How to find out if a company is legit?
It depends greatly from place to place, but nothing beats the Internet reviews' research. If you can't find anything digging slightly deeper than the impressive home page, then you probably should be worried. As it seems that you are. Specifically, I do these: @JohnFX mentions a valid point: check for physical presence. Check that the office address is a real office and not a PO box or residential; call the number and see who answers it (if you call several times during different hours and the same person answers - that's probably a one-man operation). But that doesn't always help because short-term renting an office is not all that hard and getting a call-centre outsourced to a third-world country doesn't cost all that much. It definitely helps if you're dealing with someone local, but if you're in Sweden and checking out a suspicious operation in Cyprus - this is definitely not enough. If you are trying to weed out companies that are fronts for scams, one way is to look for a physical address that checks out with the phone book and a phone number posted on the site that connects you to an actual person. By itself this isn't a guarantee that the company is legit, but it will weed out a large number of fraudulent companies hiding behind PO boxes. That is, companies that defraud a lot of people don't usually make it very easy to track them down or contact them to complain or sue them.
"This information is clearly ""material"" (large impact) and ""non-public"" according to the statement of the problem.  Also, decisions like United States v. Carpenter make it clear that you do not need to be a member of the company to do illegal insider trading on its stock. Importantly though, stackexchange is not a place for legal advice and this answer should not be construed as such.  Legal/compliance at Company A would be a good place to start asking questions." You may want to dive into the various scandals and further hefty settlements between blue chip brands and agency networks here. Ask around if Dentsu Aegie finances enjoyed being honest to their clients as to where the money was going and what kind of online advertising was actually in place, just to name a specific example.  Of course online ads find positive outcomes for lots of businesses. You don’t expect any less when you see Google revenues to be honest. It still doesn’t mean that the whole tracking and private information dragging framework isn’t wrong or that so many web experiences aren’t soiled by intrusive and nasty ads. They have no standard of conduct, their review process is opaque and they are hostile to employers who ask for content to be reviewed.  Unless you threaten to sue they take no action against slander or libel.  We have had an unhappy employee flood the site with reviews using multiple fake emails, accuse an employee of a crime, etc and they did nothing but encourage us to buy their services.   We used to advertise jobs on their site - never again.  They are just as bad as Yelp. people claim that these sites are scams  I would like to know which idiots or which website says so. And I would say you haven't done your research properly. At the bottom of the page you can see this, on IG's website, very important quote authorised and regulated by the Financial Conduct Authority Plus500UK Ltd is authorised and regulated by the Financial Conduct Authority Secondly you go and check the authencity of the firm in question on this link. your money in, you might as well kiss it goodbye This might be true because they trade in products, which if you don't understand you will more or less will loose your money. N.B. I have an account with IG for the past 5 years and they haven't scammed me yet. "This is several questions wrapped together: How can I diplomatically see the company's financial information? How strong a claim does a stockholder or warrantholder have to see the company's financials? What information do I need to know about the company financials before deciding to buy in? I'll start with the easier second question (which is quasi implicit).  Stockholders typically have inspection rights.  For example, Delaware General Corporate Law § 220 gives stockholders the right to inspect and copy company financial information, subject to certain restrictions. Check the laws and corporate code of your company's state of incorporation to find the specific inspection right.  If it is an LLC or partnership, then the operating agreement usually controls and there may be no inspection rights.  If you have no corporate stock, then of course you have no statutory inspection rights.  My (admittedly incomplete) understanding is that warrantholders generally have no inspection rights unless somehow contracted for.  So if you vest as a corporate stockholder, it'll be your right to see the financials—which may make even a small purchase valuable to you as a continuing employee with the right to see the financials.  Until then, this is probably a courtesy and not their obligation. The first question is not easy to answer, except to say that it's variable and highly personal for small companies.  Some people interpret it as prying or accusatory, the implication being that the founders are either hiding something or that you need to examine really closely the mouth of their beautiful gift horse.  Other people may be much cooler about the question, understanding that small companies are risky and you're being methodical.  And in some smaller companies, they may believe giving you the expenses could make office life awkward. If you approach it professionally, directly, and briefly (do not over-explain yourself) with the responsible accountant or HR person (if any), then I imagine it should not be a problem for them to give some information.  Conversely, you may feel comfortable enough to review a high-level summary sheet with a founder, or to find some other way of tactfully reviewing the right information. In any case, I would keep the request vague, simple, and direct, and see what information they show you.  If your request is too specific, then you risk pushing them to show information A, which they refuse to do, but a vague request would've prompted them to show you information B.  A too-specific request might get you information X when a vague request could have garnered XYZ.  Vague requests are also less aggressive and may raise fewer objections. The third question is difficult to say.  My personal understanding is some perspective of how venture capitalists look at the investment opportunity (you didn't say how new this startup is or what series/stage they are on, so I'll try to stay vague). The actual financials are less relevant for startups than they are for other investments because the situation will definitely change.  Most venture capital firms like to look at the burn rate or amount of cash spent, usually at a monthly rate.  A high burn rate relative to infusions of cash suggests the company is growing rapidly but may have a risk of toppling (i.e. failing before exit).  Burn rate can change drastically during the early life of the startup.  Of course burn rate needs the context of revenues and reserves (and latest valuation is helpful as a benchmark, but you may be able to calculate that from the restricted share offer made to you).  High burn rate might not be bad, if the company is booming along towards a successful exit. You might also want to look at some sort of business plan or info sheet, rather than financials alone.  You want to gauge the size of the market (most startups like to claim 9- or 10-figure markets, so even a few percentage points of market share will hit revenue into the 8-figures).  You'll also have to have a sense for the business plan and model and whether it's a good investment or a ridiculous rehash (""it's Twitter for dogs meets Match.com for Russian Orthodox singles!"").  In other words, appraise it like an investor or VC and figure out whether it's a prospect for decent return.  Typical things like competition, customer acquisition costs, manufacturing costs are relevant depending on the type of business activity. Of course, I wouldn't ignore psychology (note that economists and finance people don't generally condone the following sort of emotional thinking).  If you don't invest in the company and it goes big, you'll kick yourself.  If it goes really big, other people will either assume you are rich or feel sad for you if you say you didn't get rich.  If you invest but lose money, it may not be so painful as not investing and losing out the opportunity.  So if you consider the emotional aspect of personal finance, it may be wise to invest at least a little, and hedge against ""woulda-shoulda"" syndrome.  That's more like emotional advice than hard-nosed financial advice. So much of the answer really depends on your particular circumstances.  Obviously you have other considerations like whether you can afford the investment, which will be on you to decide.  And of course, the § 83(b) election is almost always recommended in these situations (which seems to be what you are saying) to convert ordinary income into capital gain.  You may also need cash to pay any up-front taxes on the § 83(b) equity, depending on your circumstances." See I believe that it's pretty in the open. A shell company whose only purpose is to license out some intellectual property to an affiliate company should be easy to spot. A company with 5 employees and a tiny office should not be claiming millions of income that originated in an affiliate company. My point is that these things are not clearly defined in the code and should be, not that they are necessarily being hidden. I've seen at least 5 articles in the last year similar to this one about other large companies, so I wish congress and whoever else would do something about it. Looking at these reviews I would filter them too. They do look like they're either straight copies of each other or they sound like they're written by the same person; A commercial writer. There are just patterns in the structure that you don't see from more random reviews. My first thought is: email? Are you sure it is legitimate? Verify everything. Assuming it is legitimate: Like all other trading brokers in the industry, they both have been acknowledged with mixed reviews. Before signing up, it’s important to know whether they are running a legitimate operation or not.  You can see BinaryOptionsTrading-Review.com, judgebinaryoptions.com etc.  to inquiries about these sites. They conduct in-depth research to identify the legitimacy of each brokers present in the market. Hope it will help you in making the right decision. Yeah, there are a lot of things that 'poof' you into existence with them. Their whole business model is that they claim to have dirt on *every* established business. And they basically do. Attempting to get a number with them is really only an issue for brand new businesses.  Regardless, they will send you very misleading spam and junk mail. And a lot of it comes off to me as threats/extortion.  They also listed my home phone number for one of my businesses for years. When you call for assistance, they really only care about tricking you into buying some package, and don't care about being helpful or correcting their records.  I know I sound mean, but honestly their entire sales method on me was to trick me into buying something I knew I didn't want or need. With multiple salespersons there. It's really scummy. From what you have written, it could be a boiler room company. These operate with fancy website and have proper book keeping systems but are elaborate scams. How did you find about this broker. If there was a seller when you purchased the shares, there is no reason you can't be seller So while these companies are not a scam, 30% feels pretty darn high.  How about you negotiate a much lower rate?  10% or 15%? Here is why: You will spend time and effort (which technically isn't free) to find the money.  I bet you can find it if you look hard enough.  But you could also just collect it and give this company a cut for their expertise. However if 30% bugs you (and it would bug me) then consider their reality.  They spent money to find the funds and contact you.  HOWEVER, that is a sunk cost.  It is already spent.  You can find it on your own and they get zip.  Or you negotiate a lower percentage, they get enough to cover their costs and make some profit and you save a ton of time. Since they took the time to explain themselves here, they are either scammers trying to bully you into compliance, or they are legit.  It is field that people might look down on, but it isn't criminal. I would look for the money if it were me, but I feel I have enough free time that it would be worth it. Definitely sounds like scam. Odds are are high that the page he gave you the link to is a fake and this app is pure identity theft. Run away, unless you are interested enough to do the work to check with the company and confirm this is legitimate.  Nobody contacts strangers with this kind of story without it being a scam. The fact that this one sounds shady is an attempt to keep you from questioning it too closely. Think about it: if it was at all legitimate, couldn't he find a friend of a friend? If it sounds too good to be true, it ain't true. Never download software unless you know exactly where it is coming from. It could be anything from ransomware, to something that first steals all you financial info, then uss you mail account to send a similar pitch to all your friends, to a botnet that uses your machine to attack other machines. I'm a programmer, and worked for a company doing natural language analysis and parsing.  Yes, it is possible to figure out what reviews are more valuable than others by passsing it through an algorithm.  How the heck do you think spam filters work? I've seen this tool.  I'm just having a hard time finding where I can just get a list of all the companies.    For example, you can get up to 100 results at a time, if I just search latest filings for 10-K.  This isn't really an efficient way to go about what I want.