In short I am involved in buying a village shop as a community, we are going to create a community interest company to do this but there are some challenges about how we operate ahead of the formation of CIC, these are as follows
- We do not want to set up company until we are sure we will buy the shop so as to avoid asset lock of communities members cash so the solicitor is going to hold the funds. The other reason to avoid forming the CIC until we are certain it will happen is simply that as individuals working together we can do all of this without the need for compliance to FSA regulations the minute we form a company to raise money we are governed by FSA and people either need to certify themselves as sophisticated investors, the trouble is some of our people investing are not
- Our lawyers have come a cropper with the money laundering regs as they are required to vet their clients, if we do not have a legal vehicle to vet then everyone contributing funds into the client holding account for funds needs to be individually vetted which is not practical given the 50 plus community members involved
- I as a lead person coordinating this do not want to end up being liable for costs or falling foul of any regulations for showing some community spirit and running the campaign.
I need a simple solution to managing the intervening period before CIC and desire to do it today that will make the lawyers happy and meet legal requirements of money laundering regs. I am not prepared to take money off people personally, the other option proposed is form a company / association / charity temporarily to hold the receive the funds legally as a transition vehicle
Anyone got any thoughts please