Mr Elisha Zinyama, the director of Rare Earth Metal Exchange Limited (REME), a company incorporated to provide rare earth metals to clients, has been disqualified from acting as a director for 10 years by the High Court, for the company failing to procure metals which it had agreed to purchase on behalf of its clients between September and December 2012.
The disqualification follows an investigation by the Insolvency Service’s London Team.
The order, on 10 June, prevents Mr Zinyama from acting as a director of a limited company for 10 years from 1 July 2015.
REME went into voluntary liquidation in December 2012 owing its clients £2,888,878 for unfulfilled orders.
Total assets available at the date of liquidation were estimated to realise approximately £110,000 and the total claims received in the liquidation stood at £3,617,702, resulting in an estimated overall shortfall of £3,507,702.
The Insolvency Service investigation found that by 17 September 2012 REME had received orders for at least £1,944,597 (1374Kg) rare earth metals but had failed to allocate stock against £783,703 (760Kg) of the orders. £303,350 (310Kg) of the orders were over 28 days from receipt and REME was in breach of its terms and conditions to clients.
At 17 September 2012 REME held 760Kg of bonded stock and 250Kg non bonded stock. The non-bonded stock was found by the liquidator to be counterfeit. REME continued to take new client orders and between 18 September 2012 and the date of liquidation took a further £880,645 from clients in respect of rare earth metal sales but failed to purchase any further stock to meet the orders.
Commenting on the disqualifications, Mark Bruce, a Chief Investigator at The Insolvency Service said:
The director in REME failed to conduct business in a manner that would facilitate the proper fulfillment of its client orders.
The Insolvency Service will always look to remove from the business community those directors who act below the standards that should be expected of them, given the circumstances of their company’s trading.
Notes to Editors
Rare Earth Metal Exchange Limited (CRO No. 07951659) was incorporated on 16 February 2012 and went into creditors’ voluntary liquidation on 18 December 2012. Its registered office was at Finsgate, 5 – 7 Cranwood Street, London EC1V 9EE.
Elisha Zinyama is of Woodford Bridge and his date of birth is 24 December 1980.
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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