Question: I agree that CoBo have been careless and incompetent. They may also have been dishonest. However, if they are bankrupted, won't I just lose all my money? Doesn't an IVA (Individual Voluntary Agreement) make more sense for investors?
Answer: Obviously, the outcome of either process cannot be known in advance. For investors who hold unsecured promissory notes (PNs), there is no guarantee either way. It’s true that in an IVA, a promise is made to repay a proportion of the money owed over a long period of time, but promises can be broken - in fact, the PNs that investors hold amount to nothing more than broken promises. Furthermore, if investors agree to an IVA which offers to repay a percentage of their loan—for example 50%—and the IVA fails, resulting in bankruptcy for CoBo, the IVA agreement will have reduced the amount each investor can claim by 50%!
As CoBo have consistently refused to give any proper accounts, it is impossible to know the likely outcome of bankruptcy. The main advantage is that the assets would be taken out of their hands and the finances examined by experts. CoBo claim that investors would lose everything by bankrupting them, but the authorities are bound by law to manage a bankrupt’s estate to the maximum benefit of the creditors. And unlike CoBo, the authorities have to be transparent and fully accountable.
Answer: Obviously, the outcome of either process cannot be known in advance. For investors who hold unsecured promissory notes (PNs), there is no guarantee either way. It’s true that in an IVA, a promise is made to repay a proportion of the money owed over a long period of time, but promises can be broken - in fact, the PNs that investors hold amount to nothing more than broken promises. Furthermore, if investors agree to an IVA which offers to repay a percentage of their loan—for example 50%—and the IVA fails, resulting in bankruptcy for CoBo, the IVA agreement will have reduced the amount each investor can claim by 50%!
As CoBo have consistently refused to give any proper accounts, it is impossible to know the likely outcome of bankruptcy. The main advantage is that the assets would be taken out of their hands and the finances examined by experts. CoBo claim that investors would lose everything by bankrupting them, but the authorities are bound by law to manage a bankrupt’s estate to the maximum benefit of the creditors. And unlike CoBo, the authorities have to be transparent and fully accountable.
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