Source: law/R5-FINANCIAL.md
# Round 5 financial-law correction and re-audit 2026-11-10. Author audit for `15usc78j`, `18usc1341`, and `18usc1343` against `qa/law-wave2-QA2-spot.md` and canonical `LAW-DSL.md`. This records implemented corrections and remaining limits; independent QA2 re-verification remains separate. ## QA2 issue matrix | File / issue | Correction and evidence | Status | | --- | --- | --- | | §78j(b) missing securities-based swap alternative | Existing `transaction` ID now has `transaction.security` and `transaction.swap` alternatives; statutory swap span `808:846`; all three core claims continue to require `transaction`. Definition cross-reference §78c(a)(78) distinguishes agreements from security-based swaps. | Fixed | | §78j concluding extension absent | Both sentences pinned at `1906:2412` and `2413:2717`, including the exclusion of prophylactic reporting/recordkeeping rules. The exclusion limits the extension, not fraud liability. | Fixed | | Private standing conflated with transaction nexus | `purchaser-seller` added only to `private-misstatement`; Dabit majority pins `9526:9785`, `17007:17178`, `11717:11826` explain Blue Chip's judge-made private limit, distinguish the nexus, and exempt government enforcement from that standing requirement. Statutory hook `672:711` deliberately selects (b), not identical short-sale language in (a). | Fixed | ## Re-audit of the two other assigned catalogues | Failure class | §1341 mail fraud | §1343 wire fraud | | --- | --- | --- | | Missing statutory elements/alternatives | Added full anchors for postal matter, carrier deposit/caused deposit, receipt, and knowingly caused delivery. Execution-purpose anchor now includes attempted execution. | Added the statutory writings/signals/pictures/sounds payload span; actual interstate/foreign transmission remains a separate element. | | Missing causation/nexus | Added Hubbard's application of Pereira's known/foreseeable-mailing causation rule. Added Bridge's substantive rule allowing innocent mailings incident to an essential part of the scheme. Causation and furtherance remain separate. | Boliaux already supplied foreseeable wire causation; clarified that this cannot replace actual interstate routing or furtherance. Buncich's charged-transmission failure remains explicit. | | Exceptions and object scope | No express exception to ordinary property fraud found in §1341. Counterfeit/spurious-article limb expressly excluded from this ordinary-property claim. Enhanced penalties and full §1346 theory remain separate. | No express offense exception found in §1343. Enhancement paragraph changes penalties; §1346 changes the target of the theory, not a defense to property fraud. | | Wrong case identity/pins or procedural contamination | Reopened Neder, Kousisis, Runner, Petlechkov, Hagen, Gross, Bascuñán and Buncich. No wrong identity found. Gross is expressly an indictment-stage honest-services ruling; Bridge's civil RICO injury rules and Hubbard's conspiracy elements are not imported. | Reopened Neder, Kousisis, Runner, Hagen, Boliaux, Buncich and Bascuñán. No wrong identity found. Boliaux adopts district-court reasoning on appeal. Buncich's honest-services posture is now identified in the operative gloss. | | Unlabeled judicial constructions / overbroad rules | Property-object and intent constructions now explicitly labeled; traditional intangible property distinguished from regulatory interests. Petlechkov's ordinary-prudence formulation expressly limited to Sixth Circuit formulation. | Property-object and intent constructions expressly labeled; causation identified as judicial interpretation. Bascuñán remains a qualified Second Circuit domestic-application rule. | | Current substantive boundary | Kousisis preserves traditional-property/object and materiality limits while rejecting net economic loss; Neder rejects victim reliance and completed damage. | Same common statutory language; no net-loss or intended-impoverishment element added. Kousisis's reserved materiality question remains disclosed. | ## Primary-source and corpus evidence Read each complete local statute; source IR and catalogue text were not changed. Current official sections: [§78j](https://uscode.house.gov/us/usc/119-136/t15/s78j/), [§1341](https://uscode.house.gov/us/usc/119-136/t18/s1341/), [§1343](https://uscode.house.gov/us/usc/119-136/t18/s1343/). The current definition is verified in the [Federal Reserve's Exchange Act §3](https://www.federalreserve.gov/frrs/regulations/section-3-definitions-and-application-15-usc-78c.htm); local §78c IR is truncated before paragraph (78), so it is a cross-reference, not a local quote. Direct official opinion checks: [Blue Chip, 421 U.S. 723](https://www.govinfo.gov/content/pkg/USREPORTS-421/pdf/USREPORTS-421-723.pdf), [Dabit, 547 U.S. 71](https://www.govinfo.gov/content/pkg/USREPORTS-547/pdf/USREPORTS-547-71.pdf), [Pereira, 347 U.S. 1](https://www.govinfo.gov/content/pkg/USREPORTS-347/pdf/USREPORTS-347-1.pdf), and [Kousisis, majority pp. 5–19](https://www.supremecourt.gov/opinions/24pdf/23-909_f2q3.pdf). Blue Chip and Pereira have no local IR record; Dabit and Hubbard provide exact, substantive local rule pins. Individual NOTES files give hashes, read windows, postures, and the limits of each use. No web quote was silently substituted for IR. ## Verification Command (isolated tool code, shared read-only corpus): ```sh NEOV2_CORPUS=/home/mma/repos/neochart/neochartdocroot python3 neov2/tools/lawdsl.py check neov2/law/15usc78j.law neov2/law/18usc1341.law neov2/law/18usc1343.law ``` Result: **3 catalogues, 37 statutory quotes, 48 case-rule quotes, 0 errors**. Independent parser checks confirm all five claim formulas resolve and purchaser/seller standing appears only in the private formula. All **26** pre-existing element IDs remain present: §78j 11, §1341 7, §1343 8. The **30 CASE files / 136 element blocks** retain valid references (respectively 23, 63 and 50 blocks); no CASE files were edited. Scoped `git diff --check` passes. These are catalogue/data changes; no runtime code, dependency, database, or publication was modified in this lane. ## Known weak spots for integration into shared NOTES - **§78j:** The new swap branch has no dedicated swap-fact CASE instance. Instrument classification still requires §78c(a)(78), not an assumption that all swaps qualify. Private forward-looking-statement safe-harbor eligibility, territorial application, timeliness, and specialized insider/tipper/tippee routes are not complete formula branches. The criminal rule-knowledge proviso remains a sentencing cross-reference. - **§1341:** The separate counterfeit/spurious-article limb is expressly outside the ordinary-property claim; this is not a full-section catalogue. Mail foreseeability does not establish execution purpose. Scheme completion and lulling are fact-sensitive. - **§1341/§1343:** Kousisis left competing materiality formulations unresolved; the Sixth Circuit ordinary-prudence wording is not a universal test. Full §1346 fiduciary/bribery analysis and penalty-enhancement allegations are not modeled. - **§1343:** Actual routing must establish interstate/foreign transmission. The quoted foreseeable-use ruling does not decide every electronic-routing proof issue; Bascuñán does not establish every circuit's extraterritoriality rule. The changes reuse the existing parent/element IDs and add only the missing transaction alternatives and private-standing node. Database integration, publication, shared NOTES, and durable memory belong to the leader; no commit was made in this lane.