Registered Finders

A firm for these economic times, and your economic opportunity.™

Representation of Texas Registered Finders

Bissex & Watson, P.C. provides advice to clients concerning state and federal securities law regulatory matters. Included in this practice is advice concerning the Texas registered finder regulations.

The lure and lore of start-up companies paying finder fees in order to raise investment capital is often in conflict with the law. The SEC’s position is that if someone is in the business of serving as a finder, that person must register as a broker-dealer. Generally, the SEC views more than a one-time occurrence as “being in the business.” The Texas State Securities Board’s position is that anyone receiving a finder’s fee must be registered, even if it’s a one-time deal. Fortunately, in 2006 Texas implemented “lite” regulations that allow finders to register with the Texas State Securities Board as a finder without conforming to the more arduous broker-dealer regulations.

Not only is this a concern to a person hoping to earn a finder’s fee, but it is a concern to the company raising money, because using an unregistered broker can cause an offering to fail to satisfy many of the exemptions from registering the securities being offered. In other words, a private placement of securities may be subject to federal and state registration if a finder’s fee is paid to a person that is not registered.

Bissex & Watson, P.C. represents individuals seeking to register in Texas as finders and advises issuers concerning the circumstances under which they can pay finders’ fees. Walter Bissex has also advised hedge funds and private equity funds concerning Texas securities regulatory matters and is an active member of the Securities Law Subcommittee of the State Bar of Texas Business Law Section.