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Client liquidating company

should we file an SAR

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in a nutshell, client has called up advising they have set up a new company as they are liquidating their existing one

asked why, for no other reason than they wont have to pay their bounce back loan back (remains to be seen!)

should we file an SAR?

Replies (11)

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By David Ex
22nd Nov 2021 16:30


Thanks (4)
By Paul Crowley
22nd Nov 2021 16:45

Probably a good idea, but bank will object anyway.
Not hit that problem yet as the only (former) client trying get rid of a company with an oustanding BB Loan paid us off and went elsewhere to a much much bigger firm
That bigger firm even completed the DS 01 in their firm name, and the personal name of one of the employees, marketing coordinator per website. In the public domain.
An objection received so it is going nowhere at the moment
The accounts showed most of the loan drawn out as negative DLA
No accounts filed (no surpise there) but recently a confirmation statement was filed

Why do we all care when the bigger firms actually appear to encourage this sort of thing

Thanks (7)
Replying to Paul Crowley:
By atleastisoundknowledgable...
22nd Nov 2021 18:57

I had one who DIY’d it with a DS01. Well, tried, but the bank blocked it and called in the BBL. Client has engaged liquidator for CVL …

That’s in addition to the 2 who went straight to CVL.

Thanks (1)
David Winch
By David Winch
22nd Nov 2021 16:37

How far have they got with this? Was this the client's intention when applying for the loan?
The reason I ask is that I am wondering if they have obtained (as distinct from they are planning to obtain) a benefit of criminal conduct.
No need to file a SAR until you suspect they have obtained a benefit of criminal conduct.

Thanks (5)
the sea otter
By memyself-eye
22nd Nov 2021 16:59

for no other reason...
won't have to repay...
sounds like fraud to me
report. - it will be a waste of time though.

Thanks (0)
By jwill76
23rd Nov 2021 13:29

I've heard many comments so far like 'its government backed aint it, so I dont have to repay it. If I do I'll just close up or go bust'

Yeah, sure.....

Thanks (0)
By Tosie
23rd Nov 2021 15:41

I am sure that most of us will be facing similar questions over the coming months. Legally what are the implications of closing a company with such a loan ? What is our position as accountants. Interesting situation to watch.

Thanks (0)
Lisa Thomas
By Lisa Thomas
23rd Nov 2021 16:48

Assuming the company is insolvent, I don't see what the issue is in liquidating?

Pheonixism is legal as long as it's done properly.

I'd be interested to know what happened to BBL funds. If there has been fraud with the original application, or misuse of funds and/or a DLA owed by the Director, the liquidator/s will investigate/report/pursue.

Thanks (0)
Replying to Insolvency Practitioner:
By petestar1969
24th Nov 2021 11:12

Hmm, its likely the BB loan was seen as a form of "grant" to supplement missing profits by the client and all the money was paid out to the director/shareholders as "dividends" against little or no profit.

I have a few clients in this situation. Luckily for me I didn't assist them in getting the loans and they have all gone quiet on me.....

Thanks (1)
Replying to Insolvency Practitioner:
paddle steamer
24th Nov 2021 11:26

Who is paying for these liquidators if company has already been picked clean and HMG are underwriting the bank's losses?

Some may have a liquidator appointed but for the rest nothing will happen.

We right now have a tenant in arrears (commercial property), we cannot evict within current Covid rules (extended to March) they never lodge accounts, new company already formed by director , old company which owes us will no doubt be struck off, we likely go down for £5-£7k, we will do nothing, we certainly will not throw good money after bad and I expect with the banks and BBL this will often be the path they take.

Thanks (0)
By cfield
24th Nov 2021 11:47

If he transferred all the BBL money to himself, there is almost certainly going to be an overdrawn DLA which the liquidator will be bound by law to collect. He will probably then have to agree (and pay for) a CVL or declare bankruptcy.

Thanks (3)
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