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Classic motorcycle dealer disqualified for nine years following Insolvency Service investigation (25 April 2016)

Date: 25/04/2016
Duncan Lewis, Crime Solicitors, Classic motorcycle dealer disqualified for nine years following Insolvency Service investigation

A dealer in classic motorbikes has been disqualified from holding the position of a director for nine years, after an investigation by the Insolvency Service.

Paul Wexham, 59 – a director of Cotswold Classics Limited – traded as a dealer in classic motorbikes. The company was found to have sold customers’ vehicles without passing on the proceeds of sale – and took deposits for vehicles that were never supplied.

Wexham – of Brockworth in Cheltenham, Gloucestershire – signed a disqualification undertaking, which, from 15 March 2016, prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company until March 2025.

Cotswold Classics was placed into liquidation on 9 May 2014, with an estimated deficiency to creditors of £181,704.

The Insolvency Service investigation found that, between October 2012 and the date of liquidation, the company purchased 19 vehicles for £61,709 on behalf of another company – then sold them and failed to remit the sales proceeds, as agreed.

It was found that Cotswold sold three vehicles belonging to customers under brokerage sales agreements – and the sales funds totalling £23,000 due to them were withheld from these customers.

The company also took customer deposits totalling £28,000 and failed to supply the vehicles or return these monies to the customers.

At the date of liquidation, these customers were owed a total of £112,709.

Wexham claimed that some of the monies due to or held on behalf of customers were used for continued trading.

The Insolvency Service investigation found that Wexham received net payments of £175,644 from the company bank account between October 2012 and the date of liquidation.

Senior Investigator for the Insolvency Service, Robert Clarke, said:

“The Insolvency Service will rigorously pursue company directors who deliberately breach the trust of customers.

“The undertaking signed by Mr Wexham sends a clear message to other company directors that if they run a business in a way that is detrimental to either its customers or its creditors, they will be investigated by the Insolvency Service – and, as a result, may be subject to a lengthy period of disqualification.”

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