6.This section amends the 1985 Act to add a new section 5C (‘Money advice’), a new section 5(4BA) and a new section 5(2B)(ba). These changes provide that an application for sequestration by a debtor can only be made if the debtor has been given advice on their financial circumstances, the effect of the proposed sequestration and the process of application for sequestration by a ‘money adviser’. The application must now include a declaration by the adviser that advice has been given. Section 5C(2) also provides for a definition of who can act as a money adviser to be prescribed by regulations. Other matters on which advice must be obtained and who can act as a money adviser have been prescribed in Bankruptcy (Money Advice and Deduction from Income etc.) (Scotland) Regulations 2014(3). A similar process is in place for money advice as part of the Debt Arrangement Scheme under the Debt Arrangement and Attachment (Scotland) Act 2002 (asp 17).
Commentary on Sections Advice and education Section 1 – Sequestration of estate of living debtor: money advice