The Research On The Causality Of Civil Liability In Security Fraud

Security fraud is the most frequently appeared torts in security market. It hurts investor's interest seriously, but the investor is hardly to get civil compensation with action because whether the causality existed or not between fraud and investor's damage is hard to confirm. Therefore, the key of civil liability of security fraud is taken reasonable standard of causality and prove its existence between investor's damage and fraud.In many other countries, the standard of causality of civil liability in security fraud comes from causality theory in traditional torts, which is divided causality with duality standard and judge in two steps. There among, in common law system, the torts law divided causality into factual causality and legal causality and in civil law system, it divided into liability founding causality and liability scope causality and confirmed related standard and burden of proof. On basis of torts law, American securities law divided causality of civil liability in security fraud into causality in transaction and causality of damage. The former uses reliability as judgment standard and it appeared presumptive reliability and the latter appears two kinds of standard, direct causality and reasonable presumption and it develops to the direction which will be benefit for investors on judgment of causality. In our judicial practice, we adopt necessary causality for a long term which has great shortage in protecting investor's interests. In present legislation, we adopt principle of presumptive causality, but it only used for fraud statement which is too narrow...