Disqualification for care home directors

7 November 2012

Deepak Mohan Mirpuri and Arun Mirpuri ran Larongrove Limited, which operated the Abbey Grange home in Sheffield until August 2009 have been disqualified from being company directors following an investigation by the Insolvency Service.

Monies belonging to seven vulnerable residents were paid into the home’s business account instead of being held separately.

The company subsequently went into administration, so the money could not be recovered.  The residents lost some £58k.

There was no suggestion that there was criminal intent so no fraud investigation was done.  However, good practice guidelines for care homes state residents’ money should be kept separately from the firm’s business account - but, instead, the owners used it as working capital.

After Larongrove went bust, Abbey Grange was taken over by another firm, Country Court Care, which introduced changes including a ring-fenced account for personal savings, and refurbishments.

Robert Clarke, head of company investigations at the Insolvency Service, said: “The orders made in this case send a clear message to other directors that if they run a business which causes harm to the public they will be investigated and removed from the business environment for a long time.”

In conclusion, if you are desperate enough to use clients money as working capital for your business then you really, REALLY, need to seek advice.