Sanctions: abusive activity, tax and corporate liability

Article 166 TUF: the criminal offence of abusive activity

The central sanction for a Swiss provider who serves Italian clients without authorization is criminal. Article 166 paragraph 1 TUF punishes with imprisonment from one to eight years and a fine from EUR 4,000 to EUR 10,000 anyone who, without being authorized under the decree, provides investment services or activities or collective portfolio management, offers units or shares of collective investment undertakings in Italy, or offers financial products, instruments or investment services outside the premises or promotes or places them by means of distance communication.¹ Paragraph 2 imposes the same penalties on anyone who carries on the activity of a financial adviser authorized to offer outside the premises without being entered in the register under Article 31 TUF. Paragraph 3 empowers the Banca d'Italia and CONSOB, where they have reasonable grounds to suspect that a company is carrying on such activities, to report the facts to the public prosecutor or to apply to the court under Article 2409 of the Civil Code.

The offence is known in Italian practice as abusivismo finanziario. Its penalty is severe by European standards. The maximum of eight years' imprisonment exceeds the penalty for many economic offences and allows the full range of investigative measures, including the interception of communications, searches and the seizure of documents, and international requests for judicial assistance. The offence is committed by the natural person who provides the service. A Swiss relationship manager who meets an Italian client in Milan and advises him on his portfolio is the primary addressee of the provision, and his employer's Swiss licence is no defence, because the offence consists precisely in acting without an Italian authorization.²

Abusive banking and financial activity under the TUB

The TUB contains parallel offences for banking activity. Article 130 TUB penalizes unauthorized deposit-taking from the public as a contravention, with arrest from six months to three years and a fine. Article 131 TUB, headed Abusiva attività bancaria, punishes anyone who takes deposits from the public in breach of Article 11 TUB and grants credit with imprisonment from six months to four years and a fine. Article 132 TUB punishes the unauthorized exercise of financial activities towards the public, among them lending, with imprisonment from six months to four years and a fine from EUR 2,065 to EUR 10,329.³ These offences have played a smaller role in practice than Article 166 TUF, because Italian prosecutors have found it easier to characterize a Swiss banker's activity in Italy as the provision of investment advice than as the taking of deposits. The transposition of CRD VI changes the regulatory backdrop. Once Article 14-bis TUB requires a branch for core banking services from 11 January 2027, a bank that grants Lombard loans or accepts deposits from Italian residents without a branch and without a documented initiative of the client will be in breach of an express supervisory rule, which will make it easier to argue that the bank carries on banking activity in Italy.

Notes

1. TUF, Art. 166 para. 1–3, text at Brocardi.it, https://www.brocardi.it/testo-unico-intermediazione-finanziaria/parte-v/titolo-i/capo-i/art166.html. ↩
2. Constitution of the Italian Republic, Art. 27 para. 1 ("La responsabilità penale è personale"), https://www.brocardi.it/costituzione/parte-i/titolo-i/art27.html; Criminal Code, Art. 6 para. 1 (Italian law applies to anyone who commits an offence in the territory of the State) and para. 2 (the offence counts as committed in Italy when the act or omission took place there in whole or in part, or when the event occurred there), https://www.brocardi.it/codice-penale/libro-primo/titolo-i/art6.html. ↩
3. TUB, Art. 131 and Art. 130 (above); Art. 132 TUB (Abusiva attività finanziaria), https://www.brocardi.it/testo-unico-bancario/titolo-viii/capo-i/art132.html. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.