Question

Ben, an accountant for AirLift, Inc., a ride service, learns of undisclosed company plans to distribute a new app. Ben buys 10,000 shares of AirLift stock. He reveals the company plans to Carly, who buys 5,000 shares. Carly tells Don, who tells Erwin, and each buys 1,000 shares. They know that Carly got her information from Ben. When AirLift publicly announces its new app, Ben, Carly, Don, and Erwin sell their stock for a profit. Refer to Fact Pattern 28-2. If Ben is liable under the Securities Exchange Act of 1934, it will be because the information on which he based his purchase of AirLift stock was

Answer 1

not yet public

Step-by-step explanation:

The Securities Exchange Act of 1934 was an act that helps preventing fraud investing and it stated that the investors should receive a truthful financial data. The Act was created to govern the securities transaction for the secondary market. It ensures accuracy and transparency in investing.

In the context, the Ben was liable for the fraud under Securities Exchange Act for leaking the information of the company to outsiders or investors as the information was not yet made public by the company.