A director of a company that is in financial difficulties could face personal liability in respect of:
- Personal guarantees.
- Fraudulent trading (section 213, 1986 Act).
- Wrongful trading (section 214, 1986 Act).
- Misfeasance or breach of duty (including the statutory general duties under the Companies Act 2006).
- Where the company is a public company, serious loss of capital.
- Where the company is listed, the Listing, Prospectus, Disclosure and Transparency Rules and the Financial Services Markets Act 2000. (For more information on these Rules.
- Other offences under the 1986 Act.
Directors should seek external advice as soon as they are aware that the company is in financial difficulties.
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