Private Syndications with non-accredited partners question

[Ryan Martin]

Hello all,

I'm trying to acquire/confirm some accurate information regarding private real estate syndications. Is it accurate to say that a person (non-accredited investor and lead on the property purchasing/fixing/reselling) is capable of reaching out to others privately (say, individuals in the home construction business who are also non-accredited investors) and gathering a group of them to help invest in said property that will be fixed/sold, without any issues from the SEC such as licensing or requiring accreditation? 

I know many real estate syndications are only open to those who are accredited, which affects how you can go about advertising it ect., but as long as a non-accredited person who is taking the lead, can find others(also non-accredited) and pitch them investment opportunity, that in of itself, has no barriers? Is that a fair statement?

Any insight, additional information or corrections is greatly appreciated.

Thanks.

[Greg Scott]

I am not an attorney.  You should get one that specializes in SEC law and have them prepare a PPM for you.

Reg D 506c exemptions from registering for a security only allow you to take accredited investors.

Reg D 506b exemptions allow you to take sophisticated, non-accredited investors, but you are prohibited from advertising, which can mean a lot of things.  It is best to have a relationship with these people before you start trying to raise funds.