She can claim she was coerced by her supervisor. He’s the CEO. It’s not a matter of not knowing the rules, it’s legalese. She can skate or she will get a big payout from the company. it’s cheaper to let her stay on and move on.
She can claim whatever she wants...she simply can’t be head of HR anymore. How is anyone in the company supposed to take her seriously?
AND...other employees can claim she benefitted from her relationship if she is allowed to keep her job.