What does the Drayton Manor Park sentencing decision mean for insolvency practitioners?

A number of important points arise from this case:

• The authorities, especially the Police and HSE, see a public interest in pursuing investigations and prosecutions even where they know there are no funds to pay a fine and will pursue their investigation and enforcement powers to the fullest extent
• There are different interests to consider in situations like this between the office holders, outgoing management team and the insurer (where policies can cover defence costs and prosecution costs awards) and it is important to have an experienced defence team who understand and will properly address all of those interests, especially given the intense press goldfish bowl that swarms around these high profile cases.  This is of course not forgetting the interests of creditors at the sentencing stage
• The Court will look carefully at the company’s insolvency position in terms of whether a fine might dilute any potential distribution to the pool of unsecured creditors – it is by no means automatic that the Court will issue a full fine in circumstances which would prejudice the existing interests of unsecured creditors when a distribution is made so insolvency practitioners will have to consider with their legal team whether to make representations in appropriate cases

What to consider when a prosecution is threatened or ongoing?

There are a number of key points to consider when a prosecution is threatened or ongoing. Please don’t hesitate to contact us or your local restructuring partner, who will be ready to discuss any issues with you and put you in touch with our experienced regulatory team at short notice.