Bankruptcy company shares

anonymous2242

Hello, I hope everyone is well. I help some help and advice.

Myself and my business partner have a 50/50 split in a company. He is about to close down another company he has and look at personal bankruptcy. He wants to transfer his 50% to his wife before and then file for personal bankruptcy. 

He is a essential part of the company for promotion. So when he is in bankruptcy he would be on social media talking about the product. 

First one is this allowed with the transfer to wife or is it better if he transferred it to me.

Second one is can he still be on social media talking about the product? He would have a paid position not any ownership as it would be with either his wife or myself. 

Can someone clear things up a little before he does anything.

Thank you in advance 

anonymous2242

Currently the company is worth very little but in a couple of months it will look very different 

MattMattMattUK

anonymous2242 said:

Hello, I hope everyone is well. I help some help and advice.

Myself and my business partner have a 50/50 split in a company. He is about to close down another company he has and look at personal bankruptcy. He wants to transfer his 50% to his wife before and then file for personal bankruptcy. 

He is a essential part of the company for promotion. So when he is in bankruptcy he would be on social media talking about the product. 

Whether it can promote the company depends in what way, in a marketing capacity, or is he essentially the product?

anonymous2242 said:

First one is this allowed with the transfer to wife or is it better if he transferred it to me.

anonymous2242 said:

Currently the company is worth very little but in a couple of months it will look very different 

Yes, no, maybe. If he transfers them in an attempt to deprive his creditors of assets then no he cannot, he would be far better to sell them at a reasonable price based on current value, so either the company buying back the shares, or you buying them from him would be a far better idea. Selling them to his wife is very unlikely to work.

anonymous2242 said:

Second one is can he still be on social media talking about the product? 

He can, but there would be restrictions in exactly how he could do it and it does depend, this is something you should seek proper legal advice for.

anonymous2242 said:

He would have a paid position not any ownership as it would be with either his wife or myself. 

He will need a defined role, a proper contract and his remuneration clearly defined, he would be unlikely to be able to buy back in for a significant period of time and it may be deemed as fraud if he were given, or effectively given shares in the company in the future, rather than buying them at a reasonable (not market) price. If his wife is involved it would be deemed that he was a shadow director and therefore not be allowed. 

anonymous2242 said:

Can someone clear things up a little before he does anything.

Thank you in advance 

Apart from the above my main bit of advice is that you need to get proper legal advice, as does he, independent from each other. 

Minkym00

First of all he should NOT transfer any shares to anyone prior to bankruptcy unless he sells them for fair market value, otherwise he'll be facing a bankruptcy misconduct allegation which could end up with him not being able to be a director for many years.  

So a section 11 offence would realistically mean him actively running a company - making decisions, access to the bank account, singing contracts etc. He can be an employee and chat about it on social media, that would not be of concern. If he cannot wait for a year until discharge he can always apply to the court for leave to act as a director An application costs about £100 and then he would need to go to court and explain to the judge why only he can do the job.