Insolvency
The question
To ask the Secretary of State for Business and Trade, what recent assessment he has made of the effectiveness of current enforcement powers where directors of insolvent companies resume trading through new companies; and what steps he is taking to strengthen consumer protection in such cases.
Answered by Blair McDougall
Both civil and criminal enforcement tools, are used to address corporate abuse, that includes phoenixism. Director disqualification helps to protect the public from individuals who have demonstrated that they are unfit to be involved in the management of a company. The Insolvency Service is working with HMRC and Companies House to tackle abusive phoenixism.
Officials at the Insolvency Service are currently conducting a comprehensive review of the effectiveness of the corporate civil enforcement regime. Any specific proposals to strengthen the public protection provided by the regime will be subject to public consultation in due course.
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