A company which falsely claimed an association to emergency services in order to induce small businesses to place advertisements in its publications has been wound up by the High Court in Manchester.
The court ordered The Emergency Services (Media Dept) Limited into liquidation on 16 October 2014, following an investigation by the Insolvency Service.
Commenting on the case, Colin Cronin, Investigation Supervisor, said
The Emergency Services (Media Dept) Limited created an impression that it was running a national campaign or initiative when, in truth, the magazine it produced was merely a mechanism by which the company raised money from members of the public by way of systematic and deliberate misrepresentations.
These winding up proceedings show that the Insolvency Service will take firm action against companies which operate in this manner.
The Court heard that the company cold-called small businesses and requested them to place an advertisement in a magazine, known as React. In doing so, a number of serious misrepresentations were made to advertisers including that:
Telesales callers falsely stated or implied that they were from or affiliated to the Police or the emergency services
The company falsely stated that it was raising funds for the emergency services and that the cost of the advertisements would contribute to such funds
The company falsely stated that the React magazine would be distributed to local schools or used by the Police to give presentations in schools regarding drug and alcohol abuse
The company falsely stated that the magazine would be distributed to Police forces, university libraries and various public bodies when no such distribution was taking place
The company falsely stated that it was raising funds to tackle child abuse, knife crime and other anti-social behaviour
The company received an advertising income of 466,922 in 2013 and 367,765 in 2012 but charitable donations amounted to just 1.8% of these amounts. In contrast, payments to the companys directors and telesales staff amounted to 308,301 in 2013 and 205,094 in 2012.