A sole director of a troubled HR recruitment agency has been banned from running further companies for breaching the terms of its insolvency.
L & H Construction Limited, which provided specialist recruitment services to the mechanical and electrical sectors, entered into administration in January last year.
According to the report, HM Revenue & Customs presented the winding up petition for an outstanding tax bill, contributing to a total debt of around £800,000.
Insolvency practitioners were brought in following the court hearing, but the director, Dean Jacobs, failed to cooperate.
The administrators were made aware that the business had been awarded an insurance settlement, but there was no sign of the award paid into any of the company’s accounts. Likewise, Mr Jacobs had no explanation of the whereabouts of the funds.
It later emerged that the director had diverted some £60,000 from the insurance settlement into his own personal bank account. As the company had ceased trading and owed money to creditors, this was entirely in breach of the terms of the liquidation.
Due to his actions, Mr Jacobs was banned from directly or indirectly becoming involved, without the permission of the court, in the promotion, formation or management of a company for 10 years.
Susan MacLeod, Chief Investigator of Insolvent Investigations, Midlands & West at the Insolvency Service, said: “Dean Jacobs put his own interests ahead of the company’s creditors and the timing of the funds he took from the insurance settlement showed a cynical disregard to those creditors.
“Directors who put their own personal financial interest above those of creditors damage business confidence. We will take action against directors who do not take their duties seriously and abuse their position and they will therefore lose the privilege of limited liability trading.”