Hansard

Company Fraud

Volume 186: debated on Monday 25 February 1991

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Mr. Cousins

To ask the Secretary of State for Trade and Industry of he will list those, apart from company directors, who have a statutory duty to report company fraud to any regulators.

Mr. Redwood

[holding answer 11 February 1991]: There is in general no statutory duty on directors or others to report company fraud to regulators. Certain people, however, are under specific statutory reporting duties which may in some circumstances require them to report fraud. In the areas for which the Department of Trade and Industry is responsible, such duties include:

  • (i) The duty on a liquidator to report evidence of criminality by any past or present officer of the company, and on a liquidator, official receiver, administrator or administrative receiver to report conduct by a director of a company, which has at any time become insolvent, which makes him unfit to be concerned in the management of a company.
  • (ii) The obligation on investment businesses to keep their regulators informed of anything concerning the firm which might reasonably be expected to be disclosed to them.
  • (iii) the duty on listed companies to notify to the International Stock Exchange any information necessary to avoid the creation of a false market in the company's listed securities.