Trust is an integral component of “traditional” crowdfunding. As such, it’s ripe for fraud. In fact, there have already been plenty of cases where strangers have been scammed out of their money believing they were contributing to reputable causes, sometimes in the 6-figure range!
The rate at which the Federal Trade Commission (FTC) is investigating such “scampaigns” occurrences is (not so surprisingly) large. The reason being it’s easy to scam on many of the popular crowdfunding platforms due to the ease of posting a campaign and the little to no money it takes to get started with one.
This is another area where Regulation A+ Offerings are so much more attractive to investors or those looking to contribute to crowdfunding ideas. Reg.A+ is NOT cheap. There’s also a lot of due diligence involved from just about every angle, including the issuer having to respond to a myriad of comments from the Securities and Exchange Commission (SEC) before their Reg.A+ project is actually approved. If your Regulation A+ paper makes it to that point, you can pretty much be certain you’re not getting scammed. The project may not work in the long-term, but at least it’s real.
From an investor perspective, you still have to do your homework. And that starts with checking the crowdfunder’s credentials and background. In addition, all their social media should be current and not look like it was done by an 8th grader, including comments, photos, and feedback across their multitude of social media sites and websites.
Perhaps you’re a business looking to use crowdfunding as a form of raising money but don’t have to resources or knowledge on how to move forward via social media or even getting started with a Regulation A+ offering. In that case you’re in luck because there are reputable agencies such as the Reg.A+ Funding Group that can guide you through each step in the process – the end result being a project that potential investors can be sure was done in diligent fashion without the fear of being scammed.
And if you’re an investor, you can thank your lucky stars that Reg.A exists and provides you with the opportunity to be an evangelist for a company you already like and start profiting from their success in the real-world, scam-free! Find out more today about how Reg.A+ can work for you!