In a ruling dated 29 January 2019, the Court of Cassation provided a useful clarification on the admissibility of a civil party’s claim in the case of the offence of presenting unfaithful annual accounts.

In this case, several people had been indicted on charges of misleading commercial practices, organised gang fraud, misuse of corporate assets, breach of trust, presentation of false accounts and money laundering.

A bank brought an incidental civil action during the course of the judicial investigation, claiming that it had granted loans to the company, whose director was under investigation, on the basis of false accounts that had been presented to it.

The Examining Magistrate did not consider that he had been seized of facts potentially prejudicial to the bank, and that there was no link between such prejudice and the commission of an offence. He therefore issued an Order of inadmissibility.

The Examining Magistrate’s Court upheld this order on the grounds that the Public Prosecutor’s opening statement of claim referred to the offence of presenting untrue accounts, which the company’s director was accused of having committed solely against its shareholders and not against other stakeholders.

Recalling the scope of the combined provisions of articles 2, 3 and 85 of the Code of Criminal Procedure, according to which ‘ for a civil claim to be admissible before the investigating judge, it is sufficient that the circumstances on which it is based allow the judge to accept as possible the existence of the alleged loss and the direct relationship of this loss with an offence under criminal law ’, The Court of Cassation overturned the decision of the appeal judges, ruling that « the offence of presenting untrue annual accounts, assuming it is established, is likely to have caused direct personal injury to the bank that granted financial assistance on the basis of the accounts presented. « 

The Court of Cassation ruled that the bank could prove that it had suffered a loss that justified its bringing a civil action.

To read the full judgment, click here: Cass. Crim. 29 January 2019, no. 17-86.974