Section 509, The Companies Act, 2009

(1) Where a prospectus contains a statement which isuntrue, every person referred to in section 503 shall, subject to subsections (3) and (4), be guilty of an offence and shall be liable on conviction to a fine not exceeding Le 8,000,000 or to imprisonment for a term not exceeding 5 years, or to both the fine and imprisonment. (2) Where there is published with or as part of a prospectus a report of any expert or an extract from such report and such report or extract contains a statement which is untrue, the expert shall, provided he has given his consent to the inclusion of such statement in the prospectus in the form and context in which it appears, and subject to subsections (3) and (4), be guilty of an offence, and shall be liable to a fine not exceeding Le8,000,000 or to imprisonment for a term not exceeding 3 years or to both the fine and imprisonment. (3) In any prosecution under this section, it shall be a defence if it is proved either that the untrue statement was immaterial or– (a) with respect to every untrue statement not purporting to be made by the Commission or an expert or of a public official document or statement, that the person charged had, after reasonable investigation, reasonable ground to believe and did up to the time of the allotment of the securities or acceptance of the officer (as the case may be) believe that the statement was true, and that there was no omission to state any material fact necessary to make the statement as set out not misleading; and (b) with respect to every untrue statement purporting to be a statement by or contained in what purports to be a copy of or extract from a report or valuation of an expert, that the person charged had reasonable ground to believe and did believe that the person making the report or valuation was competent to make it; and 372 373 Offences in respect of untrue statements in (c) with respect to every such untrue statement purporting to be a statement made by an official person or contained in what purports to be a copy of or extract from a public official document, that it was a correct and fair representation of the statement or copy of or extract from the document.