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16/07/2018

R3's letter to the editor of the Financial Times on how the insolvency profession tackles fraud

Dear Sir,

John Gapper’s article, ‘The ship tycoon, the con men and a €100m scam’, highlights the positive impact the insolvency profession and framework can play when it comes to disrupting and tackling fraud.

As the article notes, the profession has an extensive suite of powers to take on fraudsters. We believe that the profession can use these powers to provide extra capacity to the UK government’s anti-fraud agencies as they deal with a growing fraud threat and increasing pressure on their own resources.

As well as using the insolvency profession’s powers and skillsets – by, for example, ensuring insolvency practitioners are appointed to complex insolvency cases which might otherwise be held by the Government’s Official Receiver – the Government should also consider introducing a number of reforms to further boost the insolvency profession’s anti-fraud toolbox.

Potential reforms include tighter Companies House reporting requirements for directors, the introduction of the ability to make individuals bankrupt in the public interest, which would make it both easier to return money to fraud victims and to close down unincorporated trading entities, and to re-introduce ‘criminal bankruptcy’ – a power which inexplicably disappeared in a legislative tidy-up in the late 1980s.

Fraud is a growing threat in the UK and worldwide – the insolvency and restructuring profession is ready to do its bit to help tackle it.

Yours,

Frances Coulson
Chair of the Fraud Group of R3, the insolvency and restructuring trade body

The letter can be viewed on the FT's website here

Notes to editors:

  • R3 is the trade body for Insolvency Professionals and represents the UK’s Insolvency Practitioners.

  • R3 comments on a wide variety of personal and corporate insolvency issues. Contact the press office, or see www.r3.org.uk for further information.

  • R3 promotes best practice for professionals working with financially troubled individuals and businesses; all R3 members are regulated by recognised professional bodies
     
  • R3 stands for 'Rescue, Recovery, and Renewal' and is also known as the Association of Business Recovery Professionals.