CENTRE FOR POST GRADUATE LEGAL STUDIES

Academic Year: 2022-23

Name: Reema Joshi

Student Id: 22011174

Batch: 2022-23

Section: B

Degree Programme: LLM in Corporate and Financial Law and Policy

TOPIC/ TITLE OF DISSERTATION: CORPORATE FRAUDS IN INDIA: A LEGAL

STUDY
ABSTRACT:

TOPIC: CORPORATE FRAUDS IN INDIA: A LEGAL STUDY

In this paper we will discuss the topic of corporate frauds and its legal framework. The term
"corporate fraud" includes illegal, unethical, and deceptive actions committed by an
organisation or by an employee of the organisation. Corporate fraud schemes are extremely
complex, which makes them difficult to detect. The term "fraud" refers to activities like
robbery, corruption, conspiracy, embezzlement, money laundering, bribery, and extortion.
Corporate fraud can be classified into three broad categories. Financial fraud, which is also
known as accounting fraud, involves falsifying monetary data in order to deceive investors.
Accounting schemes like capitalization costs, facet deals, change transactions, channel
stuffing, extended sales, and deferred costs are the most well-known schemes of accounting
fraud. Self-dealing through company insiders is primarily associated with misappropriation of
company belongings via senior executives, which includes loans granted to senior
management that are not supposed to be repaid, failure to reveal forgiven loans, reimbursed
employee costs, and brilliant employee costs charged to the organisation. Other types of fraud
include insider trading, misappropriation of company assets for personal gain, kickbacks, and
personal tax violations associated with self-dealing. Falsifying testimony to regulators,
erasing laptop files, shredding files, growing or changing files to aid unlawful behaviour are
all examples of obstructive behaviour.

Corporate fraud and scams substantially lower the company's wealth. Corporate India as a
whole has a vested interest in preventing and minimising company frauds and scams.
Independent administrators on audit committees provide one of the best ways to reinforce
internal audit and annual statutory audit. Their independence must be bolstered. In terms of
incentives, long-term government reimbursement is based on ethics and should be used
sparingly. Corporate fraud solutions must be comprehensive and all-encompassing.

The topic provides a legal framework for analysing corporate corruption as well as a
comprehensive road map for comprehending corporate entities' roles in corporate corruption
fraud Despite the fact that corporate fraud is a well-known field, there are still differences in
its definitions, causes, consequences, and policies.

• In this article we define the meaning of corporate fraud, its causes and origin in India.
• impact on the Indian economy
• What are the major frauds happening in India?
• This paper also investigates the law, policy, and state response to corporate
corruption.
• They investigate the effectiveness of the legislative framework.
• This paper also explains the lacunas in Indian laws and what measures can be adopted
by the Indian government to resolve this problem.