Paul Wexham, a director of Cotswold Classics Limited, has been disqualified for 9 years following an Insolvency Service investigation.
The disqualification followed an investigation which found that the company, which traded as a dealer in classic motorbikes, sold customers’ vehicles without passing on the proceeds of sale, and took deposits for vehicles that were never supplied.
Mr Wexham, of Brockworth, Cheltenham, signed a disqualification undertaking, which, from 15 March 2016 prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company until March 2025.
Cotswold Classics was placed into Liquidation on 9 May 2014 with an estimated deficiency to creditors of £181,704.
The Insolvency Service’s investigation found that between October 2012 and the date of Liquidation, the company purchased 19 vehicles for £61,709 on behalf of another company, sold them and failed to remit the sales proceeds as agreed. It was found that Cotswold sold 3 vehicles belonging to customers under brokerage sales agreements and the sales funds totaling £23,000 due to them were withheld from these customers. The company also took customer deposits totaling £28,000 and failed to supply the vehicles or return these monies to the customers. At the date of liquidation these customers were owed a total of £112,709. Mr Wexham claimed that some of the monies due to or held on behalf of customers were used for continued trading.
The Insolvency Service investigation found that Mr Wexham received net payments of £175,644 from the company bank account between October 2012 and the date of liquidation.
Robert Clarke, Senior Investigator, said:
The Insolvency Service will rigorously pursue company directors who deliberately breach the trust of customers.
The undertaking signed by Mr Wexham sends a clear message to other company directors that if they run a business in a way that is detrimental to either its customers or its creditors, they will be investigated by the Insolvency Service and as a result may be subject to a lengthy period of disqualification.
Notes to editors
Mr Wexham’s date of birth is 5 June 1956 and he resides in Brockworth, Cheltenham.
Cotswold Classics Limited (CRO No. 05107575) was incorporated on 21 April 2004 and latterly traded as a classic motorbike dealer from 15 Prestbury Road, Cheltenham, Gloucestershire, GL52 2PN.
Mr Wexham was a director from 21 April 2004 to Liquidation. The Company went into Creditors Voluntary Liquidation on 09 May 2014 with an estimated deficiency of £181,704.
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: 21 April 2016
From: The Insolvency Service