Comprehension
Directions: Read the following passage and answer the questions given below:
This was one of the biggest corporate scams in the country. Sundaram Computer Services was a computer outsourcing company whose founders and directors falsified data, inflated stock prices and stole huge amounts from the company. It was a case of corporate governance and fraudulent auditing practices allegedly in connivance with auditors and chartered accountants. The company misrepresented its accounts both to its board, stock exchanges, regulators, investors and all other stakeholders. It was a fraud, which misled the market and other stakeholders by lying about the company’s financial health. Even basic facts such as revenues, operating profits, interest liabilities and cash balances were grossly inflated to show the company was in good health. Later in 2009, the company founder, Shyam confessed to the crime. In 2015, the accused were sentenced to seven year imprisonment. Further huge amounts of fines were also imposed.
Question: 1
What was the punishment for the accused?
What was the punishment for the accused?
Show Hint
Criminal cases involving corporate fraud often lead to significant prison sentences, particularly when they involve substantial financial harm to stakeholders.
Updated On: Apr 17, 2025
- Life imprisonment
- 7 years imprisonment
- 10 years imprisonment
- 5 years imprisonment
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The Correct Option is B
Solution and Explanation
As per the passage, the company founder Shyam was sentenced to seven years imprisonment for his role in the corporate fraud involving falsification of data and financial misrepresentation.
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Question: 2
Who was the founder of the company?
Who was the founder of the company?
Show Hint
In corporate fraud cases, the founder or CEO often plays a key role, which can result in severe legal consequences for both the individual and the company.
Updated On: Apr 17, 2025
- Shyam
- Sundaram
- Satyam
- Shivam
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The Correct Option is A
Solution and Explanation
The passage mentions that Shyam was the founder of the company, and he later confessed to the crime involving financial misrepresentation and fraud.
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Question: 3
When did the founder of the company confess to the crime?
When did the founder of the company confess to the crime?
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Confessions in criminal cases often play a crucial role in both legal proceedings and the severity of the punishment, especially in corporate fraud cases.
Updated On: Apr 17, 2025
- 2009
- 2011
- 2013
- 2015
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The Correct Option is D
Solution and Explanation
The founder of the company, Shyam, confessed to the crime in 2015, as stated in the passage, after the company was found guilty of fraudulent activities and financial misrepresentation.
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Question: 4
The case is predominantly related to .
The case is predominantly related to .
Show Hint
Fraud in financial matters, especially involving inflated stocks, can have serious legal and financial consequences for both individuals and companies.
Updated On: Apr 17, 2025
- Dishonest act by undervaluing the company
- Fraud by inflation of stocks
- Misappropriation of funds
- Breach of trust
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The Correct Option is B
Solution and Explanation
The case revolves around fraudulent practices, specifically the inflation of stocks and financial data to mislead the market and stakeholders. This is considered a form of financial fraud.
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Question: 5
According to the passage is one of the biggest scams.
According to the passage is one of the biggest scams.
Show Hint
Corporate scams typically involve fraud, misrepresentation, or other unethical practices that affect the company's financial integrity and mislead investors and stakeholders.
Updated On: Apr 17, 2025
- Criminal scam
- International scam
- Corporate scam
- Unintentional act
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The Correct Option is C
Solution and Explanation
The passage specifically mentions that the scam in question is a corporate scam, where the company's founders and directors were involved in falsifying data and inflating stock prices.
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