Andrew Reed (53) was the director of APR Media, formerly known as APR Video, where he produced and duplicated recordable media since it was first incorporated in 1996.
However, when the company began to make a loss and after 16 years of trading, Andrew Reed instructed insolvency practitioners in October 2012 to place APR Media into creditors’ voluntary liquidation with a total deficiency of just over £800,000.
During the initial investigation into the company’s affairs, the insolvency practitioners could not account for around £125,000 which had been transferred out of APR Media’s accounts just a couple of months before it was placed into liquidation.
Further enquiries by the Insolvency Service found that Andrew Reed fraudulently transferred money out of APR Media in the full knowledge that the business was insolvent in order to avoid paying his creditors.
In August 2012, Andrew Reed paid himself a £100,000 dividend and in September 2012, he transferred £25,250 to M5 Audio & Events, a company where his wife was a director.
Andrew Reed pleaded guilty to two fraud charges and on 27 April 2018 he was sentenced to 15 months in prison, suspended for two years, while also being ordered to complete 120 hours of unpaid work and pay £7,500 in costs.
The sentence was handed down despite the fact that Andrew Reed had paid back over £200,000 to the estate once the wrongful payments had been identified by the insolvency practitioner.
Glenn Wicks, Deputy Chief Investigation Officer of the Insolvency Service, said:
Andrew Reed knew his company was failing and unscrupulously ripped off his creditors by transferring money to his other company. The court has shown anyone doing this stands a serious chance of going to prison.
Notes to editors
APR Video Limited (Company number: 03239812) was incorporated on 20 August 1996 before it changed its name to APR Media in 2006.
On 19 March 2018 Andrew Reed pleaded guilty to two charges contrary to section 207(1)(a) of the Insolvency Act 1986 of undertaking transactions in fraud of APR Audio Limited’s creditors at Taunton Crown Court.
The Insolvency Service, an executive agency sponsored by the Department for Business, Energy and Industrial Strategy (BEIS), administers the insolvency regime, and aims to deliver and promote a range of investigation and enforcement activities both civil and criminal in nature, to support fair and open markets. We do this by effectively enforcing the statutory company and insolvency regimes, maintaining public confidence in those regimes and reducing the harm caused to victims of fraudulent activity and to the business community, including dealing with the disqualification of directors in corporate failures.
BEIS’ mission is to build a dynamic and competitive UK economy that works for all, 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.
The agency also authorises and regulates the insolvency profession, 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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