- 12 Marks
BCL – May 2018 – L1 – Q7c – Legal Implications Relating to Companies in Difficulty or Crisis
Identify conditions to restrain fraudulent persons from managing companies and actions the Registrar-General may take.
Question
c) Kum is the Executive Director of Okitimiw Company Limited. Kum ordered that three-fourths of monies received weekly by the Company should be paid into the Company’s account and the remaining into his personal account for his travels, boarding, and lodging within and outside the country. Auditing of the accounts of the Company revealed that the lodging of the monies in the personal account of the executive director was not only unlawful but was done to perpetuate fraud.
On the official winding up of the Company, it was revealed that the business was carried out for fraudulent purpose and the directors and other officers of the Company were aware of what went on.
Required:
i) Identify TWO conditions that can be used to restrain fraudulent persons from managing companies. (6 marks)
ii) State TWO actions the Registrar-General will take where the process of inspection reveals criminal liability of the Executive Director.
(6 marks)
Find Related Questions by Tags, levels, etc.