LAWS REGARDING A GROUP OF PEOPLE SPONSORING A PLAYER

[two ones]

Heres the question in a nutshell.. i am a professional poker player living in vegas. A relative in atlanta georgia has decided to put together a group of people to invest in me at the wsop. Long story short he was ready to send a proposal to a bunch of friends and associates who had the means to buy one or more 4 thousand dollar shares. We would sell 25 of them and play in the neighborhood of 100 grand worth of events at the series.. the buyins are not exact because of rebuys and add ons in three chosen events and the hope that some events that we get past day one in would mean we spent less because we missed an event. anyway everything would be documented the receipts would be available and the money would go through the relative who would do the majority of the buy ins online since he would be the connection to most of the investors. The proposal looks great my resume is great and we know its getting close but we were ready to send it out when a lawyer friend of his raised the following questions..


1. This is an investment, and it may be that I am acting as an underwriter. I may be required to report and/or file with each state, with the SEC, and with the Federal government. The only thing that may reduce the reporting requirements is the fact that this is a relatively small amount, but he didn't know and it would take a little research.
2. This may not be legal in Georgia, or in any other state except Nevada. Just by putting it out there and collecting money I could be breaking the law. With so many people involved, and very little control over who sees the email, this could become a major problem.
3. Even if everything is OK, I might need to get a signed statement from each investor that states they understand the risks and return potential. This is a requirement of anyone who has less than a $1M net worth or who has earned less than $200K over the past three years. This statement needs to be written by an attorney, and might need to be state specific.
4. We will need to set up an LLC to manage this, and a contract will need to be created for each partner (relatively minor issue) and an official contract with you as a contracted service provider to the LLC. This will take some time and involve some cost.

that was taken directly from my cousins email.. now it is my contention that most of that is way over the top and either not accurate or not necessary.. if ten friends put in a few hundred each and give one guy the money to buy lottery tickets wouldnt a simple written agreement be both enough and legal? same question for a "corporation" as they call it that puts thousands into a pick six at the track when it gets over a certain amount.. one guy might collect the money and make the picks.. they are all partners.. legal and not confusing am i right? hopefully someone can help me.. time is obviously of the essence and i wouldnt want to lose out on this great opportunity because i didnt do the research...

[JuiceBall]

This is how I set it up last year...It is an LLC...although..depending on the state, an LP may be better.
This is a private offering and not a public offering so you don't have to register with the SEC. Your lawyer should draw up an offering sheet. If you have more than 35 non-accreditted investors then you have to file with the SEC. But if they adhere to the accreditted parameters then you can have as many as you want. By doing an offering you are not "pooling" funds...that is illegal. How much of your action are you giving up..what are you retaining for yourself ? 70%? you can PM if you have any questions...

[idmtchris]

Contact Greg Raymer through his website or maybe through this one. This is how he got his bankroll together. He outlined it in last months cardplayer mag.