allinvain

Ouch! I would hate to be one of those investors who has $10,000+ tied into the program and then have to wait several years to receive my fund.

What I suppose the guy can do is obtain a financial services license from the Nevis Government. Then and only then can he accept investors funds without any worry of the US Government meddling in the program's future. Also, he would have to setup some sort of contractual relationship with his Nevis company which would require him to register a US company to manage the funds and operation of the Nevis company (ie. like e-gold). However, I don't foresee this occurring as there are numerous added costs (which no doubt will force him to lower the ROY - assuming the program is legit to begin with).

So in conclusion, the investors in this program could be gambling with their money as they might do with a regular HYIP (also assuming that Legisi is not a regular HYIP - which at this point in yet to be decided).

It would be interesting if we could get a corporate lawyer in here to let us know exactly how Legisi stands in regard to the law.

allinvain

Well Jude, if you check out Legisi's forum you'll see nothing but ranting and raving about how great the program is. I am always skeptical about everything (it's in my nature), but if I was not, I'd say the program has happy "investors" (oh no! I used the evil "I" word to describe what Legisi does - for sure Mr. McKnight will get medieval on my buttocks...loool).

Perhaps some Legisi cheerleaders will come in here? Who knows. I for one would welcome some debate about the program, but if you people are looking for the "happy customers" I would suggest checking out their forum.

Jude

Nah, I'm not that kind that buys these stuff too. There must be some members that're feeling crappy despite being paid and told nothing on what's going on with their money.

I might be wrong though. lol

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24oz

Obtaining a financial license from Nevis would not solve the situation.
In order to conduct financial business in the US you need to be licensed in the US, he is conducting financial business in the US and it is not licensed, plain simple and clear.

Stijn1234

The "loan" angle is obviously legal protection. There is no law against individuals making private loans to a person or a company and getting paid back with interest.


Concerning the 'legal' issue I guess the text above is quite important. Does this type of 'wording' set him from getting any licence or not?? I'm not familiar with the law in the US concerning this...

If he needs licensing, registering in Nevis is indeed only a solution if his whole business is leaving the US... (agreeing with 24oz)

Concerning the program itself: changing the rate is often a red flag, we'll see whether it's an exception this time or not.

allinvain

Well, true enough. Correct me if I'm wrong, but Legisi is not a registered as a US company and therefore it doesn't make sense to require a license because they are not offering financial services IN the United States. They do offer "financial services" TO United States Citizens, which might be perceived differently in the eyes of the law. Granted, I am not a lawyer, but I think there must be some clear distinction in the law, it can't be that as long as you have US customers that you have to have a US financial services license - that would be absurd. If that were true, then if you go about trying to open an offshore bank account, then the offshore bank would require a US financial services license just to have you as a client.

The same situation applies to e-gold. Does e-gold have a financial service license? I think not!

Now, on the other hand, if LEGISI were to redomicile their corporation in the United States THEN and only then they would require a financial services license as they are operating within United States territory and offering financial services to United States Citizens.

Does that make sense to you?

allinvain

Precisely. It does sort of shield his program a bit, but I don't think it will prevent his company from being sued. But the fact that it's a company registered in Nevis makes this kinda hard since Nevis has tough "breaking the corporate veil" laws.

In fact, read this: "Plaintiff bringing civil suit must post US $25,000 bond. "

source: SMS | Why Nevis?

Now about his business being in the United States. On the site in the "contact us" section it does say "Legisi Holdings, LCC (USA Office)" which brings the question, is that a separate corporation registered in the United States or is that just a virtual office of the Nevis Legisi Holdings LLC corporation?

I doubt that he registered two corporations with the same name (one in the United States and the other in Nevis), so I think that his US office is a virtual office of the Nevis company. Having this in mind, it could pose a problem as Legisi clearly has a US presence. Now, I think that changes things a bit.

As I said in my previous post, I am no lawyer, but since he clearly has a local presence and is offering services of a financial nature, Legisi Holdings LLC just *might* need to obtain special licensing.

Lol..perhaps it would have been better if Legisi did not have a US office address and just have the mail from the Nevis office forwarded to an US address. This way Mr. McKnight could administer the program remotely and no complicated legal issues would arise. However, even if the US government officials bust in on Mr. McKnight's party they can't really do anything about Legisi's assets since they belong to an offshore corporation (harder for people who are victims of fraud to get their money back).

Like I've said on some previous post, will a corporate lawyer please stand up?

24oz

It is not a *might* is a MUST obtain a special license, for an offshore entity not to have to request any special license from the US when conducting financial business, the entity must not have any interest nor presence in the US, if they have interest or presence they must comply with the US legislation and get the correspondent licenses. He has an office in the US according to the website and he hosts in the US according to the whois, then according to the law he MUST have these licenses. Furthermore if someone just calls or contacts the Michigan securities comission regarding legisi, I am 100% sure that the first thing they would do would be issue a cease or desist order and start an investigation for unlicensed securities offering ( I do not recommend to do this to anyone because they would freeze any legisi's assets and investors would have locked the funds for years.)

sharonsopinion

Wow! Some very interesting points made here! Thank you!

I'm not in Legisi, but from what I understand, it operates similar to EarnByLoaning, i.e., private loans from members to the company. There are some differences and I wonder if it changes the legality defnition for loan programs operating in the US.

• EBL is registered in Nevada and run out of Washington state.
• EBL has loaners sign a Lender Agreement, which is claimed to be legally binding in a US court of law.
• EBL claims that the Lender's Agreement makes them wholly legal and an SEC license is not necessary. They said that without the Lender's Agreement, they would need to be licensed.
• EBL is only a transaction company and online presence. It feeds revenue to Quest Holdings Inc.and profits back to cover withdraws. No loans are made directly to Quest Holdings Incl.

I'm waiting on more information from EBL and a review from a contract lawyer, who is looking at the legality of the Lender's Agreement. I'll update the EBL thread with the information, when I get it.

What does all of this mean for Legisi? As far as I know Legisi doesn't use a Lender's Ageement or a second company for generating profits. Also, the difference that Legisi is registered offshore, but has their online presence in the US and EBL has everything in the US.

JMO,
Sharon

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freedom101

Quite frankly, I don't trust any offshore companies like legisi.
Where do people go to if he runs off with the money...would people spend $25,000 just to get a court hearing?
Also..They never used the term "Loan program" until EBL was on the scene.
A+ for originality legisi.