BU231 Lecture Notes - Lecture 19: Strict Liability, Financial Statement
Document Summary
Securities legislation (ontario securities act: objectives of securities legislation. Prevent and punish fraudulent practices in the securities industry. Require full disclosure of financial information in prospectus when dealing with ipo"s: two devices for achieving this. Renew on an annual basis, revoke, suspend. Note merely a formality, commission will refuse a prospectus if they believe it is misleading or omits data. Require: full description of securities (voting rights etc , nature of business carried on, names, addresses, occupations of directors, recent audited financial statements, proposed use of proceeds from issue of shares, continuing disclosure. One of the most important innovations gives securities commission control over stock exchanges. Thus control exists over initial, as well as subsequent trading: misrepresentation. Investigate for misrepresentations in financial statements etc , where corporations have civil liability for both primary (iso) and secondary markets. Civil liability: liability towards plaintiff, typically to pay damages for harms done through committing a tort or breaking a contract, punished by fines.
