Nine-year ban for director of failed debt management firm

A third director of collapsed Greater Manchester debt management company Debt Connect (UK) Ltd has been disqualified for nine years.

The Insolvency Service found that Rahul Dev Sharma, 31, caused funds totalling £42,920 to be transferred to the company’s current account, of which at least £25,929 was paid to another company controlled by Sharma, and individuals connected to him.

Sharma’s nine-year disqualification started on July 3, 2017 and will end in July, 2026.
Debt Connect, based in Whitefield, North Manchester, was supposed to look after the interests of clients who were in financial difficulties.

However, investigators found that during the time when Rahul Sharma was directing the company, Debt Connect did not make all payments due to clients’ creditors, including printed cheques not posted out totalling £32,465 which were in a box delivered up to the liquidators, nor did it pay refunds due to clients of at least £9,267.

In addition, Debt Connect had lost its Consumer Credit Licence and been instructed by a tribunal to return payments received from clients which would not be distributed to their creditors.

Earlier, Rajiv Sharma, 58, of Whitefield, signed an 11-year disqualification in which he did not dispute that he acted as a director of Debt Connect between at least October 2013 and October 2014 whilst he was already subject to disqualification.

His disqualification in relation to Debt Connect started on November 10, 2016, and runs until Novembe,r 2027.

Stephen Bradbury, 60, of Darwen, Lancashire, signed a fou- year disqualification undertaking.

He had been appointed as a director of Debt Connect in October, 2013 but abrogated his responsibilities by taking no active role in the company, other than to sign paperwork when instructed by others.

This allowed Rahul Sharma to make some of the illegitimate payments. Mr Bradbury’s disqualification began on October 26, 2016.

Robert Clarke, investigations group leader at The Insolvency Service, said: “Debt Connect’s customers were vulnerable individuals who had already experienced financial difficulties and had turned to a debt management company with the expectation that the resolution of their problems would be paramount.

“However, there were serious failings within the company. Rahul Sharma failed to ensure all payments were made to clients’ creditors and defied a clear Tribunal instruction, and Rajiv Sharma blatantly ignored his existing disqualification. The lengthy bans these men have accepted are wholly justified.

“Also, directors such as Mr Bradbury should know that failing to play their part in directing a company is unacceptable, and the Insolvency Service will pursue this as a matter of misconduct.”