David Gary Drysdale, the sole director of loans arranging company, Welcome Loans Limited based in Glasgow, has been disqualified from acting as a director for 9 years for failing to keep proper company books, concealing the companys assets and failing to act in good faith towards the companys customers. The disqualification follows an investigation by the Insolvency Service.
Mr Drysdale, 32, was unrepresented and failed to appear in court, was banned from acting as a director of a limited company until 15 September 2024.
The company provided loan arrangement services which acted as a middle man for individuals who wanted to obtain loans from loan providers, at a one off fee of 59 and subsequently increased to 80. The company went into liquidation on 3 July 2013, almost 5 months after Mr Drysdale first approached an Insolvency Practitioner for insolvency advice on 14 February 2013.
Mr Drysdale failed to provide sufficient books or records explaining the companys transactions or co-operate with the Insolvency Practitioner administering the affairs of the company in liquidation prior to and during the course of the liquidation.
Latterly, he failed to assist the Insolvency Service during the course of its investigations.
Both the administration of the liquidation and the investigations were seriously hampered by the lack of available books and Mr Drysdales lack of co-operation. It was discovered that even though the company was very profitable, it paid just 15,000 to the Crown departments, with Mr Drysdale receiving at least 683,018 from the company during the course of the companys life. HMRC is owed at least 287,476 in the liquidation due to unpaid Corporation Tax and tax on Mr Drysdales drawings.
It later transpired that Mr Drysdale had delayed providing the Insolvency Practitioner with the companys books and records and information as he was attempting to secure the release of the companys 271,544 available funds held in a Mauritius merchant bank account for his own benefit. It was 2 months after the liquidation that Mr Drysdale finally revealed the existence of these funds to the Insolvency Practitioner. He had attempted to secure the release of these funds by producing and providing a payment processing company managing the merchant bank account with a forged official document. The Insolvency Practitioner faced difficulties recovering these funds for the benefit of the companys creditors.
Some 3 months before Mr Drysdale first contacted the Insolvency Practitioner, the company was contacted by the Financial Ombudsman Service in relation to complaints received from various aggrieved customers who requested refunds of fees from the company for unfulfilled services or overcharging. 14 February 2014, was the deadline given to the company by the Financial Ombudsman Service to make refunds to complaining individual customers, now creditors in the liquidation. Whilst Mr Drysdale refused to refund at least 233 known complaining customers, he had helped himself to the companys funds during the period, by paying himself 10,000 per week and 97,007 towards a Bentley purchase for his personal use. Mr Drysdale had informed the Insolvency Practitioner that he did not believe that these customers were owed anything; despite him initially informing the Financial Ombudsman Service of his intention to provide refunds to the customers.
Commenting on the disqualification, Mark Bruce, a Chief Investigator at The Insolvency Service said:
Mr Drysdale has shown himself to be exactly the type of businessman who should be removed from the business area. His cavalier attitude to his customers and the various regulatory bodies he faced was seen as extremely serious by the court in handing down a lengthy disqualification.
The Insolvency Service will always investigate such behaviour especially where there has been significant financial loss to members of the public