How is my accredited-investor status verified for a 506(c) offering?

Rule 506(c) offerings are private placements that the issuer may advertise publicly. In exchange for that open solicitation, SEC rules require that every purchaser be an accredited investor and that the issuer take reasonable steps to verify that status. Checking a box to say you qualify is not enough for a 506(c) offering, so expect a documented verification step before your investment is accepted.

What verification looks like

Third-party verification is the typical approach. A CPA, attorney, registered broker-dealer, or investment adviser reviews evidence of your income or net worth and confirms that you meet the accredited-investor tests. Depending on how you qualify, you may be asked to:

• share documents that show your income or net worth, such as tax forms or account statements,
• provide a written confirmation letter from one of the professionals above, or
• show that you hold a qualifying professional license — Series 7, Series 65, or Series 82 — in good standing, if you qualify through the credential pathway.

Many verification services are now automated, so a review that once took days of paperwork can often be completed within minutes. For a refresher on who qualifies in the first place, see Do I need to be an accredited investor to invest?

Who runs the verification

Under Rule 506(c), the obligation to take reasonable steps to verify purchasers sits with the issuer. 506(c) offerings listed on Invown are presented by their issuers, and each issuer’s verification process applies, so follow the steps described in that offering’s documentation. Invown Corp. is a technology company and is not a registered broker-dealer. If you are unsure what a particular offering requires, reach out through support.

How this differs from other offerings

Regulation Crowdfunding works differently. Reg CF offerings on Invown run through Invown Funding Portal LLC, an SEC-registered funding portal and FINRA member, and they are open to both accredited and non-accredited investors — non-accredited investors are subject to annual investment limits based on income and net worth — so no accreditation verification is needed. Rule 506(b) private placements, which do not allow general solicitation, commonly rely on self-certification instead of documented review.

Whatever path applies, securities offered through Invown are speculative, illiquid, and involve a high degree of risk, including the possible loss of your entire investment, so read the offering documents carefully before you invest. For the full picture of the accredited-investor rules, including how entities qualify, see our guide to accredited investor rules.