On February 28, 2017, the SEC issued an order (the “Order”) temporarily suspending the ability of Web Debt Solutions, LLC (“Web Debt”) to utilize Regulation A, pursuant to its authority under Securities Act Rule 258. The Order stems from untrue statements of material fact made in Web Debt’s offering statement on Form 1-A, which was filed with the SEC on July 11, 2016 (the “Offering Statement”). The SEC specifically noted that the Offering Statement: (i) contained inconsistent, contradictory balance statements regarding Web Debt’s total assets in 2016; (ii) included erroneous statements that Web Debt’s chief executive officer had 15 years of experience in the debt collection industry prior to forming Web Debt; and (iii) listed as the address of Web Debt’s principal office, a building that, as of the date of the Order, was currently under construction and without any businesses operating from it. The SEC also noted that Web Debt’s chief executive officer had failed to fully cooperate with the SEC’s investigation, including failing to: (i) produce, in response to a voluntary document request, any documentation related to Web Debt by a stipulated deadline; and (ii) respond to subsequent communications from the SEC regarding the voluntary document request.
A copy of the Order is available at: https://www.sec.gov/litigation/admin/2017/33-10316-order.pdf