Every figure gets a source cell
Lesson 5 of 5 · The deal week
By the end you can name the rules that bind an AI-drafted memo, BOV or investor note, the three uses that are plainly fine, the pattern that draws enforcement, and the one sentence to keep.
1 · Learn the move · Red-team audit
A model drafting the memo changes nothing about who answers for it. The rules that bind every figure: a misstatement in anything an investor relies on is securities fraud whether a person or a model wrote it [M]; a private offering loses its exemption if the draft becomes a public solicitation [S]; a broker opinion of value is not an appraisal and may not be called one unless an appraiser signed it [S]; a number a lender relies on that you knew was unsupported is a bank fraud question, not a typo [M]; and the appraisal profession's own guidance says the appraiser answers for every AI-assisted figure [P]. Three uses are plainly fine: summarizing leases, comps and reports you supplied; drafting memo prose from numbers that already carry a source; and scenario tables labeled as illustrations. The pattern that draws enforcement is AI-washing, claiming the model did analysis it did not do; the first cases were advisers fined for exactly that [P]. No case yet names an AI-drafted memo, BOV or rent roll [M]. The sentence to keep: AI drafts the memo, every number has a source, nothing is guaranteed, and nobody calls it an appraisal unless an appraiser signed it. Draft copy, not legal, securities or appraisal advice. Sources tagged [P] primary, [S] secondary, [M] unverified. Reviewed by: nobody yet.
Here are the rules I work under: [paste the rules above in your own words]. Here is a draft investor note and a BOV cover page: [paste]. Act as the reviewer trying to find the line that draws a complaint. For every sentence that breaks a rule, quote it, name the rule, and say what to write instead. Flag every figure with no source cell. Flag any return language that reads as a guarantee. Do not soften the draft; only flag it. End with a checklist I can run before anything goes to an investor or a lender.
The facts this lesson rests on, dated
Each line names the source grade the lesson shows, [P] primary, [S] secondary, [M] unverified, and the day it comes due. Past that day, treat it as a question. Draft copy, not legal advice.
- Rule 10b-5 and Securities Act section 17(a) bar a material misstatement in offering material whether a person or a model drafted it; the rule text was not fetched for this check. [M] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- A Rule 506(b) offering loses its exemption on general solicitation, so mass AI outreach or a public post naming the deal can break it. [S] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- Tennessee T.C.A. 62-39-104(a) exempts a broker price opinion from appraiser licensing only while it is not called an appraisal, and the exemption narrows when the opinion is prepared in writing for a non-party. [S] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- False figures or doctored documents in a loan package fall under the federal bank and wire fraud statutes, 18 USC 1344, 1014 and 1343; FinCEN's 2024-11-13 alert covers deepfaked statements. [M] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- USPAP Advisory Opinion 41, adopted 2026-04-23, covers AVMs and generative AI and keeps the appraiser fully responsible for every figure in the assignment. [P] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- The SEC settled its first AI-washing cases on 2024-03-18, with two advisers paying $225,000 and $175,000 for unsubstantiated claims about AI in their products. [P] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). source
- No enforcement case naming an AI-drafted memo, broker opinion of value or rent roll was found when checked. [M] (researched Oct 6, 2026, not yet confirmed by a person, recheck by Dec 15, 2026). research pack B_real_estate_land_contractors.md (parity run 2026-10-05), Boardroom section 4
2 · Your turn. You write the prompt
A junior associate pasted a rent roll into a chatbot and got back an investor teaser that promises 'a safe 14% IRR', calls the BOV an 'appraised value', and says the sponsor's 'AI-powered underwriting' found the deal. He wants to email it to the whole investor list before the weekend.
Write the prompt for this scenario as given, or swap in a real one from your own work. The score works the same either way.
Remember: the AI sees only your prompt, not this page. If the situation isn't in your prompt, it doesn't exist.
Optional. These shape the output when you run your prompt below, not your score.