Investigations by an administrator and liquidator…..

When a company enters into a formal insolvency process, one of the office holder’s roles is to review the company’s records and identify any claims which may be brought against directors or third parties.

Most IPs are now using AI to analyse transactions especially the bank statements which saves significant time and cost. This means that claims can be identified within weeks rather than months and there is now little prospect of a client being able to “sweep some transactions under the carpet” and hope that the IP does not find out about them. Issuing these claims when a company has been placed into an insolvency process can cause considerable stress for the client especially if no discussions have taken place at the pre-appointment stage about the duties of the IP and any potential claims.

At Redman Nichols Butler, our approach is to work with the company and their professional advisors to identify and find a resolution to these issues at the pre-insolvency stage. This gives all parties (including the company’s creditors) some certainty as to the likely outcome of the insolvency proceedings.