This article was first published in the February 2026 issue of Corporate Rescue and Insolvency journal published by Lexis Nexis.
Key points
- In their career, many insolvency practitioners (IPs) will be approached to take on cases from another IP. That may be when another IP in the same firm is retiring or leaving; where an IP joins a new firm and inherits a portfolio; an external approach from an IP in another practice looking to wind-down or a commercial acquisition of a book of cases from another IP/firm. Alternatively, in a small number of cases, the approach may be from a recognised professional body (RPB) as a result of an IP’s licence being withdrawn.
- In our monitoring visits, it is sadly not uncommon for us to find issues with the control and administration of transfer cases by the successor IP. Is it just that IPs do not feel as invested in those cases that they have not lived and breathed from the start, or do they somehow see them as less important? Whatever the reason, it seems as though we need to shift the mindset.
- In this article, the Head of Insolvency Monitoring at ICAEW explores the problem and how IPs can more successfully navigate the challenges.
Understanding the risk spectrum
Transfer cases vary in risk:
- Low risk: These are likely to be transfers between insolvency practitioners (IPs) in the same firm, typically due to retirement or an IP leaving. In such situations, there is likely to be the opportunity for the handover to be smooth and planned. As the cases are likely to be subject to the same processes as the successor’s existing portfolio, the successor should be able to have confidence in their management. The successor IP can also benefit from direct access to their predecessor in the handover period or the existing case team if they have any questions.
- Moderate risk: Transfers from retiring IPs in other firms may present a more elevated risk as the successor IP will not have any knowledge of the firm’s processes, or the quality of the retiring IP’s work. It should, however, be possible to do some due diligence to satisfy the successor that they are not going to be inheriting cases with numerous compliance issues.
For example, the successor could ask to review a sample of the cases; ask to see the retiring IP’s last compliance review or monitoring visit report; or search the disciplinary and regulatory findings published by the Insolvency Service. We have seen some instances where the retiring IP’s case team has moved to the successor IP’s firm along with the cases. While this can ease resource pressures, where this happens, we would always recommend that the successor IP carries out an independent review of the portfolio at an early stage to ensure that the cases have been handled to an appropriate standard, and that all compliance matters have been dealt with. Inheriting a portfolio on joining a new firm could arguably also fall into this risk-rating, as the successor IP will not have any direct experience of the quality of the portfolio. - High risk: Transfers following the death of an IP or regulatory/disciplinary action can present significant challenges for the incoming IP. The former category may bring practical issues in getting hold of all the case records, which may not always be up to date if the previous IP had a period of ill health. The latter category by its nature means that the portfolio will likely have numerous issues. In both cases we would advise successor IPs to consult the former IP’s recognised professional body (RPB) before agreeing to accept the transfer to see what they can share about the circumstances and the portfolio. While the cases need a new home, the successor IP can at least understand what issues they might face. It will also help the proposed successor understand what resource that portfolio will require, so they can be satisfied they have capacity to deal with it.
Pre-transfer considerations
There are several steps we would always advise IPs to take before agreeing to accept a block transfer.
At a basic level IPs should ensure that they hold the required insolvency licence. It may seem unnecessary to highlight this but growing numbers of IPs do not hold a full insolvency licence, having either a personal or corporate licence only. So, the first consideration should be about the mix of cases in the portfolio.
Check the jurisdictions involved. If there are mixed jurisdictions in the portfolio, IPs should ensure they are comfortable that they have the technical knowledge to handle cases in a jurisdiction that is different to that in which they usually operate. It might be that such cases would be better going to an IP specialising in those jurisdictions.
In a similar vein, IPs should consider the skill requirements if the portfolio includes case types they and their team are less familiar with.
Having adequate resource to administer any transfer cases is going to be a key concern, particularly if the transfer is substantial or is significant in relation to the successor IP’s existing portfolio. Taking on a portfolio of transfer cases should not adversely impact the conduct of the IP’s existing portfolio, and the impact could be significant if there is not additional resource, and if the transfer cases are in a poor condition and require considerable work to bring matters up to date.
It would be pertinent to enquire about any looming deadlines before the transfer goes through, for example any administrations or voluntary arrangements that are about to expire. These cases will require either urgent attention on appointment or steps to be taken before the transfer.
IPs may also want to enquire about statutory filing on the portfolio; and to check a sample of cases against Companies House records to verify that what they are being told is correct.
Finally, IPs should conduct their own anti-money laundering (AML) due diligence and ethical checks prior to the transfer to avoid taking any cases where there may be a conflict of interest or cases that might be outside their risk appetite. It is going to be too hard, if not impossible, to cease to act on these cases once in office.
Post-transfer actions
Once the cases have been transferred, several immediate actions are required, which is part of the reason that considering the available resource before the transfer is important.
The court order will set out the requirements for appointment notifications and reporting requirements, so will be the driver for the statutory requirements. The successor IP will need to ensure they comply with these.
It is also worth reviewing the court order to check that all the expected cases have been included. Sometimes the case list can be a moving feast as the application proceeds, especially as some cases may be moving to closure during the process. We have also seen examples of appointments being missed from a court order, necessitating a further court application.
Securing the estate accounts and cashiering records is an urgent requirement as the successor IP will become fully responsible for the cases on their appointment. Transfer of the estate monies to new estate accounts will be the safest approach but amending mandates on the existing estate accounts may be easier and more practical. If that is the approach being adopted, successor IPs should bear in mind that there may have been signatories on the estate accounts other than the previous officeholder, so it may not just be a case of removing one officeholder and adding another.
In terms of bonding, the value of the specific penalty sum should be based on any funds in hand at the date of the successor IP’s appointment, together with the value of any assets yet to be realised. The rationale for the bond value should be documented, particularly where there are outstanding assets and potential claims.
And then there is the need to obtain the case records, and to check at an early stage that they appear complete. Successor IPs will need to consider this when the transfer is from an external IP. There will be numerous critical documents, and any gaps should be identified at any early stage. With voluntary arrangements, it is essential that the successor has a copy of the issued proposals and the chair’s report, otherwise they will be completely unsighted as to the obligations they are supervising.
Review of the cases
We expect successor IPs and/or their staff to review all transfer cases at an early stage to identify the outstanding issues, and any deficiencies in the previous work which might need remediation. It is also particularly important to ensure that assets are adequately protected. This review should also identify whether there are any potential bond claims against the previous officeholder; and it should be documented.
If the previous IP’s staff have been transferred alongside a portfolio of cases, we would always recommend that the successor IP uses an independent member of staff to conduct this review. Assuming the successor IP is happy with the outcome of the review, the transferring staff can then continue to handle the cases, but they are unlikely to be best placed to identify any deficiencies or oversights in their previous case administration.
Ongoing management and monitoring
Once the initial review has been undertaken, transfer cases should be managed with the same diligence as the successor IP’s existing appointments. Ideally, the cases would be migrated to their case management system but, if that is not feasible for any reason, then the successor IP should introduce a sufficiently robust system to monitor and manage progression and ensure compliance with statutory obligations.
The struggle to find a successor
It is no secret that the RPBs generally struggle to find IPs willing to accept block transfers needed as a result of death, or regulatory or disciplinary action. We fully understand why IPs may be reluctant to take such a portfolio, particularly given they will be unsighted as to what they may have to deal with, and often there will be a lack of funds in hand to pay their costs.
I am not seeking to discourage IPs from accepting transfer cases, not least as that will make our existing difficulties in finding a successor even harder than it already is! But it is important that the successor IP goes into the process with an understanding of what is expected of them.
Changing the mindset
When my team select transfer cases for review, we allow a reasonable period of time since the successor IP’s appointment to allow us to review their work on the case, not the work of their predecessor. However recent monitoring visit findings, which include some basic administrative oversights such as failing to ensure assets are protected and case progression delays, suggest that transfer cases can suffer from a lack of ownership by the successor IP. Whatever the reason for that, we would like to change IPs’ mindsets; their responsibility for transfer cases is no different to that for their original appointments and they should not be treated any differently.
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