Embezzlement and SME Financing: Reflections on Ruling No. 14874 of 2024

Ruling No. 14874 of 2024, issued by the Court of Cassation, offers an important interpretation regarding embezzlement in assisted financing intended for small and medium-sized enterprises (SMEs) affected by the economic impact of the Covid-19 pandemic. In particular, the decision clarifies the responsibilities of professionals who, benefiting from emergency measures, divert the use of funds for personal purposes instead of for the purposes provided by law.

The Regulatory Context

Emergency legislation, particularly Legislative Decree of April 8, 2020, No. 23, introduced extraordinary measures to support SMEs by ensuring access to assisted financing. Article 13, letter m), of this decree extends access to the guarantee of the SME Fund, creating opportunities for professionals to obtain vital funds for their businesses. However, this has also raised questions regarding the proper destination of the financing.

The Crime of Embezzlement

As highlighted in the ruling, embezzlement is established when a professional allocates funds received for personal purposes, thereby violating legal obligations. The key points of the ruling can be summarized as follows:

• Establishment of the crime of embezzlement under Article 316-bis of the Criminal Code.
• Improper allocation of assisted financing for personal purposes.
• Specific responsibility of the professional who received the financing.

Financing assisted by a guarantee for SMEs damaged by the Covid-19 pandemic - Professionals - Diversion to different purposes - Embezzlement under Art. 316-bis of the Criminal Code - Configurability. Regarding emergency legislation aimed at supporting businesses affected by the impact of the Covid-19 pandemic, the crime of embezzlement under Art. 316-bis of the Criminal Code is established in cases where a professional, to whom, pursuant to Art. 13, letter m), of Legislative Decree of April 8, 2020, No. 23 (so-called "liquidity decree"), converted, with amendments, by Law of June 5, 2020, No. 40, access to the guarantee issued by the Fund for Small and Medium-sized Enterprises is extended, diverts the financing disbursed in their favor to personal needs rather than to the professional activity for which it is legally intended.

Conclusions

Ruling No. 14874 of 2024 represents a significant step forward in the legal qualification of illicit conduct related to the improper use of public funds. It underscores the importance of the correct and transparent use of resources intended to support SMEs, highlighting that failure to comply with these obligations can lead to significant criminal consequences. It is crucial for professionals to understand their responsibilities in managing public funds so that they can contribute ethically and legally to the recovery of economic activities affected by the health crisis.