Director Disqualification for hiding company assets
Director Disqualification for failing to disclose £600,000 of company assets to the liquidator.
According to a UK Insolvency Service press release a Mr. McKenzie from Mid-Glamorgan in Wales gave a director disqualification undertaking for a period of six years, preventing him from becoming involved in the promotion, formation or management of a company for the duration of the term.
Susan MacLeod, Chief Investigator at the Insolvency Service, said of this director disqualification case:
“Directors who fail in their obligations and cause creditors and the public to lose money can expect to be investigated by the Insolvency Service and enforcement action taken to remove them from the market place.”
Bearing in mind the misconduct summarised by the UK Insolvency Service, this article gives our view that Mr. McKenzie was fortunate only to be disqualified for six years and can probably expect further claims.
What caused the Director Disqualification?
The trade of Mr. McKenzie’s company, Blavina Manufacturing Limited (‘The Company’) was facilitated by entering into agreement with the Welsh Government. The Company was subsequently placed into Creditors Voluntary Liquidation.
Mr McKenzie accepted that he had failed to disclose Company assets of over £600,000 and had failed to disclose a debt of £1.4million owed by an associated Company. The Company also obtained credit whilst insolvent of £97,000 and breached agreements it had entered into by disposing of assets worth over £93,000.00.
From the notes the Company only traded for about 2½ years
A Misfeasance claim could also be made
No doubt the liquidator is now taking (or considering taking) steps to collect in the Company assets and pursue the debtor Company.
In addition, Mr McKenzie could well be facing a claim from the liquidator for misfeasance under Section 212 of the Insolvency Act 1986 (amongst other possible claims) for breaching his duties as a director. If proved, that could require him to make a financial contribution towards the assets of the Company for the benefit of creditors.
We can help if you are faced with Director Disqualification
Mr. McKenzie has already received a significant punishment and there might be more to come.
If you are facing an investigation from the UK Insolvency Service or a UK based liquidator or an administrator has sent you a letter threatening a claim against you, what can you do? In the first instance, please contact us or call us on 0121 200 7040, or why not email us a scan of the threatening letter and we will call you back to discuss it, and your options, on a no-obligation/no cost basis?
We will work around you wherever in the world you are based. We are currently assisting director clients in New Zealand, Australia and the Far East with such matters, as well as many much closer to home!
We are director disqualification specialists, and we believe that no hole is too deep for us not to be able to help, but the sooner you talk to us the more we are likely to be able to help you.