What the letter is
A written confirmation from a licensed attorney that the attorney has taken reasonable steps to verify that a purchaser is an accredited investor, and has determined that the purchaser is one.
Rule 506(c)(2)(ii)(C) names four kinds of professional who may give such a confirmation: a registered broker-dealer, a registered investment adviser, a licensed attorney in good standing, or a certified public accountant in good standing. InvestReady MIV letters are issued by a licensed attorney, named on the letter, whose determination is recorded against their own bar admission.
InvestReady is not an issuer of securities. It does not offer, sell, solicit or distribute securities, does not receive investor funds for any offering, and has no interest in any offering to which a verification relates. It assembles and retains the record, and engages the professional who makes the determination.
The record the determination rests on
Four things, and none of them is your offering's terms.
- Verified identity — a documentary and biometric check on the natural person, or on the individual acting for an entity.
- A capital commitment of at least $200,000 by a natural person, or $1,000,000 by an entity, confirmed in writing by the party that received it. Not the purchaser's assertion — the counterparty's, given by an authorised representative, who also confirms the commitment is binding and that they are aware of no facts indicating the purchaser is not accredited.
- The purchaser's own written representations — that they are an accredited investor, under the Rule 501(a) category they identify, and that the minimum investment amount is not financed in whole or in part by any third party for the specific purpose of making that investment.
- The attorney's determination on that record.
The standard applied
Rule 506(c)(2)(ii) sets out specified verification methods and, separately, a principles-based standard. The specified methods are non-exclusive and non-mandatory. Rule 506(c)(2)(ii)(C) does not prescribe what the confirming professional's own steps must be, so those steps are governed by the principles-based standard, applied to the record above.
These figures are not regulatory thresholds. They come from the facts presented in a no-action request, not from any rule. Nothing here says or implies that committing $200,000 makes a person an accredited investor.
Why the confirmed commitment is probative
The Commission has identified three interrelated factors bearing on whether steps are reasonable: the nature of the purchaser and the category claimed; the amount and type of information the verifying party holds about the purchaser; and the nature of the offering, including its terms, such as a minimum investment amount. Those factors operate on a sliding scale — the more likely it appears that a purchaser qualifies, the fewer steps are required.
The Division of Corporation Finance has accepted that a qualifying minimum investment, coupled with the purchaser's representations and the absence of contrary knowledge, permits an issuer to conclude it has taken reasonable steps. In that fact pattern the issuer knew the investment because it was the party receiving it — knowledge from one side of the transaction.
An MIV verification establishes the same fact from both sides. The purchaser states the amount committed, the category claimed and the absence of purpose-specific financing. The recipient of the investment separately confirms the commitment is accurate as to purchaser, amount and date, that it is binding, and that it knows of nothing to the contrary. Neither statement is taken on the strength of the other.
How long a letter is good for
A letter is valid for ninety days from the date of the qualifying commitment, stated on the face of the letter. That is deliberately stricter than the rule's own three-month look-back, which runs from the professional's steps rather than from the transaction.
Measuring from the commitment means you can satisfy yourself of currency from the document itself, without needing to know when the work was done. After it expires, obtain a current verification.
The identity check is treated differently, and its window is longer. A person's identity does not change with the transaction, so a check completed for an earlier verification is relied on for up to one year and then performed again. Everything else — the commitment, the representations, the confirmation from the recipient, and the determination itself — is done afresh for each letter.
What is deliberately not done
- No asset or income documents. No tax returns, no brokerage statements, no asset schedules. That is a separate verification product, and mixing the two would muddle two clean bases.
- No KYB, and no examination of an entity's equity owners. For an entity we confirm the entity exists by registry lookup and verify the identity of the individual acting for it. Every entity confirms the full $1,000,000; the framework's lower alternative for entities accredited through their owners is not taken.
- No gating on which Rule 501(a) category is claimed. The category is recorded. It does not affect whether a letter issues.
- No Form D or EDGAR gate. A Form D may legitimately not exist yet — it is due after first sale. Filing information is collected from the issuer as evidence and reconciled afterwards; it never blocks a verification.
Records retained
The Commission has said it is important for issuers and their verification service providers to retain adequate records of the steps taken to verify a purchaser's status. That is the capacity in which InvestReady acts, and the record is built for it.
- The exact words shown to the purchaser and to the confirming party are versioned and content-hashed, and each attestation records which version was signed.
- The decision log is append-only, enforced at the database level. A correction is a new entry; nothing is edited or deleted.
- Every letter records the determination and the signing authority it was issued under.
- Re-rendering any historical letter from the stored record reproduces the identical document.
- Every letter issued under a given determination can be identified and, if necessary, withdrawn.
What this document is not
This is not legal advice, and it is not a representation that any regulator has reviewed or endorsed this methodology. A no-action response and a staff interpretation reflect the views of the staff; they are not rules, they have no legal force or effect, and they create no obligations.
Whether reasonable steps have been taken is an objective determination in the context of the particular facts and circumstances.