The corporate environment is complex, and shareholdings are one of a company’s most sensitive areas. Unfortunately, many entrepreneurs are unaware of legal risks that could undermine their corporate structure.

One of these dangers, unfortunately on the rise, is the theft of shareholdings through falsified documents. In many cases, this fraudulent act can have devastating consequences for society. Valuable shares become the target of various threats. Surprisingly, despite the importance of exposure to legal risks, many business owners are unaware of such vulnerability and the preventive measures they could adopt.

The theft of shares through the falsification of documents is a practice that has been gaining ground. It is a clear example of how the lack of adequate legal protection can open the doors to malicious actors.

By ignoring the necessary precautions, companies expose themselves to fraud that, beyond the economic loss, can erode the trust and reputation that took so much effort to build. Therefore, to operate confidently in the business environment requires an essential understanding of the need for legal certainty.

The modus operandi: notary misbehavior and fraudulent acts

Business trust is an essential currency, and notaries enjoy client trust because they certify facts and legal acts. However, clever criminals have found a way to perpetrate fraud through bogus certification. Taking advantage of the aura of authenticity that notarized documents possess before the law, dishonest notaries can create falsified versions that appear indistinguishable from the originals. Through these fraudulent acts, they modify a company’s administrative structure, mainly by changing its legal representative.

Once the fake representative appears on paper, the way is clear for a series of malicious actions. With apparently legal control of the company, the thief alters bank accounts, allowing them free access to corporate funds. In addition, he sells properties and assets, often at ridiculous prices or to equally fraudulent entities, in a race against time before anyone detects the deception. The speed with which these scammers operate is alarming. Once a company realizes the situation, the picture is bleak: empty accounts, missing assets and a trail of unauthorized transactions and decisions. Such a sophisticated technique underlines the importance of taking robust preventative measures and always being alert to possible anomalies.

The road to recovery

Facing a fraudulent act of this magnitude is a nightmare for any business owner. The mere fact of discovering the deception is already problematic, but what follows is a marathon legal fight that requires perseverance, time and resources.

Once the theft of corporate assets is detected, the victimized company is responsible for filing a criminal complaint, a gateway to the judicial system, where a court is supposed to do its job and restore the assets illegally taken.

However, the reality is less encouraging. The workload and limited resources available to the Public Ministry can lead to the investigation starting up to a year after the complaint. Once started, it is not unusual for it to extend for years, given the complexity of these cases and the ability of criminals to hide their tracks.

Meanwhile, the company in question continues to suffer. Assets disappear, funds evaporate, and reputations can be seriously affected, straining business relationships and breaking customer and supplier trust.

The emotional cost of this process is considerable, and, in this scenario, it is essential to have a solid legal strategy and a trusted team for guidance and support during this complicated process.

Shield your Society

  1. Issuance and safeguard of shares:

At first glance, it may seem like a routine administrative procedure, but the correct issuance and safeguarding of shares is one of the main defensive barriers against fraud. When we talk about actions, we mean exercising power and property protection within a society. Therefore, any failure or negligence in this process potentially opens the door to malicious actors.

Issuing share certificates to company shareholders not only formalizes their participation in the company but also provides the company with a legal tool in case of disputes or fraud. Shareholders must protect stock certificates for the valuable assets that they are. In practical terms, it is as if they had a part of the control and destiny of the company in their hands.

Properly safeguarding these certificates does not simply mean keeping them in a filing cabinet. Safe deposit boxes, electronic registration systems, or even custody through specialized entities are alternatives to consider. By taking such steps, we are creating multiple levels of security and ensuring that, in the event of an attempted fraud, the recovery and defense of property is faster and more effective.

In short, the issuance and adequate safeguarding of shares is good administrative practice and an essential defensive strategy in the corporate sphere. The investment in this process, both in time and resources, is minimal compared to the potential damage a fraudulent act could cause.

  1. Share issuance notices:

Share issuance notices are a formal obligation and a strategic tool to protect the company and its shareholders. Submitting these notices to the Commercial Registry is an action that provides legal certainty about the quantity and ownership of the shares issued. Such registration is not merely an administrative procedure but a proactive security and transparency measure.

When a company presents these notices correctly, it makes the exact number of shares issued effective against third parties. This means that, in the event of a litigation or dispute, third parties (including those who may act in bad faith) cannot claim ignorance about the number and distribution of these shares. In other words, the stock company has a solid and legally recognized basis on which to argue in its defense.

Accuracy in the information on authorized, subscribed, and paid capital is tremendously valuable. Malicious individuals can exploit errors or inconsistent movement to create confusion or justify fraudulent acts. Therefore, it is essential to keep such data up to date, accurately reflecting the company’s reality.

Furthermore, by keeping these notices current, the detection of irregularities is greatly facilitated. Any unusual or inconsistent movement with official records will be easier to identify, enabling the share issuer to act quickly against possible threats.

In short, share issuance notices are not simply another procedure or paperwork. They are a shield of protection, a guarantee of transparency, and a tool that, in the hands of a diligent administration, can be crucial to protect the integrity and stability of a society.

  1. Custody of corporate books:

Corporate and accounting books are not simply records of a company’s activities. They are the basis of its legal and financial structure. These documents, which contain everything from meeting minutes to financial balance sheets, represent a society’s history and current state of affairs and are therefore essential instruments in decision-making and accountability.

Keeping these books in the direct custody of the company has multiple advantages. First, it ensures that information remains consistent and is not subject to unauthorized alterations. When these records are in the hands of third parties, even if they are trusted, the risk increases that the information will be accessible to unauthorized persons or that it may be altered, either inadvertently or by deliberate actions.

Additionally, keeping these books in the company’s facilities or under its direct control enables immediate access to the information when required. This control is essential whenever quick decisions need to be made based on historical or financial data or when documentation is requested by auditors, regulators, or judicial entities.

Proper custody of corporate books is not a simple precautionary measure. It is essential to ensure a company’s integrity, transparency, and efficiency, serving an investment in future security and stability by relating legal and financial narratives in a clear, coherent manner.

  1. Control of Authorized Books:

The control of authorized books is essential for a company’s proper functioning and transparency. These books, which must be registered with the Superintendence of Tax Administration and the Commercial Registry, contain critical information about the company’s operations, including shareholder records and the decisions of the administrative bodies. It is extremely important to keep careful records and control these books to avoid authorizing additional books that could be used to commit fraud.

Authorizing additional books can lead to numerous problems, including duplication of shares, manipulation of share ownership, and the creation of a fictitious shareholding structure.

Therefore, the company must implement appropriate control measures to ensure that only officially authorized books are employed that reflect an accurate record of all transactions and changes to the shareholding structure. This control includes implementing secure electronic recordkeeping systems, training staff in proper bookkeeping, and conducting regular audits to ensure the integrity of records.

Clearance control is not simply a matter of compliance but an essential defensive strategy to protect the integrity and stability of society. By implementing appropriate control measures and maintaining accurate records, the company protects itself against fraud and costly litigation and ensures transparent and efficient operations.

  1. Judicial education:

It is essential to train judges to understand that proof of ownership and rights over a share can only be provided by using a certificate from the Secretary of the Board of Directors or the Sole Administrator confirming the records and inscriptions that appear in the company’s Shareholder’s Registry Book  and, in addition, the deposit of the shares in custody of a bank. A simple copy of a share certificate does not prove the status of a shareholder, as some judges have mistakenly considered it in their rulings.

Judges must be trained to understand that title to shares requires proof and that shares and shareholders are registered in the company’s Shareholder’s Registry Book. This is crucial to avoid court rulings that may prejudice the company or legitimate shareholders and to ensure that ownership rights are respected and corporate laws are correctly applied.

Judicial training should include not only a thorough understanding of applicable corporate laws and regulations but also an education in standard industry practices and procedures. This will ensure that judges are equipped with the knowledge and tools necessary to make informed and fair decisions in cases involving partnerships and actions.

By fully understanding how ownership and rights over a share are accredited and the importance of records in the Shareholders’ Record Book, judges can make more informed and fair decisions and contribute to the protection of property rights and the integrity of societies.

Proactivity and Caution

Legal threats and challenges are not merely hypothetical scenarios but realities that any society, regardless of size or sector, could face. Shareholdings, which evidence a company’s core ownership and control, are not exempt from these risks–precisely why proactivity and precaution become two fundamental pillars for any corporate protection strategy.

Being proactive is more than reacting to problems that are already present. It means anticipating possible challenges and acting before they manifest themselves, giving companies an advantage by having defense mechanisms already in place and operational to deal with any suspected irregularities. The adoption of preventive measures, such as those described above, not only serves to counter threats but also sends a clear

Despite the best intentions and practices, vulnerabilities will always exist. However, the key is to minimize them and prepare to act swiftly and decisively as soon as they are detected.

Finally, it is essential to understand that protecting shareholdings is not only a responsibility to shareholders but also to employees, customers, suppliers, and the community who rely on the integrity and stability of the society.

Rodolfo Salazar