compliance

 

LOBBYING

Georgia Law: Georgia Code §21-5-70 and §21-5-71


When a person is hired or retained as an employee or agent or independent contractor and under the agreement of the parties the primary duties, or a substantial part of the duties, of the person will involve lobbying activities, the person shall register as a lobbyist before commencing lobbying activities.
 

Commissions


It’s against the law for lobbyists to get paid on commission. Don’t think of them like sales reps – they’re not. Instead, think of them more like attorneys – you pay them for their services. It’s against the law for lobbyists to get paid bonuses. However, there’s still a way to pay them incentives for performance, in the form of promises for continued business.

BUSINESS ADVISORY

A fee to Raise Capital for Your Business is Generally Illegal


If a company’s owner, director, officer or employee has substantial other duties to the company and is not otherwise in the business of raising capital or transacting securities for the account of others, then the insider is arguably not required to register with the SEC as a broker-dealer.
 

Broker-Dealer Registration Requirement


Under the Securities Exchange Act of 1934 and state securities laws, a “broker-dealer” is “any person engaged in the business of effecting transactions for the account of others.” It is unlawful for any broker-dealer to “effect any transaction in, or induce or attempt to induce the purchase or sale of, any security” without first registering as a broker-dealer with the Securities and Exchange Commission (SEC) and applicable state regulators. Registered broker-dealers must also be members of a self-regulatory organization-generally the Financial Industry Regulatory Authority (FINRA, formerly known as the National Association of Securities Dealers)-and comply with SEC regulations regarding financial responsibility and market conduct.
 

Harsh Penalties for Issuer Using Unregistered Broker


A finder’s failure to properly register as a broker-dealer may subject the finder to potential liability, including investor rescission claims as well as civil administrative penalties, criminal penalties, and imprisonment. More critically for the issuer, the company and its controlling persons (directors, officers, controlling shareholders) may also be held liable to investors and regulators.
 


 
MS Global Partners, LLC
Government & Business Advisors
1730 Spectrum Drive
Lawrenceville, Georgia 30043
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