UK corruption

Insolvency and its regulators– A racketeering enterprise

In the UK, insolvency is poorly regulated, the principles of the legislation and the primary legislation itself is flawed and is often contradicted by adverse actions of insolvency practitioners and lawyer advocates. Unscrupulous lawyers and office holders use these flaws as the means from which to defraud citizens and their businesses of their rightfully owned assets. The conduct is widespread and our courts are being weaponized by the establishment, constituting gross Human Rights violations and unlawful activities by the out of control public authorities and the offshoot private trustees in insolvency.

“The fuel for the fire”

We first focus on the statistics, “the fuel for the fire” so to speak. In referring to the 2019 Company insolvency statistics published by the Insolvency Service, page 6 of the report indicates that company insolvencies increased by 8,533 from the 2018 report bringing the total to 24,638 up until the second quarter of 2019. Personal insolvencies recorded until the end of the 3rd quarter 2019 also increased by 93,042 from the previous year, a total of 208,361 combined insolvencies. That is, undoubtedly a huge money spinner for central government.

The Secretary of State, under the guise of the Insolvency Service charges mandatory fees of £6,000 (Secretary of State fee), plus the £2,775 statutory Official Receiver fee against all insolvencies, both company and personal. £,8,775 per insolvency, equating to £1,828,367,775 in revenue to the Secretary of State from the combined insolvencies in the last year alone.

Intelligence UK argues that the public authorities are unlawfully profiteering from insolvency in two different ways. Firstly, they are profiteering unlawfully from the role of the fiduciary trustee and secondly, they are making gains founded by fraud and illegality.

Insolvency law and the lack of regulation paves the way for widespread abuse and criminal fraud

“There is no statutory process in the current Act that makes provision for either the courts, nor the insolvency practitioner appointed office holder to “verify the putative creditor’s true position” prior to admission of the alleged claim in the petition or thereafter as a claim in the insolvency.”

“By virtue of this flaw, alleged debts that are disputed and debts that could not be established are being used to unlawfully deprive creditors and citizens of their assets; In this case, by virtue of the flawed legislation and because the office holder is not obligated naturally “to verify the creditor’s true position” prior to admission of any proof of debt for voting, the law works against the interests of creditors, the legitimate ones, where a proof can be admitted, even though it is a bad proof, to obtain pecuniary interest in the alleged insolvent estate and to prevent creditors from their natural right to call a meeting of creditors.”  – Intelligence UK

Featured video:

Our CEO, who was defrauded by Anthony Hannon, the Official Receiver of the Insolvency Service acting as liquidator, attempts to negotiate with Hannon to remove the claim, exceeding £4 million, being the proof of debt he accepted from Middlesbrough FC knowing the claim is false.

The Official Receiver fees are unlawful

In many cases, the Official Receiver, acting as a fiduciary Trustee, has not been required to undertake any work that would justify the fee of £2,775 plus the £6,000 Secretary of State fee. To be lawful, such fees must be proportionate, in accordance with the actual work completed and, on a case specific basis. More often than not, this is not the case and the Official Receiver fee of £8,775 is applied irrespectively, even in cases where no work was required and similarly in cases that were founded by fraud in one form or the other. The actions of BEIS, the Secretary of State and the Insolvency Service in perpetrating this conduct is wholly unlawful.

The conduct in misappropriation Official Receiver fees contravenes the long stablished international precedent insofar as the decision of Keech v. Sandford , 20 E.R. 223 in 1726, being that precedent insofar as a trustee may not make a profit for himself through his trusteeship whatsoever. It is a fundamental duty of a fiduciary trustee, whether in bankruptcy or otherwise, that he must not permit his personal interest to conflict with his duty as trustee. This duty extends to any profits which the court may consider to be acquired improperly and precludes the trustee from overcharging his feed in the administration of the estate from which he is appointed

Both public and private trustees however are acting to the contrary and are widely profiteering. Same is said for the Secretary of State and the Official Receiver fees that are more often than not, misapplied and disproportionate to the level of work required or carried out.

The common synergy

In all the cases we investigated, the common synergy is that the offenders create liability that never was, either in the form of false claims or other alleged liability to enable insolvency to be used as the means of taking away one’s standing to further a claim, or, in other cases, to stymie the insolvency by making false claims, known as proofs of debt to prevent the legitimate creditors from being able to call a meeting or further the progress of the insolvency.

Those that fail to administer justice, the judges, are as much to blame as the corruptors within the sector. They all feed one another often off the fruits of one form of fraud or another.

Authorities Claims are not final in insolvency even if the claim is based on a judgment <br>Where there is cause to do so the courts have a duty to investigate

A Parliamentary investigation into abuse within the insolvency sector

Times Headline – 11th January 2021: Insolvency firms put under investigation after scandals

When businesses go bust their biggest creditors, usually banks, appoint insolvency firms to recover assets. That has prompted accusations among the stricken businesses that the recovery firms act in the interests of the banks over those of the business or other creditors.

The all-party parliamentary group (APPG) on fair business banking said it had received complaints from business owners that the present system did not do enough to protect their companies when they had fallen into insolvency. There is no independent regulator or ombudsman to oversee the industry.

Kevin Hollinrake, the Conservative co-chairman of the group, said: “In recent years there have been a number of high-profile failures in the insolvency industry. The APPG has also received its fair share of complaints about the system.”

In reality, whilst the exposure is promising, it is our view that the noise is nothing other than a “window dressing exercise” designed to convince the public the Government is doing the right thing when in reality, it is highly unlikely they will come even close to dealing with the true extent of the corruption within the sector.

About author

We are Intelligence UK International, a leading global private intelligence agency dedicated to investigating and combatting domestic corruption and economic crime where law enforcement fail. Bringing you hard hitting investigatory journalism, holding the unaccountable to account.
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