ACCA boss suggests government should form state bankruptcy body

The government should set up a high-level group to deal with the rise in bankruptcies caused by the global credit crunch, according to the head of one of country’s largest accountancy bodies.
Brendan Foster,the newpresident of ACCA Ireland, said the current shortage of bank finance was leading to a significant increase in personal debt for individuals who had provided personal guarantees on loans. Foster said many of these people had counted on the market ‘‘going the right way’’, andwere now facing major financial difficulties.
‘‘Many of these individuals will face financial ruin when the dust settles and the banks pursue these personal obligations.
‘‘The consequence is judgments and loss of credit worthiness or worse, bankruptcy,” said Foster, a founding partner of FosterMcAteer accountants.

Speaking after his election to the post of ACCA president this weekend, Foster said that, while the government was proposing radical changes to corporate insolvency, there were no provisions or proposals to deal with personal debt.

He said the government should set up a review group made up of representatives of the business community and financial institutions, to consider practical means of dealing with this issue.

‘‘Unlike in Britain, there is no practical solution available to assist individuals to deal with these situations.

The Sunday Business Post