A defense to an action based on untrue statements contained in a registration statement is:
A) innocent mistake.
B) due diligence.
C) constructive disclosure.
D) reasonable diligence.

Question

Quizplus · Accepted Answer

A defense to an action based on untrue statements contained in a registration statement is due diligence, which means the defendant made a reasonable effort to ensure the accuracy of the statement before it was included in the registration statement. This defense is available for both material misstatements and omissions. Innocent mistake, constructive disclosure, and reasonable diligence are not defenses to an action based on untrue statements contained in a registration statement.

A Defense to an Action Based on Untrue Statements Contained