How is scienter, or intent, established in securities fraud cases?

In securities fraud cases in Florida, scienter, or intent, is established by showing that the defendant acted with knowledge of wrongdoing or recklessness. Scienter can be proven by showing that the defendant had knowledge of the fraud being committed or had knowledge of facts that would make an ordinary person conclude that the securities transaction was fraudulent. In other words, it must be proven that the defendant knew or recklessly disregarded the fact that they were engaging in fraud. In addition, the defendant may also be held liable for securities fraud even if there is no evidence of scienter. Under these circumstances, the defendant can still be held liable if negligence or a failure to exercise reasonable care is established. In other words, the party may be liable if they made an intentional or reckless omission or acted in a manner that a reasonable person would consider to be grossly negligent. In the end, the party accused of securities fraud may be found liable if it can be demonstrated that they acted with knowledge that their activities were fraudulent, or if it can be shown that they were negligent or failed to exercise reasonable care in providing a service.

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