Graham John Coate, the sole director of First Class Cars Ltd, a prestige chauffeur service that operated in Luton and other London airports, has been disqualified as a director for eight years for causing the company to continue trading when he knew or ought to have known it could not meet its debts.
First Class Cars Limited was incorporated on 26th August 1999. Mr Coate was the sole director from incorporation until the company was placed in administration on 8th February 2013.
Mr Coate is banned from acting as a director or in any way managing or controlling a company from 8 October 2015 to 2023, without leave of the court, following an investigation by the Insolvency Service.
For the purpose of his disqualification undertaking, given to the Secretary of State for Business, Innovation & Skills, Mr Coates admitted that he caused First Class Cars Ltd to trade whilst insolvent to the detriment of creditors and for his own personal benefit.
Specifically, as early as May 2012, Mr Coate knew of the dangers of First Class Cars Ltd’s trading whilst insolvent should a director’s loan he had taken from the company become irrecoverable. He continued trading regardless and even increased his drawings from the company to pay personal expenses; mainly money owed in divorce proceedings.
On administration, outstanding creditor claims were £464,841 and Mr Coate owed the company £595,652 on his director’s loan account.
Mark Bruce, Chief Investigator, Investigation and Enforcement Services at the Insolvency Service, said:
Limited liability protection is a privilege to ensure businesses trade in an open and fair market.
The Insolvency Service will rigorously pursue persons, like Mr Coate, who seek to undermine or abuse this privilege for their own benefit.
Notes to Editors
First Class Cars Ltd (FCC) - Company Registration Number 03832464 - was incorporated on 26 August 1999.
FCC was placed in Administration on 8 February 2012. The Administration was converted to a Creditors Voluntary Liquidation on 24 June 2013.
Mr Coate provided a disqualification undertaking to the Secretary of State on 17 September 2015. The disqualification commences on 8 October 2015.
Graham John Coate is of Hertfordshire and his date of birth is 11 May 1954.
FCC traded as a high-end chauffeur service provider. Its registered office for the greater part of six months prior to the liquidation was situated at 86 Princess Street, Luton, Bedfordshire, LU1 5AT. It traded from Kensal House, President Way, Luton, Bedforshire, LU2 8NR.
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: 29 September 2015
From: The Insolvency Service