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M&E company boss banned for siphoning off money

The director of an m&e company has been disqualified for seven years following an investigation by The Insolvency Service's Company Investigations team based in Manchester.
Melanie Day, 31, of Ebbw Vale was disqualified by court order on 24 October 2012 from managing or in any way controlling a company or being a director until November 2019.

The investigation found that S.T.S. Building Services Ltd ('STS') was making payments to Ms Day and her sole trader business at the expense of all other creditors at a time when she knew S.T.S. Building Services Limited was insolvent.

In making the order, the Judge confirmed that:

* While a director of S.T.S. Building Services Ltd Ms Day first became aware that STS was insolvent in May 2010.

* Between 30 April 2010 and administration on 22 June 2010, STS increased the amount it owed to its creditors by at least £108,302, from £13,873 to £122,175.

* On 3 June 2010, Ms Day transferred £20,000 STS' account to her sole trader business, which she claimed was one of STS' sub-contactors.

* On 4 June 2010, Ms Day received £80,000 via bank transfer from STS.

When asked by the administrator to explain the reason for the payment , Ms Day stated that it was a bonus. But when asked about the payment by The Insolvency Service, Ms Day said it was in repayment of her director's loan. There was no evidence in STS' records showing an investment of £80,000 in to STS by Ms Day.

Commenting on the case, Claire Entwistle, Director, Company Investigations North said: 'This disqualification Order represents a successful conclusion to the investigation resulting in Melanie Day being banned from being involved in the management of any company for several years.

'The outcome of this case should serve as an important reminder; unacceptable conduct by company directors can result in lengthy periods of disqualification.'


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2 November 2012

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