An accountant is not liable for a false statement that affects the price of a security if the buyer or seller of the security knew the statement was false.

Question

An accountant is not liable for a false statement that affects the price of a security if the buyer or seller of the security knew the statement was false.​

Quizplus · Accepted Answer

This is known as the "In Pari Delicto" doctrine, which means that if both parties to a security transaction are equally at fault, then neither party can sue the other for fraud. In this case, the buyer or seller of the security would be equally at fault for knowingly accepting a false statement, and therefore the accountant would not be liable.

An Accountant Is Not Liable for a False Statement That