What is Section 10(b) of the Securities Exchange Act of 1934?

Section 10(b) of the Securities Exchange Act of 1934 is a crucial provision that aims to prevent fraud and manipulation in the securities markets. This section prohibits the use of any manipulative or deceptive practices in connection with the purchase or sale of securities. It establishes a standard of conduct for individuals and entities involved in securities transactions, including brokers, dealers, and other market participants.

One of the key elements of Section 10(b) is the prohibition of fraudulent activities. This means that individuals or entities cannot engage in any act or practice that would deceive or mislead others in connection with the purchase or sale of securities. This includes making false statements or omitting material facts that could affect an investor's decision to buy or sell a security. The purpose of this provision is to ensure that investors have access to accurate and reliable information and to maintain the integrity and fairness of the securities markets.

Section 10(b) also addresses the issue of insider trading. It prohibits individuals who have access to non-public information about a company from using that information to their advantage in trading securities. This provision aims to prevent unfair trading practices and to promote a level playing field for all investors. It recognizes that individuals with insider information have an unfair advantage over other investors, as they can make informed trading decisions based on material information that is not available to the general public.

To enforce Section 10(b), the Securities and Exchange Commission (SEC) has been granted regulatory authority. The SEC has the power to investigate potential violations of this provision, bring enforcement actions against violators, and seek civil penalties or other remedies. Additionally, private individuals who have been harmed by a violation of Section 10(b) may also bring a private lawsuit to seek damages.

In summary, Section 10(b) of the Securities Exchange Act of 1934 is a critical provision that establishes standards of conduct in the securities markets. It prohibits fraudulent activities and insider trading, aiming to protect investors and maintain the integrity of the markets. The SEC has the authority to enforce this provision, and individuals who have been harmed by violations may also seek legal remedies.

​​​The Law Offices of Timothy L. Miles
Tapestry at Brentwood Town Center
​300 Centerview Dr., #247
Brentwood, TN 37027
Phone: (855) 846–6529
​Email: [email protected]

timothy l. miles, esq.

Nashville attorney Timothy L. Miles is a nationally recognized shareholder rights attorney raised in Nashville, Tennessee. Mr. Miles has dedicated his career to representing shareholders, employees, and consumers in complex class-action litigation. Whether serving as lead, co-lead, or liaison counsel, Mr. Miles has helped recover hundreds of millions of dollars for defrauded investors,  shaped precedent-setting decisions, and delivered real corporate governance reforms. Judges and peers have repeatedly recognized Mr. Miles’ relentless advocacy for the underdog, as well as his unbendable ethical standards. Mr. Miles was recently selected by Martindale-Hubbell® and ALM as a 2022 Top Ranked Lawyer, 2022 Top Rated Litigator. and a 2022 Elite Lawyer of the South. Mr. Miles also maintains the AV Preeminent Rating by Martindale-Hubbell®, their highest rating for both legal ability and ethics. Mr. Miles is a member of the prestigious Top 100 Civil Plaintiff Trial Lawyers: The National Trial Lawyers Association,​Class Action:  Class Action: Top National Trial Lawyers, National Trial Lawyers Association (2023), a superb rated attorney by Avvo, a recipient of the Lifetime Achievement Award by Premier Lawyers of America (2019) and recognized as a Distinguished Lawyer, Recognizing Excellence in Securities Law, by Lawyers of Distinction (2019); a Top Rated Litigator by Martindale-Hubbell® and ALM  (2019-2022); America’s Most Honored Lawyers 2020 – Top 1% by America’s Most Honored (2020-2022).  Mr. Miles has published over sixty articles on various issues of the law, including class actions, whistleblower cases, products liability, civil procedure, derivative actions, corporate takeover litigation, corporate formation, mass torts, dangerous drugs, and more.  Please visit our website or call for free anytime.

CONTACT                                                      
The Law Offices of Timothy L. Miles
Tapestry at Brentwood Town Center
​300 Centerview Dr., #247
Brentwood, TN 37027
​​Phone: (855) 846-6529
​Email: [email protected]