Does the fact that a director of a bank failed to discover the existence of an ongoing embezzlement constitute fraudulent concealment?

MultiRegion, United States of America

The following excerpt is from Martinelli v. Bridgeport Roman Catholic, 196 F.3d 409 (2nd Cir. 1998):

2. See, e.g., Lippitt v. Ashley, 89 Conn. 451, 94 A. 995, 1005 (Conn. 1915) (no fraudulent concealment where directors of bank failed to discover treasurer's ongoing embezzlement). We can find no case from Connecticut (or any other jurisdiction) in which defendant's breach of a duty to investigate was sufficient to meet the actual knowledge requirement for fraudulent concealment.

2. See, e.g., Lippitt v. Ashley, 89 Conn. 451, 94 A. 995, 1005 (Conn. 1915) (no fraudulent concealment where directors of bank failed to discover treasurer's ongoing embezzlement). We can find no case from Connecticut (or any other jurisdiction) in which defendant's breach of a duty to investigate was sufficient to meet the actual knowledge requirement for fraudulent concealment.

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