Christopher Lister, the Director of GMS Stone Supplies Ltd (‘GMS’), has been disqualified for three and a half years for causing a preference transaction to a connected company, following a Disqualification Order on 18 December by Leeds County Court against Mr Lister.
The disqualification, from 8 January 2016, prevents Mr Lister from directly or indirectly becoming involved in the promotion, formation or management of a company until July 2018.
The ‘preference transaction’ had the effect of giving one creditor a ‘preference’ in the insolvency to the prejudice to the general body of creditors. Specifically, the matter of Mr Lister’s unfitness was that, whilst a director of GMS Stone Supplies Limited and the company was insolvent, an invoice for the sale of stock in the sum of £268,762 inclusive of VAT was raised to a connected company, which resulted in causing GMS to transfer stock to the connected company to the value of that invoice. The transfer was to the detriment of GMS’ creditors.
On 28 January 2013, less than a month before GMS was liquidated and whilst it was in financial difficulty, Mr Lister caused GMS to transfer stock in the sum of £268,762 (inc. VAT) to a company of which Mr Lister was a director, which was also a creditor of GMS. The stock transfer was to the detriment of GMS’s trade creditors and HMRC, who were owed £171,952 at Liquidation on 27 February 2014, as GMS did not receive full payment for the value of stock transferred.
Robert Clarke, Group Leader, Insolvent Investigations North, of the Insolvency Service, said:
The Insolvency Service and The Department for Business will take firm action against those directors who act with a disregard for company creditors, causing them loss and who are unfit to manage a company, to protect the public and the business community.
Notes to editors
Mr Lister’s date of birth is 20 November 1964 and he resides in Halifax.
GMS Stone Supplies Limited (CRO No. 06477392) was incorporated on 18 January 2008 and latterly traded as a stone supplier from Gypsy Park Farm, Lindley Moor Road, Huddersfield, HD3 3TE.
Mr Lister was a director from 18 January 2008 to Liquidation. The Company went into Creditors Voluntary Liquidation on 27 February 2013 with an estimated deficiency of £260,700.
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 is available.
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: 1 February 2016
From: The Insolvency Service