INSOLVENCY SERVICE
News Release (Ins/Coms 68) issued by The Government News Network on
18 March 2008
A director of a
property fund management company based in London has been
disqualifed for four years following an investigation by Companies
Investigation Branch of the Insolvency Service.
Mr Baljinder Chohan was the founding director and controlling
shareholder of UK Property Fund Managers Limited
("UKPFM"), a company set up by Mr Chohan to co-ordinate
the launch of a property fund and to raise up to £1billion equity
for that fund. The company was based at the office of an
associated company under Mr Chohan's control, UKLI Limited.
UKPFM prepared a proposal document in order to obtain funding,
specifically for a Shariah law compliant property investment fund.
The proposal document was sent to a commercial bank based in Saudi
Arabia for this purpose. Mr Chohan supervised and was in overall
control of the proposal drafting process. Information appearing in
the proposal document also found its way on to a UKPFM website.
The Companies Investigation Branch investigation into UKPFM
resulted in a petition to wind up the company on public interest
grounds. That petition was successful, resulting in the company
being wound up on 28th September 2005. Disqualification
proceedings then commenced, which were defended by Mr Chohan. This
resulted in the disqualification proceedings being held before a
trial hearing at the High Court in London in July and September
2007 before Registrar Baister.
The Court found that the proposal document contained a number of
lies and misleading statements, including the following:
* Falsely inflated figures concerning the value of projects that
the company's executive management team members had been
previously involved in. In many instances the value of projects
had been inflated by a factor of 10. Mr Chohan admitted that the
figures in question had been "beefed up" and that he was
fully aware that those beefed up figures had been included in the
draft and final proposal document. In fact Mr Chohan had
instructed the inclusion of those beefed up figures;
* The proposal's claim that there was an "impending
partnership" between UKPFM and an NHS Trust was found to be
"manifestly untrue and misleading";
* A list of executive team members included false names;
* One named individual appearing in the proposal as an executive
team member had not given his consent to act as an executive team
member, and was in fact unaware that his name - the spelling of
which had been deliberately altered - had been included in the
proposal. In the case of another named executive team member, that
individual's CV had been altered for the purposes of the
proposal without his consent;
* Mr Chohan's CV, which appeared in the proposal, contained
a number of "misrepresentations and some outright lies".
Mr Chohan was disclosed as holding an MBA from Henley Management
College. He held no such qualification, yet repeated this lie to
the Companies Investigation Branch investigator. Mr Chohan's
CV disclosed that he had been a Communications Director at British
Airways. This was untrue;
The Court also found that during the trial Mr Chohan had put
forward written and oral evidence which was found to be
"unsatisfactory in a number of ways", that Mr Chohan had
sought to deflect blame for the lies and misrepresentations
appearing in the proposal by blaming other people and the
company's professional advisors. It was also found that Mr
Chohan had a "generally cavalier attitude to the truth"
in respect of his evidence.
Mr Chohan was given leave to carry on as a director of, UKLI
Limited, following the disqualification order that was made
against him. This leave to act was granted under the provisions of
Section 17 of the Company Directors Disqualification Act 1986.
Notes to Editors
1. Baljinder Chohan, whose date of birth is 9 April 1975, and
current residential address is Al Majara 1, Dubai Marina, PO Box
502901, Dubai, United Arab Emirates, was disqualified from being a
company director for a period of 4 years on 14 December 2007.
2. Companies Investigation Branch, part of the Insolvency
Service, carries out confidential enquiries under Section 447 of
the Companies Act 1985 and, where necessary, takes further action
in the name of the Secretary of State. This can include winding up
proceedings in the public interest or disqualification proceedings
against directors under Section 8 of the Company Directors
Disqualification Act 1986.
3. Section 8 of the Company Directors Disqualification Act 1986
allows the Court to make a disqualification order of up to 15
years for unfit conduct. On 2 April 2001, amendments were
introduced by the Insolvency Act 2000 allowing directors, with the
agreement of the Secretary of State, to avoid the need for a Court
hearing by offering an acceptable disqualification undertaking.
This has the same legal effect as a disqualification order made by
the Court and usually includes a schedule identifying the
director's unfit conduct. The consequences of breaching a
disqualification undertaking are the same as those for breaching a
disqualification order; a fine or imprisonment for up to two years.
4. 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.
5. Companies House maintains a public register of disqualified
directors that can be viewed at http://www.companieshouse.gov.uk.
6. Members of the public who think that they know of any person
who is acting in breach of a Disqualification Order or Undertaking
should report that person's details to The Insolvency Service
Enforcement Hotline on 0845 601 3546 (24 hour message service).
7. For further information about Companies Investigation Branch,
the Insolvency Service and disqualifications see: http://www.insolvency.gov.uk