Thomas Coakley and Ronald Coakley, directors of property company ST Vincent Street (491) Ltd (SVS), have been disqualified from acting directors for 7 and 3-and-a-half years respectively for failing to ensure SVS complied with its statutory obligations to HMRC and tenants and for payments made to the benefit of a family member at a time the company was insolvent.
Thomas Coakley (54) signed a disqualification undertaking on 12 February 2015 for 7 years which resulted in him being banned from acting as a director of a limited company until February 2022. Ronald Andrew Coakley (28) signed a disqualification undertaking on 14 January 2015 for 3½ years which resulted in him being banned from acting as a director of a limited company until July 2018.
SVS traded between April 2010 and February 2013 in the acquisition and letting of residential and commercial property. SVS went into administration on 14 February 2013, with assets of £9,126,015 and liabilities of £21,741,506 resulting in an overall estimated deficiency to creditors of £12,615,491.
As a property company, SVS was required by law to protect tenants’ deposit and failed to do so. In addition, staff were paid gross, despite employment contracts claiming otherwise. Specifically, the Insolvency Service investigation showed that SVS did not account properly for its tax throughout its trading. Employment contracts showed that SVA was responsible for paying employee tax under the PAYE system. However, only one employee, latterly, was registered under the scheme. Accounts showed employees were paid over £500,000 whilst declarations, deductions and payments to HMRC in respect of PAYE and NIC totalled under £10,000.
Furthermore, although the directors operated director loan accounts they did not account to HMRC for any corporation tax.
SVS failed to protect tenancy deposits of £19,425 however, shortly before SVS ceased to trade payments totalling £26,245 were made to a family member, clearing out the company bank accounts of all funds.
Commenting on the disqualification, Cheryl Lambert, Head of Outsourced Investigations at The Insolvency Service said:
The Insolvency Service will take action to protect the integrity of the market place where directors do not comply with their obligations to pay tax and to safeguard tenant deposits. Where they breach their fiduciary duty they can expect the Insolvency Service to seek a ban.
In this case, Thomas Coakley ran the business as a personal fiefdom and consistently put his own interests before that of tenants, creditors and the general taxpayer.
Notes to Editors
St Vincent Street (491) Ltd [CRO No. SC367833] was incorporated on 2 November 2009 and entered Administration on 14 February 2013.
Thomas Coakley gave an undertaking to the Secretary of State for Business, Innovation & Skills not to be a director for 7 years. The disqualification commenced on 5 March 2015. Ronald Coakley gave an undertaking on 14 January 2015, for 3yrs 6 months. The disqualification is due to commence on 4/2/15.
Thomas Coakley is of London and his date of birth is 30 January 1962. Ronald Andrew Coakley is of Riyadh, Saudi Arabia and his date of birth is 18 June 1986. 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.
Published: 18 March 2015
From: The Insolvency Service