SINGAPORE – Laws around a scheme to help individuals avoid insolvency may be tightened, with the authorities targeting firms that encourage individuals to borrow money and file for bankruptcy to get a discount off their debts.
These consultancy firms are looking to abuse the Debt Repayment Scheme (DRS), a pre-bankruptcy scheme administered by the Ministry of Law (MinLaw).
On June 9, MinLaw said there has been an increasing number of debtors engaging the services of consultancy firms, which encourage debtors to self-petition for bankruptcy with the objective of being placed on the DRS.
“This is done not with the intention of being adjudged a bankrupt, but with the intention of abusing the DRS to obtain a discount off their…
