Leslie William Stephens, the director of school clothing company, Scoolwear For Less Limited, based in Henlow, Bedfordshire has been disqualified for eight years for borrowing from the bank against sales that never actually took place. The disqualification follows an investigation by The Insolvency Service.
Mr Stephens, 55, of London has given an undertaking that he will not act as a director of a limited company from 23 April 2013 until April 2021.
Scoolwear For Less Limited went into administration on 9 June 2011 owing more than 500,000 to creditors, including 475,745 to its bank under the invoice discounting facility, operated by Mr Stephens.
From 3 December 2010 to 6 May 2011, Mr Stephens faked 2,033 invoices for various amounts relating to goods that had not been supplied. His bank lent him funds of 513,799 against future payments for these goods but these payments failed to materialise. The bank was able to recover just 38,054 less than a tenth of the amount owed – leaving an outstanding balance of 475,745 as at 9 June 2011.
Commenting on the disqualification, Mark Bruce, a Chief Examiner at The Insolvency Service said:
Directors who seek to improperly operate invoice discounting facilities or similar financial products damage commercial confidence and harm the UKs reputation as a place to do business. They should not expect to get away with it.
Other directors tempted to follow this path should remember that if they run a business in a way that is detrimental to either its customers or its creditors they lose the protection afforded by limited liability. The Insolvency Service will investigate them and seek to remove them from the business environment.