Jail and ban for undischarged bankrupt who acted in the management and promotion of a company and fraudulently removed £54K
Philip Henry Martin, an undischarged bankrupt has been sentenced to 20 months imprisonment at Amersham Crown Court after he pleaded guilty to acting in the management and formation of two companies whilst an undischarged bankrupt and to fraudulently removing £54,000 from one of those companies.
Additionally, Mr Martin received a 7 and half year ban from being a director of a limited company.
Mr Martin (42) was initially adjudged bankrupt on 15 December 2010 with estimated liabilities of £2.1 million. Being an undischarged bankrupt he was precluded from acting in the management or formation of a company. Following an initial investigation by the Insolvency Service and a full criminal investigation and Prosecution by The Department for Business Innovation and Skills (BIS) it was shown that between 18 November 2011 and 23 May 2012 Mr Martin acted in the management and formation of Multiguard Solutions UK Ltd and Premiere Building and Construction Ltd whilst an undischarged bankrupt.
A winding up order was made in respect of Multiguard Solutions UK Ltd on 14 May 2012.
The investigation also showed that approximately £108,000 was removed from the company account and paid into another account controlled by Mr Martin. Of the £108.000, £55,000 was used for Mr Martin’s personal expenditure. This offence was committed both before and after winding up proceedings in relation to Multiguard Solutions UK Ltd had commenced.
In sentencing Mr Martin, His Honour Judge Sheridan QC remarked:
Mr Martin’s conduct was exactly the type of conduct the legislation was designed to prevent.
The Judge noted that at the time Mr Martin was introduced to Multiguard Solutions UK Ltd, the company was already in financial difficulty, but it did not need Mr Martin to finish it off.
The Judge listed the aggravating features as including the lengths Mr Martin went to in order to hide his identity from the vendors of Multiguard Solutions UK Ltd, the use of a Patsy director – Mr Cross whom Mr Martin funded to stay in Thailand out of the reach of the Official Receiver and the fact that Mr Martin pretended to be Mr Cross and encouraged others to lie to the Official Receiver.
Deputy Chief Investigation Officer Glenn Wicks from the Department for Business Innovation and Skills said:
This man was a bankrupt, meaning he should not have been controlling a company. He ripped-off a lot of people and destroyed the company. The courts will clearly consider imprisonment for these very serious offences as he has discovered.
Notes to editors
Mr Philip Henry Martin’s date of birth is 21 January 1973.
Multiguard Solutions UK Ltd (CRO No. 04911136) was incorporated on 25 September 2003. The company was ordered into compulsory liquidation on 30 December 2013.
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. Further information on director disqualifications and restrictions is available.
BIS’ mission is to build a dynamic and competitive UK economy, in particular by creating the conditions for business success and promoting an open global economy. The Criminal Investigations and Prosecutions team contributes to this aim by taking action to deter fraud and to regulate the market. They investigate and prosecute a range of offences, primarily relating to personal or company insolvencies. Further information about the work of the Criminal Investigations and Prosecutions team 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: 9 October 2015
From: The Insolvency Service