Alex Charles Richard Gabb, an appointed director of FCS Resourcing Ltd (‘FCS’) has been disqualified from acting as a director for 7 years for breaching the terms of a factoring agreement through the way in which he manipulated invoices that were part of the agreement.
An investigation by the Insolvency Service found Mr Gabb arranged payment of invoices directly to FCS after having submitted the invoices to the factoring company; submitted invoices to the factoring company that differed from those issued to customers; and submitted invoices to the factoring company that were false.
The disqualification, from 6 January 2016, prevents Mr Gabb from directly or indirectly becoming involved in the promotion, formation or management of a company for the duration of the term.
The investigation found FCS Resourcing Ltd entered into the factoring agreement on 14 June 2010, whereby invoices were assigned to the factoring company, which advanced monies to FCS, and payments from customers were collected and controlled by the factoring company.
From 2 September 2013 to 20 January 2014, FCS issued at least 20 invoices to six customers that breached the factoring agreement, causing a loss of over £67,000 to the factoring company. In total, the factoring company claimed £142,569 in the administration.
The factoring company appointed administrators over FCS Resourcing Ltd on 29 January 2014.
Commenting on the disqualification, Robert Clarke, Investigations Group Leader at The Insolvency Service said:
Company Directors should be aware that if their company enters into a factoring agreement, they should abide by the terms of that agreement and not submit invoices to the factor that they know will not be reimbursed.
When The Insolvency Service becomes aware of such acts in companies that are subject to insolvency proceedings, they will be vigorously investigated and the directors subject to significant periods of disqualification.
Notes to editors
Mr Gabb’s date of birth is 1 January 1971 and he resides in Nottinghamshire
FCS Resourcing Ltd (CRO No. 07237526) was incorporated on 28 April 2010 and traded as a recruitment agency for temporary employees in the haulage and engineering sectors, from 36 Perlethorpe Avenue, Gedling, Nottinghamshire NG4 4GG
Mr Gabb was an appointed director from 15 October 2010. The company ceased trading on 29 January 2014 when administrators were appointed. Liabilities totaled £261,067.57. On 16 December 2015, the Secretary of State accepted a Disqualification Undertaking from Alex Gabb, effective from 6 January 2016, for a period of 7 years. The matters of unfitness, which Mr Gabb did not dispute in the Disqualification Undertaking, were that:
Between 02 September 2013 and 29 January 2014, Alex Charles Richard Gabb (“Mr Gabb”) caused and / or allowed FCS Resourcing Limited (“FCS”) to breach the terms of a Debt Purchase Agreement entered into on 14 June 2010 to the detriment of the invoice finance company. This resulted in the invoice finance company being unable to recover a total of £67,322.35 from 20 invoices that FCS had assigned in respect of 6 separate different customers.
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