Register of Insolvencies
The register of insolvencies is a statutory register about the insolvency of individuals and businesses in Scotland.
What are the consequences of bankruptcy?
Being made bankrupt is a very serious matter. A person must hand over their estate, including their home, to their trustee. In addition there are a number of other consequences to being made bankrupt. The following are some of the other consequences that a debtor should be aware of:
An individuals credit rating will be affected for many years. Neither the Accountant in Bankruptcy nor the trustee have any influence over a debtor's credit rating.
A bank may freeze or close an account of someone who is bankrupt. Some banks will allow a debtor to have an account, however the debtor must tell their bank that they have been made bankrupt. If a debtor has any savings they will be transferred to their trustee.
If a debtor experiences any difficulties with their bank account they should speak to their bank or a money adviser.
Service providers such as gas or electricity suppliers may have concerns with the way they provide services to a debtor and may wish to change the way they receive payments. The changes could include the installation of a meter or the set up of a pre-payment plan.
Every bankruptcy is recorded on a public register called the Register of Insolvencies (RoI). Anyone can search the RoI and there is no charge for doing this. Details of a bankruptcy will remain on the RoI until one year after the trustee has completed their duties.
If a trustee considers that a debtor's conduct has been dishonest or blameworthy in some way, either before or during the bankruptcy, they will report it to the Accountant in Bankruptcy. The Accountant in Bankruptcy may seek restrictions on the debtor's behaviour which can last between 2 and 15 years. Details of the restrictions are recorded on the Register of Insolvencies.
The following are examples of behaviour by debtors that could be considered dishonest or blameworthy:
- incurring debts that they knew they had no reasonable chance of repaying;
- giving away assets or selling them at less than their value;
- gambling or making rash speculations or being unreasonably extravagant; and
- not co-operating with the trustee during the period of the bankruptcy.
The Accountant in Bankruptcy will consider the evidence provided by the trustee and will make an application to the sheriff asking for a Bankruptcy Restrictions Order (BRO) to be made against the debtor if they have been dishonest or blameworthy in the bankruptcy. The sheriff will consider the application and any other evidence put before them and will decide whether they should impose a BRO. If the order is imposed, the debtor will remain subject to certain restrictions for the specific period stated in the BRO even after they are discharged from bankruptcy. Failure to comply with the terms of bankruptcy restriction is an offence.
It is possible for a debtor to agree to accept restrictions rather than go to court. This agreement is called a Bankruptcy Restrictions Undertaking (BRU).
Further information on bankruptcy restrictions is available in the AiB publication, 'Bankruptcy Restrictions - Orders and Undertakings'.