Director banned for paying £150,000 bonus before liquidating the company
A recruitment company director has been banned for six years after an investigation found he paid himself a £150,000 bonus while he planned to make his company insolvent.
Roy Davies founded Cheshire-based LTG Recruitment, which had also been called EMS Omega Executive Search and EMS Recruitment Group. The company collapsed into liquidation in 2016.
LTG Recruitment owed more than £289,000 to the tax authorities when it went into liquidation. Four other recruitment companies that Davies had been a director of when they went into liquidation earlier in 2016 had owed nearly £700,000.
But Davies had borrowed money from some of the connected companies and owed nearly £300,000 when they entered in liquidation.
He also had paid himself a £152,000 bonus after he had started discussions with insolvency advisors, which he used to reduce the amount of money he owed to the company while the £70,000 tax bill went unpaid.
Rob Clarke, chief investigator for The Insolvency Service, said: “It is bad enough that Roy Davies received substantial payments from LTG Recruitment, leaving the company unable to pay its creditors when the company collapsed.
“But knowing from the previous failures that he would be pursued for repayment of his loan account, he also took steps to ensure that he would not be required to repay the money he had received when LTG Recruitment went into liquidation.”
Davies’s six-year ban, which began on July 15, prevents him from promoting, forming or managing a company.