Insolvency service cracks down on dodgy directors

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The number of Directors disqualified in England, Scotland and Wales has risen sharply according to new figures released by the Insolvency service.

The latest statistics show that there was a massive 25% increase on the previous year for director disqualifications demonstrating the Insolvency service’s commitment to rooting out those who fail to fulfil the obligations of a company director.

The latest figures released show that there were 1,208 disqualifications for the year 2013 – 2014, up significantly on the previous years figure of 969 for the year 2012 – 2013.

Also on the increase for the last financial year was the number of director disqualification proceedings issued by the insolvency service in the courts of mainland UK. This figure rose by a huge 19% reiterating the Insolvency service’s ‘get tough’ stance on rogue directors.

These new figure represent the first increase since 2010 and are welcomed by experts working in industries deeply affected by delinquent directors.

Steve Cottee, partner in Pinsent Masons restructuring team is quoted as saying “It may be a sign that the insolvency service are taking a more robust approach to rogue directors. In any event, it is certainly a warning for directors to act in accordance with their fiduciary duties and behave”

A spokesperson for leading Commercial Debt Recovery firm, Federal Management said “This is welcome news for our industry. For years we have witnessed a flagrant and wilful abuse of the current laws in place. We welcome the Insolvency service’s pro active approach to dealing with rogue directors”

These recently published findings come as Business secretary Vince Cable has continued to call for a more robust approach in cracking down on ‘dodgy directors’ and recommended tougher laws.

A disqualified director can face a ban of up to 15 years dependant on the recklessness of their behaviour and even face imprisonment in very severe cases.

 

 

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