Looking for a bit of advice on bankruptcy..

Discussion in 'General Chat' started by benecios, Sep 5, 2006.

  1. benecios

    benecios Senior member

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    A friend made himself bankrupt last week,before doing so he withdrew the entire balance of his bank account(which was a paltry £12000).He made this withdrawal approx 3 months ago.My question is when he speaks to the official receiver and he asks him where it went and he says I spent it on various things,will he accept that or will he have to account for every penny with receipts etc....I live in England so I would need advice regarding English law.
     
  2. odoreater

    odoreater Senior member

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    I know nothing about English bankruptcy law, but under American bankruptcy law (which, presumably was influenced by English bankruptcy law), your friend's withdrawal of all the funds in his bank account could be considered a fraudulent transfer if he didn't receive reasonably equivalent value in exchange for them. If a creditor objects to the transfer you will probably have to account for every penny (roughly) spent in order to determine whether reasonably equivalent value was received in exchange for the transferred funds. Again, English law might be totally different, but this is a starting point.
     
  3. Violinist

    Violinist Senior member

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    A friend made myself bankrupt last week,before doing so he withdrew the entire balance of his bank account(which was a paltry £12000).He made this withdrawal approx 3 months ago.My question is when he speaks to the official receiver and he asks him where it went and he says I spent it on various things,will he accept that or will he have to account for every penny with receipts etc....I live in England so I would need advice regarding English law.

    Is he one of your soccer pals?
     
  4. benecios

    benecios Senior member

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    Is he one of your soccer pals?

    Yes he is actually.Will that influence the advice you are about to give? Maybe you are going to enlighten me,I am no expert but I didnt think playing soccer part time had any bearing on a case like this.
     
  5. benecios

    benecios Senior member

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    I know nothing about English bankruptcy law, but under American bankruptcy law (which, presumably was influenced by English bankruptcy law), your friend's withdrawal of all the funds in his bank account could be considered a fraudulent transfer if he didn't receive reasonably equivalent value in exchange for them. If a creditor objects to the transfer you will probably have to account for every penny (roughly) spent in order to determine whether reasonably equivalent value was received in exchange for the transferred funds. Again, English law might be totally different, but this is a starting point.

    Cheers,I will pass it on,it should be helpful.
     

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