Criminal Code > TITLE II ECONOMIC AND 2

CHAPTER II CRIMES RELATING TO PROCEEDINGS OF DEBT, EXECUTION AND BANKRUPTCY

Article 725- Fraudulent Insolvency.

Whoever intentionally conceals the fact that he is insolvent and contracts an obligation knowing that he is unable or unwilling to execute it,

Shall be punishable, upon compliant, with a fine not exceeding fifty thousand Birr, or with simple imprisonment.

Article 726- Irregular Bankruptcy.

(1) A debtor who has caused his own insolvency or who has intentionally aggravated it by acting with culpable lack of foresight, or with gross negligence or mismanagement, in the exercise of his profession, whether by failing to keep proper books or accounts, by incurring excessive expenditure or by hazardous speculation or in any other manner,

Shall be punishable with simple imprisonment.

(2) Where the act is committed negligently, the punishment shall be simple imprisonment not exceeding six months, or fine not exceeding five thousand Birr.

(3) Proceedings may be taken against a debtor not registered in the commercial registry only upon a complaint by the creditor, to be brought within three months from the delivery of the declaration of default.

(4) A creditor who caused a debtor to act with lack of foresight or negligence, resulting in insolvency, or who acted towards him with usury, may not bring a complaint against such debtor.

Article 727- Fraudulent Bankruptcy.

(1) A debtor adjudged bankrupt who has intentionally disposed of his assets to the prejudice of this creditors,

a) either materially, whether by assigning or by destroying, damaging, depreciating or rendering useless certain property forming a part of such assets; or

b) fictitiously, whether by removing or concealing property, by relying on or recognizing not-existent debts or claims or by inciting a third party to make fictitious claims, or in any other manner pretending that his estate is less than it is in fact, in particular by means of incorrect accounting, falsified correspondence or a false balance sheet,

shall be punishable with simple imprisonment for not less than six months.

(2) In serious cases where the damage was of particular gravity or was imposed upon the Defence Forces, or a public undertaking or service, the punishment shall be rigorous imprisonment not exceeding eight years.

(3) A third party who has committed such acts to the prejudice of the creditors shall be punishable with simple imprisonment not exceeding three years.

(4) Where the acts of the criminal amount to fraud, the relevant provisions shall apply concurrently.

Article 728- Fraud in Execution.

(1) A debtor subject to proceedings by way of execution against whom a declaration of default has been delivered, and who with intent to prejudice his creditors has reduced his assets, whether materially of fictitiously as provided in Article 727,

Shall be punishable with simple imprisonment, or, in grave cases, with rigorous imprisonment not exceeding five years.

(2) A third party who has so acted to the prejudice of the creditors shall be punishable with simple imprisonment.

Article 729- Misappropriation or Destruction of Property Subject to Pledge or Lien.

(1) Any debtor who, with intent to obtain for himself or to procure for a third persons a benefit, or, to cause damage to his creditor, removes, assigns, damages, depreciates or renders useless his property, whether movable or immovable, and which was held by the creditor by way of pledge, usufruct or lien,

is punishable with simple imprisonment for not less than one year.

(2) Any third person who so acts with the same intent to the prejudice of the creditors is punishable with simple imprisonment not exceeding three years, or fine not exceeding fifty thousand Birr.

Article 730- Misappropriation or Destruction of Property Subject to a Order.

(1) Whoever, to the prejudice of his creditors, improperly appropriates or uses property under seizure or sequestration, listed in a bankruptcy, or in a document evidencing a lien, or destroys, damages, depreciates or renders such property useless,

is punishable with simple imprisonment.

(2) A third person who so acts to the prejudice of the creditors,

is punishable with simple imprisonment or fine.

(3) Where the acts punished under this Article are performed solely to the detriment of the creditors, Article 439 of this Code may not be applied concurrently.

Article 731- Unjustifiable Preference.

Any debtor who, having been adjudged bankrupt or having given a declaration

of default, and knowing himself to be insolvent, has preferred certain of his

creditors to the prejudice of the others, in particular:

a) by paying debts not due or by paying debts as maturity other than in cash or by the customary securities; or

b) by giving on his own account security for a debt when not bound so to do; or

c) In any other similar manner,

Is punishable with simple imprisonment not exceeding three years.

Article 732- Purchase of Votes.

(1) Any debtor who, in order to obtain a favourable vote of one of his creditors or a composition by the Court, grants or promises particular advantages:

a) to that creditor or to his representative in a general meeting; or

b) to a member of the administration or winding-up in a bankruptcy,

is punishable with simple imprisonment not exceeding three years.

(2) A third person who so acts in favour of the debtor, or any person who with the same intent causes such an advantage to be granted or promised to him, is liable to the same punishments.

Article 733- Fraudulent Composition.

(1) Any debtor who, in order to obtain a scheme of arrangement or the ratification of a composition by the Court, misleads his creditors, the commissioner in bankruptcy or the competent authority, as to his financial position, in particular by means of incorrect or falsified accounts, correspondence or a balance sheet,

is punishable with simple imprisonment.

(2) A third person who so acts in favour of the debtor is liable to the same punishment.