Insolvency Service Investigations
Insolvency Service Investigations & Prosecutions
What You Need to Know
The Insolvency Service is a government agency with wide powers to investigate company directors, bankrupt individuals, and business practices. If they believe there has been misconduct, they can take action through the civil courts – and in some cases bring criminal prosecutions.
When might the Insolvency Service investigate?
The Insolvency Service may look into you or your business if:
- A company has gone into liquidation or administration.
- A person has been made bankrupt.
- There are allegations of misconduct, such as:
Failing to keep proper company accounts or records.
Trading while insolvent.
Fraudulent or wrongful trading.
Concealing or dissipating assets.
Breaching the duties of a company director.
What powers do they have?
Investigators can:
Demand documents and explanations.
Interview directors and other individuals.
Apply to court to disqualify directors (up to 15 years).
Seek compensation orders for company debts.
In serious cases, bring criminal charges (for example, fraudulent trading, falsifying company books, or concealing assets).
What are the risks?
Director disqualification (up to 15 years).
Personal liability for company debts.
Criminal conviction with possible fines or imprisonment.
Lasting damage to your professional and personal reputation.
Can you challenge or defend proceedings?
Yes. With the right legal advice, you can:
Respond effectively to investigation notices.
Contest allegations of misconduct.
Negotiate with the Insolvency Service where appropriate.
Defend against disqualification applications or criminal prosecutions.
Why early advice matters
Investigations often begin quietly, with requests for records or interviews. How you respond at this stage can have a major impact on the outcome. Having a solicitor to guide you ensures your rights are protected, and that you put forward the strongest possible case from the outset.
Contact us
Liverpool – Head Office
- 19-23 Sir Thomas Street
- Liverpool
- L1 6BW
- office@cobleys.com
- 0151 242 9000
