Mr Baber Yaqub has been disqualified for nine years for his conduct as a director of Yaqub Pharmacy Limited trading as Bruntons Chemist (Yaqub Pharmacy) in allowing the company to trade while insolvent.
The ban follows an investigation by the Insolvency Service.
Mr Yaqub (47), has given an undertaking to the Secretary of State for Business, Innovation & Skills, which means that he is prevented until February 2024, from becoming involved in the promotion, formation or management of a company.
The investigation found Mr Yaqub had caused Yaqub Pharmacy to trade whilst insolvent between at least February 2011 and March 2013. By February 2011, Yaqub Pharmacy had no assets of value and overdue unsecured liabilities of at least 596,437.
The company had been receiving financial support from an associated company of which Mr Yaqub was also director. When the associated company was placed in compulsory Liquidation in February 2011, Yaqub Pharmacy was already trading at a loss and no longer had the support of the associated company, which had previously settled substantial debts incurred by Yaqub Pharmacy. Yaqub Pharmacy was also substantially indebted to the associated company in respect of intercompany loans.
Between February 2011 and March 2013, Yaqub Pharmacy incurred additional unsecured liabilities of at least 216,546. In the absence of payment, many of these creditors were forced to resort to formal recovery action such as County Court Judgements.
The company was placed in administration in March 2013, with unsecured liabilities of at least 813,983.
During the course of both the administration and investigation, Mr Yaqub offered no explanation as to his actions.
Commenting on the case, Marc Symons, Deputy Head of Company Investigations at the Insolvency Service, said:
Directors have a statutory duty to ensure their companies maintain proper accounting records. Without a full account of transactions it is impossible to determine whether a director has discharged his or her duties properly, or is using a lack of documentation to mask impropriety.
This disqualification should is a reminder to others tempted to operate in a misleading way and seek to gain an unfair advantage on competitors, by trading while insolvent, that the Insolvency service will rigorously pursue enforcement action to remove them from the market place for a lengthy period to protect the public.