Four-time bankrupt hit with fourteen-year restriction


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This article was originally produced by the Insolvency Service and was published on 10th April 2018. The original version of the article can be found by clicking here.

The ban, from 7 February 2018 to 6 February 2032, one year short of the maximum, follows an investigation into the affairs of Fintan Noel Arrowsmith.

During the period 2010 to 2017, Fintan Arrowsmith had traded as a horticulturist but ceased trading in April 2017 after the failure of his crop.

He stated his liabilities mostly related to stock obtained on credit from suppliers and on 18 October 2017, Fintan Arrowsmith filed on his own bankruptcy petition, listing a deficiency of £39,374.

Fintan Arrowsmith was interviewed by the Official Receiver at which time he stated that he had traded as F Arrowsmith, Glebe Farm Nursery during the period 2010 to April 2017.

He further explained that in 2016 he had a significant loss of his perishable stock, which were uninsured as no underwriter was willing to insure him because of his bankruptcy history

The Insolvency Service investigation into his affairs confirmed that Fintan Arrowsmith had signed a Bankruptcy Restrictions Undertaking (BRU) on 17 November 2009, which was accepted by the Secretary of State and was effective for 11 years to November 2020.

This meant that Fintan Arrowsmith had defied his bankruptcy restrictions and obtained a variety of stock and supplies, to the value of at least £24,549, from trade creditors on cash-on-delivery and credit terms.

The Official Receiver made enquiries with these trade creditors, all of whom confirmed Fintan Arrowsmith had not disclosed that he had been made bankrupt before obtaining credit and that they would not have extended credit to Mr Arrowsmith had they been aware of this.

On 6 February 2018, the Secretary of State for Business, Energy and Industrial Strategy accepted a bankruptcy restrictions’ undertaking (BRU) from Mr Arrowsmith (47), which means he is to be bound for 14 years, by the restrictions set out in insolvency law that a bankrupt is subject to until they are discharged from bankruptcy – normally 12 months – until 2032.

Gerard O’Hare, an Official Receiver at the Insolvency Service, said:

Where a bankrupt has acted contrary to restrictions placed upon him by insolvency law, by obtaining credit with fully disclosing his states, he should not expect to do so without consequences, particularly when others suffer financial loss as a result.

A bankruptcy restriction in these circumstances will serve to provide creditors with a degree of protection, and it will also act as a deterrent to the bankrupt not to act in a similar manner in the future.