Bankruptcy Restriction Order
A Bankruptcy Restrictions Order (BRO) can be made by the AiB or the sheriff where a client behaves inappropriately before or after the date of sequestration.1Part 13 B(S)A 2016 BROs were introduced to deter clients from misbehaving or being dishonest and to provide businesses and creditors with a level of protection. A BRO can help ensure those who abuse the bankruptcy process to face the consequences of their actions. This can include an appearance in front of a sheriff if the AiB deems the client’s behaviour has been exceptionally serious.
It is normally made after the date of sequestration and before the discharge of the client (six months), but can be made after this time on application to the court by the AiB.
There are two time limits for this.
•Where the AiB make the order, it can last for between two and five years for less serious cases.
•Where the sheriff makes the order, it can last for between five and 15 years for more serious cases.
Trustees (or agents) have a duty to report any misconduct to the AiB.
What can be deemed as misconduct?
– Not co-operating with your trustee during the period of your bankruptcy.
– Incurring debts that you knew you had no reasonable chance of repaying.
– Giving away assets or selling them at less than their value.
– Deliberately paying off some creditors in preference to others.
– Gambling or making rash speculations or being unreasonably extravagant.
– Failing to keep or produce records that would explain a loss of money or property.
– Fraud or fraudulent breach of trust.
– Causing your debts to increase by neglecting your business affairs.
– Failing to supply goods or services that have been paid for.
– Carrying on a business when you knew or ought to have known that you could not pay your debts.
– Failing to supply accurate information for the granting of a certificate for sequestration.