Bankrupt - Hide Assets From Official Receiver

	Do you live in Scotland? As Scotland has its own legal system, distinct from that of England and Wales, laws relating to bankruptcy are different too. In Scotland, personal bankruptcy is known as sequestration.

More news Bailiffs to get more powers but not much needed regulation Citizens Advice warns Citizens Advice Bureau reports sharp rise in debt problems Record number of people going bust - and it's set to get worse More than a million householders use credit card borrowing to pay their mortgage or rent Number of CCJs issued hits ten year high Number of Scots going bankrupt hits record high	Insolvency Service cracks down on bankrupts who try to hide assets Debtors who believe they can go bankrupt and hide some of their assets from the Official Receiver have been told to think again by The Insolvency Service. Anyone who is declared bankrupt must disclose details of all of their assets, no matter how small, or they face a penalty which could include having their period of bankruptcy restrictions increased by up to 15 years instead of the usual 12 months. The Official Receiver will also seek to recover such assets. The new warnings have been prompted by a surge in cases dealt with by Official Receivers where potential bankrupts have attempted to put assets out of reach of their creditors – up to nearly 200 cases this year compared with just 28 in 2008-09. Recent cases exposed by The Insolvency Service include bankrupt individuals who failed to disclose cash, insurance policies and even cars to the Official Receiver. All were found out and had their period of bankruptcy restrictions extended. This meant that their ability to borrow money, manage a company, or even stand for the local council, remained limited by the insolvency rules for even longer than the standard 12 months. "It is only fair to the creditors that we seek full disclosure of any assets that might be available," said Les Cramp, Senior Official Receiver for the Insolvency Service. "Potential bankrupts who want the debt relief offered by this form of insolvency must declare all of their assets straight away. It is then for the Official Receiver to decide which assets must be sold for the benefit of the creditors and which might be retained by the debtor." If the Official Receiver considers that the conduct of a bankrupt individual has been dishonest or blameworthy in some other way, he (or she) will report the facts to court and ask for a Bankruptcy Restrictions Order (BRO) to be made. The court will consider this report and any other evidence put before it, and will decide whether it should make a BRO. If it does, the bankrupt will be subject to certain restrictions for the period stated in the order. This can be from two to 15 years. The bankrupt may give a Bankruptcy Restrictions Undertaking (BRU) which will have the same effect as an order, but will mean that the matter does not go to court. March 31st 2010

Insolvency Service cracks down on bankrupts who try to hide assets

Debtors who believe they can go bankrupt and hide some of their assets from the Official Receiver have been told to think again by The Insolvency Service.

Anyone who is declared bankrupt must disclose details of all of their assets, no matter how small, or they face a penalty which could include having their period of bankruptcy restrictions increased by up to 15 years instead of the usual 12 months. The Official Receiver will also seek to recover such assets.

The new warnings have been prompted by a surge in cases dealt with by Official Receivers where potential bankrupts have attempted to put assets out of reach of their creditors – up to nearly 200 cases this year compared with just 28 in 2008-09.

Recent cases exposed by The Insolvency Service include bankrupt individuals who failed to disclose cash, insurance policies and even cars to the Official Receiver. All were found out and had their period of bankruptcy restrictions extended. This meant that their ability to borrow money, manage a company, or even stand for the local council, remained limited by the insolvency rules for even longer than the standard 12 months.

"It is only fair to the creditors that we seek full disclosure of any assets that might be available," said Les Cramp, Senior Official Receiver for the Insolvency Service. "Potential bankrupts who want the debt relief offered by this form of insolvency must declare all of their assets straight away. It is then for the Official Receiver to decide which assets must be sold for the benefit of the creditors and which might be retained by the debtor."

If the Official Receiver considers that the conduct of a bankrupt individual has been dishonest or blameworthy in some other way, he (or she) will report the facts to court and ask for a Bankruptcy Restrictions Order (BRO) to be made. The court will consider this report and any other evidence put before it, and will decide whether it should make a BRO. If it does, the bankrupt will be subject to certain restrictions for the period stated in the order. This can be from two to 15 years. The bankrupt may give a Bankruptcy Restrictions Undertaking (BRU) which will have the same effect as an order, but will mean that the matter does not go to court.

March 31st 2010

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