Join our team:
Sales & Marketing Assistant, Kent

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Role title: Sales & Marketing Assistant
Reporting to: Senior Researcher and Operations Manager / Client Services Director
Contract type: Permanent full-time or part-time position
Location: Discovery Park, Sandwich, Kent

We are recruiting a Sales & Marketing Assistant to join our growing Kent office based in Discovery Park, Sandwich.

About ESA Risk

ESA Risk is a relatively new, but fast-growing risk management and investigations business.

The brand was launched in 2020 and we now have offices in four locations: London, the Midlands, Manchester and Kent. We recently established our Kent office in Sandwich’s Discovery Park, where we are developing one of the company’s key hubs.

We support our clients by managing business risks, protecting and enhancing their profitability, and providing solutions when organisations need specialist assistance. We build strategic partnerships and add value to businesses worldwide by providing consulting, corporate intelligence, risk management and litigation support services.

Our clients include major accountancy firms, multinational corporations, lenders, high-net-worth individuals, investors and international law firms.

We are instructed on a broad range of projects, such as worldwide asset tracing (including crypto tracing), intelligence gathering, enhanced due diligence, fraud investigations and digital forensics.

We pride ourselves on the quality of our service and the speed of our response.

About the role

This is a great opportunity to work across the customer lifecycle and a key role in supporting ESA Risk’s growth. You will be in a position to influence the customer experience from the very beginning – by identifying target clients and tactics we may use to reach them – through to the development of client accounts through cross-selling, upselling and revenue growth.

Your efforts will be focused on optimising our sales pipeline. You will be involved in lead generation, as well as nurturing inbound leads into closable opportunities by booking in and project-managing new and follow-up sales meetings.

The key objectives of the role are to:

  • Contribute to year-on-year increases in revenue.
  • Contribute to growing key client accounts.
  • Contribute to winning new clients.
  • Move contacts from marketing to sales to operations.
  • Maintain good client relations.

Typical areas of responsibility and tasks will include:

  • Client communications – onboarding, event and meeting invites.
  • Pipeline generation – reach out to prospects via email, telephone, networks, events and social media.
  • Planning – thinking ahead about who we want to reach/see, where they are, and when and how it makes sense for us to approach them.
  • Identification of opportunities – research potential targets, opportunities and leads, as well as the competitive landscape.
  • Data management – population, enhancement, cleansing and archiving of contact data, particularly in HubSpot CRM.
  • Quotation management – ensuring we follow through on the process to take advantage of more opportunities and improve internal reporting and development.
  • Compliance – answer supplier onboarding questions when asked by clients/potential clients, and ensure ESA Risk is in the best position to win new accounts/work where there is a compliance requisite.
  • Copywriting – communications to contacts, plus regular article writing and other marketing content creation.
  • Reporting – demonstrate impact on a regular basis.

About you

You will be:

  • Personable and excellent at building relationships.
  • A strong communicator across different channels.
  • Data-focused and digitally savvy.
  • Organised and able to manage your workload effectively.

You must have:

  • Excellent written and spoken English.
  • A problem-solving mindset.
  • A good understanding of data protection laws as applied to marketing, sales and contract fulfilment.

You should have:

  • Experience working in a marketing, sales or related role.

Additionally, we’d love you to have:

  • Experience / knowledge of the investigations and risk management market.
  • Experience using key software for a commercial purpose – HubSpot (or another CRM platform), Mailchimp (or another email service provider), social media.

We will provide all necessary training on systems and processes.

How to apply

If you are interested in the Sales & Marketing Assistant role and would like to apply, simply send your up-to-date CV to us at hr@esarisk.com and we will be in touch.

The future of insolvency regulation – government publishes consultation outcome

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The UK government has, this week, published its plans to reform insolvency regulation, based on the results of a public consultation held under the banner of ‘The future of insolvency regulation’ which ended in March last year.

It will come as no surprise that the plans focus on increasing regulation within the sector.

The headline reform addresses the current absence of regulation for firms offering insolvency services – at present, only individual insolvency practitioners are subject to regulation.

Additionally, a central public register will be created, listing all those authorised to provide insolvency services – both individuals and firms. The register will include notice of any sanctions brought by regulators against those on the list.

Respondents to the consultation were “overwhelmingly supportive” of the proposals. This was reflected in the thoughts of the insolvency practitioners I spoke to when the plans were published earlier in the week.

Colin Wilson, Partner at Opus, told me that “the move to regulating firms as well as individual insolvency practitioners will be a positive change, which should improve professional standards, just as the creation of a public register of insolvency practitioners and firms will increase transparency.”

Similarly, Rehan Ahmed, Managing Director at Quantuma, called the public register “a great idea” which “will give clarity and confidence to the general public that who they are seeking advice from is a bona fide practice.”

Existing insolvency regulators to stay in place

Another proposed change mooted at the start of the public consultation was the creation of a single regulator for insolvency practitioners to replace the role of the four recognised professional bodies that currently cover the sector (as we reported on in January 2022).

Plans for a new central regulator have been dropped, however. Instead, the government will “challeng[e] the current four professional body regulators to deliver significant and measurable improvements to the quality of regulation through non-legislative means, whilst keeping options to replace the current regulatory model with a single regulator of insolvency practitioners under review”.

The government has said it will provide the four bodies – Institute of Chartered Accountants in England and Wales (ICAEW), Insolvency Practitioners Association (IPA), Institute of Chartered Accountants of Scotland (ICAS) and Chartered Accountants Ireland (CAI) – “with additional tools” and “work with [them] to deliver transformational improvements to the regulatory framework without the need for legislation”.

On the development of regulations within the existing regulatory bodies, Rehan Ahmed said: “Whilst the industry is already heavily regulated and most do a fabulous job, it is great to see there is a proposal to scrutinise insolvency practices and make them more accountable. It suggests that any regulations may be akin to those of the Law Society whereby, if a practice is failing to provide the right level of service, the relevant body will intervene.”

Further insolvency regulation reforms

The government’s response to the consultation also includes plans to:

  • “Reform… the way ethical and professional standards for the profession are set”.
  • “Develop… and consult… on proposals to introduce a compensation/redress scheme for those affected by an insolvency practitioner’s acts or omissions”.
  • “Strengthen… the bonding framework, which requires insolvency practitioners to hold security in the event of their fraud or dishonesty”.

On this final point, Colin Wilson added: “The proposal to reform the current bonding regime is also welcome, but it is important that the government provides more details without delay to demonstrate how any new system will work in practice.”

Although this week’s announcement has come nearly eighteen months after the public consultation ended, the reforms are still only plans, which the government says it “will take forwards when parliamentary time allows.”

Get support from ESA Risk

Insolvency investigations

When you suspect fraud or believe that a company director or third party is not being honest, we understand how difficult and time-consuming the investigations process can be. Our investigative services are designed to provide you with the whole picture allowing you to concentrate on the more technical insolvency issues. From intelligence gathering and tracing, to on-site support including digital data capture and forensics, ESA Risk has the investigations side of your insolvency case covered.

Support for company owners and directors

If you have a limited company that you wish to close, we can introduce you to an insolvency practitioner, who will ensure the correct legal process is followed.

If you suspect that a fraud has occurred within your business and need advice or support on the next steps, we’re here to help.

Contact us

Contact Mike Wright, Risk Management & Investigations Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form, to find out more.

 

Download our Insolvency & Debt Investigations brochure

 

Bounce Back Loans: August 2023 news roundup

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As we’ve been reporting, the Insolvency Service’s recent press releases have been awash with director disqualifications and bankruptcy restrictions related to misuse of the Bounce Back Loan Scheme (BBLS).

The frequency of updates on the subject from the Insolvency Service certainly appears to have slowed, recently. (In fact, there were none at all in July.) However, the cases being reported now are interesting in that the errant company owners are being penalised with more than only director disqualification in more and more instances.

Custodial sentence for Bounce Back Loan Scheme fraud

35-year-old Aleksander Staskiewicz has been sentenced to eight months in prison for offences under the Fraud Act 2006 and the Companies Act 2006 related to the Bounce Back Loan Scheme (BBLS).

The Southampton-based plumber successfully applied for a Bounce Back Loan for his company Think Gas Ltd in May 2020, early in the Covid-19 pandemic.

The Polish national’s company was already facing financial challenges before the pandemic began, though. Staskiewicz “had considered closing it down.” This fact alone meant Think Gas Ltd should not have been eligible for the scheme.

As we have seen in so many other BBLS cases, the director inflated the company’s turnover when applying through the scheme and obtained a £20,000 loan.

Staskiewicz withdrew nearly all of the money a day after the loan reached the company’s bank account. And a day later, he completed a striking-off application to dissolve Think Gas Ltd.

Dissolving a company without informing creditors within seven days is a criminal offence. In this case, Staskiewicz did not inform the bank that provided him with the Bounce Back Loan.

Staskiewicz was sentenced at Southampton Crown Court on 17th August 2023, having pleaded guilty at a hearing on 20th July 2023 to fraud by misrepresentation contrary to sections 1 and 2 of the Fraud Act 2006 and failure to notify creditor of a strike off application contrary to section 1006 of the Companies Act 2006. He was handed an eight-month sentence for both offences, to be served concurrently.

Peter Fulham – Chief Investigator of the Criminal Investigation Team at the Insolvency Service, said: “Aleksander Staskiewicz thought he could abuse the rules to exploit a scheme, backed by taxpayers, specifically designed to help businesses get through the pandemic. He now has a criminal conviction as a consequence of his actions. We will not hesitate to prosecute such cases.”

In court, Staskiewicz said “he had hoped to repay the loan…within twelve months”, but the money was still outstanding after three years.

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Suspended sentence plus curfew

In another case involving the dissolution of a company after securing a Bounce Back Loan, Ivan Hristov Fratev was given a two-year suspended prison sentence, a four-month electronically tagged curfew from 19.00 to 7.00 each night, a six-year director disqualification and fifteen days rehabilitation activity requirement at Snaresbrook Crown Court.

The Bulgarian national ran a construction, security and extermination business, BI&F Ltd, in Chingford, London. Fratev obtained a £50,000 Bounce Back Loan (the maximum amount under the scheme) in May 2020.

Using powers granted in December 2021 to investigate directors of dissolved companies, the Insolvency Service found that Fratev moved to dissolve his company less than a fortnight after receiving the loan money. He did not inform the bank that provided the loan.

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Exaggerated turnovers

Two cases of exaggerated turnovers to secure Bounce Back Loans, now, that were uncovered due to the companies involved entering liquidation.

Ryan Moir, an Eastbourne-based builder, took out the maximum £50,000 Bounce Back Loan in May 2020 through his company Croxton Group Ltd.

In order to obtain the maximum loan amount, Moir claimed that the company’s turnover was £250,000 for the relevant period. Insolvency Service investigators found that Croxton Group Ltd’s actual turnover was under £21,000 – less than 10% of the figure Moir used in the loan application.

Moir’s company went into liquidation owing more than £184,000 in May 2022, including the majority of the loan (£49,400). Croxton Group Ltd’s liquidators, from FRP Advisory, “are taking action to recover the money.”

Separately, Bradley Malone also obtained a £50,000 loan through the Bounce Back Loan Scheme in June 2020. Malone recorded the turnover of his company – ONENETPRINT Ltd – as £200,000 (the amount needed to claim the maximum loan value).

The company’s actual turnover was around £90,000 – less than half that stated by Malone – the Insolvency Service found, once the company had gone into liquidation in February 2022 with the full loan amount still outstanding.

Both Malone and Moir have received ten-year director bans.

Interestingly, Malone claimed that all he had done through the Bounce Back Loan application process was “clicked ‘next’ on his phone, and the money arrived within the hour.” This perception by some directors of the Bounce Back Loan Scheme as providing easy money with few or no checks goes some way to explaining the issues being uncovered now, as companies are dissolved or enter insolvency.

Insolvency and debt investigations

Seeing the whole picture in insolvency and debt cases is key to maximising returns to creditors. For more information on how ESA Risk can help to identify hidden assets or locate targets who have gone to ground, contact Mike Wright, Investigations and Risk Management Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

You can also learn more from our Insolvency & Debt Investigations brochure:

 

Download your copy

Former footballer jailed for breaking bankruptcy terms

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Former Halifax Town player, Stephen Oleksewycz, has been imprisoned for 27 months after pleading guilty to five offences under the Fraud Act 2006, Insolvency Act 1986 and Company Directors Disqualification Act 1986.

The 39-year-old from Halifax also must pay compensation to two creditors he defrauded.

Oleksewycz was forced to retire early from professional football following an injury, after which he moved into the events industry. In February 2016, he formed An Exp With Ltd as an events promotion company, offering ‘experiences with’ celebrities such as mixed-martial arts fighter Conor McGregor.

Oleksewycz was made bankrupt later in 2016, as he was unable to repay a debt of around £16,000.

Bankrupts are restricted from acting as company directors without permission from the courts. However, Oleksewycz continued to act as a director of his company, running an event featuring McGregor in February 2017.

In addition to the bankruptcy offence, Oleksewycz committed fraud when he falsified bank documents to show payments being made to two companies involved in the McGregor event – EventCity (the venue) and Groovy Gecko (who provided live streaming).

EventCity and Groovy Gecko were due fees of nearly £80,000 and over £15,000 respectively. The doctored bank statements convinced Oleksewycz’s suppliers that money was on the way and the event went ahead.

The venue was paid only £5,000 and Groovy Gecko did not receive a payment. With around £90,000 outstanding in relation to the event, An Exp With Ltd entered liquidation. As a result, Oleksewycz was charged with two offences under the Insolvency Act 1986 section 206 – fraud during the course of winding up.

I spoke to Mark Sands, Head of Insolvency at Apex Litigation Finance, who has a wealth of experience in dealing with personal insolvency cases. He told me that Oleksewycz’s behaviour was all too familiar: “As an insolvency practitioner (IP) who has acted as Trustee of hundreds of bankrupts over the years, it has always been galling how many do not take seriously the obligations and duties placed upon them. For example, they are required to cooperate with their Trustees and identify all their assets, but so often as an IP I had to instruct solicitors and enquiry agents to help me do my job. Here, the bankrupt has blatantly ignored the bar on his acting as a director, and worse still has caused losses to creditors of the company he should not have been controlling.”

Oleksewycz received a sentence of 16 months jail time for each of the insolvency offences, 13 months for acting as a director whilst an undischarged bankrupt and 27 months for each of the two fraud offences under section 11 of the Fraud Act 2006 – obtaining services dishonestly. At Leeds Crown Court, Oleksewycz was ordered to serve the sentences concurrently.

Sands is more surprised by the sentence handed down in the case: “Custodial sentences in bankruptcy matters are extremely rare and the sentence shows just how serious the breaches were in this case. That should send a clear message to undischarged bankrupts – do not ignore the restrictions placed on you, and cooperate with your Trustee.”

Oleksewycz had originally entered a not guilty plea at Leeds Magistrates’ Court in February 2021, but he changed his plea for the five offences and other charges against him were dropped when the case came to trial in June 2023.

About the case, Glenn Wicks, Chief Investigator at the Insolvency Service, said:

“Acting as a company director while being an undischarged bankrupt is a serious offence, and to compound this Stephen Oleksewycz deliberately defrauded two businesses who gave him the benefit of the doubt to run an event despite their concerns about his behaviour.”

Insolvency and debt investigations

Seeing the whole picture in insolvency and debt cases is key to maximising returns to creditors. For more information on how ESA Risk can help to identify hidden assets or locate targets who have gone to ground, contact Mike Wright, Investigations and Risk Management Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

You can also learn more from our Insolvency & Debt Investigations brochure:

Download your copy

What are directors’ responsibilities when insolvent?

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By guest author Shaun Barton of Company Closure.

Company directors are also responsible for overseeing the welfare of their employees and ensuring that the company fulfils its filing and other statutory obligations. Directors’ responsibilities change if their company slips into insolvency, however.

Director responsibilities in insolvency

Prioritising creditor interests

When a business is solvent, directors prioritise the interests of the company by promoting its success for the benefit of its members as a whole. Conversely, when a company becomes insolvent, creditor interests must be placed to the fore to minimise their financial losses.

Part of this responsibility involves being aware of the financial status of the company at all times so that a director can take the necessary action if it slides into insolvency. The action they must take is to cease trading and seek assistance from a licensed insolvency practitioner.

Ensuring equitable treatment of creditors

Creditors must be treated without preference, which means that directors cannot favour one creditor over another – by repaying a loan that has a personal guarantee attached, for example.

Preference payments are a serious breach of a director’s responsibility to all creditors when their company is insolvent and can lead to serious repercussions including director disqualification.

Statement of Affairs

Directors must produce a statement of affairs if an insolvency practitioner is appointed voluntarily by the directors to close the insolvent company. If the company has entered compulsory liquidation by order of the court, the Official Receiver will typically prepare the document.

A statement of affairs sets out the company’s financial situation and typically includes a valuation of assets, a balance sheet, details of employees, creditors, and other stakeholders, as well as information on the debts owed by the business.

Cooperation with the office-holder

A key responsibility for directors in this situation is to cooperate fully with the appointed office-holder. This typically involves providing all the documentation and information requested.

The directors are also typically required to attend an interview. The main aim of the interview is to establish how the company declined and whether director actions contributed to it or to creditor losses.

What if directors do not fulfil these responsibilities when insolvent?

The ramifications of failing to carry out these requirements are serious for directors. Depending on the issue, they could be disqualified for anywhere between two and fifteen years, held personally liable for the company’s debts, and in the most serious cases, receive a prison sentence.

Director misconduct and disqualification

If any wrongdoing is uncovered leading up to or during the company’s insolvency, such as making preference payments or concealing assets, a director can be disqualified under the Company Directors Disqualification Act (CDDA), 1986.

Personal liability for company debts

Directors may have failed in their responsibility to cease trading when the company entered insolvency, in which case, they place themselves at risk of being held personally liable – either for the additional losses suffered by creditors during this time or in some cases, all of the company’s debts.

Court action

Refusing to assist the office-holder can also lead to a court ordering compliance from a director or the compulsory seizure of the books and records if they are not readily handed over.

The responsibility to be aware of the company’s financial situation is a key responsibility that underpins a director’s role even when it is solvent. It is vital not to delay seeking assistance, therefore, even if the company is not yet officially insolvent. Doing so helps company creditors, but it also means that directors can avoid accusations of wrongful trading or other misconduct allegations.

Insolvency and debt investigations

Seeing the whole picture in insolvency and debt cases is key to maximising returns to creditors. For more information on how ESA Risk can help to identify hidden assets or locate targets who have gone to ground, contact Mike Wright, Investigations and Risk Management Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

You can also learn more from our Insolvency & Debt Investigations brochure:

Download your copy

 

This article was written by guest author Shaun Barton of Company Closure.

Debt recovery options among advice included in new director information hub

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The Insolvency Service has, this week, launched a new information hub on the Gov.uk website “to help limited company directors make the right decisions at the right time”.

The hub includes advice and guidance on the statutory duties of limited company directors, as well as on “business themes commonly faced by companies”, such as recognising financial distress early warnings, company and personal debts, and the different forms of insolvency.

There is no new advice in the ‘Director information hub’ (as it is officially titled); instead, the existing content published by the Insolvency Service has been reviewed, improved, and better organised in a single place.

The project has been informed by “extensive” research with micro and small company directors and input from Companies House, HMRC, Royal Bank of Scotland, and business groups such as The Directors Helpline and the Institute for Directors.

One section of the hub focuses on the options available to businesses when they are owed money. Starting with an explanation of mediation and how it can be used in such cases, the advice page goes on to outline using court action, statutory demands, bankruptcy petitions and winding up petitions in debt recovery.

The hub provides a brief overview of each topic area, with links out to existing further information elsewhere on the Gov.uk website. For example, staying with the debt recovery advice page, while there is only a single sentence on the hub about getting a company wound up, a link is provided to the detailed information about this process within the ‘Business and self-employed’ section of the government’s website.

Offering guidance to directors on their obligations and what to do when facing financial difficulties was an objective in the Insolvency Service’s five-year strategy, published in 2021.

The topics included on the hub are:

  • Getting your company started
  • Your duties, responsibilities and obligations as a director
  • Company money
  • Spotting the signs of company distress
  • Turning your company around
  • Avoidable insolvency and insolvency
  • Consequences of company insolvency
  • Director information hub: Help and guidance resources.

The launch of the hub comes less than a month after the Insolvency Service announced a 40% year-on-year increase in the number of registered company insolvencies in May 2023 (also higher than the levels seen both during and before the pandemic).

Responding to the launch of the hub, Jonathan Cooper from The Directors Helpline said:

“[It] is a welcome tool in the current climate for Directors of all types and sizes of businesses. We have been pleased to be recognised by the Insolvency Service as an important part of its development, due to the number of Directors we help on a monthly basis and will continue to support its ongoing development.”

Litigation support services from ESA Risk

If you are hoping to claim back a debt owed to you or your business, we can support you with a range of services under our litigation support banner, including tracing the address of a debtor, delivering documents such as statutory demands, winding up petitions and bankruptcy petitions (process serving), and tracing assets to aid the recovery process or determine whether legal action will be a worthwhile investment.

To instruct us or for more information on our litigation support services, contact Mike Wright, Risk Management & Investigations Consultant at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

Bounce Back Loans: June 2023 news roundup

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As we’ve been reporting, the Insolvency Service’s recent press releases have been awash with director disqualifications and bankruptcy restrictions related to misuse of the Bounce Back Loan Scheme (BBLS).

While there were only two updates from the Insolvency Service on the subject in June, those updates covered £600,000 of Bounce Back Loans and thirteen companies.

Network of sham companies wound up

Eleven companies have been wound up after an Insolvency Service investigation uncovered “systematic fraud” to the tune of £500,000 through the Bounce Back Loan Scheme.

While the group of companies listed various registered office addresses across England, no evidence of trading premises nor trading could be found for any of the companies. Despite never having traded, the companies obtained Bounce Back Loans during the Covid-19 pandemic, with nine of the eleven claiming the maximum £50,000 loan and one company securing two loans.

Money was moved around the network of fake companies – which were also linked by their registered addresses, in some instances – before eventually “being transferred to entities registered in Hong Kong.” The investigation started after the Insolvency Service found links between these eleven companies and five other companies that were wound up in 2021 and 2022. The five companies in the earlier investigation fraudulently obtained £250,000 through the BBLS, as well as £350,000 through other schemes.

The companies were wound up in the High Court in Manchester with the Official Receiver appointed liquidator and now “working to trace the funds and those responsible, with a view to recovering the money.”

The eleven companies in question are:

  • Laslett Industries Limited (company reg no 11690274).
  • JP Capital Management Ltd (formerly called Hampton Brookers Limited) (company reg no 11690206).
  • CMJA Limited (company reg no 11690056).
  • JK Distributions Limited (company reg no 11667454).
  • Kubrick Trade Ltd (company reg no 11386566).
  • Lowe Brokers Limited (company reg no 11474219).
  • Rubeum Auri Limited (company reg no 11886277).
  • Share Apartment Limited (company reg no 12248395).
  • Stella Management Limited (company reg no 11886188).
  • Globexel Ltd (company reg no 12063877).
  • JLS Enterprises Limited (company reg no 11830409).

Personal use of loan funds and exaggerated turnovers

George Pinnegar successfully applied for the maximum £50,000 Bounce Back Loan through his company London Sound Engineering Ltd in July 2020. In the application, he gave an estimated turnover of £250,000 for 2019, as the company began trading after 1st January that year, making the company eligible for the maximum loan amount. However, investigators found that the company had not been trading on 1st March 2020. Under the rules of the Bounce Back Loan Scheme, companies had to be trading on that date to be eligible for a loan.

Pinnegar “transferred almost £38,000 of the loan money to his personal bank account” and the other £12,000 “into the bank account of a connected company.”

London Sound Engineering Ltd was listed as a temp agency on Companies House, but traded as a sound engineering business. The company’s liquidator – Ian Yerrill of Yerrill Murphy LLP – “is currently working to recover the funds.”

Pinnegar has been disqualified as a company director for eleven years from 20th June 2023.

Azmi Shafi Ahmed also obtained a £50,000 Bounce Back Loan in July 2020 through his company AZ Fiancials Ltd, a bookkeeper in Ludgate Hill, London. He claimed the company’s 2019 turnover was £200,000 (the amount needed to apply for the maximum loan through the scheme). However, investigators found that Ahmed had exaggerated that figure by more than five times the true turnover, which was “less than £40,000”.

Ahmed moved the entire £50,000 he secured through the scheme into his personal bank account just three days after his company received the money.

He has repaid £25,000 of the the loan and has agreed to repay the remaining £25,000.

Ahmed has been disqualified for six years from 13th June 2023.

Insolvency and debt investigations

Seeing the whole picture in insolvency and debt cases is key to maximising returns to creditors. For more information on how ESA Risk can help to identify hidden assets or locate targets who have gone to ground, contact Mike Wright, Investigations and Risk Management Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

You can also learn more from our Insolvency & Debt Investigations brochure:

 

Download your copy

Bounce Back Loans: May 2023 news roundup

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As we’ve been reporting, the Insolvency Service’s recent press releases have been awash with director disqualifications and bankruptcy restrictions related to misuse of the Bounce Back Loan Scheme (BBLS).

While there were no announcements from the Insolvency Service on the subject in May, there were two interesting stories related to Bounce Back Loans from other sources – one from the Traffic Commissioners for Great Britain and another from the BBC.

Group of companies now in insolvency received c. £2m in Bounce Back Loans

The BBC reports that JVIP Group – a group of companies in the property sector – obtained “more than 40 Bounce Back Loans, each of about £50,000.”

The businesses, based in Tunbridge Wells, Kent, have faced insolvency since the start of last year, with the companies now either in administration or liquidation.

On the face of it, there is nothing necessarily wrong with companies in the group receiving loans under the Bounce Back Loan Scheme, designed to help businesses through the Covid-19 pandemic. However, the BBC article suggests that some of the companies were unlikely to have met the turnover requirements to access the maximum £50,000 loans, therefore implying that figures were manipulated during the application process.

Additionally, the article questions whether the JVIP Group companies were in financial difficulty before the pandemic, which would have made them ineligible for the scheme. The article quotes “a former member of staff who…said alarm bells were ringing in January 2020, three months before the first lockdown.”

Investors in the JVIP Group are “facing losses of up to £30m collectively”. Group director Peter Dabner “denies any wrongdoing.”

With formal insolvency processes underway across many of the group’s companies, it is only a matter of time before the facts about JVIP Group’s use of the Bounce Back Loan Scheme is revealed.

Bounce Back Loan Scheme abuse cited in licence decision

Gregorys Transport Ltd’s application for a goods vehicles operator’s licence was refused at a public inquiry, in part due to the director Gregory Swartz’s misuse of the Bounce Back Loan Scheme in his previous company.

Investigators found that GMAKX Ltd had a Bounce Back Loan of £40-45,000 which remained outstanding when the company was sold earlier this year. “The company had not had the necessary turnover to have been eligible for that Bounce Back Loan in the first place.”

Swartz was seen as “disposing of the company” by the Traffic Commissioner for the West of England, Kevin Rooney, in order to “avoid insolvency proceedings” and “avoid significant liabilities” including the Bounce Back Loan. His attempt to set up again almost immediately, using a new company, was blocked with the reason given that the commissioner was not satisfied that Gregorys Transport Ltd “is of good repute”.

Perhaps the most interesting element of the case, as set before the public inquiry, is the company that purchased GMAKX Ltd in January 2023 – Atherton Corporate Limited – and the director who replaced Swartz after the sale – Neville Taylor.

There are, apparently, “hundreds of businesses which appear[…] to have the same Mr Taylor listed as director albeit with several different dates of birth and addresses.” And additional research led to the discovery of related “websites touting services to protect reputations from insolvency.” A quick web search returns a host of sites doing just that with anti-insolvency practitioner messaging, promises of quick wins and specific mentions of Covid-related loans.

The commissioner decided that “if the sale was not illegal, it was certainly unethical.”

Insolvency and debt investigations

Seeing the whole picture in insolvency and debt cases is key to maximising returns to creditors. For more information on how ESA Risk can help to identify hidden assets or locate targets who have gone to ground, contact Mike Wright, Investigations and Risk Management Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

You can also learn more from our Insolvency & Debt Investigations brochure:

 

Download your copy

New specialist squad to tackle fraud in UK public services

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The Risk, Threat and Prevention Service, led by the Public Sector Fraud Authority (PSFA), will work closely with various government departments to help prevent fraud, ensuring that public funds are used efficiently and effectively.

The importance of tackling fraud in public services

Fraud is a significant issue that affects the integrity of public services and the efficient use of taxpayer funds. The PSFA estimates “the extent of fraud and error across all of government” was up to £58.8 billion in 2020-21.

By addressing fraud, the government can ensure that public services are delivered effectively and that resources are allocated where they are most needed.

The new counter-fraud team, which starts work today (24th May 2023), will consist of experts from across the civil service, law enforcement, and the private sector. This multidisciplinary approach is to enable the Risk, Threat and Prevention Service to tackle fraud in a comprehensive and effective manner, and is described by the government as “a global first, with no other government in the world currently providing such a cross-government resource and capability to identify and counter fraud.”

The role of the Risk, Threat and Prevention Service

The new team will work with government departments to identify and prevent fraud in public services. This will involve sharing best practices, providing support and guidance, and implementing effective counter-fraud measures.

Some of the key responsibilities of the Risk, Threat and Prevention Service will include:

  • Identifying and assessing risks of fraud in public services.
  • Developing and implementing strategies to prevent and detect fraud.
  • Providing training and support to government departments in counter-fraud measures.
  • Collaborating with law enforcement and private sector partners to tackle fraud.

The benefits of the Risk, Threat and Prevention Service

The government expects the establishment of the new team to bring numerous benefits to public and government services. By identifying and preventing fraud, the team will help to ensure that public funds are used efficiently and that resources are allocated where they are most needed.

By working together with law enforcement and private sector partners, the service will also contribute to the broader fight against fraud and financial crime.

The formation of the Risk, Threat and Prevention Service should be a significant step forward in the UK government’s efforts to combat fraud in public services. By working together with government departments, law enforcement, and private sector partners, the Risk, Threat and Prevention Service can play a crucial role in ensuring that public funds are used effectively and that public services are delivered with integrity.

Fraud investigations by ESA Risk

If you suspect that a fraud has occurred within your business and need advice or support on the next steps, we’re here to help.

Additionally, we can help you to prevent fraud from occurring through manager and employee training and resource provision.

For further details, contact Mike Wright, Risk Management & Investigations Consultant, at mike.wright@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

Duties of care owed by trustees: A brief guide

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Here, Leanne Millhouse and Audrey Serrano of law firm Kennedys provide a brief guide to the duties of care owed by trustees.

The duties of skill and care arise both under common law (judge made law) and under statute. Trustees also owe fiduciary duties.

Common law duty of care

A common law duty of care has been developed over many centuries following decisions made by judges in cases involving trustees.

To comply with the common law duty, a trustee must take all those precautions that an ordinary prudent person of business would take in managing similar affairs of their own. The test is objective, which means it is the standard of a prudent business person, not the standard of the trustee in question. A higher duty will apply to a professional trustee, whose standard would be that of a professional trustee.

The common law duty applies in all cases involving trustees, unless there is an appropriately worded exclusion clause in any trust document, which may limit this liability.

Statutory duty of care

The statutory duty of care is imposed by Section 1(1) of Trustee Act 2000, and only applies in certain cases after 1st February 2001. The duty requires a trustee to exercise such skill and care as is reasonable in all the circumstances, having regard to:

  • Any special knowledge or experience that they have, or hold themselves out as having.
  • Any special knowledge or experience that it is reasonable to expect of a person acting as trustee in the course of a business or profession.

The statutory duty of care may be limited or specifically excluded by the trust document. As stated, where the duty does not universally apply, it is limited to the following circumstances:

  • Any exercise of powers of investment including the acquisition of land and exercising any powers in relation to such land.
  • Insuring property or any exercise of power to insure.
  • Entering into arrangements with nominees, custodians and agents and reviewing such arrangements.
  • Dealing with reversionary interests and valuing trust assets and any corresponding powers.
  • Exercising powers of compromise and any corresponding powers.

What happens if a trustee breaches the duty of care?

If a trustee has fallen short of the required standard when carrying out the duties, the trustee is in breach of trust. The trustee may also have a personal liability to reconstitute the trust fund by making good any damage caused where possible, or by paying compensation for all losses that would not have occurred “but for” the breach.

How can a trustee limit their liability for breach of trust?

There are various steps a trustee can take in an attempt to mitigate a potential claim, namely:

1. Always seek professional assistance when faced with any onerous, unusual or difficult decisions concerning the carrying out of your functions.

2. Ensure that you maintain appropriate insurance cover to provide for legal fees and damages in the event of any claim. A specialist broker will be able to assist you.

3. Familiarise yourself with the trust deed and its requirements.

4. Consider an exclusion clause, limiting or excluding your duty of care in certain cases or to certain classes of beneficiaries.

4.1. A properly worded clause in a trust document may exclude or limit the trustee’s liability under some statutory or common-law duties of care. It will not, however, prevent beneficiaries from restraining the trustees from carrying out certain acts, or from removing trustees. Nor will the exclusion clause limit liability for fraud, or exclude the trustee’s core duty, which is to perform the duty honestly and in good faith for the benefit of the beneficiaries.

We recommend that a trustee always seeks legal advice on any issues they are not familiar with, or where there is discord between the beneficiaries as a whole or a class of beneficiaries.

First published on the Kennedys website.

Advice and support from ESA Risk

For advice and support in areas from risk management and security to corporate investigations and digital forensics, contact us at advice@esarisk.com, on +44 (0)343 515 8686 or via our contact form.

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