Ex-footballers Paul Sugrue, once of Manchester City, and former Wales International Mark Aizlewood have both been disqualified as company directors for six years each for failing to comply with requirements relating to the funding of sports apprenticeships, within their training company, Luis Michael Training Limited (LMT).
The disqualifications follow an investigation by the Insolvency Service. Two co-directors Keith Williams and Christopher Martin have also been disqualified for six-and-a-half and eight years respectively.
The four directors have given undertakings to the Secretary of State for Business, Innovation & Skills, not to be involved in the management of a limited company for the duration of their bans, which are as follows; .
Mr Paul Anthony Sugrue - six years from 2 September 2013;
Mark Aizlewood six years from 9 September 2013;
Keith Anthony Williams six-and-a-half years from 19 November 2013;
Christopher Paul Martin eight years from 29 November 2013.
LMT was incorporated in 2009 as a subcontractor providing training, assessment and quality assurance of sport qualifications on behalf of colleges throughout England. The Skills Funding Agency (formerly the Learning and Skills Council) funded the training by paying colleges which, in turn made payments to LMT.
The investigation found that in late 2010, one of the colleges cancelled its contract with LMT citing anomalies with funding. An audit by the colleges external auditors identified ineligible claims made by LMT.
This audit, plus telephone audits undertaken by colleges to whom LMT provided services, found amongst other things that: LMT had
Submitted ineligible claims for Welsh leaners, who have their own funding body
Failed to ensure that all learners were in employment
Submitted claims for learners who did not participate in or had withdrawn from the programme
Submitted claims for learners who had undertaken prior learning or who were otherwise undertaking additional learning
Submitted claims for learners outside of the stipulated geographical area specified in contracts
In light of these problems, the Skills Funding Agency required the college to repay funding and the college subsequently sought to reclaim the funds paid to LMT. As LMT was not able to repay the amount, a winding up petition for 2,573,994 was presented by the college and the company was wound up by the court on 26 September 2011.
The investigation established that the four directors had failed to ensure that the company complied with funding guidance and failed to ensure that adequate documentation has been maintained and/or supplied to colleges to support the funding claims they made , placing the company at risk of being held liable to repay funding totalling at least 3,442,809.
Commenting on the case, Ken Beasley, Official Receiver of Public Interest Unit (Manchester), of the Insolvency Service, said:
This company received millions of pounds in government funding but failed to provide sufficient evidence to support claims for funding or to demonstrate that the company had complied with funding guidance which was readily available to them.
The various failures of the four directors constitute behaviour that falls far below that expected of responsible directors of a limited company.
The Insolvency Service has strong enforcement powers and will not hesitate to use them to remove directors who have failed to honour their obligations from the business environment.