What are mini-bonds?
A 'bond' is a debt instrument under which an investor lends money to a borrower, usually a corporate entity. Bonds are issued by the borrower on specified terms which are contained in a 'bond instrument'.
Using the internet to promote an investment is an effective way to access a large audience. Those using this medium must, however, ensure that they are not in breach of the rules imposed by the Financial Conduct Authority (FCA).
In June 2013 the Financial Conduct Authority (FCA) published a policy statement and final rules to ban the promotion of units in unregulated collective investment schemes (UCIS) and other non-mainstream pooled investments (NMPIs) to the vast majority of retail investors in the UK from 1st January 2014.
Thank you to Paul Sutton of LCN Legal for contributing this article. Paul's details can be found at the end of this article.
The Alternative Investment Fund Managers Directive applies to alternative investment funds (AIFs) that are managed or marketed in the European Union.
So what is an AIF?
In March 2014 the FCA issued it's Policy Statement, entitled 'The FCA's regulatory approach to crowdfunding over the internet, and the promotion of non-readily realisable securities by other media'.