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Wall St. Cop Stakes Its Turf In 1st Crowdfunding Decision

June 12, 2019 | Law360
Alison Noon

Mark Roderick, Flaster Greenberg’s resident crowdfunding and fintech attorney, was quoted extensively in a Law360 article discussing the recent decision by the Financial Industry Regulatory Authority (FIRA) to police crowdfunding websites with the panel's first litigated enforcement action against Silicon startup and funding portal DreamFunded and its CEO Manuel “Manny” Fernandez. They were accused of misleading investors, promising more due diligence than they delivered and then falsifying documents in an attempt to show compliance.

“It’s as if they had a checklist of all the bad things you can do wrong and they had to do every one,” said attorney Mark Roderick, who has established a crowdfunding practice at Flaster Greenberg PC. He went on to say “I think what FINRA disliked the most was they believed that the guy was lying to them - that’s what they disciplined him most harshly for.”

Attorneys outside the case also disagreed with the argument from DreamFunded and Fernandez that FINRA has no authority to investigate the people whose platforms it was tasked with regulating. “That is a loser, I think,” Roderick said.

The DreamFunded decision was the first time either FINRA or the U.S. Securities and Exchange Commission had litigated an enforcement action applying their crowdfunding rules

Click here to read the article.  

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