The Insolvency Service selected 2,235 companies for civil investigation during 2025/26, according to its latest annual enforcement figures published in July 2026. It also selected 273 live companies for a separate form of investigation into possible corporate abuse.
Receiving an investigation letter is a common concern for directors following company insolvency, dissolution or a complaint about an active business. It does not automatically mean that wrongdoing has been established or that director disqualification will follow. An investigation is a process for gathering and assessing evidence, and some cases conclude without enforcement action.
Directors can regain a degree of control by identifying the type of investigation, preserving the relevant company records and providing a careful response based on the available evidence. What happens next will depend on the company’s status, the conduct under consideration and whether the Insolvency Service considers further action to be in the public interest.
This article explains the position for directors in England and Wales. However, the territorial scope of the official statistics differs between investigation categories.
What do the latest Insolvency Service investigation figures show?
The Insolvency Service enforcement outcomes for 2025/26 divide investigation work into four categories.
During the financial year, the Insolvency Service selected:
- 2,235 companies for civil investigation;
- 273 companies for live company investigation;
- 199 cases for criminal investigation; and
- 78 bankruptcy restriction cases for investigation.
The figures do not all cover the same geographical area. Civil director disqualification and criminal investigation figures relate to Great Britain. Live company investigation figures cover the United Kingdom. Bankruptcy restriction figures relate to England and Wales.
The categories also count different things. The civil and live investigation columns refer to companies, while the other columns refer to criminal cases and bankruptcy restriction cases. They should not be added together to produce a single total for companies investigated.
The publication records cases “targeted for investigation”. The safest interpretation is that these were selected for investigation during the reporting period. The figures do not represent the total number of complaints, reports or referrals received by the Insolvency Service.
The Insolvency Service explains that it receives more complaints about live companies than it has resources to investigate. It uses discretionary powers and prioritises companies that appear to present the greatest risk of harm to the public or business community.
What types of company investigation does the Insolvency Service conduct?
The nature of an Insolvency Service investigation depends significantly on whether the company is insolvent, dissolved or still active.
A civil director disqualification investigation usually examines the conduct of directors connected with an insolvent or dissolved company. The purpose is to decide whether there is sufficient evidence of unfit conduct and whether seeking a disqualification order would be in the public interest.
- The latest figures record 2,235 companies targeted for civil investigation during 2025/26.
- As at 31 March 2026, 1,177 company cases remained under civil disqualification investigation.
- The Insolvency Service concluded 1,148 civil director disqualification investigations during the financial year.
These figures do not mean that 2,235 directors were investigated. One company may have several directors, while an investigation may focus on some directors but not others.
For companies in formal insolvency, the official receiver or appointed insolvency practitioner will consider the conduct of the directors. Reports and other information are reviewed by the Insolvency Service, which may investigate further where there is sufficient reason and an investigation is considered to be in the public interest.
A live company investigation is different. It concerns an active company, limited liability partnership or qualifying overseas company that is suspected of corporate abuse. The Insolvency Service’s guidance refers to serious misconduct, scams, dishonest trading and conduct causing significant harm to groups of customers, suppliers or other stakeholders.
During 2025/26, 273 companies were targeted for live investigation. There were 59 live companies under investigation as at 31 March 2026, and 185 live company investigations were concluded during the year.
Live company investigations are civil fact-finding exercises. They are intended to protect the public and business community, rather than recover an individual creditor’s money.
Our guidance on public interest winding-up petition company investigations explains how an investigation into an active company may develop.
Does every Insolvency Service investigation lead to enforcement action?
No. Being selected for investigation does not mean that director disqualification, criminal prosecution or a winding-up order is inevitable.
- The source records 1,148 concluded civil director disqualification investigations, 185 concluded live company investigations, 117 concluded criminal case investigations and 132 concluded bankruptcy restriction investigations during 2025/26.
- It does not state how many of those investigations resulted in enforcement and how many ended without further action.
The Insolvency Service’s live company guidance expressly recognises that an investigation may find no evidence, or insufficient evidence, of misconduct or corporate abuse. In those circumstances, no action will be taken against the company.
Other possible outcomes of a live company investigation include a warning, referral to another regulator, director disqualification proceedings or a public interest winding-up petition. Where suspected criminal conduct is identified, information may be passed to an appropriate law enforcement body.
Similarly, company failure does not itself establish unfit conduct. The Insolvency Service recognises that misconduct is only one of many possible reasons why a company fails and that directors should only be disqualified where there is evidence of wrongdoing or unfitness.
Civil disqualification proceedings are brought under civil law. The court makes the final decision unless the director offers a disqualification undertaking that is accepted by the Secretary of State.
The investigation figures cannot sensibly be used to calculate an enforcement rate. A case may be selected in one year, remain open at the year end and conclude during a later reporting period. One investigation may also involve several directors or defendants.
What does it mean if a case remains under investigation?
The Insolvency Service recorded 1,177 company cases under civil disqualification investigation as at 31 March 2026. It also recorded 197 criminal cases, 59 live companies and 28 bankruptcy restriction defendants under investigation at that date.
- These figures are a snapshot of work that had started but had not concluded. They do not show how long the cases had been open or when a decision was likely to be made.
- The source does not publish an average investigation duration. It would therefore be misleading to use these figures to suggest that an Insolvency Service investigation normally lasts for a particular number of months.
The time required in an individual case may depend on the volume and quality of company records, the number of directors involved, the complexity of the transactions and whether information is required from third parties.
An investigation may begin with a questionnaire, request for documents or letter seeking an explanation. The Insolvency Service’s director disqualification guidance states that it will make best efforts to contact a director at an early stage and seek their explanation. If a final decision is made to seek disqualification, the director should then be notified in writing.
Our guide to dealing with early enquiries from the Insolvency Service explains why these initial responses may matter later in the process.
What should a director do after receiving an investigation letter?
The first step is to establish which company, period and conduct the Insolvency Service is examining.
- The director should determine whether the correspondence concerns an insolvent company investigation, a dissolved company, an active company or possible criminal conduct. Different investigation routes involve different statutory powers and possible outcomes.
- Relevant company records should be preserved. These may include statutory accounts, management accounts, bank statements, board minutes, contracts, tax correspondence and communications with accountants or insolvency practitioners.
- A director should not alter or recreate documents. Where records are missing or the director cannot remember a particular event, the response should explain that honestly rather than substitute an assumption.
- The director should also identify their personal role. An investigation into a company does not necessarily mean that every director had the same responsibilities, knowledge or involvement. A response should distinguish between decisions made personally, decisions made by the board and matters handled by employees or advisers.
- Directors have an opportunity to respond to allegations and explain why decisions were made. New information must be considered, and disqualification proceedings may be discontinued where they are no longer regarded as being in the public interest. You should always take legal advice as directors can, often with the best of intentions, say things in their initial responses which can inadvertently harm their position and increase the prospects of a director disqualification order or claim by a liquidator.
At the same time, directors should appreciate that information supplied during the investigation may later be used in disqualification proceedings or another related process. Responses should therefore be accurate, consistent and supported by the available documents.
Our director disqualification guidance explains the wider process and the possible consequences where the Insolvency Service considers a director’s conduct to be unfit.
The latest statistics demonstrate the scale of the Insolvency Service’s investigation work, but they do not mean that an adverse result is inevitable. The immediate priority is to understand the enquiry, protect the relevant evidence and respond on a properly informed basis.
Francis Wilks & Jones advises directors in England and Wales on Insolvency Service enquiries, civil disqualification investigations and related personal liability risks. We can review the correspondence, identify the issues being investigated and help prepare an evidence-based response.
We have been successfully defending directors since 2002. Let us help you too.
