Legal News

A former financial adviser has been handed a 15-year bankruptcy restriction order – the maximum limit – for trading while an undischarged bankrupt.

On 15 December 2016, Registrar Christine Derrett ordered Stephen Benjamin James Todd, a financial adviser, be subject to the bankruptcy restrictions order as a result of him acting in the management of a limited company, despite having previously agreed to a disqualification undertaking for ten years, and for breaching a bankruptcy order.

In handing down the maximum period of bankruptcy restriction allowed by the court, Registrar Derrett stated that Mr Todd’s case was one of the worst examples of someone having disregard for the insolvency and directors disqualification regime, which exists to protect the public.

The misconduct occurred during the period 8 February 2013 to 14 April 2014 and from 21 January 2015 to 2 February 2015, whilst he was subject to a company directors disqualification undertaking – and from 29 April 2013, whilst Todd was an undischarged bankrupt.

Previously, on 8 October 2012, he had offered a disqualification undertaking not to act as a director, act as a receiver of a company’s property or in any way, whether directly or indirectly, be concerned or take part in the promotion, formation or management of a company for a period of ten years, as a consequence of his conduct as a director of an earlier company in liquidation.

A bankruptcy order was subsequently made against Todd on 29 April 2013, and on 16 December 2013, his discharge from bankruptcy was suspended indefinitely.

Without leave of the court, he nevertheless acted in the management of IPR Capital Limited (IPR), which was incorporated on 8 February 2013 and went into provisional liquidation on 2 February 2015, and liquidation on 1 April 2015, with liabilities of more than £10 million.

The court also found that Todd had failed to disclose in the bankruptcy proceedings his income from IPR and other parties – from 29 April 2013 (the date of his bankruptcy) to 15 April 2014, he received at least £517,100 from IPR.

Todd also received payments into his bank account from other parties, totalling £59,904 during the period 29 April 2013 to 6 January 2014. He stated to the Official Receiver that he had assets with an approximate value of £8,800.

As at 29 April 2013, his liabilities amounted to at least £454,107 – of which £363,607 was due in respect of unpaid National Insurance contributions, self assessed tax and penalties.

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