The Sarbanes-Oxley Act prohibits public companies from making personal loans to their directors or executive officers.

Question

Quizplus · Accepted Answer

This statement is true. The Sarbanes-Oxley Act, also known as the Public Company Accounting Reform and Investor Protection Act, prohibits public companies from making personal loans to their directors or executive officers. The purpose of this provision is to prevent conflicts of interest and ensure that company funds are not used for personal gain by those in management positions.

The Sarbanes-Oxley Act Prohibits Public Companies from Making Personal Loans