PART XXWinding Up of Companies Registered Under this Act or the Former Companies Acts

CHAPTER VProvisions Applicable to Every Mode of Winding up

Offences of fraud, deception, etc., before and in course of winding up; fraudulent trading and its consequences

626Misconduct in course of winding up

(1)

When a company is being wound up, whether by or under the supervision of the court or voluntarily, any person, being a past or present officer of the company, commits an offence if he—

(a)

does not to the best of his knowledge and belief fully and truly discover to the liquidator all the company's property, and how and to whom and for what consideration and when the company disposed of any part of that property (except such part as has been disposed of in the ordinary way of the company's business), or

(b)

does not deliver up to the liquidator (or as he directs) all such part of the company's property as is in his custody or under his control, and which he is required by law to deliver up, or

(c)

does not deliver up to the liquidator (or as he directs) all books and papers in his custody or under his control belonging to the company and which he is required by law to deliver up, or

(d)

knowing or believing that a false debt has been proved by any person in the winding up, fails for the period of a month to inform the liquidator of it, or

(e)

after the commencement of the winding up, prevents the production of any book or paper affecting or relating to the company's property or affairs.

(2)

Such a person commits an offence if after the commencement of the winding up he attempts to account for any part of the company's property by fictitious losses or expenses; and he is deemed to have committed that offence if he has so attempted at any meeting of the company's creditors within the 12 months immediately preceding the commencement of the winding up.

(3)

For purposes of this section, " officer " includes a shadow director.

(4)

It is a defence—

(a)

for a person charged under paragraph (a), (b) or (c) of subsection (1) to prove that he had no intent to defraud, and

(b)

for a person charged under paragraph (e) of that subsection to prove that he had no intent to conceal the state of affairs of the company or to defeat the law.

(5)

A person guilty of an offence under this section is liable to imprisonment or a fine, or both.