'dodgy Directors' Putting Public At Risk

The number of directors disqualified by the government for misconduct, such as fraud, has failed to keep pace with an increased number of reports of potential misconduct, according to research by insolvency trade body R3.
By: Griffin and King
 
Feb. 6, 2011 - PRLog -- The number of directors disqualified by the government for misconduct, such
as fraud, has failed to keep pace with an increased number of reports of
potential misconduct, according to research by insolvency trade body R3.

The percentage of reports taken forward by the Insolvency Service (i.e.
disqualifications) has halved from 40% in 2003/4 to 20% in 2009/10.
Fraudulent activity is known to increase during tough economic times. In
2009/10, insolvency practitioners submitted 7,030 reports on directors'
behaviour which they believed warranted further investigation. However, in
that year, only 1,387 cases were concluded by the Insolvency Service.

R3's President Steven Law commented:

"This mechanism is in place to protect the general public and other
businesses from dishonest directors. Not punishing directors who are
blameworthy sends out a dangerous message to others."

The most common reasons for insolvency practitioners reporting directors
are: failure to pay tax debts (35%); obtaining personal benefits from the
company (28%) and appropriation of assets to other companies (24%).

"These are serious infringements that damage the reputation and success of
UK plc", continued Steven Law. "Furthermore, R3 would like to assist the
Insolvency Service in implementing an effective system which ensures that it
is not just the easier cases that are pursued. It is important that the more
serious offences are punished appropriately."

R3 would like to see blameworthy directors fined and wants to work with
Government to establish a financial and corporate education programme for
disqualified directors. This would help prevent the sequential failures from
directors which are so damaging to public confidence, as would increasing
the percentage of insolvency practitioner reports taken forward by the
Insolvency Service.

http://www.griffinandking.co.uk/

Insolvency Shropshire | Insolvency Bournemouth | Insolvency Midlands | Insolvency Walsall |Debt Advice

# # #

Griffin and King are a leading firm of Insolvency Practitioners within the West Midlands with offices covering Dorset, Hampshire, Shropshire and Mid Wales. We are licensed by The Institute of Chartered Accountants in England & Wales. At Griffin & King we understand. With over 25 years experience we have helped businesses and individuals find solutions to their financial problems. We believe there really is "Life after Debt!"
End
Source:Griffin and King
Email:***@aim-internet.com Email Verified
Zip:WS1 1QL
Tags:Insolvency Practitioners
Industry:Business, Financial, Services
Location:Walsall - West Midlands - England
Account Email Address Verified     Account Phone Number Verified     Disclaimer     Report Abuse



Like PRLog?
9K2K1K
Click to Share