q: Does a brokerage firm have a right to deny my application to open a cash brokerage account? (please provide references)

I'm a non-resident alien.

Ali Shahrestani, Esq.
Ali Shahrestani, Esq. answered on Jul 14, 2017

For what reason? More details are necessary to provide a professional analysis of your issue. The best first step is an Initial Consultation with an Attorney such as myself. You can read more about me, my credentials, awards, honors, testimonials, and media appearances/ publications on my law... Read more »

1 Answer | Asked in Real Estate Law, Business Law and Securities Law for New York on
Q: Does a broker have to - by law - submit a commission statement or similar invoice in order to receive their commission?

Or is sending a confirmation that the wire / check came through after the closing is enough?

This is pertaining to selling a note (debt) and mortgage upon a commercial property in NYC

Barry Eran Janay
Barry Eran Janay answered on Jun 12, 2017

I am not aware of any law requiring a commission statement, however just about every closing I have handled, literally hundreds, the broker has almost always created a memorandum of sale at the outset which delineates the parties, price, and terms of the deal and then prior to closing the broker or... Read more »

1 Answer | Asked in Landlord - Tenant and Securities Law for New York on
Q: How long of a period before landlord are legal suppose to refund tenant security plus interest It has been 6 months.

Moving letter along with keys was sent to landlord lawyers office.

During the course of the move property was moved out of apt. door lock was change before deadline?

Mitchell A. Nathanson
Mitchell A. Nathanson answered on Jun 5, 2017

You should have received the refund by now if there were no damages or arrears. I would suggest you send a demand notice to the Landlord and follow up with a small claims action, if necessary, assuming the deposit was $5,000 or less.

#LegalQ&A

2 Answers | Asked in Criminal Law and Securities Law for New York on
Q: Why would a mall cop come to your car after you've been sitting parked in a lot for twenty minutes?

I had pulled into a mall during operating hours to make a phone call since I was on a road trip and wanted to do so safely. So I park at a mall. In an empty lot, away from all the other cars. So I'm on the phone maybe fifteen minutes when a mall security officer starts walking across the lot... Read more »

Aubrey Claudius Galloway
Aubrey Claudius Galloway answered on Apr 23, 2017

The only thing I can see from the above fact pattern is that, perhaps, you were trespassing… Although after just 15 minutes I would think of you as "an invitee" as opposed to a "trespasser."

Regardless, if either of the store or, in the unlikely event the town police...
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1 Answer | Asked in Criminal Law and Securities Law for New York on
Q: if you are unaware if your passenger has Marijuana on them? could law enforcement investigate you're innocent?

If your passenger has marijuana on them and you get pulled over by law enforcement and they discover it on them does everyone in that car get jail time even if they're innocent or law enforcement can investigate that you're innocent?

Robert Jason De Groot
Robert Jason De Groot answered on Nov 8, 2015

They do not investigate the innocence of certain defendants as much as we want. It depends upon the facts, and there are not enough here for us to comment much. The concept is called constructive possession, and everyone in the car can be charged, depending upon the facts.

1 Answer | Asked in Securities Law for New York on
Q: Is there any court case that a broker is sentenced for leaking client trading secret?

The broker tells the other trader about the trading orders and positions one trader makes. If the answer is yes, please provide the cout case number and where to find the judgement

Adam Studnicki
Adam Studnicki answered on Aug 11, 2015

Not all cases result in published decisions.

Please Take Notice: I am not your lawyer unless we enter into an engagement agreement in writing. This is general information that is given for legal education only. It is not legal advice, and it may not work for your specific situation. It is...
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