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Full-Text Articles in Securities Law
Online Arbitration As A Remedy For Crowdfunding Fraud, C. Steven Bradford
Online Arbitration As A Remedy For Crowdfunding Fraud, C. Steven Bradford
Florida State University Law Review
It is now legal to sell securities to the general public in unregistered, crowdfunded offerings. But offerings pursuant to the new federal crowdfunding exemption pose a serious risk of fraud. The buyers will be mostly small, unsophisticated investors, the issuers will be mostly small startups about whom little is known, and crowdfunded offerings lack some of the protections available in registered offerings. Some of the requirements of the exemption may reduce the incidence of fraud, but there will undoubtedly be fraudulent offerings. An effective antifraud remedy is needed to compensate investors and help deter wrongdoers. But because of the small …