Because crowdfunders ask the public for money in exchange for the promise to deliver something in the future, it’s good to know that there are a few “sheriffs” in town.
The venture capitalists and private equity guys can afford to hire experts to conduct their due diligence. However, the masses don’t have that luxury and are relying on the truthfulness and good faith of the company seeking funding.
Under the securities laws, companies get some leeway for projections, but facts are facts. Mis-stating facts about, say, the health benefits of green coffee beans, may move you into fraud territory.
However, there are a few private crowdfunding project vetters that appear to have a level of expertise that even the state securities regulators may not have. Drop Kicker, for example, is run by two engineers and former product consultants. Others include tech writers for PandoDaily, TechCrunch and Digital Trends, as well as other experts in the various fields. Note that Reddit is keeping a running list of failed or unfulfilled projects. And there’s always snopes.com for your run-of-the-mill internet scams.
Perhaps the State Securities Commissioners could create a panel of tech/science experts who would randomly select projects to review for technical accuracy.