New bankruptcy laws attacked.

Stephen Gale, president of the R3 Association of Business Recovery Professionals and a partner at Herbert Smith, launched his attack on the consultation paper Bankruptcy – A Fresh Start following industry submissions last week.

The insolvency body argues that proposals to introduce a notion of culpable bankrupts are unworkable and are highly critical of suggestions that non-culpable bankrupts could keep up #20,000 of invested money.

R3 argues that higher creditors’ returns can be achieved by further use of the existing Individual Voluntary Arrangement (IVA), that allows debtors time to turnaround a failing business.

Gale called for more ‘joined up government’ over bankruptcy and claimed R3 offered on ‘numerous occasions’ without success to advise the DTI on IVAs.

Former Tory minister Rod Richards – cleared of causing grievous bodily harm to a young woman last month (above) – was due to appear in the High Court today to face a bankruptcy petition.

– A long-awaited joint DTI/Treasury report on corporate rescue mechanisms was also anticipated this week, including proposals that government creditors should give more warning to failing businesses before collecting debts.

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