Business Law for the Accountant

Violations of Securities Laws

Karel Svoboda, a credit officer for Rogue Bank, evaluated and approved his employer's extensions of credit to clients. These responsibilities gave Svoboda access to nonpublic information about the clients' earnings, performance, acquisitions, and business plans from confidential memos, email, and other sources. Svoboda devised a scheme with Alena Robles, an independent accountant, to use this information to trade securities. Pursuant to their scheme, Robles traded in the securities of more than twenty different companies and profited by more than $2 million. Svoboda also executed trades for his own profit of more than $800,000, despite their agreement that Robles would do all the trading. Aware that their scheme violated Rogue Bank's policy, they attempted to conduct their trades to avoid suspicion. When the bank questioned Svoboda about his actions, he lied, refused to cooperate, and was fired. Using this information, address the following:

• Explain what crimes Svoboda and Robles each committed.

• Analyze the civil liability for Svoboda and Robles including who could file suit and on what grounds.

• Explain any defenses that Svoboda and Robles could raise and the likely success of the defense.

The paper

• Must be four to six double-spaced pages in length (not including title and references pages) and formatted according to APA style as outlined in the Ashford Writing Center.

• Must include a separate title page with the following:

o Title of paper
o Student's name
o Course name and number
o Instructor's name
o Date submitted

• Must use at least two scholarly sources in addition to the course text.
• Must cite all sources in APA style as outlined in the Ashford Writing Center.
• Must include a separate references page that is formatted according to APA style as outlined in the Ashford Writing Center.