Securities Law Commons^™

Banks And Banking - Bank Stock Holding Company As Fraud On Double Liability Statute

Michigan Law Review

The question as to when, to prevent evasion of a statutory liability, a court will look behind a corporate entity in order to hold individual stockholders liable has been raised in two recent cases. The first, a federal case, involved the Detroit Bankers Company, a Michigan corporation formed for the purpose of holding and investing in bank stocks. Each corporate stock certificate of the holding company contained an "agreement" that the holder of the stock would be liable for his pro rata share of any assessment for which the corporation might become liable as a result of the failure of …