7 year ban for Surrey man for failing to provide records to HMRC
Gazmend Lika, a director of Blue Universal Ltd, was disqualified for failing to provide sufficient accounting records and tax returns.
The disqualification, from 23 June 2016, means that Mr Lika has given an undertaking to the Secretary of State to not be a director of a company, whether directly or indirectly, for seven years unless he has permission from the Court.
The disqualification follows an extensive investigation by the Insolvency Service.
The principal trading activity of Blue Universal Limited was that of floristry and building maintenance. Without sufficient accounting records, it was not possible to verify what all the payments of £579,058 out of the company bank account were for. This amount included £86,310 in cash withdrawals and £205,520 in transfers to Mr Lika that occurred during the period from October 2010 to liquidation in October 2013. During this period, no payments were made to HMRC in respect of taxation due.
In particular, Mr Lika acknowledged that he failed to deliver up sales invoices for the construction/maintenance side of the business to the Joint Liquidators.
At liquidation, the company had also failed to comply with its statutory obligations to HMRC in particular that it had not submitted any VAT returns to HMRC for six years (June 2007 to June 2013) or PAYE returns for the tax years commencing 2008 through to 2012. In addition, no annual accounts were prepared and filed with the Registrar for periods ending September 2009 to September 2012.
Commenting on the disqualification, Lawrence Zussman a Deputy Head of Investigations with the Insolvency Service said:
This disqualification sends a clear message to other company directors: If you fail to comply with statutory legislation because you do not maintain sufficient company records to satisfactorily explain payments, or if you treat creditors such as HMRC differently to others, then you have not taken your responsibilities as a director seriously and The Insolvency Service will not hesitate to investigate and you run the risk of being removed from the business environment.
Notes to editors
Gazmend Lika, 41, was the sole registered director of Blue Universal Limited, which was incorporated in 2003 and whose trading was based from Kingston.
Mr Lika has been disqualified for a period of 7 years commencing from 23 June 2016.
One of the main purposes of the Company Directors Disqualification Act is to ensure that proper standards of conduct of company directors are maintained and to raise those standards where appropriate.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
act as a director of a company
take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
be a receiver of a company’s property
In addition that person cannot act as an insolvency practitioner and there are many other restrictions are placed on disqualified directors by other regulations.
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings. Further information on director disqualifications and restrictions can be found here.
The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
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Published: 4 July 2016
From: The Insolvency Service