- tel: 0141 332 0915
- email: email@example.com
- 12 Nelson Mandela Place, Glasgow G2 1BT
Oraclelaw's Blog on Business & Law
Sheriff approves application for Bankruptcy Restriction Order
Scotland’s insolvency service, Accountant in Bankruptcy (AiB), recently secured another Bankruptcy Restriction Order (BRO) where an individual had behaved irresponsibly prior to the award of bankruptcy.
Bankruptcy Restriction Orders were introduced in 2008 to offer protection to creditors and businesses and impose certain restrictions on debtors who have acted inappropriately when made bankrupt, or expect to be made bankrupt.
There are various types of behaviour which can lead to a BRO, including gambling, extravagant living, speculation and failing to co-operate with their trustee. The restrictions can apply for between two and 15 years after bankruptcy.
In this case a Mr Graeme Edmundson Calvert, from Lockerbie, received a BRO after Sheriff Ross agreed with AiB that his misconduct was sufficient to warrant a BRO lasting nine years. The effects of the BRO mean that restrictions are placed on his future access to credit, the ability to manage a business and the types of employment opportunities available to him during the term of the Order.
The Sheriff was informed that Mr Calvert had gambled and lost more than £800,000 over a two year period. This included gambling over £400,000, received from Dumfries and Galloway District Council for the specific purpose of paying VAT bills to HMRC for a nursing home which he operated. AiB also informed Sheriff Ross that Mr Calvert had disposed of a number of vehicles, but was unable to account to AiB as his appointed trustee, for the money from their sale.
“Bankruptcy Restriction Orders and Undertakings are central to protecting not just the bankruptcy process, but the people and organisations owed money who suffer financially from irresponsible or unscrupulous behaviour," said Agency Chief Executive of AiB and The Accountant in Bankruptcy, Rosemary Winter-Scott. "They also alert potential future creditors and employers that an individual has demonstrated inappropriate behaviour before or during their bankruptcy and may therefore, be unsuitable for future credit or certain types of employment.”
“In this specific case, money which could have gone to the debtor’s creditors could not be accounted for and was recklessly gambled away," she added. "This sort of misconduct can have far reaching consequences, not only for creditors but for all parties involved.”