IPs told to point the finger
The Insolvency Service has called on IPs to blow the whistle on colleagues who carry out 'liquidation administrations', instead of just complaining about the illicit practice in public.
The service denied the appeal amounted to a ‘put up or shut up’ warning.
But a spokeswoman said: ‘It’s not acceptable for people to just say the system’s not working without taking action.’
She called on IPs to report anyone using the procedure, in which companies are put into administration purely because they can then be placed in liquidation without a traditional creditors’ meeting being held.
Despite much talk within the profession, the insolvency service has yet to receive a report of the abuse.
But Stephen Hunt, president of the Insolvency Creditors Association, said: ‘The new rules only came into force in September and it’s going to take some time for information to come out as to why a certain procedure was chosen.’
The insolvency service said that if reports were made, unscrupulous IPs could ultimately lose their licences. Malpractice complaints concerning IPs can be emailed to [email protected].