Unit 9 Discussion – the Case of Falbo . Considering the case held against Falbo, his act of using confidential information for his personal gain make his case to fall under the Misappropriation Theory. According to Misappropriation Theory, any individual who accesses and uses any confidential information wrongfully to purchase or sell securities is considered as being guilty of securities fraudulence. According to Wolfson (1990), misappropriation is a infringement of a responsibility owed to the individual who provided the confidential information and then goes further to share the information with others or act with regard to the confidential information.
Roush, C. (2004). Writing business and economics stories: The SEC law. London: Lawrence Erlbaum Associates.
Wolfson, N. (1990). Amendment rights and the SEC. New York: Quorum Books.