Comment by 0xbadcafebee
12 hours ago
It works like any other case of liability. If the seller is in the US, the seller is held liable if they transfer to a foreign entity who isn't accountable to US laws (because the user/customer would have no recourse if the buyer does something evil). Opposite is true if the buyer is in the US. If only the user is in the US, there's not much they can do but use the courts or politicians to try to get justice overseas. If no party is in the US, our laws don't apply.
I must not have been clear, I'm not saying you only hold one party accountable. I mean all parties engaged in a specific kind of contract or agreement would be liable. Since it's a transfer of ownership, and the law would specifically be intended to protect people who are at risk because of that transfer, both parties would need to ensure the law was followed, or both parties would be putting those people at risk.
So you want people who sell a business to be open to liability for things that the new owner does? Don't you see what kind of negative consequences that would have?
I meant to hold the seller liable if they do not follow a due diligence process. But actually the liability you mean also exists. The two are called direct liability and vicarious liability.
I'm not sure what kind of due diligence you think would have prevented this that couldn't have been easily circumvented by the buyer just simply lying about their intentions. This is such a typical knee-jerk reaction that results in policies that harm the average person but do not actually reduce fraud or crime.