Two directors involved in a company providing debt collection services have been disqualified from acting as directors following an investigation by the Insolvency Service.
Terence Mellor, 52, of Northumberland and Ross Alan Morton, 28,of Sunderland, have both been disqualified following an application to the court for a total period of 22 years.
Terence Michael Mellor and Ross Alan Morton were both disqualified by the court on 22 June 2016 for 10 years, and 12 years respectively, from 13 July 2016.
Both were directors of Express M S Limited (“Express”) a company that had previously been investigated by Company Investigations, acting on behalf of the Department for Business, Innovation and Skills (“BIS”). The company provided debt collection services charging customers an annual fee, with commission being payable on any debt recovered.
The matters of unfit conduct as found by the court were that the directors had:
- caused or allowed Express to make misleading and unfounded statements to customers; and
- made recoveries on behalf of customers that they had failed to pay over.
Commenting on the disqualifications, Ken Beasley, Official Receiver at the Insolvency Service’s Public Interest Unit, said:
These companies misled customers, inducing them into entering into contracts for debt collection services and subsequently failed to remit all collections made on behalf of those customers.
Such behaviour falls below the standards expected of responsible directors of a limited company.
The Insolvency Service has strong enforcement powers and we will not hesitate to remove directors from the business environment who have failed to demonstrate the level of care and responsibility required of them.
Notes to editors
Express M S Limited was incorporated on 8 August 2012. The registered office of the company was Suite 11 Albion House, West Percy Street, North Shields, Tyne & Wear NE29 0DW. The company traded from 10 Headley Court, Tyne Tunnel Trading Estate, North Shields NE29 7ST.
On 17 July 2014 the Secretary of State for Business, Innovation and Skills presented a petition to wind the company up on grounds of public interest a winding up order was later made on 9 September 2014.
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.
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: 3 August 2016
From: The Insolvency Service