Which of the Following Is an Accurate Statement Regarding Rule

question 66

Multiple Choice

Which of the following is an accurate statement regarding Rule 10b-5 of the Securities Exchange Act of 1934?

• A) The Supreme Court has ruled that liability under Rule 10b-5 does not extend to aiders or abettors who participated in financial statement misstatements that were not the primary defendants.
• B) Federal court decisions have clarified that Rule 10b-5 applies only to direct sellers.
• C) Hochfelder and subsequent court decisions have increased the liability of auditors under Rule 10b-5.
• D) According to most recent court decisions, poor judgment is proof of fraud.