The Act and its accompanying rules were enacted to protect investors in connection
with the trading of securities already issued and outstanding. The most important
components of the Act are Section 10(b) and Securities and Exchange Commission
(SEC) Rule 10b-5, which prohibits manipulative or deceptive acts in connection
with the purchase or sale of a security. Corporate directors and officers are
frequently the targets of lawsuits brought under these antifraud provisions.
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