In brief. When an Italian company becomes insolvent, criminal liability does not fall on the company alone — it falls on the individuals who managed it. Italian law reaches both the de jure director (amministratore di diritto, the person formally appointed) and the de facto or shadow director (amministratore di fatto, the person who actually ran the business), and it punishes a cluster of conduct ranging from the diversion of assets to the falsification of company accounts. For foreign directors of Italian subsidiaries — and for those who lent their name to a company they never truly controlled — the exposure is acute and the defences are technical. This guide maps the liability and how it is contested.

Who is a “director” for criminal purposes

Italian criminal law looks past the corporate register to the substance of management. Two figures matter.

The amministratore di diritto — the de jure director — is the person formally appointed and recorded at the Companies Register. Formal appointment is enough to ground the duties whose breach the criminal law sanctions.

The amministratore di fatto — the de facto / shadow director — is the person who, without a formal title, in fact exercises the typical powers of management on a continuous and significant basis. The figure is codified for company-law offences by art. 2639 of the Italian Civil Code, which extends liability to anyone who exercises the management function in a continuous and significant way. The Court of Cassation applies the same criterion to bankruptcy offences, to absorb into criminal liability the real decision-maker hiding behind a nominee.

The practical consequence cuts both ways. A nominee director (“testa di legno”, literally “wooden head”) who only signed papers may escape liability for conduct they neither knew of nor controlled — while the silent owner who pulled the strings is fully exposed despite holding no title.

The core offences directors face

Directors of an insolvent company are most often investigated for the bankruptcy offences of the Codice della crisi d’impresa e dell’insolvenza (D.Lgs. 14/2019, in force since 15 July 2022), which replaced the Legge Fallimentare (R.D. 267/1942); the old provisions still apply to bankruptcies declared under the previous regime, and the Court of Cassation has confirmed the continuity between the two (judgment no. 33810/2023). For company directors, art. 329 CCII (formerly art. 223 L.Fall.) extends to them the bankruptcy offences of the entrepreneur.

  • Fraudulent bankruptcy (bancarotta fraudolenta, art. 322 CCII, formerly art. 216 L.Fall.): distraction or concealment of assets, or falsification of accounts, to the detriment of creditors — three to ten years; preferential bankruptcy one to five years. Treated in depth in our fraudulent bankruptcy guide.
  • Bankruptcy through corporate offences or wilful transactions (art. 329, para. 2 CCII, formerly art. 223, para. 2 L.Fall.): causing or aggravating the insolvency by committing a company-law offence (such as false accounting) or by wilful or fraudulent transactions — three to ten years.
  • Simple bankruptcy (bancarotta semplice, artt. 323 and 330 CCII, formerly artt. 217 and 224 L.Fall.): imprudent or grossly negligent management, aggravating the insolvency by not filing in time, disorderly bookkeeping — six months to two years.

Alongside the insolvency offences sit the corporate (company-law) offences of the Civil Code, which often run in parallel:

  • False corporate communications (false comunicazioni sociali, artt. 2621-2622 c.c.) — the “accounting offence” of misstating the company’s financial statements;
  • Obstruction of supervisory authorities (art. 2638 c.c.);
  • Unlawful return of contributions or distribution of fictitious profits (artt. 2626-2627 c.c.).

A further layer is the company’s own administrative liability for offences committed in its interest under D.Lgs. 231/2001, which can run alongside the director’s personal criminal liability.

Accounting offences: where directors are most exposed

The accounting records are the battlefield. Two distinct charges arise from them.

Documentary fraudulent bankruptcy (art. 322, para. 1, letter b) CCII, formerly art. 216 para. 1 no. 2 L.Fall.) punishes the director who destroys, conceals or falsifies the books, or keeps them so as to make reconstruction of the company’s assets and dealings impossible. Consolidated Court of Cassation case law (Section V) distinguishes: destruction, concealment or falsification require specific intent (dolo specifico) to obtain an unjust profit or harm creditors, while fraudulent bookkeeping requires awareness that reconstruction is being made impossible. Merely disorderly bookkeeping, without that awareness, falls instead under the lighter documentary simple bankruptcy (art. 323 CCII, formerly art. 217 L.Fall.). This distinction is decisive in practice.

False corporate communications (artt. 2621-2622 c.c.) punish the director who, in the financial statements or other mandatory disclosures, presents material facts untruthfully or omits them, to mislead shareholders or the public. The reform of Law 69/2015 sharpened these provisions and removed several thresholds, widening the directors’ exposure.

Defences — and the foreign-director problem

The defence of a director facing insolvency-related charges turns on three axes.

Attribution: did this person actually manage? The prosecution must tie the specific director to the specific conduct. For a non-executive, a nominee, or a director excluded from a given area of the business, the chain of attribution is often the weakest link. The de facto director doctrine cuts both ways: it can be used by the defence to show that real control — and therefore liability — lay elsewhere.

Intent. Fraudulent bankruptcy and false accounting are intentional offences. Demonstrating that a transaction had genuine economic logic, or that an accounting choice was a defensible judgment rather than a deception, defeats the dolo element.

The foreign director. Foreign nationals appointed to the board of an Italian subsidiary frequently discover Italian criminal exposure they never anticipated. Common scenarios: a parent-company executive sitting on a subsidiary board; a director who relied wholly on local management and local accountants; a person who lent their name as a favour. The defence assembles evidence of the real allocation of powers, of reliance on professionals, and of the limits of the foreign director’s actual role. These cases routinely intersect with cross-border service of process, language barriers and, where an arrest warrant issues, with our extradition practice.

How ILA protects directors

The firm acts for directors from the first signs of distress through any criminal proceeding that follows. The work has three pillars:

  1. Pre-insolvency risk assessment. Where a company is heading toward crisis, we advise directors on the conduct — and the timing of filing — that minimises future criminal exposure.
  2. Reconstruction and the trustee. Once insolvency is declared, the curatore (trustee) report shapes the prosecutor’s case. We engage early, with forensic accountants, to contest its inferences.
  3. Cross-border defence. For foreign directors we coordinate the Italian defence with home counsel, manage extradition and Interpol risk, and keep the client oriented in an unfamiliar system.

FAQ

Can I be criminally liable if I was only a nominee director? Possibly not for conduct you neither knew of nor controlled — a pure nominee (“testa di legno”) who never managed the company has a real defence on attribution. But beware: signing the accounts and resolutions can still expose you, and the prosecution will test whether you truly were excluded from management.

What is a de facto director and why does it matter? A de facto (shadow) director is someone who runs the company without a formal title. Under art. 2639 of the Civil Code, Italian criminal law reaches that person as if they were formally appointed. It matters because the real decision-maker cannot escape liability by hiding behind a nominee — and a nominee can point to the de facto director to deflect liability.

I am a foreign director of an Italian subsidiary — am I at risk? Yes, if the subsidiary becomes insolvent or its accounts are challenged. Foreign nationality is not a defence. Your protection lies in showing the real limits of your role, your reliance on local management and professionals, and the absence of intent. Specialist Italian defence is essential.

Speak to the firm

If you sit, or have sat, on the board of an Italian company facing insolvency or an accounts investigation, your personal exposure should be assessed now. ILA defends directors and shadow directors across the full range of insolvency-related criminal liability. Contact us through the Contact page or learn more about the firm.