Eric Reid has been disqualified from acting as a director for 8 years for failing to keep adequate accounting records. Mr Reid’s disqualification follows an investigation by the Insolvency Service.
Glasgow Commercials Limited began trading as car repair garage in 2007. On 14 June 2013, HM Revenue & Customs presented a petition to wind up the Company. On 13 August 2013 a winding up order was granted and a Liquidator was appointed.
On 16 August 2014 the police carried out a raid at the trading address of the company in connection with allegations of drug manufacturing at the premises.
The Insolvency Service investigation found that Mr Reid had failed to ensure that the company maintained or preserved full accounting records, or that he had failed to deliver them up. As a consequence, it was not possible to verify the true nature of the company’s business and operations, to establish when the company ceased trading, and to establish the identity and value of the company’s assets.
Specifically, it was also not possible to:
- Establish the reason for payment into the two Company bank accounts totalling £70,684.80 in the period from 7 January 2013 to cessation of trading
- Establish reasons for payments from the two Company bank accounts totalling at £119,554.66 in the period from 7 January 2013 to cessation of trading, and whether that was for bona fide Company expenditure.
- Ascertain, in the absence of any VAT records, the full and true amount due to HMRC in relation to VAT.
- Ascertain, in the absence of any payroll records, the names and identities of employees and the full and true amount due to HMRC in relation to PAYE/NIIC including the accuracy of P35s submitted.
- Establish the true amount received by Mr Reid in salary and any other benefits
At the date of Liquidation creditors were owed at least £240,166.
Commenting on the disqualification, Cheryl Lambert, Chief Investigator at the Insolvency Service, said:
Directors who do not maintain adequate accounting records or do not deliver them up to a liquidator can expect to be investigated by the Insolvency Service and enforcement action taken to remove them from the market place.
Mr Reid’s failure to keep accounting records has hindered the liquidator’s investigations and as a result funds have not been recovered to repay creditors.
Taking action against Mr Reid is a warning to directors to take heed of of their duties and obligations.
Notes to editors
Glasgow Commercials Limited (SC329010) was incorporated on 9 August 2007. Its registered office was 33 Main Street, Stewarton, Kilmarnock, KA3 5BS. It traded from 8 Underwood Road, Paisley, Renfrewshire, PA3 1TD. Eric Reid was the only director at the time of Liquidation.
Glasgow Commercials Limited was placed into Liquidation on 13 August 2013.
Eric (Peter) is of1 Blackwood Terrace, Johnstone, PA5 0AX. His date of birth is 31 January 1973.
A Disqualification Order was made against Eric Reid at the Paisley Sheriff Court on 21 September 2015. The disqualification commences on 12 October 2015.
A disqualification order or undertaking 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 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.
All public enquiries concerning the affairs of the company should be made to: Cheryl Lambert, Head of Outsourced Investigations, Investigations and Enforcement Services, The Insolvency Service, 3rd Floor, Abbey Orchard Street, London SW1P 2HT. Tel: 0207 596 6117. Email: Cheryl.Lambert@insolvency.gsi.gov.uk.
Contact Press Office
Media enquiries for this press release – 020 7674 6910 or 020 7596 6187
The Insolvency Service
4 Abbey Orchard Street
Media Manager 020 7596 6187
This service is for journalists only. For any other queries, please contact the Insolvency Enquiry line on 0300 678 0015.
For all media enquiries outside normal working hours, please contact the Department for Business, Energy and Industrial Strategy Press Office on 020 7215 1000.
You can also follow the Insolvency Service on:
Published: 22 October 2015
From: The Insolvency Service