Lifting the veil of incorporation is an exceptional legal process where the separate legal entity principle of a corporation is disregarded to hold its members or directors personally liable, often applied in cases of wrongful or fraudulent trading.
A shadow director is an individual whose directions, typically, the board of directors of a company follow, although this individual is not officially appointed as a director. Certain legal provisions, particularly those under the Companies Act, hold shadow directors accountable in similar ways to formally appointed directors.
Wrongful trading refers to the act of continuing to trade when a company has no reasonable prospect of avoiding insolvency. Directors can be held personally liable if they knew, or should have known, about the company's financial predicament.
