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Phones 2 U Direct.co.uk Limited directors given seven-year ban

News Release issued by the COI News Distribution Service on 03 February 2012

Two directors of failed mobile ‘phone cash-back’ company Phones 2 U Direct.Co.UK Limited have undertaken not to be directors following an investigation by Company Investigations, part of the Insolvency Service.

David James Ellis and his wife Angela Ellis of Kent also undertook not to be involved in the management of companies. Mr Ellis was banned for five years while Mrs Ellis received a two-year ban..

The company was formerly based at Kemsing in Kent and, shortly after the commencement of investigations, was placed into creditors voluntary liquidation on 21 February 2008 with a reported estimated deficiency of £339,304

Commenting on the disqualification, Company Investigations Supervisor Chris Mayhew said:

“The Insolvency Service has strong enforcement powers and we will not hesitate to use them to remove dishonest or reckless directors from the business environment as these directors found out.”

Marion Ward, Advice & Education Manager for Kent County Council’s Trading Standards Service added:

“The liquidation of Phones 2 U Direct.Co.UK Limited caused significant financial detriment to residents of Kent and indeed across the UK so we therefore welcome the undertakings from Mr & Mrs Ellis that they will not be involved in the management of companies in the foreseeable future”.

Ends

Notes to Editors

1. Phones 2 U Direct.Co.UK Limited was incorporated as a private company on 8 August 2000. The registered office of the company was latterly at 74 West Street, Erith, Kent, DA8 1AF and it carried on business from Unit 4B Chaucer Business Park, Watery Lane, Kemsing, Sevenoaks, Kent TN15 6QY. The directors of the company throughout were Mr David James Ellis and his wife Angela Ellis.

2. The company was placed into creditors voluntary liquidation on 21 February 2008 having ceased to trade around September 2007. According to the statement of affairs prepared by the directors the estimated deficiency of the company was £339,304 with an estimated £100,000 shown as due to its cash back customers. On 12 March 2009 the voluntary liquidator reported to creditors that he had received 805 claims from creditors and that of these, 796 had been received from customers making cash back claims totalling £349,593.

3. Mr Ellis gave an undertaking on 3 January 2012 to the Secretary of State not to be a director for five years and Mrs Ellis gave an undertaking on the same day not to be a director for two years. Their undertakings have been accepted and the periods of disqualification commence on 2 February 2012.

4. Mr and Mrs Ellis each accepted that the following misconduct made them unfit to be directors, namely that they:

1) Failed to exercise responsibility over the company’s financial affairs, in particular;

(a) Failed to adequately monitor and/or make financial provision for the company’s liabilities to customers making legitimate cash back claims against the company;

(b) Failed to file the company’s statutory accounts for the year ended 31 January 2007 in the permitted time, contrary to section 242 of the Companies Act 1985;

(c) During the relevant periods failed to adequately monitor and/or make financial provision for the company’s liabilities to customers making legitimate cash back claims against the company.

2) Caused and/or allowed substantial payments to be made to themselves at various times during the financial years ended 31 January 2007, 2008 and 2009 using company funds, such payments being for no consideration and of no benefit to the company.

5. Disqualification undertakings were introduced in April 2001, they are an administrative equivalent of a disqualification order but do not involve court proceedings. Without specific permission of a court, a person with a Company Directors Disqualification, including Undertakings, cannot:-

Act as a director of a company; take part, directly or indirectly, in the promotion, formation or management of a company; be a liquidator or administrator of a company; or be a receiver or manager of a company’s property.

6. Further information on director disqualifications and restrictions can be found at www.bis.gov.uk/companies/company-investigations

7. The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. The Service also authorises and regulates the insolvency profession; deals with disqualification of directors in corporate failures; assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees; provides banking and investment services for bankruptcy and liquidation estate funds; and advises ministers and other government departments on insolvency law and practice. Further information about the work of The Insolvency Service is available from www.bis.gov.uk/insolvency

8. Media enquiries should be directed to: -

Ade Daramy, Press Officer 020 7596 6187


Ins12/Coms/06

Contacts:

Ade Daramy
Phone: 020 7596 6187
ade.daramy@insolvency.gsi.gov.uk