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CVA working for the administrators

Hi everyone. I am feeling so incensed that I have to get this off my chest. I know nobody can do anything about this but it is good to have a rant. Our small transport business was hit by two successive bad debts early in 2006. Business had not been good for a while and we were fighting to keep our heads above water. This bad debts amounting to some £20,000 were the death blow. Our MD though, was loathe to liquidate saying he didn't believe in walking away from his debts even though the company was limited. On the advice of a friendly accountant we contacted an insolvency practice ( a reputable one) to ask what were the options. After a couple of meetings we agreed to enter into a CVA. At the creditors meeting, nobody turned up as the nature of the business means that the only large creditor was HMRC. Lorries were leased (and paid up to date), fuel company was holding a security deposit, drivers were paid weekly. Over the next two years we paid £30,000 into the CVA but ended it this year as the administrators had taken more than £22000 in fees (they actually say they have written off £10,000 so their fees they claim should have been £32000). We always paid on time, always provided accounts on time - but when they charge £1000 for two people to attend an hour's meeting with us and actually charge out the secretary who checked there was a parking space available for us at £80 per hour, what chance do we have of paying enough to leave some in reserve for the creditors? I think these charges are a disgrace but there is nobody to complain to (or is there?). We were definitely misled over the level of fees and as I said to the partner dealing with it - had we known we would be working for years just to pay their fees we would never have entered into the CVA and he knows this. He gave us the advice knowing he was lining his own pocket in my opinion. Sorry to rant online but as if business is not difficult enough these days, there are these vultures waiting in the wings.

Comments

  • Hi pbell

    Thankyou for your post....its worth remembering that business are having tough times as well.

    Have you tried Nat Debtline , they have a free Business Debtline (sorry hav`nt got number) They offer free advice & hopefully can give you further avenues to explore.

    Anyone know Bus Nat Debtlines number?? or try main number 0808 8084000 & ask to be transferred.

    Can you come to a seperate arrangement with HMRC at all & to get out of the CVA??
  • RAS
    RAS Posts: 34,437 Forumite
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    National Debtline 0808 808 4000 Business Debt Line 0800 197 6026
    If you've have not made a mistake, you've made nothing
  • It's all to late now as the business is being liquidated. (Not by the firm who did the CVA - they said there was not enough money in the business to pay their fees to liquidate!!) so we are having to go with the Official Receiver. I just hope our sorry tale makes anyone thinking of entering a CVA think twice and get the level of fees they will be charged in writing that is absolutely clear and not open to misunderstanding. The fat cat insolvency practitioners should look to the banks - hopefully they will be next to have the licence to print money taken away.
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