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Bank Account
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Some time ago, I took out a simple bank account that doesn't have an overdraft facility. Someone who used to be a friend of mine asked me if he could use it to put any money into it that he earned because he didn't have a bank account. He said there was a time limit from going bankrupt to when he would be allowed to open an account. He said that it would only be for a year, but many years have passed since then. He has taken over the account so he uses it online from his address instead of mine. I want to close the account. I could send him a letter telling him that I am closing the account. How can I go about it?
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You and your friend are breaking the law on financial transactions, I understand you were just trying to help him out, but it is illegal for a bankrupt to have a bank account without permission from the bankruptcy court .
He is using you to get round the law that says he can not open his own bank account.
I would just close the account and send him the balance.
You could be in trouble over this, it is an offence to help a bankrupt by providing financial services .
He is using you to get round the law that says he can not open his own bank account.
I would just close the account and send him the balance.
You could be in trouble over this, it is an offence to help a bankrupt by providing financial services .
>>> He said there was a time limit from going bankrupt to when he would be allowed to open an account
Not entirely true. While most banks don't offer accounts to undischarged bankrupts, both Barclays and Virgin Money do.
However, to address your question directly, here's a draft letter for you:
"Dear Mr Bloggs
TAKE NOTICE that I intend to CLOSE the bank account held in my name at Toytown Bank plc (A/c No: 12 34 56 1234567) on 31st August 2017.
I advise you to WITHDRAW any money that you have in that account prior to the said date.
Should any money be left in the aforementioned account on 31st August 2017 I will transfer it to my own bank account and then make it available to you when you have provided me with details of an account to which the money should be transferred or otherwise indicated a mutually acceptable way of facilitating the transfer (e.g. by cheque).
Yours faithfully
A Explorer"
Send the letter by recorded delivery (or 'Signed For', as Royal Mail now actually call that service).
Whatever you do, try to avoid explaining the full situation to your bank as
(a) it appears that you've committed a criminal offence, under money-laundering legislation, by allowing someone else to operate an account in your name ; and
(b) the law requires banks to automatically notify the authorities whenever they discover that such a breach in the law has occurred.
Not entirely true. While most banks don't offer accounts to undischarged bankrupts, both Barclays and Virgin Money do.
However, to address your question directly, here's a draft letter for you:
"Dear Mr Bloggs
TAKE NOTICE that I intend to CLOSE the bank account held in my name at Toytown Bank plc (A/c No: 12 34 56 1234567) on 31st August 2017.
I advise you to WITHDRAW any money that you have in that account prior to the said date.
Should any money be left in the aforementioned account on 31st August 2017 I will transfer it to my own bank account and then make it available to you when you have provided me with details of an account to which the money should be transferred or otherwise indicated a mutually acceptable way of facilitating the transfer (e.g. by cheque).
Yours faithfully
A Explorer"
Send the letter by recorded delivery (or 'Signed For', as Royal Mail now actually call that service).
Whatever you do, try to avoid explaining the full situation to your bank as
(a) it appears that you've committed a criminal offence, under money-laundering legislation, by allowing someone else to operate an account in your name ; and
(b) the law requires banks to automatically notify the authorities whenever they discover that such a breach in the law has occurred.
Thanks Chris, that's just as I thought. Explorer 8 is committing a offence under the bankruptcy law, as well as money laundering .
Explorer 8 you need to get out of this situation fast, I realise you have been mislead but it is an offence and if it gets out you are going to have a job explaining it to the bankruptcy court!
Explorer 8 you need to get out of this situation fast, I realise you have been mislead but it is an offence and if it gets out you are going to have a job explaining it to the bankruptcy court!
Admirable feelings Explorer but you have done way more than enough!
It is your friend that has knowingly and intentionally mislead you into illegally helping him.
Contacting the bankruptcy court may well go against you, as they will probably yet incorrectly assume that you were a partner in the deception.
I would just do as you have been told and close the account then hand back any money he had in it.
The amount he owes is going to be in the high £ thousands , I think you need to be at least £5000 in debt just to start a bankruptcy hearing. Then there is the fact that all the cash he has earned since becoming bankrupt should legally have been used to pay off his creditors. There will be a lot of extra penalties to pay because he has not been illegally avoiding paying off his creditors. You will almost certainly be looking a tens or even hundreds of thousands of £s !
Cut and run is my opinion!
It is your friend that has knowingly and intentionally mislead you into illegally helping him.
Contacting the bankruptcy court may well go against you, as they will probably yet incorrectly assume that you were a partner in the deception.
I would just do as you have been told and close the account then hand back any money he had in it.
The amount he owes is going to be in the high £ thousands , I think you need to be at least £5000 in debt just to start a bankruptcy hearing. Then there is the fact that all the cash he has earned since becoming bankrupt should legally have been used to pay off his creditors. There will be a lot of extra penalties to pay because he has not been illegally avoiding paying off his creditors. You will almost certainly be looking a tens or even hundreds of thousands of £s !
Cut and run is my opinion!
correct statement of money laundering regs at present Chris
I was thinking of making a voluntary declaration to your bank
but I think Chris' way is better
( the bank may respond by closing ALL your accounts and putting you on the Bad Boys List - and you dont want that !)
You are A. Dimwit and he is A Friend
in order to get money into his account ( unless it is cash only ever) is to get cheques written to A Dimwit - in order for A Friend to use that money - s2 of the Fraud Act is engaged here ( for him ) and you would be compliant.
get that letter written !
I was thinking of making a voluntary declaration to your bank
but I think Chris' way is better
( the bank may respond by closing ALL your accounts and putting you on the Bad Boys List - and you dont want that !)
You are A. Dimwit and he is A Friend
in order to get money into his account ( unless it is cash only ever) is to get cheques written to A Dimwit - in order for A Friend to use that money - s2 of the Fraud Act is engaged here ( for him ) and you would be compliant.
get that letter written !
Ummm bankruptcy does pay off your debts , but the law is that you must co-operate with the bankruptcy court and make best efforts to repay as much as possible. This has to be for at least a year but can be much longer. This person has obviously not made any attempt to pay off what he owes and is has just carried on working and putting what he earns into Explorers bank account to avoid paying.
Eddie, that's not Correct. The only debts anyone can chase you for once you've been declared bankrupt are:
secured debts, such as a mortgage or charging order on property
debts where a bailiff has got a walking possession order or controlled goods agreement.
magistrates court fines
maintenance arrears
child support arrears
social fund loans
student loans
any payments a court has ordered you to make under a confiscation order, for example for drug trafficking
debts to HM Revenue and Customs, who have a right to recover payment by taking belongings after bankruptcy. They can't try to make you pay in any other way, for example by taking money from your wages.
secured debts, such as a mortgage or charging order on property
debts where a bailiff has got a walking possession order or controlled goods agreement.
magistrates court fines
maintenance arrears
child support arrears
social fund loans
student loans
any payments a court has ordered you to make under a confiscation order, for example for drug trafficking
debts to HM Revenue and Customs, who have a right to recover payment by taking belongings after bankruptcy. They can't try to make you pay in any other way, for example by taking money from your wages.
I agree with PP , just close the account ASAP !!!!
The longer this goes on the more the chance of you getting dragged into a dispute with the bankruptcy court . I now think it is best to just close the account without even warning him! He will probably just start threatening you if you tell him what you are going to do!
The longer this goes on the more the chance of you getting dragged into a dispute with the bankruptcy court . I now think it is best to just close the account without even warning him! He will probably just start threatening you if you tell him what you are going to do!
It is not against the law for an undischarged bankrupt to have a bank account without permission from the bankruptcy court, unless the bankrupt is subject to a bankruptcy restriction order which specificallys states so. The problem used to be was that banks would not offer a bank account to those who are undischarged, but now many do. A bankrupt is automatically discharged after a year unless there is a BRO.
On bankruptcy, your debts crystallise at that precise moment. Any assets you owned at the time of bankruptcy are taken into account and used to discharge creditors. Unless the bankrupt is subject to an income payments order, his earnings are his to keep and there is no duty to work to pay off the debts included in the bankruptcy.
The bankruptcy limit is £5k since 2015, but before that it was only £750.
I would suggest that explorer closes the account. I cannot see there are any offences under the Insolvency Acts but there may be other offences.
Explorer, try not to worry and just write to him to close the account. You could also go to this website https:/
On bankruptcy, your debts crystallise at that precise moment. Any assets you owned at the time of bankruptcy are taken into account and used to discharge creditors. Unless the bankrupt is subject to an income payments order, his earnings are his to keep and there is no duty to work to pay off the debts included in the bankruptcy.
The bankruptcy limit is £5k since 2015, but before that it was only £750.
I would suggest that explorer closes the account. I cannot see there are any offences under the Insolvency Acts but there may be other offences.
Explorer, try not to worry and just write to him to close the account. You could also go to this website https:/
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