Derek was a successful trader in jewellery. One day whilst at lunch he was contacted by an employee informing him that a couple of people from the bank accompanied by an insolvency practitioner had suddenly arrived. They asked to look at the company’s books. Within two hours, the insolvency practitioner concluded that the business needed to close down. In subsequent report, they claimed that it took them two days to reach their conclusion, but they were on the premises for only two hours and informed Derek of the conclusion immediately afterwards. Derek said that he would consider re-financing the business, especially as he had an almost full order book. But this was not encouraged and the insolvency practitioner (an accountant) was not keen on it. Once a liquidator was appointed, Derek was not consulted for the running of the business. The liquidator had no knowledge of the jewellery business, but proceeded to place of valuation of £50,000 on the contents of the strongroom. Within a week, a sale was organised. The liquidator had no idea of the worth of the tools. Items previously valued at £35,000 were sold for just £3,000. Many sets of jewellery were separated and sold as separate items thus decimating their value. The rubbish piled on the floor included pearls and gemstones. Valuable solutions used in the jewellery business were given away for no charge.
Derek's business and life has been ruined. He cannot appeal to any independent
ombudsman to have his case investigated. Meanwhile, insolvency practitioners
continue to enrich themselves.