1/18/2012
We in the Model Club of Northern Virginia, MicNOVA, have a
member who is in retirement I believe and last year took a
6-month leave to travel, then returned for approximately 4
months but did not resume her Stockwatcher position.

Now she is requesting another 8 month leave from the club,
and the members feel positive about granting her this leave.

I know there are SEC laws about a club having
non-participating members being considered a Mutual Fund,
and therefore being vulnerable to legal issues.

Could someone clarify that in light of MicNOVA's situation?

Thanks, Etana

I would think that if she is paying her money, she is participating.  She is no
different than some of the members who just come to the meetings and don't do
any research or add to the discussion!! 


 


----- Original Message ----
From: Carol E Finkler <etana.finkler@gmail.com>
To: club_cafe@bivio.com
Sent: Wed, January 18, 2012 1:27:17 PM
Subject: [club_cafe] Non-participating member legal rules?

1/18/2012
We in the Model Club of Northern Virginia, MicNOVA, have a
member who is in retirement I believe and last year took a
6-month leave to travel, then returned for approximately 4
months but did not resume her Stockwatcher position.

Now she is requesting another 8 month leave from the club,
and the members feel positive about granting her this leave.

I know there are SEC laws about a club having
non-participating members being considered a Mutual Fund,
and therefore being vulnerable to legal issues.

Could someone clarify that in light of MicNOVA's situation?

Thanks, Etana

After reviewing some of the SEC information several years ago, we decided to add "passive" and "inactive" behavior by member(s) such that membership investment club could be considered a security (under the Security Act of 1933) as grounds for expulsion.

From the SEC: When does an investment club have to register the offer and sale of its membership interests with the SEC under the Securities Act of 1933? If every member in an investment club actively participates in deciding what investments to make, the membership interests in the club would probably not be considered securities. If the club has any passive members, it may be issuing securities.

It may seem a bit harsh including this, but it's a pretty solid position to fall back to when you start discussing a member's activity.
 
Jimmy
James P. Dickerson

-----Original Message-----
From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of JAYNE GILBERT
Sent: Wednesday, January 18, 2012 3:43 PM
To: club_cafe@bivio.com
Subject: [I] Re: [club_cafe] Non-participating member legal rules?

I would think that if she is paying her money, she is participating.  She is no
different than some of the members who just come to the meetings and don't do
any research or add to the discussion!! 


 


----- Original Message ----
From: Carol E Finkler <etana.finkler@gmail.com>
To: club_cafe@bivio.com
Sent: Wed, January 18, 2012 1:27:17 PM
Subject: [club_cafe] Non-participating member legal rules?

1/18/2012
We in the Model Club of Northern Virginia, MicNOVA, have a
member who is in retirement I believe and last year took a
6-month leave to travel, then returned for approximately 4
months but did not resume her Stockwatcher position.

Now she is requesting another 8 month leave from the club,
and the members feel positive about granting her this leave.

I know there are SEC laws about a club having
non-participating members being considered a Mutual Fund,
and therefore being vulnerable to legal issues.

Could someone clarify that in light of MicNOVA's situation?

Thanks, Etana