Corporate Crimes: Unfaithful Management and False Accounting
In this article
Key Takeaways
- De facto vs de jure director
- Falsified annual accounts
- Misuse of the corporate card
- Defending the minority shareholder
Corporate crimes (Arts. 290 et seq. CP) punish conduct that undermines the transparency and the assets of the company, its shareholders or third parties. The flagship offence is unfaithful management, now governed as a property offence in Art. 252 CP: it is committed where a person with powers to administer another's assets exceeds those powers and causes loss (an exorbitant unapproved salary, systematic personal use of the company card, selling assets at a knockdown price to a related company). Falsifying the annual accounts is punished under Art. 290 CP, and the imposition of abusive resolutions by the majority under Art. 291 CP. Liability also reaches the de facto director, even where a frontman appears on paper.
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Economic criminal law has turned its focus to the internal management of companies. Being a good commercial manager is no longer enough; the director holds a position of guarantor over the legality of corporate operations. Corporate crimes (Arts. 290 et seq. CP) punish conduct that undermines the transparency and the assets of the company, of its shareholders or of third-party creditors. Our criminal lawyers experienced in corporate crimes in Madrid can help you with this type of situation.
Unfaithful Management: Bad Management or an Offence?
The flagship offence is unfaithful management (now governed by Art. 252 CP as a property offence). It is committed where a person with powers to administer the assets of another exceeds the exercise of those powers and causes loss. Clear examples: setting an exorbitant salary not approved by the General Meeting, systematically using the company card for personal expenses, or selling company assets at a knockdown price to a related company.
Liability of the 'De Facto Director'
Do not hide behind the fact that "I do not appear in the Companies Register". The Criminal Code extends liability to the de facto director: the person who really makes the decisions in the shadows, even if a frontman appears on paper. We lift the corporate veil to defend or to prosecute the person truly responsible.
False Accounting (Art. 290 CP)
Cooking the accounts to show profits and collect a bonus, or to show losses and avoid paying taxes or dividends, is an offence. It punishes directors who falsify the annual accounts or other documents that must reflect the legal or economic situation of the entity, in a manner liable to cause economic loss. The key to the defence is the accounting expert report: showing that the accounting adjustment was a valid interpretation of the rules and not a deliberate manipulation.
Imposing Abusive Resolutions
It is also an offence (Art. 291 CP) for the majority to impose abusive resolutions with an intention of personal gain and to the detriment of the minority, where they bring no benefit to the company. This is the criminal route to protect the oppressed minority shareholder against the majority's "steamroller".
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Frequently asked questions
What is the flagship corporate crime in Spain?
Unfaithful management (now governed by Art. 252 CP as a property offence), committed when someone with powers to administer another's assets exceeds those powers and causes loss — examples include an unapproved exorbitant salary, systematic personal use of a company card, or selling company assets at a knockdown price to a related company.
Can a company's real decision-maker be prosecuted even if they are not the registered director?
Yes — Spanish criminal law extends liability to the 'de facto director,' the person who actually makes the decisions, even where a frontman appears in the Companies Register.
What does Article 290 CP punish regarding company accounts?
Falsifying the annual accounts or other documents that must reflect the company's legal or economic situation, in a manner liable to cause economic loss — whether to inflate profits for a bonus or understate them to reduce taxes or dividends.
How is an accounting adjustment defended against a falsification charge?
Through an accounting expert report showing that the adjustment reflected a valid, defensible interpretation of the applicable accounting rules rather than a deliberate manipulation of the figures.
Can imposing a shareholder resolution against the minority be a crime?
Yes — Article 291 CP punishes a majority that imposes abusive resolutions with intent of personal gain and to the detriment of minority shareholders, where the resolution brings no benefit to the company itself.
Who can bring a criminal complaint over corporate mismanagement?
Affected shareholders, the company itself, or third-party creditors harmed by the conduct can pursue the matter, either as a criminal complaint or, where the accused is under investigation, by joining as a private prosecutor.
Do you need criminal defense in this area?
We are criminal defense lawyers specializing in corporate crimes. We act urgently to protect your rights.