Two former directors of Manchester discount store chain Pound Empire, which entered into company liquidation on February 29th 2012, have been disqualified for a decade for acting inappropriately immediately when the company stopped trading.
On January 25th 2012, the date trading ceased but before a Creditors’ Voluntary Liquidation was entered into, the assets of the company were transferred to another company owned by the wife of one of the directors, Manchester-based Javed Fozdar.
This was said to be repayment of a debt – but no evidence of such a debt was provided, and a further £900,000 had been paid out of the business in cheques without any record of the payees.
Robert Clarke, head of Insolvent Investigations North at the Insolvency Service, said: “Directors have a duty to ensure that their companies maintain proper accounting records and, following insolvency, deliver them to the office-holder in the interests of fairness and transparency.”
Javed Fozdar and Salford-based Riyaz Fozdar have both now been disqualified from acting as company directors for ten years each, highlighting the importance of following the correct procedures during company liquidation, if you want to be able to set up in business again in the years to follow.