Investment banker does not have to draft fraudulent communication to be held liable for fraud, finds Supreme Court

By

The US Supreme Court ruled Wednesday that an investment banker may be held liable under 17 CFR § 240.10b-5 (Rule 10b-5) for sending fraudulent information about a potential investment even if the employee did not draft the correspondence and sent it at the behest of their boss.

In Lorenzo v. Securities and Exchange Commission the court considered of whether Lorenzo, then a director of investment banking at a brokerage firm, committed fraud when, at the request of his boss, he sent two emails to clients about an investment opportunity at a company with assets of $10 million. Lorenzo knew the real valuation of the company's assets was closer to $400,000. Lorenzo copied and pasted the information from his boss and sent the emails anyway.

Full Article

Join the Discussion
More Law & Society
Brandon Durham

Homeowner Killed by Cop After Calling to Report Break-In Predicted His Own Death on 911 Call: 'I Don't Think I'll Be Alive'

Reese Louise Myers

Texas Mom Abandons Baby at Home to Go on a Date, Never Comes Back

Carey Dale Grayson

Last Meal Revealed For Alabama Death Row Inmate Who Butchered Hitchhiker, Cut Off Her Fingers

Miley Cyrus, Bruno Mars

Miley Cyrus Points Out 'Fatal Flaw' in Copyright Lawsuit Against Her for 'Flowers'

Real Time Analytics