A FORMER CHIEF of the ICAEW has called for a crackdown on the ‘cosy’ relationship between insolvency practitioners and asset-based lenders.
Eric Anstee, who now runs investment firm City of London Group, told the Daily Telegraph that asset-based lenders must be regulated so that businesses are treated fairly.
“There needs to be a thorough examination of insolvency practitioners’ relationship with invoice finance firms. There are a lot of conflicts of interest,” he said.
His comments follow an investigation by the Telegraph, which highlighted allegations of lenders charging excessive and opaque fees and “profiting” from administrations, with business owners claiming they have been forced into administration unnecessarily.
There have also been complaints of alleged collusion between administrators and invoice finance firms over insolvencies.
Anstee said that since the insolvency industry is already regulated, it needs to scrutinise how it works with the asset-based lending industry.
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