Five directors from a Swansea claims management firm receive disqualifications for a total of 28 years following an investigation by the Insolvency*Service.
The Secretary of State for Business, Energy, & Industrial Strategy has accepted disqualification undertakings from the five directors of McCaskill & Morse Ltd (McCaskill). Timothy Chapple has been disqualified for eight years, Richard Adams for six, Catherine Wood for five, Gary Richards for five and James Bell for four years.
The five directors are now prevented from acting as a director of a company, they cannot take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership, as well as being unable to be a receiver of a company?s property.
McCaskill was first incorporated in March 2012, offering claims management services for people miss-sold payment protection insurance and bank charges reclaims.
But clients started to complain to the Ministry of Justice, the regulators of the claims management sector, that while McCaskill claimed to offer a no-win-no-fee service, they had failed to return upfront fees and were often late paying refunds following unsuccessful claims.
The Ministry of Justice issued a warning to McCaskill that they were engaging in unfair trading practices before the company was put into administration in November 2015.
The Insolvency Service investigated McCaskill after it had gone into administration and found that the claims management company had failed to repay upfront fees to clients who were due a refund.
Using complaints data, the Insolvency Service also found that clients received their refunds between 180 and 380 days after the start of the claims process, exceeding the contract terms that stated McCaskill would pay refunds within 90 days.
Further investigations showed that, during their directorships, Mr Bell and Mr Richards failed to properly deal with complaints, prevent delays on refunds and return upfront fees to clients. McCaskill also failed to inform the Ministry of Justice about changes to its business model, including the charging of up-front fees which they had previously declared it did not intend to charge.
Investigators concluded that McCaskill had been engaging in unfair trading practices in breach of the Conduct of Authorised Persons Rules 2006 and 2013 (COAPRs). This meant that they had failed to comply with the Compensation (Claims Management Services) Regulations 2006.
Following the disqualification orders, Robert Clarke, Investigations Group Leader at the Insolvency Service said:
Compensation regulations are there to protect the general public from unfair sales techniques by companies operating within the claims management sector.
It?s ironic that McCaskill, a company established to support consumers claw back money owed to them, consistently failed to return what was rightfully owed to their clients.
The length of the bans should serve as a warning to other directors who may feel tempted to breach legislation intended to protect the public, that the Insolvency Service will seek lengthy periods of disqualification.
He added: ?I would also like to thank my colleagues at the Ministry of Justice and the Legal Ombudsman for their hard work and co-operation in achieving this outcome.