Is It Illegal to Have Investors Lend You Money? (non-hedgefund)

[Baker 10]

just wondering. some people want me to manage their money and was wondering if its legal.

 

only trading stocks btw.

[MightyMouse 12]

just wondering. some people want me to manage their money and was wondering if its legal.

 

only trading stocks btw.

 

You have to give more information.

 

Are you securities licensed?

 

Are you an RIA?

 

If yes, then you are crossing ethical lines and you can be fined or barred or enjoined or some other humiliating method of tarring and feathering.

[Baker 10]

Nope, just a college kid. No ties to any financial companies.

[SIUYA 11]

depending on which jurisdiction you are in......

 

Basically ---- If someone wants to lend you money to trade then that is enitrely up to them

If there is no contract involved setting out terms etc, then there might be issues in regards taxes.

If there is no contract - they are an idiot....unless they have other methods of extracting the money.

If there is - be careful about what the contract terms are.

 

If you are promoting, or enticing anyone then you may fall under advisory rules in certain places. There are exceptions for friends and family usually up to a certain amount, and a certain number of investors, and it depends on if you are treating it as a business and promoting yourself. I would not take money from people you dont know well, and for those people you know well be prepared to loose them as friends if you loose money. No matter the consequences the relationship changes.

 

You should be able to check what exceptions there are for where you live and whose money it is pretty easily - listening to us can only guide you as to maybe what to look for and what questions to consider.