12 CFR 16.32 – Fraudulent transactions and unsafe or unsound practices
(a) No person in the offer or sale of national bank or Federal savings association securities shall directly or indirectly:
Terms Used In 12 CFR 16.32
- Fraud: Intentional deception resulting in injury to another.
- National Bank: A bank that is subject to the supervision of the Comptroller of the Currency. The Office of the Comptroller of the Currency is a bureau of the U.S. Treasury Department. A national bank can be recognized because it must have "national" or "national association" in its name. Source: OCC
(1) Employ any device, scheme or artifice to defraud;
(2) Make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or
(3) Engage in any act, practice, or course of business which operates as a fraud or deceit upon any person, in connection with the purchase or sale of any security of a national bank or Federal savings association.
(b) Nothing in this section limits the applicability of section 17 of the Securities Act (15 U.S.C. § 77q) or section 10(b) of the Exchange Act (15 U.S.C. § 78j) or Rule 10b-5 promulgated thereunder (17 CFR 240.10b-5).
(c) Any violation of this section also constitutes an unsafe or unsound practice under 12 U.S.C. § 1818.
(d) SEC Rule 175 (17 CFR 230.175—Liability for certain statements by issuers) applies to this part.