Asset Stripping

Phoenix companies, liquidation & insolvency

This involves selling the assets of a business individually making a profit. It usually entails taking the company’s assets that are of value as well as their funds whilst leaving behind the debts. The stripping consists of the company directors only transferring the assets of one company to another and not the liabilities. This creates an inactive company with large liabilities that can’t be met which means it has to be put into liquidation.

Stripping a company’s assets is normally done because of two main reasons. Firstly fraudsters may intentionally target a company or companies to take ownership, move to assets over and then put the stripped organisation into liquidation. The other main reason involves ‘phoenixing’. This is when the company directors move the assets from one limited company to another so that the benefits of the business are secure and so they can avoid the liabilities. Generally the directors will be the same in both companies which usually arises as a way of rescuing the assets of a failing business rather than targeting a company.

Phoenix firms and asset stripping are investigated by the Financial Services Authority or by the Companies Investigation Branch.

Share your experiences

Please note: The views expressed in community areas of this site do not necessarily reflect or represent the views of Law on the Web, its owners, its staff or contributors.

Fraud law solicitors — the scourge of charlatans

BusinesswomanIf someone sets out to deceive another person for their own gain they have committed fraud. Fraud solicitors specialise in constructing the arguments and examining the evidence to help punish these people.

Find out more

Types of fradulent practice to watch out for

The Mystery of the Missing MoneyFraudulent activities cost the UK millions of pounds every year, the average company in the UK loses over £100,000 every year thanks to fraudulent behaviour on the part of employees, customers, clients and professional fraudsters.

Find out more

Legal advice on fraud law

meetingFraud can be very damaging an individual or a business. This article gives some introductory legal advice so that people can begin to understand what the law is surrounding the process of fraud.

Find out more
Get unlimited telephone legal advice
Instant Law Line Business
Licence Assist
I found Law on the Web to be very informative when looking for a solicitor to do our family will. It helped me find key information fast and when getting in contact with a solicitor I already had some knowledge on the subject and could focus in on what we needed. Thanks for all your hard work.
David Doulton, Long Ashton, Somerset May 2012

  Have you got a minute for a quick question?

Thank you for your response.