Bankruptcy restrictions for accountant who sold shares

A former accountant from Burton-on-Trent has been landed with five years of additional bankruptcy restrictions after transferring £145,000 in shares to avoid paying creditors.

Valerie Culley has signed a five-year Bankruptcy Restriction Undertaking after transferring almost £145,000 in shareholdings to an associate whilst insolvent.

Culley, a former accountant and auditor specialising in tax affairs, was served by a creditor with a statutory demand for almost £346,000 in December 2019 but she failed to pay this within the deadline.

In January 2020 Culley then transferred £26,000 worth of shares to an associate, less than a week before the creditor issued a bankruptcy petition against her.

Before the first bankruptcy hearing, in April 2020, Culley then transferred almost £119,000 worth of additional shares in a second company to the same associate.

The bankruptcy petition was heard in August 2020 and a bankruptcy order was made against Culley. Upon bankruptcy she had liabilities of more than £1.2m.

Culley’s bankruptcy triggered an investigation by the Insolvency Service, which discovered the share transfers to the detriment of her creditors.

On 10 May 2021 the Secretary of State for Business, Energy and Industrial Strategy accepted a five-year bankruptcy restrictions undertaking from Culley.

Effective immediately, Culley is under a number of restrictions, including not being able to borrow more than £500 without disclosing her bankrupt status and she cannot act as a company director without the court’s permission.

Kevin Read, official receiver at the Insolvency Service, said: “Valerie Culley knew of the statutory demand and the petition for bankruptcy, and yet still transferred the shares so the funds could not be paid to her creditors.

“As a qualified practising accountant, Valerie Culley was in a position of trust and this exacerbated her misconduct. We will always consider bankruptcy restrictions for those who act in detriment to their creditors and carry out serious misconduct like this.”

The shareholdings were recovered by the Trustee in Bankruptcy for the benefit of the bankruptcy estate.