THE director of a car spare parts company has been disqualified for seven years after he admitted transferring £50,000 out of the company’s bank account just as the firm was about to go into liquidation.
Ayaan Khan was the sole director of Salford Auto Spares Ltd (SAS), which was incorporated in 2011 and traded in motor vehicle scrap parts.
The company latterly operated from leased premises in Rutland Street, Swinton, Manchester, and went into liquidation on May 4, 2016, owing more than £112,000 to creditors.
Following the company’s insolvency, the liquidators received claims from at least 98 customers, who said they had made full payments in advance to SAS before the liquidation but goods hadn’t been delivered to them at liquidation, leaving them as unsecured creditors. In particular, 64 customers said they were owed amounts totalling at least £18,869.
Khan didn’t dispute that between April 12 and 18, 2016 – when SAS was insolvent and preparing to cease trading on April 19, 2016 before entering into liquidation – he caused the company to make transfers out of its bank account totalling £50,180.
He also didn’t dispute that the transfers were not in the best interests of the company and were to the detriment of its creditors generally. Owing to the lack of information provided, the transfers remain unexplained.
Khan’s disqualification undertaking was accepted by business secretary Greg Clark on April 16, 2018 and came into force on May 7, The Insolvency Service said today.
It prevents him from directly or indirectly becoming involved, without legal permission, in the promotion, formation or management of a company or limited liability partnership for the duration of his ban.
After the case, Robert Clarke, head of insolvent investigations north at The Insolvency Service, said: ‘In full knowledge that the company was failing, this director has chosen to seek to defeat the claims of creditors, and his improper actions caused losses to others which were wholly avoidable.
‘Directors who show such blatant disregard for their fiduciary duties can expect to be investigated by The Insolvency Service and removed from the corporate arena for a lengthy period.’
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