Criminal liability for misstatements in prospectus makes issuers who authorise misleading prospectuses liable, subject to narrow defences.

Criminal liability applies to any person who authorises the issue of a prospectus that includes an untrue or misleading statement, or an inclusion or omission likely to mislead, making such person liable under the designated penal provision; defences are limited to proof that the matter was immaterial or that the person had reasonable grounds and did believe up to issue that the statement was true or the inclusion or omission necessary.

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