Asked by Yania Campbell on Jul 19, 2024
Verified
The due diligence defense generally requires the defendant to show that he had reasonable grounds to believe and did believe that there were no untrue statements or material omissions.
Due Diligence Defense
A legal defense where a defendant shows that they have taken all necessary steps to avoid violating the law, usually in relation to investments or financial transactions.
Material Omissions
Failure to disclose important information that results in presenting a misleading picture of the facts.
- Comprehend the legal outcomes and possible liabilities resulting from failure to adhere to securities regulations.
Verified Answer
SO
Sophie OlivarezJul 25, 2024
Final Answer :
True
Explanation :
The due diligence defense allows a defendant, typically in a securities fraud case, to argue that they conducted a reasonable investigation and genuinely believed there were no false statements or omissions in the information provided to investors.
Learning Objectives
- Comprehend the legal outcomes and possible liabilities resulting from failure to adhere to securities regulations.