The gifting of shares of stock prior to taking a small cap company public can seem like a good idea. However, in reality it causes significant problems that can easily be avoided. In this blog post we take a look at those issues and how they can easily be avoided.
Tag: Gifting Shares
The transferring of the ownership of shares without monetary consideration. This is very problematic as it makes it virtually impossible for a broker/dealer to accept the shares for deposit into a brokerage account. This is due to the current Anti-Money Laundering (AML) laws. The proper way to transfer shares is through the use of a subscription agreement, and to pay for the shares by a check. Copies of the subscription agreement, and processed check need to be retained.