Business failure and challenging antecedent transactions

September 29, 2022

Sector: Finance

If you have lent money to a business that has become insolvent, then recovering your debt can be a difficult process. In many cases, the best course of action is to investigate the root cause of the business’ failure to develop a greater understanding of who’s liable. Under scrutiny, you may even discover that actions took place before insolvency that put your money at risk. If any antecedent transactions did take place, then you need to challenge them in order to recover your assets.

Our advisers are deeply experienced in identifying root causes and contributing factors of business failures. They’ll help you find out if your credit was put at risk unnecessarily and guide you through the most appropriate course of action to recover what’s owed to you. If this is something you’d like to learn more about, get in touch and we’ll discuss how we can help you.

The scope of our business failure investigation services?

We have many forensic accounting specialists in our network, who can use their experience to investigate the circumstances surrounding the failure of a business and determine if any wrongdoing took place. Working closely with legal advisors, they’re ready to do what is necessary to give you closure on your losses following a business failure, including:

• Tracing funds, identifying and recovering assets, and conducting due diligence reviews
• Uncovering any wrongdoing that took place leading up to insolvency
• Providing evidence and explaining the nature of the wrongdoing in court

Investigating antecedent transactions

It could be that antecedent transactions took place in the two years prior to insolvency. In such cases, we work with multi-disciplinary teams including legal advisers and forensic experts to bring claims against the responsible parties. Our team of experts are experienced in uncovering and challenging the many types of antecedent transaction, including but not limited to the following.

Misfeasance: If a director has breached their duty by acting outside of the company’s best interests, damaging your returns in the process, then as a creditor you have the right to make a claim against them.

Preferential transactions: If the company made a transaction with another creditor, which gave them a preferential outcome after the insolvency, their gain may have been your loss. We can help you demonstrate that preferential transactions have taken place and work to convince the court that a reversal should be put in place.

Wrongful trading: If the director continued trading after it was clear that the company would become insolvent, then the court could declare them personally liable. We can use our expertise to help you prove that this was the case and improve your chances of recovering your debts in the process.

Why choose Kreston Global?

Don’t allow wrongful behaviour to go unchallenged. Kreston Global’s team of forensic accountancy specialists is on hand to help you. We will leverage our expertise and connections to obtain disclosures, trace and recover assets, and make claims against those responsible wherever we find misconduct.

You can look forward to many benefits when you become a member. Namely, access to an international network spanning more than 115 countries and 160 accountancy firms, each of whom adheres to the accountancy standards of their respective nation. We are also knowledgeable on international standards, meaning that we are able to pursue your business failure investigation wherever it may take us.

If you would like more details about our services – whether related to business failure investigations and antecedent transactions or otherwise – get in touch with us today.