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. 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:

A. a forward-looking forecast.B. not material.C. not yet public.D. not yet true.

Securities Exchange Act: The term "Securities Exchange Act" is also denoted as SEA and was created during 1934, it was developed to govern or carry out "securities transactions" based on the less manipulation or fraud, secondary market, ensures huge financial accuracy and transparency and after issues.

Basically, it refers to the law that is responsible for governing the "Secondary trading securities" in the USA. It also prevents unfair and inequitable practices on specific market and exchange.

In the question above, the correct option is C.

enyo enyo · Answer 2 · 2020-05-21T18:35:24+02:00

Answer:

C. not yet public.

Explanation:

Securities Exchange Act 1934 is a legal framework governing secondary trading of securities in USA.

Ben is liable under Securities Exchange Act of 1934, as he has leaked the 'not yet public' information for personal motives. His act of disclosing about app launch & buying shares then (for reselling further after launch) : is a case of Insider Trading. Insider Trading refers to deliberate disclosure of company's confidential information, for selfish motives accomplishment.