Securities Fraud Liability of Secondary Actors

This report responds to the mandate in section 929Z of the Dodd-Frank Wall Street Reform and Consumer Protection Act directing GAO to study the impact of authorizing a private legal right of action against any person who aids or abets another in violation of the securities laws. The report includes a description of the legal and factual background of such "secondary actor" liability, as well as a summary of recent proposals to create this private right of action, arguments in favor of and against such proposals, and steps that have been identified to mitigate potential concerns with creating such liability.