Which statement is true regarding Chris's statement that the CEO could not be held liable for violations of the act?

A) Chris is correct. Under no circumstances can a CEO be held personally responsible for violations under the act. Any fines would be imposed upon the business entity.
B) Chris is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect but claims that they are truthful, can be heavily fined. There are no penalties, however, for destruction of financial documents.
C) Chris is incorrect. The act provides for harsh penalties, and a CEO who destroys or changes financial documents to mislead can be heavily fined. There are no penalties, however, for misstatements of a company's financial reports because the company is solely responsible for its statements.
D) Chris is incorrect, but any fine against a CEO under the act cannot exceed a nominal amount of $1,000.
E) Chris is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect, but who claims that they are truthful, can be heavily fined. Additionally, a CEO who destroys or changes financial documents to mislead can be heavily fined.

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Doan Phi Hoang · Accepted Answer

Final Answer : E, Explanation :  The Sarbanes-Oxley Act imposes strict regulations and accountability standards for public companies and their executives, including CEOs. It specifically holds CEOs and other top executives personally responsible for the accuracy of financial reports and for any acts of fraud, including the destruction of financial documents to cover up fraud.

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