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Section 588G(3) Corporations Act 2001
Director’s Duty to Prevent Insolvent Trading by Company

Section 588G(3) of the Corporations Act 2001 (Cth) is ‘Director’s Duty to Prevent Insolvent Trading by Company’ and is extracted below.

If you require the services of a criminal defence team that specialises in corporate crime and compliance, call Sydney Criminal Lawyers today on (02) 9261 8881 to arrange a consultation.

Our criminal defence lawyers are vastly experienced in advising and representing corporations and individuals who are facing investigations for regulatory issues and proceedings for criminal offences, and our expertise in serious and complex cases means you can rest assured of receiving the most effective legal representation whatever your situation may involve.

The Legislation

The Legislation

Section 588G(3) of the Corporations Act 2001 (Cth) is Director’s Duty to Prevent Insolvent Trading by Company and reads as follows:

Director’s Duty to Prevent Insolvent Trading by Company

(3) A person commits an offence if:

(a) a company incurs a debt at a particular time; and

(aa) at that time, a person is a director of the company; and

(b) the company is insolvent at that time, or becomes insolvent by incurring that debt, or by incurring at that time debts including that debt; and

(c) the person suspected at the time when the company incurred the debt that the company was insolvent or would become insolvent as a result of incurring that debt or other debts (as in paragraph (1)(b)); and

(d) the person’s failure to prevent the company incurring the debt was dishonest.

The penalties                                                                                                              

The maximum penalty for the offence of Director’s Duty to Prevent Insolvent Trading by Company is:

(a) for an individual–5 years imprisonment, 2,000 penalty units, or both; and

(b) for a body corporate–20,000 penalty units

(a Commonwealth penalty unit is currently $210).

However, it should be kept in mind that maximum penalties are reserved for the most serious cases.

Your legal team will be able to advise you of the essential elements the prosecution would need to prove in order to establish the offence, whether those elements are capable of being established in your particular situation, the most effective and efficient way forward and the likely outcome.

Why Sydney Criminal Lawyers®?

Choosing the right legal team to defend your reputation and interests can be a difficult process.

However, it is always important to look at a firm’s experience and results when making this decision.

At Sydney Criminal Lawyers®, we have extensive experience defending and winning some of the most complex criminal matters – so you can rest assured that you are in safe hands.

Our criminal law specialists will take the time in every case to carefully scrutinise all the evidence in order to identify problems with the prosecution case at an early stage in the proceedings.

Where issues are found, our lawyers will write to the prosecution asking to have the charges dropped on this basis – often sparing our clients the considerable time and expense associated with defended hearings.

However, should your matter proceed to court, our senior lawyers will represent you and present a strong defence case to maximise your chances of being found ‘not guilty.’

Our senior lawyers are highly skilled advocates who have been recognised for their expert knowledge of the criminal law, as well as their ability to obtain excellent results in difficult cases.

We can assist you in avoiding the harsh penalties imposed by the law if you simply wish to plead guilty – in these cases, our experienced advocates can prepare and present compelling sentencing submissions which focus on any positive factors of your case.

For the best defence in your case, get the experts on your side today. Call us now on (02) 9261 8881 and book your FREE first conference with our criminal law specialists.

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