TBO Investments, founded by former UKIP MEP Godfrey Bloom in 1992, appointed liquidators last week amidst a High Court legal battle with a creditor. The liquidator is now likely to look at wrongdoing by the directors.
In June, TBO successfully appealed against a judgement which would have ordered the company to pay £2.2 million in claims. The directors used an associated company, Ubique Wealth Management, to pay for the court and legal costs. However after the appeal, they felt they could no longer pay creditors or continue running TBO Investments, therefore called in the liquidators.
At the time of liquidation, the company owed £300,000 to creditors, including a substantial amount to the claimant taking the company to court.
Jonathan Mortimer from Raworths Solicitors, who is acting for the claimants, said in a statement:
“We actually see the insolvency of the company as a positive development as we now have clarity on the financial standing of the company and can move forward with additional claims which only arise following insolvency."
"In particular, we will be asking the liquidator to investigate personal claims against the directors for the manner in which they have conducted the business of the company."
"In particular, a transfer of nearly all clients from TBO Investments Limited to a new start up company run by the same directors called Mount Sterling Wealth Limited for no consideration."
TBO Investments, would be considered by liquidators to have breached section 238 of the Insolvency Act 1986 – Transaction at an Undervalue. The transfer of TBO’s clients clearly benefited the directors to the detriment of creditors and as the solicitor suggests, this will be investigated in the liquidation. This means the liquidator can in effect get the transaction reversed and the value of the assets will have to be paid for by Mount Sterling Wealth for the benefit of creditors.