Regulatory/Compliance Checks

At least 80% or more of the success of a company is dependent upon those who manage the company. But even a well-managed company can quickly go astray—facing financial liabilities and legal encumbrances--if the entity does not comply with the city, state and federal regulations in which it operates.

Non-compliance issues with these governmental regulations can and will impact the success and return on your investment. Doing due diligence on how compliant the company is with numerous regulations is vital. Fines, penalties, liabilities of a company and/or founders can easily be “inherited” by the stockholders and investors.

Again, your financial advisor can be of tremendous assistance to you in this matter. You will want to know that Jang’s company is in full compliance with not only regulatory mandates but in taxes and licenses required at the city, state and federal levels.

“Fines, penalties, liabilities of a company and/or Founders can easily be “inherited” by the stockholders and investors.”

Investor Tip

Do you know your place in line?

Knowing what liabilities the founder or company are subject to can help appraise your level of risk going into this investment. As company funds, your investment could possibly be rendered subordinate to other claims and legal actions against the founders and/or company. You don’t want to learn later that any claims of your own are being trumped by those of a government agency or other investors.

At a minimum, include in your due diligence research on the following:

  • IRS tax liens or penalties
  • SEC penalties or mandates
  • State/City government agency penalties or mandates
  • Judgments and other creditors
  • Pending legal actions and lawsuits.

Starting with Jang’s registration of his business ventures with the Securities Exchange Commission (SEC) you will want to verify that all SEC Form D’s have been properly completed and filed. This particularly applies to you because as a prospective investor you will want to be assured that Jang and Swanson are authorized to sell securities, equities or promissory notes to you!

To check the registration of Jang’s Adriaen Black or any other business venture you can contact the SEC directly or visit them online to search for Jang’s company filings.

Of particular interest are IRS claims and liens. If these have been levied against the company and/or its founders/principals the agency will preempt any claim you may have against the company or founders. It is useful to know in advance if any of your legal claims are limited before you have even invested!