Banned directors racked up more than £350,000 debt following liquidation

The directors of a demolitions company have been banned from running a limited company for three to seven years after failing to observe a winding up petition.

The firm, George Hunter, was placed into liquidation on 20 April 2015 with an estimated deficiency to creditors of £1,755,782.

However, a later investigation found that the three directors had caused or allowed the company to continue to trade to their own benefit while incurring further liabilities to the risk and detriment of creditors.

The Insolvency Service said the firm was doing this in full knowledge that HM Revenue & Customs (HMRC) had presented a winding up petition to Court.

It said the directors made net payments of at least £155,310 to the benefit of connected parties and further offset liabilities due to the company from the directors and connected companies of at least £457,395.72.

The Service said liabilities increased during this time by at least £359,097.33.

Rob Clarke, Head of Insolvent Investigations North, part of the Insolvency Service, said: “This was a cynical attempt by the directors, in the clear knowledge that their company was insolvent, to extract money that should have been paid to other creditors.

“The Insolvency Service will take robust action against this sort of misconduct which is a clear abuse of limited liability.”

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Gitta Altmann
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Posted in Blog, Commercial.