11-year director ban for bankrupt boss

TWO businessmen who ran an Oldham furniture firm that failed owing creditors £1m have received lengthy director bans.

Martin Muldowney, of Oldham, and Roger John Hallas, of Disley, have been disqualified for 11 years and five years respectively following an investigation by the Insolvency Service.

The action was taken against Muldowney for acting as a director while an undischarged bankrupt, and against Hallas for allowing him to do so.

They ran CFS Furniture which went into liquidation in January 2012. Muldowney resigned as a director in February 2011 after being made bankrupt but continued to act as a director of the company.

The Insolvency Service said he did not dispute that CFS received payments totalling £162,752 to which it was not entitled from a daily deals website company and also transferred cash and assets of £150,000 to a supplier company of which his wife was the sole director, when other creditors went unpaid.

Robert Clarke, head of insolvent investigations North at the Insolvency Service, said: “The bankruptcy restrictions provided for by legislation are there to protect the public and ensure that trading partners can deal confidently with the registered directors of a company. Those who knowingly breach such provisions do so at significant risk and will be rigorously pursued by the Insolvency Service.

“In this particular case, not only did the directors of CFS act in a less than transparent manner, but their actions caused considerable losses to be suffered by a trade partner who, after already paying for orders, had to refund their customers for purchases which were never delivered. Those losses, and the losses of other parties, were then compounded by the unfair distribution of the company’s cash and other assets, favouring a connected company in a manner entirely unacceptable.”