— Valleywag’s Sam Biddle shows how easy it is to scam the JOBS Act-enabled AngelList:

Just think: all the wisdom and accountability of Kickstarter, only aimed at the far more stable world of tech ventures. There’s no chance that anyone will get burned, because, as AngelList buries in some fine print, you have to be an “accredited investor” in order to join a syndicate.
Except you don’t, because I just signed up, and I promise you, those sentences do not describe me! But thanks to lax federal policy and a gold rush mentality, no one really cares who I am, what I’m worth, or if I’m remotely qualified to even think about investments—let alone make them…
It’s not hard to imagine what could go wrong here, were I not very obviously a make believe bullshit investor, but someone with seedy motives. With essentially zero screening process, I could fabricate the profile of a reputable VC, or at least someone who aspires to be a reputable VC. AngelList gives me a simple, clear way to proposition strangers, to beckon group investments based on virtually nothing.


Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.