Press release

Award-winning entrepreneur handed 13-year ban for misusing clients’ funds

An Insolvency Service investigation leads to a 13 year directorship ban for an entrepreneur who misused investors' funds.

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A business consultant who was found to have misused monies entrusted to him by unsuspecting investors through a business consultancy company and acted with a lack of probity was banned from being a company director for 13 years under the terms of a disqualification undertaking he gave to the Secretary of State for Business, Energy and Industrial Strategy.

Shazan Izziq Qureshi, who described himself as an “Alphapreneur” on his business cards and email account, was a director of Rejuvenate Your Business Ltd, and led the EU funded “Enterprise Village” project in Liverpool for small rapidly growing businesses.

Mr Qureshi’s web profile states:

Shazan has been recognised as a ‘Top 42 Under 42’ entrepreneur by NW Insider magazine in 2006, a finalist for MEN Small Business of the Year in 2008, nominated for the prestigious LloydsTSB Asian Jewel award, EMBF(NW) Rising Star award & Tiger Award in 2009 and been awarded Regional DM Campaign of the Year by Royal Mail.

Shazan has sat on the EMBF(NW) Board, NW Further Education Group, an Ambassador for Enterprise UK, supported the charity Karma Nirvana and Mix-d and been a Governor for Liverpool College & Elton High School.

Rejuvenate Your Business was formed in 2008 by Anna Louise Gilhooley, who had given a disqualification undertaking to the Secretary of State for four years in May 2016 in connection with the failure of the company. Mr Qureshi was appointed director of the company on 11/01/13 but was dismissed by Ms Gilhooley on 02 June 2014 when the extent of his misdealings became apparent.

An investigation into the failure of the company by The Insolvency Service found that Mr Qureshi used the company, and, monies entrusted to it, to fund his own personal business dealings, which included the buying and renovating of properties in partnership with others in a joint venture. The investigation revealed that Mr Qureshi blatantly disregarded his obligations under the joint venture agreement and misused funds entrusted to Rejuvenate Your Business by his joint venture partners. Mr Qureshi only made good the loss by borrowing monies from one of the company’s clients, a prominent surgeon, stating that the loan was for the benefit of Rejuvenate Your Business. The loan was intended to be secured by means of a fixed and floating charge over RYB’s assets, however, no such charge was created. Mr Qureshi also pledged security for the loan over on assets he did not own. The lender was left with an unpaid unsecured debt of £545,346 when Rejuvenate Your Business entered Liquidation. The Insolvency Service’s investigation further revealed that Mr Qureshi also persuaded an unsuspecting young woman to entrust monies to Rejuvenate Your Business, supposedly for the purpose of buying a residential property. These funds too were expended for other purposes, leaving the depositor with an unpaid unsecured debt of £125,500 when the company went into liquidation.

Robert Clarke, Head of Insolvent Investigations North at the Insolvency Service, said:

This was a clear case of abuse of trust, which has caused much financial loss and distress to those who trusted Mr Qureshi with substantial sums of money. The circumstances of Mr Qureshi’s dealings with external parties meant that he owed not only a duty of trust but also an obligation of transparency and probity in relation to such dealings. He clearly failed to provide either. The Insolvency Service will not hesitate to use the full force of the disqualification regime to remove such individuals from the marketplace with a view to maintaining its integrity and reputation, the length of the disqualification is evidence of the seriousness with which such conduct is viewed.

Notes to editor

Mr Qureshi’s date of birth is 26 September 1973 and he resides in Bury.

Rejuvenate Your Business Ltd (CRO No. 06658839) was incorporated on 29 July 2008 and latterly traded from Suite 114, Imperial Court, Exchange Street East, Liverpool, L2 3AB.

Mr Qureshi was a director from 11 January 2013 until 02 June 2014.The estimated deficiency at the date of Liquidation was £928,359.

On 03 October 2016, the Secretary of State accepted a Disqualification Undertaking from Shazan Qureshi, effective from 24 October 2016, for a period of 13 years. The matters of unfitness, which Mr Qureshi did not dispute in the Disqualification Undertaking, were that he caused Rejuvenate Your Business Ltd (RYB) to trade with a lack of commercial probity with reference to the following:

Investors’ monies held on trust

  • Pursuant to a joint venture agreement, RYB was to hold funds (“The Subscription Monies”) received from investors in a third party (“Company A”) until such time as Company A had set up its own bank account.
  • On 16 August 2013, the sum of £360,898 was remitted by individual B and Individual C to the designated bank account in the name of RYB as stipulated in the joint venture agreement.
  • Between 17 August 2013 and 15 December 2013, £250,377 of these monies had been utilised by RYB. Contrary to the terms of the joint venture agreement:
  • The Subscription Monies had been expended without the prior written consent of Individual C.
  • Mr Qureshi did not produce the required weekly reports in relation to the Subscription Monies and the disposal thereof to individual C in the manner prescribed.
  • No bank account had ever been set up for Company A.
  • Not withstanding the absence of written permission from individual C, £45,620 was applied for the intended purpose as stipulated in the joint venture agreement, namely the purchase of and redevelopment of a property (“The Blackpool Property”). £41,000 was used to make payments to individuals b and C, other than in relation to Company A, with the balance being utilised for purposes unconnected with the investment in Company A, namely:
  • Payments to Mr Qureshi, his co-director and/or connected parties.
  • Loan advances to third parties, which had not ben recovered by the Liquidator to date.
  • Repayment of existing loans that had been made by third parties to RYB.
  • Expenditure incurred by RYB in the course of its trading activities.
  • Expenditure incurred for which there is no explanation in the available accounting records of RYB.

Loans intended for the benefit of RYB

  • On 16 December 2016, RYB borrowed the sum of £375,000 from individual B and individual E for the purposes of financing RYB’s working capital requirements and a bridging loan.
  • The agreement pertaining to this loan stipulated that a fixed and floating charge was to be created in favour of individuals D and E over RYB’s assets and that a further charge in their favour was to be created over two pieces of registered land. With regards to the security pledged:
  • The records maintained by the Registrar of Companies show that no charge had been registered over RYB’s assets in favour of individual D or E prior to Liquidation.
  • The records maintained by HM Land Registry show that neither Mr Qureshi nor RYB had legal title to either piece of land stipulated in the agreement, nor had any charges in respect of the same been registered in favour of individual D and E.
  • RYB used the funds advanced by individuals D and E to make good the dissipation of the Subscription Monies on behalf of individual B and C. Neither individual D and E nor RYB have any equitable interest in the assets of Company A, and the loan from individual D and E remained outstanding at Liquidation.

Further monies held on trust

  • On 31 January 2014, the sum of £125,500 was remitted to RYB’s bank account from individual F, the intended use of the said monies being for the purchase of a private residence jointly with Mr Qureshi. However, the property was never purchased and the monies so deposited was utilised for other purposes by RYB, namely:
  • Payments to Mr Qureshi, his co-director and/or connected parties.
  • Loan advances to third parties, which have not been recovered by the Liquidator to date.
  • Payments in connection with Company A’s investment in The Blackpool Property.
  • Expenditure incurred by RYB in the course of its trading activities.
  • Expenditure incurred for which there is no explanation in RYB’s available accounting records of RYB.
  • The £125,500 remitted by individual F to RYB has not been repaid by the date of Liquidation.

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

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.

Persons subject to a disqualification order are bound by a range of other restrictions.

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 20 October 2016