Insolvency Services News

Construction director banned for failing to declare sales income

The director of a construction company based in Cradley Heath has been disqualified for seven years after he failed to declare all the company?s sales income.

Martin Baker was the sole director of C.J.M Tiling Limited (CJMT), which was incorporated in 2007 and traded as a construction company in Cradley Heath, West Midlands.

On 3 December 2015 and 4 March 2016, HMRC made unannounced visits to CJMT and identified the construction company had under-declared its VAT liabilities by failing to disclose all its sales.

Furthermore, an additional bank account was identified in which sales income was deposited. HMRC raised an officer?s assessment for additional VAT liabilities of ?205,262 for the period June 2012 to December 2015, as well as applying civil penalties of ?90,146 to the company.

CJMT later entered liquidation on 26 January 2017 owing ?469,673 to creditors, including at least ?344,221 for VAT, and following the company?s liquidation, the Insolvency Service carried out its own investigations, leading to Martin Baker?s disqualification.

On 21 May 2018, the Secretary of State for Business, Energy & Industrial Strategy accepted a disqualification undertaking from, Martin Baker, effective from 11 June 2018, for a period of 7 years.

In giving the undertaking, Martin Baker admitted that he failed to ensure the company declared its true VAT liabilities on returns submitted to HMRC between June 2012 to December 2015, by failing to disclose all its sales.

Martin Baker further admitted that a second company bank account was not disclosed to HMRC. This resulted in under-declarations of VAT due, as a consequence of which penalties were raised.

His ban means Martin Baker cannot promote, manage, or be a director of a limited company.

Commenting on the disqualification, Jane Knight, deputy head of insolvency investigations for the Insolvency Service, said:

Under-declaration of the VAT due by a company deprives the exchequer of the monies needed to provide public services.

In co-operation with HMRC, the Insolvency Service will not hesitate to investigate such misconduct with disqualification as a director the likely outcome.


July 20th, 2018|

Kent pension company shut down in the interest of investors

The High Court ordered into liquidation a pension company which invested in storage products after it was found to have abused millions of investors? savings.

Chartwell Trustee Pension Solutions Ltd (Chartwell), was the sole trustee of the Pinnacle Pension Scheme and was incorporated on 14 December 2007. Its registered office was Kingfisher House, Bromley, Kent.

The Insolvency Service launched an investigation into the company?s activities following complaints received by it and Action Fraud.

The investigation found:

the company was entrusted with in excess of ?4.8m of members? pension funds following an apparent cold-calling telesales operation. Members were told that they could expect a guaranteed 8% return into their pension for the first two years and that further returns may follow

members were told their pensions would be invested in ?storage products?. However, records provided by the company to the Insolvency Service investigators were incomplete, and it did not provide the investigators with an adequate explanation for the application of the funds it received

customers experienced enormous difficulties in contacting the company, received very little information from the company and do not appear to have been issued with any Annual Returns, which are supposed to provide them with details of their invested funds, since October 2015

Investigators were unable to obtain any clear view of how the company operated and records the company did provide were incomplete, inconsistent, and contradicted information the company had itself provided to The Pensions Regulator.

The company was wound up by the court on Wednesday 6 June 2018, on the petition of the Secretary of State for Business, Energy & Industrial Strategy, following an investigation by the Insolvency Service.

The Court said that it was appropriate, desirable, and in the interest of investors to make an order to place the company into insolvent liquidation.

Judge Prentis found that the company operated with a lack of commercial probity, a lack of transparency, and without any presence at its Registered Office address.

Investigators were unable to obtain any clear view of how the company operated.

Nobody appeared on behalf of the company to oppose the petition.

Investigation Supervisor Irshard Mohammed, of the Insolvency Service, said:

Those behind companies such as Chartwell should be aware that the Insolvency Service will not tolerate such abuses of the corporate regime. It is telling that this situation appears to have arisen from telephone cold-calling.

Members of the public should be most wary when approached with investment proposals or proposals of how to manage their pension, through unsolicited telephone calls.


July 17th, 2018|

Pension directors banned from running companies for 21 years

The directors of two pension companies shut down in the public interest have received bans for their role in the companies? mismanagement of members? funds. Gleeson Bessent Trustee Services (GBTS) and Gleeson Bessent Trustees (GBT), based in Presto...

July 11th, 2018|

Directors banned after attempting to cheat millions in complex VAT scam

Two bosses who involved their companies in complex VAT scams, attempting to cheat the tax man out of millions of pounds, have received lengthy director bans following investigations by the Insolvency Service. The two directors, Nadeem Ahmed and Ulh...

July 3rd, 2018|

Plymouth property developer disqualified for 8 years

A property developer from Plymouth has been banned from running companies for eight years after he failed to keep adequate records of his business.

David John Trathen was the director of Rocco Primrose Limited (RPL) which developed housing on an old school site formerly owned by Plymouth City Council.

Formerly known as Trathen Lewis Limited, RPL was first incorporated in August 2013 and traded for around three and a half years before entering into creditors? voluntary liquidation in April 2017 with an estimated deficiency of ?416,353.

Independent insolvency practitioners were appointed to wind up the company but their job was made difficult by the fact that David Trathen failed to deliver adequate accounting records showing the true nature of the company?s business.

Further investigations by the Insolvency Service found that from at least June 2016 to the end of the business in February 2017, David Trathen failed to ensure that RPL maintained adequate accounting records.

This meant it was impossible to account for various payments out of the business, explain the source of credits to RPL?s bank account, what RPL owed to HMRC in taxes, as well as determining the amount of remuneration, if any, received by David Trathen.

In one example, investigators were unable to account for at least ?141,000 of RPL?s income, generated from the sale of 20 building plots of land now known as Lilford Gardens ? the former site of West Park Primary School in Wanstead Grove.

In another example, investigators could not explain why there had been more than ?407,000 worth of expenditure from RPL?s bank account and whether this related to genuine company expenses.

And because of the lack adequate accounting records, investigators could not determine whether David Trathen?s statement of affairs in the liquidation was accurate and the real reason why RPL failed as a business.

As a result, the Secretary of State accepted a disqualification undertaking from David Trathen, and from 1 May 2018, he is banned from running companies, both directly and indirectly, for 8 years.

Dave Elliott, Head of Insolvent Investigations (Midlands & West) for the Insolvency Service said:

Directors have a duty to ensure that companies maintain proper accounting records, and, following insolvency, deliver them to the office-holder.

Without such records, it is not possible to determine whether or not a director has discharged his duties properly, or is using a lack of documentation as a cloak for other wrongdoing.


June 29th, 2018|

Directorship ban for charity CEO

The director of a charity has been disqualified for three-and-a-half years for failing to ensure the company met its tax obligations. Jo Harvey-Barringer, currently residing in Sussex, was the Chief Executive Officer and a director of Broken Rainbo...

June 29th, 2018|
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