What should a dealer do if they become aware of a potential misstatement in an Official Statement?

• A. Ignore it if not material
• B. Promptly investigate, correct the record, and inform customers and regulators as required
• C. Delay disclosure until the next annual report
• D. Only inform the underwriter

Answer: (B)

When a dealer becomes aware of a potential misstatement in an Official Statement, the priority is to act quickly to verify the information, correct the record, and communicate changes to those who rely on it. Official Statements contain material information about a bond issue, and investors base decisions on what they read there. Because a misstatement—whether confirmed or suspected—can affect pricing and outcomes, it’s essential to investigate promptly to determine materiality and the proper corrective steps. If the misstatement is material, the dealer should arrange for a correction or amendment to the Official Statement and notify investors, as well as regulators or other required parties, as dictated by applicable rules. This approach protects investors, maintains market integrity, and fulfills regulatory obligations. Delaying disclosure, ignoring the issue, or restricting notice to only the underwriter would fail to safeguard investors and could create regulatory risk.