North Capital refers to a group of companies that develop, operate and distribute financial technology and technology-enabled investment and brokerage services, including the Accredited.AM website. For the purpose of the Accredited.AM website, North Capital may mean any one or both of North Capital Investment Technology Inc. (“NCIT”), which operates the website and provides technology services, North Capital Private Securities Corp. (“NCPS”), a wholly-owned subsidiary of NCIT registered as a broker-dealer and member of FINRA and SIPC.

Under the Securities Act of 1933, a company that offers or sells its securities must register the securities with the SEC or find an exemption from the registration requirements. The Act provides companies with a number of exemptions. For some of the exemptions, such as rules 505 and 506 of Regulation D, a company may sell its securities to what are known as “accredited investors.” Federal securities laws define the term Accredited Investor in Rule 501 of Regulation D as:

• a bank, insurance company, registered investment company, business development company, or small business investment company;
• an employee benefit plan, within the meaning of the Employee Retirement Income Security Act, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5 million;
• a charitable organization, corporation, or partnership with assets exceeding $5 million;
• a director, executive officer, or general partner of the company selling the securities;
• a business in which all the equity owners are accredited investors;
• a natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person;
• a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or
• a trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes.
• Financial professional licenses. The General Securities Representative license (Series 7), the Private Securities Offering Representative license (Series 82) and the Licensed Investment Adviser Representative (Series 65) are professional certifications and designations for financial professionals.  In order to obtain and qualify for these licenses, an individual must pass the related exam.  Whether one is considered in good standing is specific to the designation, and persons seeking accredited investor status as a Series 7, 65 or 82 license holder should consult FINRA rules and any state rules applicable to them.

From the SEC’s website – http://www.sec.gov/answers/accred.htm

As of September 2013, the SEC requires companies that engage in general solicitation (so-called 506c offerings) of private offerings (and their agents) to take reasonable steps to verify that investors are accredited. Self-accreditation through attestation is not a sufficient basis for an issuer or agent to have a reasonable belief that an investor is accredited. The SEC has provided a non-exclusive “safe harbor” for verification, stating that the issuer will be deemed to have taken reasonable steps if:

• the issuer reviews IRS forms that report an investor’s income for the last two years and obtains a representation that their income will reach the qualifying income level in the current year;
• the issuer reviews bank or brokerage statements, tax assessments and/or independent appraisal reports, along with a report from a nationwide consumer credit reporting agency to verify liabilities, that confirm the investor’s net worth;
• the issuer obtains a written representation from a registered broker-dealer, a registered investment advisor, a licensed attorney or a CPA that the such person has taken reasonable steps to verify the investor’s accredited status;
• the issuer obtains a certification that an investor who previously purchased securities in an issuer’s Reg D private offering prior to the effectiveness of Rule 506(c), that such investor is an accredited investor.

An Accreditation Investor Verification Letter is an official document provided by North Capital Private Securities Corporation, through the Accredited.AM website, that you can provide to third parties to satisfy the Accredited Investor verification requirement under Section 506(c) of Regulation D of the Securities Act of 1933. Because your status is verified by NCPS, a registered broker-dealer, your Letter qualifies as a professional letter that offers safe harbor to issuers and platforms who rely upon it. In addition, a third party recipient can confirm the authenticity of your Verification Letter at the Accredited.AM website.

If you qualify as an Accredited Investor based on income, you will need to document your income for the past 2 years. Documentation can be in the form of tax returns, W2s or other official documents. Alternatively, you can electronically sign a release form and we will obtain the information directly from the IRS.

If you qualify as an Accredited Investor based on net worth, you will need to provide recent account statements or third party appraisals that show the value of your assets. We will also pull your credit report and deduct any non-mortgage liabilities from the value of your assets.

In lieu of providing income or net assets information, you may provide a professional letter from a licensed CPA, attorney, investment advisor or registered broker-dealer. The letter should state that the professional service provider has a reasonable belief that you are an Accredited Investor. Contact us to obtain model language.

If you qualify as an Accredited Investor based on income, you will need to document your income for the past 2 years. Documentation can be in the form of tax returns, W2s or other official documents. Alternatively, you can electronically sign a release form and we will obtain the information directly from the IRS.

If you qualify as an Accredited Investor based on net worth, you will need to provide recent account statements or third party appraisals that show the value of your assets.

Yes we can. If you qualify as an Accredited Investor based on net worth, you will need to provide recent account statements or third party appraisals that show the value of your account(s).

In lieu of providing income or net assets information, you may provide a professional letter from a CPA, attorney, investment advisor or registered broker-dealer. The letter should state that the professional service provider has a reasonable belief that you are an Accredited Investor.

A professional letter is an official written communication from a licensed CPA, attorney, investment advisor or registered broker-dealer, stating that the professional service provider has a reasonable belief that you are an Accredited Investor. The communication can be in the form of a traditional letter, or an email, from a principal or officer of the firm. Contact us to obtain model language.

You can provide your Letter to third parties to satisfy the Accredited Investor verification requirement under Section 506(c) of Regulation D of the Securities Act of 1933. Because your status is verified by NCPS, a registered broker-dealer, your Letter qualifies as a professional letter that offers safe harbor to issuers and platforms who rely upon it. In addition, a third party recipient can confirm the authenticity of your Verification Letter at the Accredited.AM website.

If you qualify as an Accredited Investor based on net worth, we will pull your credit report to verify your liabilities. If you have liquid assets greater than $2 million, we may (in our sole discretion) waive the requirement to pull your credit report.

Your Accredited Investor Verification Letter includes personal-identifying information, such as your name, address, email address, and a unique investor identification number assigned to you by North Capital. There is no specific information about your income or net worth, other than a statement that you have been verified as an Accredited Investor. The Letter also includes an authentication code, so that a recipient can confirm that it is genuine.

North Capital does not place a specific expiration date on the Accredited Investor Verification Letter. We will request additional information as necessary to maintain our reasonable belief that you are an Accredited Investor. Issuers or platforms to whom you provide the Letter may maintain their own standards with respect to the timeliness of a professional letter.

The protection of your confidential information is one of our highest priorities. Our security measures include a wide range of hardware, software and procedural protocols, including data encryption, communication over SSL, vulnerability/malware scanning, a system of firewalls, and routine security testing and reviews. Our full Privacy Policy can be viewed here.

North Capital will not share your confidential information with third parties except with your express permission. North Capital will use your confidential information solely for the purpose of determining your status as an Accredited Investor and to offer you additional services or products that, in our opinion, would be appropriate for an Accredited Investor or a non-accredited investor, as the case may be.