Perils of internet VC fund placement networks

I got conned last week in paying $500 to a network group whose agent informed me that they will get us early stage finance for one of my companies. We got the commitment letter for funding which however required us to pay another $2500 to a consultant who will negotiate the letter on our behalf. When we refused, the commitment letter was withdrawn and threatening letters were written.

I see a lot of blogs speaking on the incompetence of entrepreneurs and the lack of understanding of the investing process. I trawled and couldn't find a single blog describing the experiences of investees with investment placement agents.

I know majority of the agents are hardworking, straight and deliver value for money. US regulation in this area is almost invisible to investees who are forced to move from pillar to post for fraud redress.

In the internet world of today, these people will not be able to hide because the world is watching.