- February 20, 2017
- Posted by: Josiah Hincks Solicitors
- Category: Business Law Updates
Following an investigation by Insolvency Service (IS) specialists, a director has been given the maximum bankruptcy restriction order of 15 years after he was found to be acting as a director of a limited company despite having previously agreed to a 10-year disqualification order and that order still being in force.
The undertaking, which was given in 2008, prohibited him from acting as a director, directly or indirectly, for any company in the UK. He was made bankrupt in 2013 and his discharge was suspended indefinitely – a rare occurrence. A bankrupt is also not allowed to act as a company director until discharged.
Despite this, he participated in the management of a company which went into liquidation in 2015 with net liabilities exceeding £10 million after promoting what a judge called ‘a fraudulent scheme’ purporting to offer high returns based on the exploitation of mining rights not actually owned by the company selling the scheme.
No announcement has as yet been made regarding the actions taken against the other directors of the company but, clearly, the IS will be taking a dim view of their involvement.
Failing to adhere to the conditions attaching to bankruptcy or observe a ban on activity can have severe consequences.