Six-year ban for Swindon garage director
The owner of a vehicle recovery and repair garage in Swindon, has been disqualified from being a company director for six years for paying herself and a friend ahead of other creditors.
Linda Ann McCracken (58), a director of Titcombe Garage Ltd, is banned from acting as the director of a limited company from 29 May 2013 to May 2019.
In an official statement, The Insolvency Service said Titcombe Garage entered liquidation on 25 November, 2010.
In the weeks immediately prior to liquidation, at a time when she knew the company was insolvent, Mrs McCracken made payments totalling £247,436 from the company to herself and to a consultancy creditor who was a friend – putting these payments ahead of the claims of all other creditors.
When the company finally collapsed, it owed unsecured creditors almost £400,000.
In the summer prior to liquidation Mrs McCracken twice sought professional legal advice regarding the business’s financial position and was specifically warned against paying herself ahead of other creditors. However, she disregarded this advice.
She was subsequently declared bankrupt in July 2012 on the petition of the liquidator for failing to return the funds she took out of the company, which had been in the form of a director’s loan.
David Brooks, chief examiner at The Insolvency Service, said: “This result should serve as a timely reminder to directors that any self-serving actions, resulting in removal of company funds or assets when a company is insolvent, are a breach of their obligations to the company and its creditors, and are likely to lead to serious sanction.”