(Reuters) — U.S. Supreme Court justices on Monday appeared skeptical of further limiting the scope of who can be held liable for violating laws that protect investors from securities fraud as they weighed an appeal by a New York investment banker who had been banned from the industry.

Only eight of the nine justices were present to hear arguments over a ruling by a Washington-based federal appeals court that found Francis Lorenzo liable for participating in a scheme to defraud investors when he sent misleading emails about a financially-troubled clean energy company.

Most of the justices seemed to agree with the Securities and Exchange Commission, which had enforced the securities laws against Mr. Lorenzo, while Chief Justice John Roberts and fellow conservative Justice Neil Gorsuch, seemed sympathetic to him.

The court has a 5-4 conservative majority. Justice Brett Kavanaugh, a conservative appointee of Republican President Donald Trump, did not participate in the case because he was part of the three-judge appeals court panel that previously reviewed the dispute. Justice Kavanaugh joined the high court in October.

Justice Kavanaugh dissented in the appeals court ruling that upheld most of the SEC's liability findings against Mr. Lorenzo, and would have sided with the banker.

The high court must rule in the case by the end of June.

The dispute centers on whether a person who did not personally make fraudulent statements but merely passed them along can be found liable for engaging in a fraudulent scheme. Anti-fraud provisions of U.S. securities laws prohibit false statements and other conduct categorized as acts, devices, practices or schemes.

On Monday, all four liberal justices and conservative Justice Samuel Alito appeared to approve of Mr. Lorenzo's liability in the deceptive scheme.

Mr. Lorenzo's attorney Robert Heim said that sending emails was not inherently deceptive. Justice Ruth Bader Ginsburg asked why is it not "inherently deceptive to send a succession of untruths?"

Justice Alito wondered why Mr. Lorenzo's actions would not "fall squarely" within the language of the SEC's rules.

In 2011 the Supreme Court narrowed the scope of who can be liable for false statements to those with ultimate authority over the statements.

Mr. Lorenzo, who served as the investment banking director at a broker-dealer called Charles Vista, sent the emails in 2009 seeking investors for a startup company's debt offering even though its energy-from-waste technology did not work.

The SEC in 2015 found that he made false statements and participated in a deceptive scheme by sending the emails, which a commission in-house judge said contained "staggering" false claims. The commission fined him $15,000 and barred him from working in the industry for life.

Citing the 2011 Supreme Court precedent, the District of Columbia U.S. Circuit Court of Appeals last year threw out Mr. Lorenzo's liability over the false statements, saying they were made by his boss. But the court said he was still liable for perpetuating the fraudulent scheme because he knowingly produced and sent the false statements in the emails. It ordered the SEC to reconsider the penalties against Mr. Lorenzo.

In appealing to the Supreme Court, Mr. Lorenzo said the SEC is trying to paint people who might be liable at most for aiding and abetting fraudulent schemes as the primary violators of securities laws.

On Monday, Justice Gorsuch seemed to agree, noting that Mr. Lorenzo did not make the false statements in the emails he sent.

Mr. Lorenzo, who had the support of the powerful U.S. Chamber of Commerce business group, said that if the appeals court is not overturned it will lead to a swarm of abusive lawsuits, harming financial markets and the economy.