Reply To: Overpayment Recovery



Sorry but I think a lot of this is wrong. In brief:

Firstly, the Supreme Court decided in the case of Nortel that a person became a "freed man" on completion from bankruptcy….freed from liabilities and obligations etc. This means that any non fraud debt has to be written off… does not matter if you created an overpayment before or after the bankruptcy for the period prior to discharge.  The person walks away completely free. It used to be that a creditor knowing the claimant was going bankrupt could wait until discharge and THEN issue an invoice but Nortel replaced all that. That is clearly sensible and reflects the idea of bankruptcy….you the person are bankrupt not some but not all of your debts. 

search for Nortel and you will find lots of discussions on this.

Fraud (and that means PROVEN fraud) are not affected by the insolvency acts or Nortel. You can continue recovering this in full by weekly deductions if you want. DWP guidance was that you should wait until discharge but no-one has any idea where they got that from. No Court has suggested that and it is a bizarre idea to suggest that a proven fraudster should get a repayment holiday. No one in DWP can even remember who thought that up. 

IVA's are very different animals and do not affect recovery of HB overpayments at all….as the largest IVA provider admitted to a member recently.