Director of an Insolvent Warrington-based waste business has been disqualified for being a director for seven years and handed a six-month suspension following unexplained transfers, totalling over £500,000.
Lee Smith, of Smith Waste and Recycling (SWR) failed to share adequate accounting records - despite requests from both insolvency practitioners and investigators from the Insolvency Service, a government agency. The company went into a Creditors Voluntary Liquidation in November 2014.
Investigators say they were not able to explain cash withdrawals from SWR’s bank accounts over the period between September 2013 and September 2014. The withdrawals totalled just over £430,000- it being unknown if the value represented genuine business expenditures.
Investigators were also unable to explain over £86,000 worth of transfers between January and October 2014, to the accounts of two companies connected to Lee Smith, as well as his remuneration and what the company’s assets and liabilities were at liquidation. Smiths’ ''lack of co-operation’’ is the reason for the lack of explanations.
Arwel Jones, director of criminal enforcement for the Insolvency Service commented that Mr Smith’s behaviour during the insolvency process was very unacceptable. The fact he failed to deliver any type of company record, meant his creditors were at risk of losing a significant amount of money.
The seven-year disqualification Mr Smith has received is a significant ban which ''should serve as a deterrent to those directors who fail to conduct their business affairs in accordance with the law’’.
On September 20th 2018, Mr Smith appeared at Liverpool Court where he was ordered to perform 250 hours of unpaid work and pay prosecution costs of £8,901.
A disqualification order can be effective in that without ''specific permission of a court’’, someone with an order is limited. They can not act as a director of a company, be a receiver of a company’s property or take part in forming, promoting or managing a company.