Between September 2012 and February 2014, Alan Verinder, an ICAEW fellow, caused his company, V&AES, to make payments of £406,240 to directors and connected businesses, at a time when it was unable to pay its debts to HMRC.
V&AES (or in its earlier incarnation, Verinder and Associates Employee Services) operated as a payroll company for subcontractors working for third party companies. These companies would pay gross sums as wages for the workers and V&AES was then responsible for deducting PAYE and paying it to HMRC on their behalf.
According to the Insolvency Service, V&AES had tiny tax liabilities regarding its own employees but had to pay significant amounts on behalf of the subcontractors.
Over the 18-month period, the debt owed to HMRC rose from £53,974 to £395,274 while Verinder’s borrowings from the company increased from £22,125 to £163,091.
The company went into voluntary liquidation in February 2014 with an estimated deficiency of £201,980. In June 2016, Verinder paid £210,000 to its liquidator in full and final settlement of his director’s loan account and the payments that had been made to the connected businesses.
Commenting on Verinder’s disqualification, Robert Clarke, head of the Insolvency Service’s insolvent investigations north, said, “Directors who put their own personal financial interests above those of creditors damage confidence in doing business and are corrosive to the health of the local economy.”
He added that company directors had a duty of care to their creditors and if they neglected that duty, they risked losing the privilege of limited liability trading.
Verinder was not the only member of his family to receive a ban. Carol Verinder was disqualified for two years and Ross Verinder, a licensed financial adviser, for three years.
Fellow director Graham Rummens, a chartered certified accountant, was also banned for three years.