Wrongful and fraudulent trading — government consultation
The Insolvency Service and the Department for Business, Innovation and Skills have published consultations proposing amendments to the regulations affecting insolvency practitioners (IPs), the practice of insolvency and the reporting duties of IPs regarding the conduct of directors.
The proposals include increasing the powers of IPs in circumstances where a former director may be guilty of wrongful or fraudulent trading to enable: administrators to bring a claim for wrongful or fraudulent trading; and liquidators to sell or assign a claim against a director suspected of wrongful or fraudulent trading.
The stated aim of the Insolvency Service consultation, entitled ‘Red Tape Challenge — changes to insolvency law to reduce unnecessary regulation and simplify procedure’, is to ‘identify savings in the costs of administering insolvency proceedings, which should result in more money being returned to creditors, but without weakening the regulatory regime’…
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