Series 79 practice questionhardProspectus Requirements
Which of the following parties may be liable under Section 11 of the Securities Act for a material misstatement in a registration statement?
- AEvery underwriter named in the registration statement✓ Correct answer
- BOnly the issuer's CEO and CFO
- COnly company insiders who signed the registration statement
- DShareholders who participated in the offering as sellers only
Explanation
Why A — Every underwriter named in the registration statement
All underwriters named in the registration statement can be held liable under Section 11 for material misstatements. The trap is to assume only insiders or officers have this liability.
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