Certificate for Sequestration
A Certificate for Sequestration of the client’s estate is a certificate granted by an authorised money or debt adviser (or other authorised persons) certifying that the client cannot pay debts as they become due.1Reg 8 B(S) Regs No fee can be charged for completion of the certificate.2Reg 9 B(S) Regs Who is an authorised person?
An authorised person includes anyone who:3Reg 3 B(CS)(S) Regs – is qualified to act as an insolvency practitioner under section 390 of the Insolvency Act 1986; or
– is an individual who works for such an insolvency practitioner and has been given authority by that practitioner to act on the practitioner’s behalf as a money adviser for the purposes of the DAS; or
– works as a money adviser for organisations which have been awarded accreditation at type II level or above against the Scottish National Standards for Information and Advice Providers (see here); or – works as a money adviser for a Citizens Advice Bureau which is a full member of Citizens Advice Scotland (see here); or – works as a money adviser for a local authority; or
– is approved for the purposes of the DAS.
A debt adviser must grant a certificate only if the client can demonstrate that they are unable to pay their debts as they become due.
The certificate must be in Form 2, be signed by the debt adviser and the client, be on the organisation’s headed paper and be less than 30 days old.
A copy of the certificate can be found in Schedule 1 of the Regulations or on the AiB website.4 Before granting a Certificate for Sequestration, an authorised person must give the client advice on:5Reg 6 B(S) Regs •their income and expenditure in accordance with the CFT;
•the evidence required to confirm their debts;
•the Debt Advice and Information Package;
•the options of a voluntary repayment plan, debt payment programme under the DAS or a trust deed;
•the consequences of sequestration and that an award of sequestration, if granted, is recorded in a public register and may result in:
◦their being refused credit or being offered credit at a higher rate (before or after the date of being discharged);
◦their not being able to remain in their current place of residence;
◦damage to their business interests and employment prospects;
◦their still being liable for some debts;
◦their past financial transactions being investigated;
◦other restrictions or requirements being imposed.