Ezra, an accountant, intentionally misstates a material fact to mislead Fruit Packing Inc., a client. Fruit Packing justifiably relies on the misstatement to its detriment. Ezra is most likely liable for
A)actual fraud.
B)constructive fraud.
C)destructive fraud.
D)virtual fraud.

Question

Quizplus · Accepted Answer

Ezra's intentional misstatement of a material fact to mislead Fruit Packing Inc., which then justifiably relies on this misstatement to its detriment, constitutes actual fraud. Actual fraud involves intentional deception to secure unfair or unlawful gain.

Ezra, an Accountant, Intentionally Misstates a Material Fact to Mislead