So what if an FCA regulated ECF platform promoted a company and as a result the company achieved its funding target. Then sometime later, the company got itself into serious trouble and ceased trading. It turned out the founder had issues and couldnt cope. Or so it was claimed.
What if this founder was in fact not having issues of his own making? He was having issues induced by the things, illegal things, he was doing. What, if any, liability comes back onto the platform for not seeing this in the original pitch?
What if, when the company got into trouble, the platform and the founder told investors that the reason for the company's collapse was in fact nobody's fault - it was just a case of circumstances. And then what if there was irrefutable evidence that this was not the case. Would the platform be liable then for misleading investors?
As things stand today the platforms are not liable for any form of behaviour by the founders who use their sites to raise cash - even though the pitches are supposedly vetted.
Should this founder be banned from being a Company Director? Or do we allow this sort of thing just to happen and put it down to bad luck.
Im not sure but unless we start talking about these things and stop trying to hide them for the bad PR they will bring, then we will never come to a satisfactory answer.
Very relevant points; of course ecf platforms and company directors/ Founders have to be accountable and should be vetted accurately; just Too many instances presently of false information, lack of transparency and poorly vetted businesses/ Founders. Unless a clearly defined code of rules, and sufficient initiatives to discourage the poor ones, there soon will be no investors.....
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