In our previous posts on Eureeca Capital (available here and here), we looked at Eureeca’s ill-fated attempt to operate a crowdfunding platform in the U.S. as a cautionary tale on how not to conduct an exempt offering. We mentioned that, in anticipation of the institution of the SEC proceedings, Eureeca undertook voluntary remedial actions and submitted an offer of settlement to the agency, including civil penalties of $25,000, which the SEC determined to accept. We also mentioned that Eureeca’s website now features a prominent disclaimer and information page that provides information about what constitutes “U.S. persons,” among other things, and asks the user to confirm that they not a U.S. person before they can proceed to view any information on the website.
We now have additional information about other corrective actions taken by Eureeca. Eureeca no longer accepts investors who are U.S. persons, accredited or otherwise. Instead, it has taken its funding platform operations to other markets and obtained regulatory authorizations from the U.K. Financial Conduct Authority and the Securities Commission Malaysia, for example. Eureeca seems to have learned from its experience that equity crowdfunding (or securities offerings for that matter) is not an area to tread on lightly. We wish Eureeca all the best.
This posting is intended to be a planning tool to familiarize readers with some of the high-level issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your transaction planners including attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. This article should not be treated as legal advice to any person or entity.
Steps have been taken to verify the contents of this article prior to publication. However, readers should not, and may not, rely on this article. Please consult with counsel to verify all contents and do not rely solely on this article in planning your legal transactions.
About the Author
Shawn McBride – R. Shawn McBride is the Managing Member of The R. Shawn McBride Law Office, P.L.L.C. which helps clients in legal issues related to starting companies, joint ventures, raising capital from and negotiating with investors and outside General Counsel functions. Shawn can be contacted at: (214) 418-0258; firstname.lastname@example.org, or www.mcbrideattorneys.com.
 See generally In the Matter of Eureeca Capital SPC, SEC Administrative Proceeding File No. 3-16265 (Nov. 10, 2014), http://www.sec.gov/litigation/admin/2014/33-9678.pdf.