Joseph Newman and Kerry Sebestyen, directors of Joseph Richards Limited (which traded as Joseph Newman), based in Canterbury, Kent have been disqualified from acting a company directors for seven and five years respectively for failing to secure and pass on tenants deposits as they were required to do by the laws regulating letting agents.
The disqualifications follow an investigation by the Insolvency Service.
Joseph Newman, 73, and Kerry Sebestyen, 30, have given undertakings to the Secretary of State for Business, Innovation and Skills that they will not act as a director of a limited company for seven and five years respectively as a result of their conduct as directors of Joseph Richards Limited.
Joseph Richards Limited operated as letting agents collecting deposits and rents on behalf of landlords. The company ceased trading in April 2012 owing over 400,000 to creditors, of which over 100,000 was owed to tenants and landlords for deposits.
In giving his undertaking, Mr Newman admitted that he failed to deal with 92 deposits totaling 119,778 taken by Joseph Richards Limited, including protecting them, as he was required to by law; instead, he used the money as part of the companys general funds.
Ms Sebestyen, who resigned as a director of the company on 23 June 2011, admitted in her undertaking that she failed to deal with 28 deposits totaling 32,238 taken Joseph Richards Limited, including protecting them, as she was required to by law; instead, she used the money as part of the companys general funds.
The disqualifications means that Mr Newman and Ms Sebestyen may not be directors of a company or be involved in the management of a company in any way for the duration of their disqualifications unless they have permission from Court.
Commenting on the disqualification, David Brooks, a Chief Examiner with the Insolvency Service said:
"The undertakings signed by Mr Newman and Ms Sebestyen send a clear message to other company directors: The Housing Act 2004 places those who receive tenancy deposits under clear obligations to protect tenants and landlords from loss. If your company has failed and you have not taken seriously your responsibilities as a director when dealing with tenancy deposits, the Insolvency Service will investigate you and you could be removed from the business environment.