Business Law

Business Law News 2015, Issue 4

Resolving the Finders’ Dilemma: California Clarifies the Role of Finders in Securities Laws Transactions

Julie Ryan

Julie Ryan is an Associate Professor of Lawyering Skills at the University of Southern California Gould School of Law. Prior to joining USC, she was a partner at Russ, August & Kabat, where she specialized in mergers and acquisitions, securities offerings, and general corporate matters.

On October 10, 2015, Governor Brown signed into law a bill that provides long-awaited clarification of the role and scope of permitted activities of finders in securities laws transactions in California.1 The bill (Assembly Bill No. 667 (2015)) adds a new section 25206.1 to the California Code of Corporations (the "Code"). Formulated as an exemption to the California broker-dealer licensing requirements,2 section 25206.1 creates a clear set of minimal statutory requirements for individuals engaging in finder activities in California. With the enactment of this legislation, California joins only a small number of states that provide a streamlined regulatory framework in which finders can legitimately provide services.3

Why is this clarification so important?

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