There are no state guaranteed markets for mathematicians, scientists, engineers or computer experts but the insolvency market is controlled by over 1,800 insolvency practitioners who belong to various trade associations (accountancy and law firms). In contrast to the markets for these professions, there are no independent ombudsmen and no compensation for those who are injured by insolvency practitioners london abuse. There is also no system for insolvency regulators to investigate complaints and, even when they do take action, it can drag on for years. Moreover, these regulators are not openly elected and there is no parliamentary scrutiny of their work through a Select Committee. Instead they are largely trade associations and act simultaneously as promoters, defenders and prosecutors of their industry and the insolvency practitioners who form part of it.
Licensed insolvency practitioners (IPs) have an important role to play in helping to ensure that individuals and companies in financial distress are not subjected to excessive fees or treated unfairly during the insolvency process. It is essential that they are fully qualified to work in their roles and have the right experience. IPs can help companies avoid insolvency by working with directors to devise rescue and restructure strategies which may enable them to overcome the financial problems they are facing, and will not encourage a company to pursue an insolvency procedure when alternative rescue and restructuring steps could have been taken.
When a company is insolvent, the IP will work to realise the assets of the business and its book debts for the benefit of creditors and shareholders. They will also manage a formal insolvency procedure such as an administration, MVL or liquidation. In the case of a pre-pack administration, they will work to facilitate a sale of the business and its assets to another party and will be required to report on their activities to the relevant regulator.
In addition to case work, many IPs spend time on business development and maintaining strong relationships with their key stakeholders such as banks who may have a major interest in the cases they undertake. This is in addition to the time they spend on training to ensure that they meet high standards of technical knowledge.
Ultimately, an IP’s remuneration should be proportionate to the level of their skill and experience, and reflect the complexity and risks associated with the cases they undertake. However, it is clear that the courts across Europe and indeed the United States are increasingly concerned that insolvency practitioners are charging excessive fees and failing to prioritize the interests of unsecured creditors.
If you have concerns about an IP you should raise these with them in the first instance, as they will have details of their complaints procedure and should deal with any complaint fairly and efficiently. If you are not satisfied, you can then raise your concerns with the RPBs. In addition, the government has a searchable database that allows you to find an IP who is licensed to take insolvency appointments.