FRAUDULENT INSOLVENCY ORGANIZATION
LexInter | August 29, 2008 | 0 Comments

FRAUDULENT INSOLVENCY ORGANIZATION

The fraudulent organization of insolvency is a form of fraudulent appropriation of the property of others by embezzlement which constitutes an offense bordering on breach of trust.

The fraudulent organization of insolvency is defined by article 314-7 of the penal code as the fact, by a debtor, even before the judicial decision noting his debt, to organize or aggravate his insolvency either by increasing the liabilities or by reducing the assets of its patrimony, either by reducing or concealing all or part of its income, or by concealing some of its property, in order to avoid the execution of a judgment of a patrimonial nature pronounced by a criminal court or, in tort, quasi-delict or maintenance matters, pronounced by a civil court,

 is punished by three years’ imprisonment and a fine of 45,000 euros

The same offense is committed by the de jure or de facto manager of a legal person who organizes or aggravates the insolvency of the latter under the conditions defined in the previous paragraph with a view to exempting it from the pecuniary obligations resulting from a sentence pronounced in criminal, tort or quasi-tort matters.

The court may decide that the person convicted as an accomplice of the offense defined in article 314-7 is jointly and severally liable, within the limit of the funds or the market value of the goods received free of charge or against payment, for pecuniary obligations resulting from the execution sentence from which the offender wished to avoid.
When the judgment of a financial nature has been pronounced by a criminal court, the court may decide that the sentence it pronounces will not be confused with that which has been previously pronounced.
The prescription of public action runs only from the sentence from the execution of which the debtor wished to avoid; however, it only runs from the last act having as its object to organize or aggravate the insolvency of the debtor when the last act is subsequent to this conviction.

court decisions and legally approved agreements relating to the obligation to pay benefits, subsidies or contributions to the costs of marriage are assimilated to orders for the payment of maintenance.

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