Can a Director have a Criminal Record?

A director can get a criminal record from company insolvency, but only for specific offences involving deliberate dishonesty.

Running a company badly does not give you a criminal record. Concealing assets, falsifying records, or trading with intent to defraud creditors does.

We make this distinction immediately because directors confuse disqualification with a criminal record. They are not the same thing.

Director disqualification is a civil and regulatory process that bans you from being a director. It does not give you a criminal record.

A criminal record comes from prosecution and conviction for a criminal offence under the Insolvency Act 1986 or the Fraud Act 2006. The threshold for criminal prosecution is deliberate dishonesty, not incompetence or poor judgement.

Quick Answer: When Can a Director Get a Criminal Record?

You can get a criminal record for the following offences under UK insolvency law:

Offence	Statute	Maximum sentence
Fraudulent trading	Insolvency Act 1986, section 213	10 years
Concealment of company property	Insolvency Act 1986, section 206	7 years
Destruction or falsification of records	Insolvency Act 1986, section 209	7 years
Fraudulent disposal of property	Insolvency Act 1986, section 208	7 years
Material omissions from statement of affairs	Insolvency Act 1986, section 210	7 years
Fraud by false representation	Fraud Act 2006, section 2	10 years
Breaching a disqualification order	CDDA 1986, section 13	2 years

You cannot get a criminal record for wrongful trading (section 214, civil only), misfeasance (section 212, civil only), being a director of a company that enters insolvency, or being disqualified.

We stress this because the fear of a criminal record prevents directors from seeking advice, and in most cases the fear is unfounded. Our guide on whether directors can go to prison covers the imprisonment risk specifically.

Offences That Create a Criminal Record for Directors

Fraudulent trading (section 213). Carrying on the business of a company with intent to defraud creditors or for any fraudulent purpose. The key word is intent.

Taking customer deposits when you know the company is about to enter liquidation and cannot deliver is fraud. Continuing to trade for two months too long because you genuinely believed things would improve is not.

We have seen the Insolvency Service prosecute directors who accepted advance payments for services they knew would never be delivered. The deposits went into the general account, the company closed weeks later, and the customers received nothing.

Concealment of company property (section 206). Hiding assets that should be available to creditors. This includes transferring vehicles to family members, moving cash to personal accounts, and removing stock from company premises before the liquidator arrives.

We have seen prosecutions for asset concealment where the director moved a company van into a friend’s garage the weekend before the CVL.

Destruction or falsification of records (section 209). Destroying, altering, or falsifying company books, documents, or records. Wiping a company laptop, deleting accounting software data, or shredding financial records before the liquidator arrives.

We see directors delete email accounts believing this prevents the liquidator from seeing the correspondence. The liquidator obtains the emails from the hosting provider. The deletion becomes an additional offence.

Breach of a disqualification order (section 13 CDDA). If you are disqualified and you act as a director, promote or manage a company, or are involved in the management of a company during the disqualification period, you commit a criminal offence. Maximum 2 years.

You also become personally liable for all debts incurred by the company during the breach. We see directors breach disqualification orders by acting as “consultants” or “advisers” while effectively running the company. The courts see through these arrangements.

What Does Not Give a Director a Criminal Record

We list these explicitly because the confusion causes unnecessary fear:

• Wrongful trading (section 214). Civil claim only. You pay money. No criminal record.
• Misfeasance (section 212). Civil claim only. You pay compensation. No criminal record.
• Director disqualification. A ban on being a director, not a criminal conviction (unless you breach the order).
• Being a director of an insolvent company. Insolvency itself is not a criminal offence. How you behaved during the insolvency determines whether criminal liability arises.
• Late filing of accounts. A civil penalty, not a criminal offence (unless the filing failure is part of a wider pattern of record destruction).
• Preference payments. Civil recovery under section 239. The transaction is reversed. No criminal record for the preference itself (though it may form part of a wider fraud case).

How the Insolvency Service Decides Whether to Prosecute a Director

The liquidator files a conduct report with the Insolvency Service. If the report identifies potential criminal conduct, the Service’s enforcement directorate assesses whether prosecution is in the public interest and whether there is a realistic prospect of conviction. They apply the same evidential and public interest tests as the Crown Prosecution Service.

We find that prosecutions tend to involve large-scale customer deposit fraud, systematic asset stripping across multiple companies, deliberate destruction of records to obstruct investigation, and serial phoenix trading with fraudulent intent.

A director who traded too long through optimism, failed to keep adequate records through disorganisation, or made poor decisions under pressure is far more likely to face civil claims and disqualification than criminal prosecution.

We tell directors: if your conduct was honest but misguided, the criminal threshold is almost certainly not crossed. If your conduct involved deliberate deception of creditors, customers, or the authorities, take criminal defence advice immediately. Do not wait for the Insolvency Service to contact you.

The Impact of a Criminal Record on a Director’s Life

A criminal conviction for an insolvency offence appears on your DBS (Disclosure and Barring Service) record. This affects future employment checks, professional registrations, and certain regulated activities.

The conviction is “spent” under the Rehabilitation of Offenders Act 1974 after a period that depends on the sentence (typically 1 to 7 years for non-custodial sentences, longer for custodial).

A criminal conviction is separate from and in addition to any disqualification order. You can be both convicted of an offence and disqualified as a director, and the two run concurrently. The combined impact on your professional life is severe, which is why avoiding conduct that crosses the criminal threshold is so important.

How to Avoid a Director Criminal Record from Insolvency

1. Do not take deposits or advance payments if you know the company cannot deliver.
2. Do not destroy, alter, or conceal any records. Not a laptop, not an email account, not a filing cabinet.
3. Do not move company assets to yourself, family members, or connected companies below market value.
4. Complete the statement of affairs honestly. Every asset, every liability, every creditor.
5. Cooperate fully with the liquidator. Non-cooperation is not criminal on its own, but it creates the appearance of concealment.
6. If you are disqualified, do not breach the order. Not even informally, not even as a “consultant”.

If you are concerned about potential criminal exposure, seek specialist criminal defence advice from a solicitor experienced in Insolvency Act offences. Company Debt connects directors with licensed insolvency practitioners who can assess the full picture. A confidential conversation will help you understand whether your conduct crosses any criminal thresholds.

FAQs on Directors and Criminal Records