ENG-1995 — Page 117

FINANCIAL AND MONETARY AFFAIRS

States of America, 395 from the United Kingdom, 381 from Bermuda, and 368 from Japan.

Money Lenders

Under the Money Lenders Ordinance, anyone wishing to carry on business as a money lender must apply to a licensing court for a licence. The ordinance does not apply to banks and deposit-taking companies authorised under the Banking Ordinance.

Licence applications are, initially, submitted to the Registrar of Companies as Registrar of Money Lenders. A copy is also sent to the Commissioner of Police, who may object to the application. The application is advertised, and any member of the public who has an interest in the matter also has the right to object. During the year, 940 applications were received and 824 licences were granted. At the end of 1995, there were 876 licensed money lenders.

The ordinance provides severe penalties for statutory offences such as carrying on an unlicensed money-lending business. It also provides that any loan made by an unlicensed money lender shall not be recoverable by court action. With certain exceptions (primarily authorised institutions under the Banking Ordinance), any person, whether a licensed money lender or not, who lends or offers to lend money at an interest rate exceeding 60 per cent per annum commits an offence. Any agreement for the repayment of any such loan, or security given in respect of such a loan, is unenforceable.

Bankruptcies and Compulsory Winding-up

The Official Receiver's Office administers the estates of individual bankrupts and companies ordered to be compulsorily wound up by the High Court. Once a receiving order is made against the property of an individual debtor or a winding-up order against a company by the High Court, the Official Receiver becomes the interim receiver or provisional liquidator of the debtor or company, respectively.

Where the assets of an estate are unlikely to exceed $200,000 in value, the Official Receiver applies to the High Court for a summary procedure order and is appointed trustee or liquidator. In other cases, meetings of creditors in bankruptcy, or of creditors and contributors in compulsory liquidations, are held to decide whether the Official Receiver or some other fit person from the private sector should be appointed trustee or liquidator. As in past years, the Official Receiver was appointed trustee or liquidator in most cases.

The work of the Official Receiver where he acts as trustee or liquidator includes the investigation of the affairs of the bankrupt or the wound-up company, the realisation of assets and the distribution of dividends to creditors. The Official Receiver also prosecutes certain offences set out in the Bankruptcy and Companies Ordinances; applies for disqualification of company directors; supervises the work of outside liquidators and trustees; and monitors the funds held by liquidators in compulsory and voluntary liquidations.

During the year, 455 receiving orders and 481 winding-up orders were made by the High Court. The assets realised by the Official Receiver during 1995 amounted to $149.06 million, while $71.7 million in dividends were paid to creditors in 242 insolvency cases.

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