OR threats to benefits

[ianmillington]

All right Skippy, you wanted to know! here is what your IPA buys:

Contributions 7181
CW fees 5%+VAT 675
Available 6506
Balance of OR admin fee (after £300 deposit) 1415
OR Realisation Fees incl VAT 1559
DTI Ad Valorem Fee (Bank Charges) 5181 x 17% = 880 (+ £15 every 3 months IIRC)
OR distribution fee about £260 inc VAT
To Creditors £2200 approx.

Makes you wince!

Ian

[ianmillington]

Chris

Glad to see that you have at least had one piece of good news

After discharge the OR can't get an IPO and by implication ought not to attempt to gain your consent to an IPA

Ian

[wen]

Not wanting to drive this OT, but I thought I read somewhere that the average "cost" of a bankruptcy was about £10,000 to the Insolvency Service.

It may have been one of those 97% of all facts being made up on the spot situation, but I certainly read it somewhere!

[MelanieGiles]

The Insolvency Service levy Ad Valorem fees which are based on a percentage of realisations - usually 17% on receipts in excess of £2,000. So the average fee across the board is probably more like £10,000, but Ian's example was very specific to Chris' circumstances.

[chris.g]

It is looking more and more likely that the OR has chosen to use hubby's WTC just to cover their fees. She kept stating that the IPA was beneficial to our creditors and how they had a duty to obtain as much for them as possible when really it was to cover their fees. It does make you realise just how little the creditors actually do receive from bankrupts, not a lot at all.....

[wen]

And then the question begs to be asked how some creditors can say no to an IVA proposal when you can see what the alternative is!!

[Reviva UK]

Hi Wen
just wondering how things went for you on the day.
also how did you get on with the OR meeting?

Maybe your experience could help others who are overly worried

[aguise]

Paul why arent you in bed. I am doing my usual not able to sleep. Iv'e tried for 2 hrs and given up. Trouble with working nights your brain cant decide what you are doing.

Ang

[ianmillington]

You know, the more I think about this, the more wound up I feel about it. If I, Melanie or any any other IP for that matter were to misrepresent the need for payments in this way, our licensing bodies would be seeking to strike us off.

Chris - don't let this go please. Speak to one of the Assistant Official Receivers about it.

Ian

[chris.g]

I'm waiting until things get sorted, I have a niggling feeling that she will find the need to add in the other benefits already mentioned to bring the disposable income back up, but we will have to wait and see. If that happens, we will not agree to the IPA, as reading the advice, benefits wouldn't be taken into account for IPO......
I do take your point Ian, I wonder how many other's have had their IPA's calculated this way. Do you think it would be an idea to contact the Assistant OR to bring it to their attention? If you do , can you advise me how to do that?

[MelanieGiles]

I would be very careful if you are going to go about accusing the OR's staff of manipulating figures just to recover their costs. In my experience, the Official Receiver's office are a relatively uncommercial organisation who work to the rule book and sometimes get things wrong. I suspect that this is down to an inexperienced examiner more than anything, but (so far as I am aware) there is no correlation between recovering costs and the setting of IPAs.

If you genuinely feel that your IPA has been miscalculated, then a chat with the AOR is essential to avoid being taken to Court, but I would be very suprised if this calculation has been performed with the sole motivation to recover costs.

[ianmillington]

Hi Chris

If she does do what you fear, then simply ask her to put the matter to one of the Assistant Official Receivers. She shouldn't have a problem with this. If she does, draw your own conclusions. Make a fresh phone call and ask the switchboard to put you through to one of the people here ( I think you're with the Newcastle OR?):

http://www.insolvency-service.co.uk/off ... =newcastle

Ian

[chris.g]

Thanks Ian, that's great and yes it's Newcastle. Trouble is, I'm expecting the benefits to go down anyhow in April when they are reviewed so it'll have to be reviewed if she does include them. Maybe she was just being a bit over zealous in trying to hit her targets......

[ianmillington]

I take your point Melanie and would hope you are right. I would certainly not suggest that it's Insolvency Service policy to act in this way. I am sure that we have a case of an over-zealous examiner who appears to have made up her mind to get an income payments agreement. I would certainly hope that now that Chris has lost her job the very idea of an IPA will fall away.

Whilst I would not for one minute suggest that Chris makes allegations about the examiner's conduct, the representations allegedly made about the IPA being for the benefit of the creditors, without disclosing that the creditors won't actually receive a penny, I find somewhat concerning.

Clearly Chris I would suggest that if you find it necessary to go higher up, you do so with appropriate tact and diplomacy. [:)]

[chris.g]

Thanks Ian, hopefully it will not come to that.