NOT SO CHARITABLE SUPPORT PUBLISHING COMPANY WOUND UP

11 Nov 2005 09:45 AM

A Liverpool-based publishing company that claimed it was raising money for charity but only donated a fraction of its profits to good causes has been wound up following a DTI investigation.

Barrington House Publishing Corporation Limited used self-employed telesales staff to cold-call businesses throughout Britain, persuading them to buy advertising space on wall-planners, claiming that money raised would support children's charities.

But despite an annual turnover of £3.5 million, combined salaries worth hundreds of thousands of pounds and luxury company cars for sales managers, the company only gave £100,000 to the charities.

The company began trading in February 2001, and at its peak employed around 50 people with another 50-60 self-employed telesales staff.

Sole director Lorraine Michelle Wells enjoyed a combined annual salary and dividend of £100,000.

Barrington House Publishing Corporation Limited (New Barrington) was set up following the demise of its forerunner Barrington House Publishing Company Limited (Old Barrington). On 28 February 2001, that company was put into liquidation by the owners, with large sums of money owed to creditors.
Old Barrington director Peter James Lyon had resigned just days earlier, on 20th February 2001, and subsequently was adjudged bankrupt in November that year.

But throughout the period of his bankruptcy, Lyon was employed as a sales manager of New Barrington latterly on an annual salary of £176,400 plus a £103,000 company Mercedes.

The High Court in Manchester heard that the company had:

* failed to tell advertisers how much of the money they spent would go to charity, in breach of the Charities Act 1992;

* paid excessive remuneration to its sales managers, restricting the profits available to charities; and

* was insolvent, owing more than £700,000 to Crown creditors, chiefly in unpaid VAT.

Consumer Minister Gerry Sutcliffe said:

"This isn't the first time we have taken action against companies claiming to raise money for good causes and getting fat from the profits.

"Companies like Barrington House are preying on the good nature of honest businesspeople, and diverting much needed money from genuine good causes.

"They are thoroughly disreputable, and the DTI won't hesitate to shut them down."

Notes for Editors

1. Barrington House Publishing Corporation Limited was incorporated on 25th October 1993 and traded from premises at Moorgate Point, Knowsley Industrial Park, Liverpool as Barrington House Publishing and, latterly, McKenzie Campbell Publishing.

2. The registered office and trading address of Barrington House Publishing Corporation Limited was Moorgate Point, Moorgate Road, Knowsley Industrial Park, Knowsley, Liverpool, L33 7AZ.

3. The petition to wind up the company in the public interest was presented on 19th September 2005 under the provisions of Section 124A of The Insolvency Act 1986 following enquiries conducted under the provisions of Section 447 of the Companies Act 1985 by the DTI's Companies Investigation Branch.

4. The Winding up Order was made on 31st October 2005 and the Official was appointed liquidator of the company. All public enquiries concerning the business affairs of the company should be made to the Official Receiver at the following address:

The Official Receiver
The Insolvency Service
Public Interest Unit
PO Box 326
17-21 Chorlton Street
Manchester
M60 3ZZ
Telephone: 0161 934 4163

Department of Trade and Industry
7th Floor
1 Victoria Street
London SW1H 0ET
Public Enquiries +44 (0)20 7215 5000
Textphone +44 (0)20 7215 6740
(for those with hearing impairment)
www.dti.gov.uk