Article 307 Spanish Criminal Code: Social security fraud

1. Whoever, by act or omission, defrauds the social security by evading the payment of its contributions and of the concepts collected jointly with them, by improperly obtaining refunds of them or by enjoying deductions under any head likewise improperly, provided that the amount of the contributions evaded or of the improper refunds or deductions exceeds fifty thousand euros, shall be punished with imprisonment of one to five years and a fine of the amount of that sum up to six times that sum, unless that person has regularised the position before the social security on the terms of paragraph 3 of this article.

The mere filing of the contribution documents does not exclude the fraud, where the fraud is established by other facts.

In addition to the penalties indicated, there shall be imposed upon the person responsible the loss of the possibility of obtaining public subsidies or aid and of the right to enjoy tax or social security benefits or incentives for a period of three to six years.

2. For the purposes of determining the amount mentioned in the preceding paragraph, the total amount defrauded during four calendar years shall be taken into account.

3. The position before the social security shall be regarded as regularised where the person under an obligation to the social security has proceeded to the complete acknowledgement and payment of the debt before being notified of the commencement of inspection proceedings directed at the determination of those debts or, where such proceedings have not taken place, before the public prosecutor or the counsel of the social security lodges a querella or a complaint directed against that person or before the public prosecutor or the investigating judge carries out steps which permit that person to have formal knowledge of the commencement of proceedings.

Likewise, the effects of the regularisation provided for in the preceding subparagraph shall be applicable where debts to the social security are satisfied once the right of the administration to determine them in administrative proceedings has become time barred.

The regularisation of the position before the social security shall prevent the prosecution of that person for the possible accounting irregularities or other instrumental falsifications which, exclusively in relation to the debt which is the object of the regularisation, that person may have committed prior to the regularisation of the position.

4. The existence of criminal proceedings for an offence against the social security shall not halt the administrative procedure for the assessment and recovery of the debt incurred towards the social security, unless the judge so orders upon the provision of security. Where security cannot be provided in whole or in part, the judge may exceptionally order the suspension with a total or partial dispensation from security, where it finds that the enforcement might cause irreparable harm or harm which is very difficult to repair. The administrative assessment shall finally be adjusted to what is decided in the criminal proceedings.

5. Judges and courts may impose upon the person under an obligation to the social security or upon the perpetrator of the offence the penalty of the next lower degree or of the two next lower degrees, provided that, before two months have elapsed from the judicial summons as a person under investigation, that person satisfies the debt to the social security and acknowledges the facts before the court. The foregoing shall likewise be applicable in respect of other participants in the offence other than the debtor to the social security or the perpetrator of the offence, where they cooperate actively in obtaining evidence which is decisive for the identification or apprehension of other persons responsible, for the complete clarification of the criminal acts or for the ascertainment of the assets of the person under an obligation to the social security or of other persons responsible for the offence.

6. In proceedings for the offence contemplated in this article, for the enforcement of the penalty of a fine and of the civil liability, which shall comprise the amount of the debt to the social security which the administration has not assessed by reason of limitation or another legal cause, including its interest for late payment, judges and courts shall seek the assistance of the services of the administration of the social security, which shall demand them by the administrative procedure of enforcement.

Working translation prepared by Société Juridique from the consolidated Spanish text published by the Official State Gazette. It has no official status: the only authoritative version is the Spanish original, available at the Official State Gazette and reproduced verbatim in our Spanish-language entry for this provision. Source: Organic Law 10/1995 of 23 November, the Spanish Criminal Code.