This is the question that comes up in almost every first conversation on an embezzlement file involving an SRL (societate cu răspundere limitată), Romania’s limited-liability company: “How can I embezzle if the company is mine? You cannot steal from yourself.” The argument has impeccable economic logic and a much weaker legal value than it appears to have. The reason has nothing to do with the severity of the criminal law; it comes from a choice made when the company was set up, the choice to create a new legal person, distinct from the founder.
The reasoning “the company’s money is my money” starts from an economic reality: the sole member bears the entire risk, and any increase or decrease in the company’s assets affects them directly. From there, the step to the conclusion that withdrawing money is simply moving it from one pocket to another looks small.
Legally, the step cannot be made. Under Article 187 of the Civil Code, every legal person must have an organisation of its own and assets of its own, allocated to a lawful and moral purpose. Article 193(1) adds the effect: the legal person takes part in civil dealings in its own name and is liable for the obligations it assumes with its own assets. The company’s assets remain separate from those of its members until liquidation.
The sole member is not the owner of the company’s assets. They hold the membership interests (părți sociale), a right of a different nature, which gives them entitlement to dividends, to a vote, and to what remains after liquidation. Between “the company belongs to me” and “the money in the company’s account belongs to me”, there is exactly the distance created by legal personality.
That same distance also produces the advantage the member sought in the first place: limited liability. You cannot invoke the separation of assets when it protects you from creditors and deny it when it becomes inconvenient in a criminal case. Article 193(2) confirms the asymmetry: no one may invoke against a person acting in good faith the status of a legal person as a distinct subject of law, if this is done in order to conceal fraud, an abuse of right, or harm to public order. Legal personality is a shield, not a tool.
Article 295(1) of the Criminal Code makes it an offence for the person who manages or administers money, valuables or other assets to misappropriate, use or traffic in them, punishable by 2 to 7 years’ imprisonment. In the private sector, the text becomes applicable through Article 308(1), with the limits reduced by one third: 1 year and 4 months to 4 years and 8 months.
The victim of embezzlement is the legal entity whose assets are managed or administered, not the member. Legal scholarship consistently holds that the fact that the person who misappropriates, uses or traffics in the assets is also the administrator who happens to be a member does not change the rationale for the offence, precisely because the company is a distinct legal person, with assets separate from those of its members and its management bodies. The constituent elements are set out in detail in the analysis on the elements of the offence of embezzlement.
There is also a textual argument that is often overlooked. By Decision no. 15/2024, given on an appeal in the interest of the law, the High Court of Cassation and Justice (ÎCCJ) held that embezzlement under Article 295(1), applied together with Article 308(1), cannot be classified as an offence against property. Placing embezzlement instead among offences involving a breach of duty in the exercise of one’s office shows what the provision actually protects: the correct and honest discharge of a duty of management or administration. Seen from this angle, “ownership” of the company matters even less; the duty that is breached is one owed in the course of one’s office, not one owed to oneself.
It would be wrong to say that the issue has been settled uniformly. It is an open dispute, and anyone who presents it otherwise, in either direction, is misleading you.
The permissive view was expressed by the Ploiești Court of Appeal in criminal decision no. 64 of 24 January 2006. The court acquitted a sole member and sole administrator who had transferred sums from his company’s account to another company, holding that, in the case of an SRL with a sole member, “there is a merging of the company’s assets with those of the sole member”, so that using the company’s funds is equivalent to using one’s own funds, and the non-repayment of the sums is a civil dispute. The decision was given under the 1969 Criminal Code (Article 215¹, read together with Article 275 of Legea nr. 31/1990) and must be read in that regulatory context.
The opposing view rejects the merging of assets, as incompatible with Article 187 and Article 193 of the Civil Code and with the structure of Article 308 of the Criminal Code, which expressly targets acts committed “within any legal person”, without excepting single-member companies. It is consistently supported in legal scholarship and is consistent with the ÎCCJ’s expansive approach to who can commit the offence: by Decision no. 31/2022, given by the panel for resolving points of law, the ÎCCJ accepted that a de facto administrator of a homeowners’ association, that is, a person with no formal appointment whatsoever, could be a perpetrator of embezzlement. A necessary caveat: this decision concerns the de facto administrator, not the sole member, and is not a direct precedent on our question.
Another useful reference is Constitutional Court Decision no. 587/2023, which dismissed the challenge to the constitutionality of Article 309, read together with Articles 295 and 308 of the Criminal Code. The Court held that, given the considerable danger posed by acts of embezzlement to the social values protected, resorting to criminal liability is proportionate to the aim pursued, even where other forms of liability may also be engaged alongside criminal liability. This is precisely the counter-argument to the “this is a civil matter” view.
Where things realistically stand. The imbalance of sources is real and should be stated as such: for the permissive view there is one concrete judgment, but it is isolated and was given under the old law; for the opposing view there is consistent legal scholarship, ÎCCJ decisions on related issues and a Constitutional Court decision, but we have not identified a published final judgment, given under the current Criminal Code, that expressly rejects the merged-assets argument for a single-member SRL. We therefore do not assert that a majority practice has been proven in either direction. The question remains open, and anyone who builds a strategy on the certainty of a dominant view is building on sand.
WARNING: Do not infer from the 2006 decision a general rule that a sole member cannot be held liable. It is an isolated solution, given under the earlier criminal law, and relying on it as the main line of defence, without an analysis of the economic substance of the transaction, is risky. The reverse is equally important: the prosecution cannot automatically infer embezzlement from the mere fact that a sole member withdrew money. Each case is decided on its own evidence, and the presumption of innocence applies in full until a final judgment of conviction. The defences that actually work, in practice, are discussed in the analysis on defences in embezzlement cases.
If we want to understand why the law does not accept the “the company is mine” argument, we need to look beyond the relationship between the member and the company.
The company’s assets are the general security available to creditors, suppliers, banks, employees, the state budget. The separation of assets exists precisely so that they can be satisfied out of a pool of assets that is not merged with the member’s personal wealth. Emptying that pool of assets does not harm the member, it harms the creditors. How the loss is quantified is dealt with in the analysis on establishing the loss.
One that pays its obligations on time and distributes dividends out of real profit rarely generates a criminal file. There is no one who has been harmed and, as a rule, no one to report it.
This turns the same withdrawals into a problem. When the company does not pay its suppliers, but the member’s account keeps receiving transfers, the facts take on a different shape, and creditors have both the interest and the means to react.
The absence of debts is not a ground for exemption from punishment. It simply means that, in the absence of a loss and an injured party, the mechanism that triggers a case is missing.
Insolvency is the threshold from which things change radically, because it formally brings in the category of persons the law actually protects.
Article 241 of the Criminal Code makes fraudulent bankruptcy (bancrută frauduloasă) an offence: the act of a person who, in fraud of creditors, falsifies, removes or destroys the debtor’s records or conceals part of the debtor’s assets; presents non-existent debts or shows unowed amounts in the books, another document or the financial statements; or, where the debtor is insolvent, disposes of part of its assets. The penalty is imprisonment from 6 months to 5 years. Criminal proceedings are brought on the prior complaint of the injured party, usually a creditor.
The relationship with embezzlement is not one of mutual exclusion. The same withdrawals can, in theory, attract both classifications: embezzlement for misappropriating the managed funds, fraudulent bankruptcy for disposing of assets in fraud of creditors after insolvency proceedings have opened. Whether a concurrence of offences or a single classification applies depends on the configuration of the underlying facts and their timing. It must be said openly: there is no decision unifying practice that settles the relationship between Articles 295 and 241 of the Criminal Code for withdrawals made during the suspect period. This is ground on which arguments are made, not one on which a rule can simply be cited. Where the sums are later transferred or disguised, the discussion can extend to embezzlement and money laundering.
There is also a special offence, often left out of the discussion. Article 272(1)(2) of the Companies Law punishes with imprisonment from 6 months to 3 years, or a fine, the act of a founder, administrator, general manager, manager, member of the supervisory board or of the management board, or legal representative who, in bad faith, uses assets or the credit enjoyed by the company for a purpose contrary to its interests, for their own benefit or to favour another company in which they have a direct or indirect interest.
The text covers ground close to embezzlement, but not identical: Article 272 targets the wrongful use of the company’s assets or credit, while Article 295 of the Criminal Code also targets the misappropriation or trafficking of managed assets. The relationship between the two, a concurrence of offences or a relationship of speciality, applying the rule specialia generalibus derogant, is treated inconsistently. There are decisions that find a concurrence, where an administrator’s misappropriation of sums was classified simultaneously as embezzlement and as an offence under Legea nr. 31/1990. A methodological note: we have not identified an ÎCCJ decision, given on an appeal in the interest of the law or a preliminary ruling on a point of law, that settles this relationship. The existence of decisions that find a concurrence is not the same as a unified practice. The practical stakes are considerable: the sentencing limits differ, and Article 272 allows for a fine.
The most common structure in Romania is also the most exposed to scrutiny of the evidence. When the same person decides on a distribution, carries it out, signs the payment order and approves the supporting documents, there are three consequences.
That can be relied on. The defence “I signed what the accountant put in front of me” has no support in a single-member structure. The division of roles is discussed in the analysis on the administrator’s liability.
That could dilute the subjective element. A sole member’s resolution is the act of a single person.
In a company with several members, meetings, correspondence and debates leave traces. With a sole member, if a document was not drawn up at the time, there is nothing else, a subject developed in the analysis on accounting evidence and expert reports.
The paradox is that the very structure that seems to make formalities pointless (“who would I consult with?”) is exactly where they matter most.
The unpaid supplier, the bank, sometimes a former business partner or former spouse. This is the most common and best documented source, because whoever reports it has access to the facts.
The judicial administrator or the liquidator draws up the report on the causes and circumstances that led to insolvency. When the report identifies unjustified withdrawals, a referral to the criminal investigation bodies frequently follows.
An inspection that finds unsettled cash advances, personal expenses or cash withdrawals with no supporting documents can refer the matter to the criminal investigation bodies, a route described in the analysis on when a tax inspection becomes a criminal file.
The conclusion is not that withdrawing money from your own company is dangerous. It is that undocumented withdrawals are dangerous. Not every payment out to a member is criminal, quite the opposite, the vast majority are perfectly lawful.
The conditions are known and verifiable: the existence of a legal basis (a dividend distributed out of real profit, backed by a general meeting resolution; repayment of a loan under a contract; contractual remuneration), contemporaneous documentation of the transaction, correct accounting entries, and, the criterion the law actually protects, no impairment of creditors’ rights. The correct classification of each payment out is discussed in the analysis on dividend, loan, or embezzlement.
A sole member who distributes dividends out of real profit, with a correctly dated resolution and tax paid, has nothing to fear from Article 295 of the Criminal Code. Someone who empties the account of an indebted company, with no documentation at all, on the ground that “it’s his company”, is not defending himself with a legal argument, but with a personal belief. In the courtroom, the distinction is decisive.
This is recognised as possible under the view based on the company’s distinct legal personality (Articles 187 and 193 of the Civil Code) and on Article 308 of the Criminal Code, which refers to acts committed within any legal person, without excepting single-member companies. This view is consistently supported in legal scholarship. There is, in the opposite direction, an isolated acquittal from 2006, given under the earlier criminal law, based on the merged-assets argument. We have not identified a published final judgment under the current Criminal Code that expressly settles the question, so we present it as an open dispute. In any event, a conviction requires proof of all the elements of the offence, including intent.
In theory, yes, because the victim of the offence is the company, not its creditors. In practice, in the absence of an actual loss and someone to report it, such cases are rare. The absence of debts is not a legal ground for exemption from punishment, but a factual element that significantly reduces the likelihood of a complaint and weighs in the assessment of the actual danger involved.
Almost everything. Withdrawals made while the company is insolvent can attract fraudulent bankruptcy (Article 241 of the Criminal Code), alongside or instead of embezzlement. In addition, a new actor appears, the judicial administrator or the liquidator, who has a legal duty to examine the causes of insolvency and may refer the matter to the criminal investigation bodies. The period before the procedure opened is examined retroactively.
It depends on when it was concluded and whether it was performed. An agreement drawn up at the time of the transaction, recorded in the accounts and followed by actual repayments, is a solid defence. An agreement drafted after an inspection or insolvency has begun can make matters worse, raising the issue of forgery of a private document. Also note the restrictions introduced by Legea nr. 239/2025 on granting and repaying loans between a company and its members, in force since 18 December 2025.
Caution calls for a nuanced answer. The merged-assets argument is consistently criticised in legal scholarship and is difficult to reconcile with Articles 187 and 193 of the Civil Code and with the text of Article 308 of the Criminal Code. On the other hand, the only concrete judgment identified on this point, a 2006 acquittal by the Ploiești Court of Appeal, applied it, but under the 1969 Criminal Code. We have not identified a published final judgment under the current Criminal Code that expressly rejects it. It is therefore more accurate to speak of a question not settled uniformly than of a proven majority view.
Informative material, updated on 18 July 2026. It does not constitute legal or tax advice; individual situations must be assessed on their own facts. Every person is presumed innocent until a judgment of conviction becomes final.
If the matter involves a criminal complaint or an open file, the related analyses are grouped under economic criminal law. For how such charges are handled, see company-law offences defence.
Time limits run from the date of communication. A first conversation clarifies what is being alleged, what you need to substantiate and how the defence is built, before an estimate becomes a tax assessment decision.