All crowdfunding transactions must be made through a broker or funding portal registered with the SEC. Funding portals are subject to many regulations. Some highlights are that the funding portal must be registered with the SEC and a self-regulatory organization, provide SEC-mandated disclosures and investor education material, ensure that investors review the education material and demonstrate understanding of the risks involved, take measures to reduce the risk of fraud, make information regarding the company available to investors at least 21 days before any sales take place, and protect investor privacy.
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