R3 is the trade association for the UK’s insolvency, restructuring, advisory, and turnaround professionals. We represent insolvency practitioners, lawyers, turnaround and restructuring experts, students, and others in the profession.
The insolvency and restructuring profession plays an important, if not widely recognised, role in tackling fraud. However, in order for this important work to be effective in light of new emerging trends and the growth in the scale of the problem, it is vital that the framework for tackling fraud is fit for purpose and up to date.The proposals contained within this paper aim to truly close some of the loopholes currently exploited so easily by fraudsters. In particular, the report’s recommendations on the reform of the company dissolution process will considerably improve the speed at which fraudsters can be investigated and prosecuted, and reduce the costs to creditors and victims of pursuing unscrupulous directors. They will enable more culpable directors to be brought to book, more recoveries made to victims of fraud and creditors, and will provide a stronger deterrent for fraudsters going forward.
The impact of fraud is wide-ranging and extremely harmful. It deprives businesses and individuals of their money and causes numerous other negative effects, including a drain on public funds, an increased risk of some businesses failing and the associated reputational, psychological and emotional damage to victims.
In December 2015, the government announced the end of the exemption for insolvency litigation from the 2012 Legal Aid, Sentencing and Punishment of Offenders Act – an exemption which helps return approximately £480m owed to creditors from rogue directors and others every year. R3 fought a long campaign to secure a permanent exemption from the Act, including winning an extension to the exemption in February 2015.
R3 members can provide advice on a range of business and personal finance issues. To find an R3 member who can help you, click below.