Sec. 20. liability of controlling persons and persons who aid and abet violations

527 words·~2 min read·/statute-compilations/comps-1885/sec-20

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

## Sec. 20 liability of controlling persons and persons who aid and abet violations **[**78t**]** ###

(a)Every person who, directly or indirectly, controls any person liable under any provision of this title or of any rule or regulation thereunder shall also be liable jointly and severally with and to the same extent as such controlled person to any person to whom such controlled person is liable (including to the Commission in any action brought under paragraph

(1)or

(3)of section 21(d)), unless the controlling person acted in good faith and did not directly or indirectly induce the act or acts constituting the violation or cause of action. ###

(b)It shall be unlawful for any person, directly or indirectly, to do any act or thing which it would be unlawful for such person to do under the provisions of this title or any rule or regulation thereunder through or by means of any other person. ###

(c)It shall be unlawful for any director or officer of, or any owner of any securities issued by, any issuer required to file any document, report, or information under this title or any rule or regulation thereunder without just cause to hinder, delay, or obstruct the making or filing of any such document, report, or information. ###

(d)Wherever communicating, or purchasing or selling a security while in possession of, material nonpublic information would violate, or result in liability to any purchaser or seller of the security under any provisions of this title, or any rule or regulation thereunder, such conduct in connection with a purchase or sale of a put, call, straddle, option, privilege44 or security-based swap agreement with respect to such security or with respect to a group or index of securities including such security, shall also violate and result in comparable liability to any purchaser or seller of that security under such provision, rule, or regulation. 44Sections 205(a)(3) and 303(i) of the Commodity Futures Modernization Act of 2000 (114 Stat. 2763A-426, 2763A-526), as enacted in to law by section 1(a)(5) of Public Law 106-554, both amended section 20(d) of the Securities Exchange Act of 1934. Section 203(a)(3) amended section 20(d) by striking “, or privilege” and inserting “, privilege, or security future product”. Section 303(i) amended section 20(d) to read in the form in which it appears in this compilation. Apparent intention of the combined amendments would be to insert references to both securities futures products and security-based swap agreements after the reference to “privilege”. ###

(e)Prosecution of Persons Who Aid and Abet Violations For purposes of any action brought by the Commission under paragraph

(1)or

(3)of section 21(d), any person that knowingly or recklessly provides substantial assistance to another person in violation of a provision of this title, or of any rule or regulation issued under this title, shall be deemed to be in violation of such provision to the same extent as the person to whom such assistance is provided. ###

(f)The authority of the Commission under this section with respect to security-based swap agreements shall be subject to the restrictions and limitations of section 3A(b) of this title.

Connections1 off-index

1 reference not yet in our index

Pub. L. 106-554

Citation graph

cites case law

Sec. 20

liability of controlling persons and persons who aid and abet violations

Pub. L.Pub. L. 106-554

Cites 1Cited by 0 across 0 sources