PRACTICE NOTES
Businesses may either suffer fraud or be used by their own management to commit it. In the first scenario, corporate property is diverted. In the second, the enterprise may trade partly legitimately or lack any real business. Either way, insolvency may follow. Once appointed, the office-holder will seek to uncover events, trace assets and recover value for creditors.
Investigation and enquiry into a company’s assets
After a decision is taken to appoint an insolvency practitioner (IP), the Insolvency Act 1986 (IA 1986) grants powers allowing the office-holder to probe the company’s affairs and investigate its dealings, then gather in its assets.
Under IA 1986, s 236, an administrator, administrative receiver, liquidator or provisional liquidator may ask the court to order certain persons to supply information about the company and/or its dealings, produce any books, papers or other records in their possession or under their control
Restructuring & Insolvency