Christopher John Etheridge, director of Staplehurst-based D&R Pike Crane Hire Ltd, has been disqualified for six years by the Department for Business, Innovation & Skills after an investigation by the Insolvency Service.
The Insolvency Service investigation found that by 1st October 2011, D&R was unable to pay its liabilities, which totalled at least £77,036.
HM Revenue & Customs was owed at least £18,036 in VAT, corporation tax and national insurance contributions.
At least six creditors were pressing for payment and a county court judgement for £3,933 was secured against the company on 14th September 2011.
It was also found there were 17 bounced cheques issued from D&R’s bank account totalling more than £8,000 and there were 21 rejected direct debits/standing orders totalling close to £7,000.
As a result of Mr Etheridge continuing to trade D&R, its liabilities increased from at least £77,036 as at 1st October 2011 to known liabilities of £103,175 as at liquidation.
The insolvent trading was aggravated in August 2013 when Mr Etheridge transferred D&R’s sole crane, its principle tangible asset and form of generating income and turnover, to an associated company for less than its worth. At this time, D&R had liabilities of at least £95,549. The company then incurred a cost to hire back the asset, increasing its overheads and reducing any profit it may have made.
Commenting on the disqualification, Andrew Stanley, the Insolvency Service’s Chatham official receiver, said: “There can be no doubt that Mr Etheridge was aware of D&R’s insolvency, nevertheless he chose to ignore this and expose unsuspecting creditors to the risk of continuing to trade for a further four years.
“Whilst promising suppliers payments, he personally benefitted from the income of D&R and the protection that limited liability afforded him.
“Limited liability is a privilege that should not be abused and directors should note that should they do so, the Insolvency Service will take appropriate action to remove them from the business community.”