Dodgy directors could escape justice, warns expert
Government plans to axe more than 50 front line jobs in the insolvency service will keep directors who flout the law in business, warns a Black Country insolvency expert.
The cost-cutting measures will most likely see the West Midlands losing three Official Receiver Investigators. John Travers, of Stourbridge-based John D Travers & Co, says the cuts are “unfortunately timed”.
He added: “In tough economic times, we are likely to see the number of dodgy directors rise, and it is particularly odd, coming at a time when the government is upping its stance against directors utilising crown monies to fund their failing businesses.”
Last year, out of the 4,752 referrals by insolvency practitioners, the Insolvency Service disqualified 1,252 directors, or about 26 per cent. Six years ago, 45 per cent of those put forward were disqualified.
“One in four reports resulting in a disqualification is simply not a high enough strike rate,” says Travers.
