Tennis star Boris Becker has recently been found guilty of four charges under the Insolvency Act 1986 (the Act). This case shows that the Insolvency Service will take similar cases seriously and shows that there are clear consequences for individuals who try to conceal assets in bankruptcy. In this article, restructuring and insolvency partner Aman Sehgal explores the details of this case and what can be learnt from it.
What were the charges against Boris Becker?
Mr Becker was found guilty of four charges by the Insolvency Service, which were:
- the removal of property in contravention of s354(2) of the Act
- two counts of failing to disclose his estate in contravention of s353(1)
- concealing debt in contravention of s354(1)(b). These charges were in relation to the concealing of £2.5 million worth of assets and loans by Mr Becker to avoid paying his creditors.
How does the court deal with bankrupts concealing their assets?
Where the court finds someone guilty of the above offences, it has the power to order the following:
- Absolute Discharge – no further action is taken.
- Community Order – including community punishment orders, curfew orders, hospital orders, rehabilitation orders, supervision orders and unpaid work.
- Conditional Order – the bankrupt is released and the offence is registered on their criminal record. No further action is taken unless they commit a further offence within the time period set by the court.
- Disqualification – the bankrupt is disqualified for a specific period of time from becoming a director of a company, or directly or indirectly being concerned or taking part in the promotion, formation or management of a company without permission from the court.
- Financial Order – including an order to pay compensation to a party suffering loss and a confiscation order to prevent benefits of proceeds.
- Imprisonment – may be immediate imprisonment or a suspended imprisonment sentence of up to seven years.
In the Crown Court, unlimited fines can be imposed. Imprisonment is typically reserved for the most serious offences. Mr Becker’s ‘dishonesty and lack of humility’ played a significant part in his sentencing and demonstrates that the courts are prepared to sentence harshly where appropriate.
The Chief Executive of the Insolvency Service, Dean Beale, stated:
“This conviction serves as a clear warning to those who think they can hide their assets and get away with it. You will be found out and prosecuted.”
He also stated that this sentence given to Mr Becker demonstrates that concealing assets in bankruptcy is a serious offence. It seems that the Insolvency Service is taking these offences seriously and will be holding individuals responsible for their actions.
What can be learnt from the Boris Becker case?
Concealment of assets is a serious and prosecutable offence, as shown by this case. It also highlights the importance in being honest, acting in good faith and adhering to guidance during bankruptcy proceedings. By doing so, debtors avoid committing offences under the Act, for which they may be prosecuted.
If you have any questions or require further advice relating to insolvency/bankruptcy, please contact Aman Sehgal using the below details.
This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.