SPECIALIST ATTORNEY IN FRAUDULENT CONVEYANCE IN MADRID
Specialized criminal defense in fraudulent conveyance, punishable insolvency and frustration of execution. Criminal defense attorney in Madrid.
Criminal defense in fraudulent conveyance offenses
The fraudulent conveyance offense is codified in article 257 of the Criminal Code and is part of the offenses against patrimony and socioeconomic order. It is an offense frequently committed in contexts of business debts, contentious divorces, bankruptcy proceedings or when a judicial claim is anticipated.
What is fraudulent conveyance?
It consists of the debtor performing acts of disposition over their patrimony —concealing, transferring or encumbering it— with the purpose of removing it from the enforcement action of their creditors. The protected legal interest is the creditor’s right to credit, that is, the legitimate expectation that the debt can be enforced against the debtor’s assets.
Elements of the Criminal Offense
For a crime to exist, four elements must be present:
- Debtor status with respect to the harmed creditor
- Act of asset disposal (sale, donation, concealment, nominee)
- Result of total or partial insolvency, real or apparent
- Specific intent —fraudulent purpose—, that is, the conscious will to harm the creditor.
Difference from fraud
Unlike the crime of fraud, in asset concealment there is no prior deception to the creditor. The debt already exists and is lawful in its origin; what is criminally sanctioned is the attempt to make it uncollectible through manipulation of the debtor’s assets.
When do you need an asset concealment attorney?
The intervention of a criminal defense attorney specialized in asset concealment is essential when any of these situations occur:
- You have received a complaint filed by a creditor alleging that you have hidden or misappropriated your assets
- You are subject to judicial investigation for asset concealment or suspicious transfers
- Donations or asset transfers to family members made during a time of financial difficulty are being questioned
- You are accused of having used a nominee to put assets beyond the reach of execution
- You are involved in insolvency proceedings with potential criminal implications for punishable insolvency
- You have a tax debt with the Tax Agency (Treasury) and have conducted asset transactions that may be subject to criminal review
Acting quickly from the first moment —even before being called to testify— can be decisive for the outcome of the proceedings.
Penalties for asset concealment according to the type
The Criminal Code establishes different penalties depending on the specific type of the offense. Knowing exactly which criminal type is charged is essential for guiding the defense:
- Basic type (art. 257.1 CP): classic asset concealment by the debtor to evade payment. Penalty of 1 to 4 years imprisonment and fine of 12 to 24 months.
- Asset concealment to evade civil liability derived from crime (art. 257.2 CP): when the perpetrator is already convicted or being investigated for a previous crime and tries to hide assets to avoid paying civil liability.
- Aggravated for public debt or with Treasury (art. 257.3 CP): penalty of 1 to 6 years imprisonment and fine of 12 to 24 months. The legislator grants enhanced protection to the public treasury.
- Special gravity (art. 257.4 CP): applies when the debt exceeds 50,000 euros or when the act of concealment affects the primary residence of the creditor or particularly vulnerable third parties. Involves penalties aggravated in their upper half.
- Liability of legal entities (art. 258 ter CP): when the conduct is committed through a company, the legal entity can be directly liable, with consequences including proportional fine, dissolution or disqualification from contracting with the Administration.
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Types of asset concealment we defend
Each asset concealment case presents different characteristics. Our defense covers all types recognized by Supreme Court jurisprudence.
Asset concealment
Removal of assets from the debtor’s visible patrimony through simulated documentation, fictitious ownership or simple omission before the executing court.
Fraudulent donations
Gratuitous transfers to family members or associates made when a collectible debt or judicial proceeding was already in progress, characterized by the absence of real consideration.
Use of Front Men
Interposition of third parties—relatives, partners, shell companies—to make it appear that the debtor has lost ownership of their assets when in practice they continue to control them.
Asset Concealment in Divorce
Asset stripping operations carried out in the context of separation or divorce proceedings, designed to artificially reduce the basis for the liquidation of marital property or spousal support.
Account Draining
Disposal of bank balances, investments or liquidity through transfers, withdrawals or account closures immediately before or during forced execution initiated by the creditor.
Insolvency Asset Concealment
Punishable insolvency conduct within the framework of insolvency proceedings: concealment of assets, preparation of fictitious accounting or fraudulent agreements with preferred creditors.
Defense Strategies in Asset Concealment Cases
ABSENCE OF FRAUDULENT INTENT
Asset concealment requires that the accused acted with specific intent —conscious intent to harm the creditor—. If the asset transfer responds to an objective economic rationale (business restructuring, legitimate tax planning, proven family needs), the absence of fraudulent intent can be proven and the subjective element of the crime can be destroyed.
NON-EXISTENCE OF INSOLVENCY
The criminal offense requires that the debtor’s conduct produces actual or apparent insolvency. If the debtor retains sufficient assets to meet the debt —even if different from those transferred—, there is no harmful result required by art. 257 CP. A detailed asset appraisal can demonstrate that the creditor had and has effective collection avenues.
STATUTE OF LIMITATIONS
The basic offense under art. 257.1 CP has a statute of limitations of 5 years (maximum penalty under 5 years). The calculation of the dies a quo —start of the limitation period— is a controversial technical issue: majority case law sets it at the moment when the creditor could have become aware of the insolvency, not on the date of the transfer. Reviewing the statute of limitations is always the first step of the defense.
CHALLENGING THE UNDERLYING DEBT
Asset concealment presupposes the existence of a liquidated, due and enforceable debt at the time of the asset disposal. If the debt is disputed in its amount or enforceability, if it is pending appeal or if it has not been judicially recognized, the defense can attack the very foundation of the crime: without a firm debt there is no legal interest to protect.
ECONOMIC-FINANCIAL EXPERT ANALYSIS
The incorporation of an economic-financial expert into the proceedings is frequently decisive. The expert can demonstrate the actual solvency of the debtor at the time of the questioned acts, the existence of economic consideration in the transfer, or the objective business justification for operations that at first glance might appear suspicious.
RELATIONSHIP WITH PUNISHABLE INSOLVENCY
When the facts occur in the context of insolvency proceedings, a conflict of laws may arise between asset concealment (art. 257 CP) and punishable insolvency crimes (arts. 259-261 CP). The correct classification —and the possible absorption of one type by another— may result in a significant reduction of the penalty or even in the conduct being non-criminal.
What to Do If You Are Accused of Asset Concealment?
If you have received a complaint or court summons for asset concealment, follow these immediate guidelines:
- Do not make any additional asset transfers. Any new transaction may be interpreted as confirmation of the fraudulent intent being attributed to you.
- Preserve all documentation related to the questioned operations: contracts, payment receipts, expert valuations, emails and any evidence of consideration received.
- Document your current solvency. Gather bank statements, tax returns, property deeds or any other assets that demonstrate the creditor has means of collection.
- Consult with a specialized criminal defense attorney before testifying in court. The first statement as a defendant is crucial and can determine the entire subsequent defense.
What specific conducts constitute fraudulent conveyance?
The jurisprudence of the Supreme Court has recognized as typical conducts: placing assets in the name of a family member (spouse, children, parents) when a demandable debt already exists; making a fictitious or simulated donation without real consideration; proceeding to empty bank accounts through withdrawals, transfers or cancellations; and using a front person to make it appear that the assets no longer belong to the debtor. The key is always the subjective element: that the operation aims to frustrate the creditor’s action.
Can there be an offense if the debt is not yet enforceable at the time of transfer?
This is a highly debated point in jurisprudence. The Second Chamber of the Supreme Court (STS 152/2022, among others) has admitted that the offense can be committed even when the debt is not yet liquid or demandable, provided that the debtor acts with awareness that a pending obligation exists and with intent to make it uncollectible. However, the more questionable the enforceability of the debt, the weaker the prosecution’s position and the stronger the foundations for the defense.
Can a company be convicted for fraudulent conveyance?
Yes. Article 258 ter of the Criminal Code expressly establishes the criminal liability of legal entities for fraudulent conveyance offenses committed in their name or on their behalf by their representatives, administrators or employees. The consequences for the company may include proportional fines of up to double the damage caused, disqualification from contracting with the Administration, and in extreme cases, dissolution of the company.
When does the fraudulent conveyance offense reach the statute of limitations?
The basic offense under art. 257.1 of the Criminal Code, with a maximum penalty of 4 years, has a statute of limitations of 5 years. The aggravated offense under art. 257.3 of the Criminal Code, with a maximum penalty of 6 years, has a statute of limitations of 10 years. The calculation begins —dies a quo— from when the creditor could reasonably have known about the insolvency situation, which in practice may differ significantly from the date of the disposition act. Analyzing the statute of limitations is always the first step in any criminal defense.
How can it be proven that there was no intent to defraud?
The fraudulent intent is destroyed by proving that the patrimonial transaction had an objective justification unrelated to harming the creditor: real economic needs of the counterpart, market price in the transfer, lack of knowledge of the debt at that time, or simply that the debtor retained other assets sufficient for payment. An economic-financial expert report, contractual documentation and testimonial evidence of the consideration are the main defense tools.
Why Choose a Lawyer Specializing in Asset Concealment
The crime of asset concealment is one of the most technical in economic criminal law. Its proper defense requires not only deep knowledge of substantive criminal law, but also solid understanding of civil property law, insolvency law and economic-financial analysis. At Victor Avila Abogados we have spent years successfully defending individuals and legal entities investigated or accused of this crime.
- Exhaustive analysis of subjective elements: we challenge the fraudulent intent from the first defense brief, before the accusatory narrative becomes consolidated.
- Coordination with specialized economic experts: we regularly work with forensic economists who verify the client’s actual solvency or the objective justification of the questioned operations.
- Defense of both individuals and legal entities: we cover both individual criminal liability (administrators, executives) and corporate liability under article 258 ter of the Criminal Code.
- Experience in insolvency proceedings with criminal implications: when asset concealment occurs in the context of a company in crisis, proper coordination between criminal defense and creditor proceedings is crucial.
- Immediate review of statute of limitations: in many cases the complaint is filed years after the facts. We always review the starting date to detect if the crime has prescribed.
If you are accused of concealing assets, emptying accounts, or making fraudulent transfers in the face of debt or divorce, contact our team in Madrid. We will analyze the legality of your transfers and design a tailored defense strategy.
Request a consultation with an asset concealment attorney in Madrid
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