Over the last 10 years, there has been an ongoing discussion regarding an alternative to bankruptcy where the debtor has limited assets and there is little prospect of a return to creditors.
A proposal for a 1-year bankruptcy was put before Parliament, but didn’t proceed. The Government has now proposed a new alternative, the Minimal Asse
Over the last 10 years, there has been an ongoing discussion regarding an alternative to bankruptcy where the debtor has limited assets and there is little prospect of a return to creditors.
A proposal for a 1-year bankruptcy was put before Parliament, but didn’t proceed. The Government has now proposed a new alternative, the Minimal Asset Procedure (“MAP”). The potential elements of the MAP are:
The proposal is still at the discussion stage, so watch this space.
The Federal Court recently ruled with regard to Australian Financial Complaints Authority (AFCA) compensation claims paid to undischarged bankrupts.
The Court determined that the funds received from these claims are in the nature of compensation payments in respect of personal injury or wrong done to the bankrupt (whether before or after
The Federal Court recently ruled with regard to Australian Financial Complaints Authority (AFCA) compensation claims paid to undischarged bankrupts.
The Court determined that the funds received from these claims are in the nature of compensation payments in respect of personal injury or wrong done to the bankrupt (whether before or after the date of bankruptcy) and as such are not divisible property of the bankrupt estate (s.116(2)(g) Bankruptcy Act 1966).
As the funds do not vest in the bankrupt estate, the bankrupt is entitled to retain these funds.
Official Trustee in Bankruptcy v Kent [2023] FCA 1211
New figures from the Australian Financial Security Authority (AFSA) revealed that insolvency numbers fell in every state and territory except Tasmania, which recorded an increase of almost 13% from the previous year.
Of the new insolvencies in 2021-22, 63% were bankruptcies and 36% were debt agreements. The remainder were personal insolvency agreements and deceased estates.
AFSA Chief Executive Tim Beresford noted that while numbers are at an historic low, overall there are signs of increased insolvency activity.
‘In the June quarter, we saw 2,301 new personal insolvencies nationally – up from 2,215 in the March quarter,’ Mr Beresford said.
‘It’s no secret that Australia is facing ongoing economic challenges and we know this is likely to impact some individuals.
‘We expect there will be a reversion towards pre-pandemic volumes over the next two years.’
Christopher Michael Brown of WA was convicted this week and sentenced to 6 months’ imprisonment, to be released on a recognisance release order in the amount of $5,000 to be of good behaviour for 6 months.
The sentencing comes after Mr Brown pleaded guilty to one count of intentionally making a false statement in an affidavit used for
Christopher Michael Brown of WA was convicted this week and sentenced to 6 months’ imprisonment, to be released on a recognisance release order in the amount of $5,000 to be of good behaviour for 6 months.
The sentencing comes after Mr Brown pleaded guilty to one count of intentionally making a false statement in an affidavit used for the purposes of the Bankruptcy Act 1966.
The charge against Mr Brown was the result of an AFSA investigation into Mr Brown in relation to falsely stating, in a sworn affidavit, to have sufficient funds in his account to cover all his debts. The affidavit included an annexure indicating Mr Brown had a cash balance over approximately $172 million with the National Australia Bank (NAB), which he knew to be false.
It is an offence under section 263A of the Bankruptcy Act to make a false statement in an affidavit to be used for the purposes of the Bankruptcy Act.
Mr Brown became bankrupt by sequestration order on 10 May 2021, triggered by his grandparents as the petitioning creditors, who were owed $82,050.
Personal insolvencies decreased in August 2024, according to provisional monthly statistics released by the Australian Financial Security Authority (AFSA).
In August 2024, there were 1,119 new personal insolvencies, dropping from 1,157 in July 2024.
Of the new personal insolvencies, 617 were bankruptcies, 479 were debt Agreements, 20 were p
Personal insolvencies decreased in August 2024, according to provisional monthly statistics released by the Australian Financial Security Authority (AFSA).
In August 2024, there were 1,119 new personal insolvencies, dropping from 1,157 in July 2024.
Of the new personal insolvencies, 617 were bankruptcies, 479 were debt Agreements, 20 were personal insolvency agreements, and three were insolvent deceased estates.
Where AFSA could identify the industry in which an individual worked, the most common industries were:
During the same period, 310 people who entered a formal personal insolvency were also involved in a business, dropping from 315 in July 2024.
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