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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 1986 Act; 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 Debt Arrangement Scheme (DAS); or
– works as a money adviser for organisations which have been awarded accreditation at Type 2 level or above against the Scottish National Standards for Information and Advice Provision (see p000); or
– works as a money adviser for a citizens advice bureau which is a full member of Citizens Advice Scotland (see p000); 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.4aib.gov.uk/publications/form-2-certificate-for-sequestration
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:
      them being refused credit or being offered credit at a higher rate (before or after the date of being discharged);
      them not being able to remain in their current place of residence;
      damage to their business interests and employment prospects;
      them still being liable for some debts;
      their past financial transactions being investigated;
      other restrictions or requirements being imposed.
 
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Who cannot be approved debt advisers
The following cannot be approved debt advisers.1Reg 5 B(S) Regs
    A sheriff officer or messenger-at-arms, or an employee of such a person.
    A person or body providing financial services, or financial advice other than debt advice, in the course of a business or otherwise for profit, or an employee of such a person, unless the person is a solicitor or chartered or certified accountant.
    A credit union registered under the Co-operative and Community Benefit Societies Act 2014 or the Industrial and Provident Societies Act 1965 by virtue of section 1 of the Credit Unions Act 1979.
    A person providing debt collection services, or an employee of such a person.
    A person convicted of an offence involving theft, fraud or other dishonesty.
    A person subject to a bankruptcy restrictions order (including an interim order) under section 155 or 160 of the Act or subject to a bankruptcy restrictions order, or bound by a bankruptcy restrictions undertaking, under schedule 4A of the Insolvency Act 1986.
    A person in respect of whom a court has made a disqualification order under section 1, or who has had a disqualification undertaking accepted under section 1A, of the Company Directors Disqualification Act 1986.
    Persons without a licence from the Money Advice Trust to use the Common Financial Statement.
 
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Revocation or suspension of an approved debt adviser
The AiB can revoke or suspend an approved debt adviser if they fail to apply the CFT accordingly or do not maintain records of advice given.
A debt adviser must obtain evidence of a client’s income and expenditure and retain all records for two years and provide this information to the AiB on request.1Reg 7 B(S) Regs
 
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