Insolvency practitioners – the power to recover

Fraud and insolvency often go hand in hand. You do not have to look very far to see how the fruits of fraud are often left as rotten bad debts in the hands of unwitting creditors. Fraudsters will often leave companies devoid of assets in an attempt to frustrate a subsequently appointed liquidator from pursuing them - they assume that if no funds are available in the insolvent estate then the liquidator will be unable to take action. However, this is where they are wrong, say James Earp and Nick Wood of Grant Thornton’s Fraud Division - even if an estate is devoid of funds, liquidators and their lawyers can act on a contingent fee basis and there are litigation insurance products available which will minimise the risks associated with legal action.

James may be contacted on tel 0870 991 2464, email james.earp@gtuk.com and Nick may be contacted on tel 0870 991 2426, email nick.s.wood@gtuk.com.

Insolvency Act powers

The Insolvency Act 1986 (the Act) gives office-holders potent powers to get in assets and carry out investigations. In the company context powers are available to: