Insolvency Practitioners Association urges businesses and consumers struggling due to rising interest rates to beware fraudsters and seek professional advice
London, 22 June 2023
The Insolvency Practitioners Association (IPA), a Recognised Professional Body which licences and regulates Insolvency Practitioners is issuing a warning to businesses and consumers grappling with financial hardship in the face of increased interest rates.
With inflation remaining stubbornly high, the Bank of England has raised interest rates further today, meaning more businesses, families and individuals will find themselves in the position where they are unable to make ends meet.
This trend is already being reflected in official insolvency statistics as more businesses enter liquidation and more individuals reach out for help with their finances. The Insolvency Service’s monthly statistics for May showed company insolvencies in England and Wales jumped 40% year on year – the highest level since records began.
The IPA is encouraging individuals and businesses to seek help early when they are facing difficulty. However, the IPA is also cautioning individuals, families, and businesses to tread carefully when seeking advice, to ensure the advice they receive is from genuinely qualified and regulated sources.
The IPA reports that criminals and others are taking advantage of the financial hardship many are facing and warn that they are seeing an increase in the number of fraudulent websites masquerading as debt advisers, often providing false or misleading information.
The IPA strongly recommends that advice is only sought from firms employing a regulated Insolvency Practitioner, or firms authorised by the Financial Conduct Authority (FCA) to give debt advice, or firms regulated by an equivalent professional body. The Insolvency Service and FCA websites both provide tools to find regulated support.
Paul Smith, Chief Executive of the IPA commented:“The IPA works closely with the Insolvency Service, the Advertising Standards Authority, the FCA and other professional bodies to try and root out fraudulent and misleading advertising. This is a very challenging time for businesses and families alike and it is essential that reliable, high-quality advice is obtained, and that you fully explore the range of options available to you to deal with your specific circumstances.”
Notes to editors
The following government websites will help individuals and business owners respectively understand their options in more detail:
- Options for dealing with your debts: Overview – GOV.UK (www.gov.uk)
- Liquidation and insolvency – GOV.UK (www.gov.uk)
Details of licensed Insolvency Practitioners and who they work for can be found via the Insolvency Service Website at: www.gov.uk/find-an-insolvency-practitioner
Details of FCA registered firms can be found via the FCA website at: www.fca.org.uk