Regulatory liability by SEC actions. Consent order - issuer does not admit guilt, but agrees to stop. Disgorgement of profits. Civil liability by private party actions for violation of the 1933 Act or for false information in the registration statement or prospectus. Defendants would include the issuer, its executive and financial officers, and attorneys and accountants who certify that information is correct.
Due diligence is a defense.
Regulates subsequent trading of stocks that have already been issued by with continuous reporting requirements for large companies or companies that have a registered offering under the 1933 Act or that have securities traded on a national securities exchange. Insider trading - insiders should not use material nonpublic information to take advantage of others in the investing public. Insiders include directors, officers, employees, and others that owe a fiduciary duty to an entity, such as lawyers, accountants, and other agents. Tipper and tippee liability. Statutory insiders - directors, executive officers, and ten percent shareholders of a particular entity.