Investor verification
VerifyInvestor.com
VerifyInvestor.com reviews investor documentation and issues verification letters for companies raising capital under Rule 506(c), where federal law requires the issuer to take reasonable steps to confirm that each investor is accredited.
Investors upload the evidence their accreditation type calls for - a W2, K1, or 1099 for an income test, or asset and liability detail for a net worth test - and a licensed attorney reviews the file. The company expects most verifications to finish in one or two business days once complete information is supplied, and investors can redact sensitive details before uploading. Alongside 506(c) verification it offers Rule 506(b) accredited investor review, AML/KYC checks, qualified purchaser and qualified client verification, custom verifications built in an online editor, and storage of accreditation on the blockchain through On-ChainPass.
The company is majority owned by tZERO, a financial technology firm that counts the New York Stock Exchange and Intercontinental Exchange as a significant investor. Published security measures include 128/256-bit data encryption, database encryption, DDOS protection, a system of firewalls, and regular vulnerability checks.
A letter may be reused for as many offerings as needed during its life, except where it is restricted to a specific offering. The SEC requires evidence used for verification to be no older than 90 days, other than income evidence, so letters generally expire after 90 days. Confirm current per-verification fees and turnaround before an offering opens.
Best for
Issuers running Rule 506(c) offerings who need an independent party to verify accredited investors, and funds that also need qualified purchaser or qualified client letters. Sponsors doing a 506(b) offering with no general solicitation may not need a verification letter at all.
What they do
- Rule 506(c) accredited investor verification
- Rule 506(b) accredited investor review
- Qualified purchaser verification
- Qualified client verification
- AML/KYC checks
- Custom verifications built in an online editor
- True and correct certification
- On-ChainPass blockchain accreditation storage
Details
| Attribute | Value |
|---|---|
| Ownership | Subsidiary |
What stands out
- Every verification file is reviewed by a licensed attorney bound by professional confidentiality duties.
- Expects most verifications to complete in one or two business days once full information is provided.
- Published security measures include 128/256-bit data encryption, database encryption, DDOS protection, and firewalls.
- Majority owned by tZERO, which names the New York Stock Exchange and Intercontinental Exchange as a significant investor.
- Verification letters can be reused across offerings but generally expire after 90 days.
Common questions
- How long does a verification take?
- Most verifications finish in one or two business days, assuming all necessary information is provided. Part of the process is a review by a licensed attorney, which the company describes as a best practice given how severe the penalties for noncompliance are.
- What documentation does an investor have to provide?
- It depends on the accreditation type. An investor qualifying on income may be prompted for a W2, K1, or 1099; other types may need an officer's certificate or a detailed statement of assets, and a net worth test also requires liabilities. The reviewer can ask for additional evidence.
- Can a verification letter be used for more than one investment?
- Yes, for as many investments as needed during the life of the certificate, unless the letter is restricted to a specific offering. Because the SEC requires evidence used for verification to be no older than 90 days, except income evidence, these letters generally expire after 90 days.
- What does the JOBS Act require of an issuer?
- The JOBS Act lets a company publicly solicit for funds while still running a private offering, but only accredited investors may invest and the issuer must take reasonable steps to prove they are accredited. A questionnaire alone is not sufficient, and failing to comply can bring enforcement action and an obligation to return money raised.