Business Irish

Saturday 3 December 2016

Bankrupts risk prosecution by continuing links with firms

Emmet Oliver

Published 13/01/2011 | 05:00

BANKRUPT business people have been warned they cannot have any role in a company or they will face prosecution by the watchdog Paul Appleby.

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The number of bankrupts has risen sharply since the recession began and it is understood some of these individuals have tried to retain a link with their former firms, often behind the scenes.

But now the Companies Registration Office (CRO) has reminded firms that bankrupts who are still repaying debt, cannot, directly or indirectly, promote or manage a company unless they have the permission of the High Court.

This regulation arises in the 1963 Companies Act and only refers to undischarged bankrupts -- that is people who are still involved in repaying debt to their creditors.

The issue of bankrupts has become especially prominent since Sean FitzPatrick went into bankruptcy last year after he could not repay loans to Anglo Irish Bank.

There is no suggestion here that Sean FitzPatrick has retained a management role in any company.

The CRO has also warned that companies must file accounts for each year of their operations and not so-called 'accumulated accounts', where several years are lumped together in one set of financial statements.

"Notice is now given to all companies and presenters to the CRO that amalgamated accounts will no longer be accepted by CRO with annual returns that are received by CRO, with effect from 31st December 2011.''

Since February 1, 2007 the CRO has not accepted amalgamated accounts covering more than one financial year, where more than one annual return is being filed.

"The only exception is where more than three annual returns and associated accounts are being filed, in which instance the most recent three annual returns must be accompanied by an individual set of accounts,'' said the CRO.

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