• Stanford, Liquidations and the Serious Fraud Office
  • June 8, 2011 | Author: Steven D. Richards
  • Law Firm: Jones Day - London Office
  • In relation to insolvent liquidations under U.K. law, one of the primary objectives will be the implementation of an efficient process to preserve and recover assets for the benefit of the creditors. This is particularly so where there is a need to instigate costly litigation or cross-border recognition proceedings and where the liquidator will want increased assurances as to the likelihood that those steps will generate positive returns. Difficulties can arise, however, where - as is often the case when fraud has contributed to the insolvency - criminal investigations are being conducted in parallel to the liquidation proceedings. In those circumstances, the criminal process is often afforded a priority, which can have a prejudicial effect on civil recovery actions and the liquidation process generally. In this article, we take a brief look at the interaction between insolvency and criminal proceedings in the context of the recent decision of the U.K. Court of Appeal in Re Stanford International Bank Ltd (In Liquidation) [2010] EWCA Civ 137.