Repayment of intercompany loans prior to sale
Just days before the sale of a company, intercompany debts were repaid draining in excess of £3.6m from the company. Just 9 months later the company appointed Administrators. As a result of a malware attack, limited accounting records were available. Using the company’s email database and server files we identified the key individuals and carried out a targeted review of the data to obtain various management information. Our team used their skills and expertise to piece together the transactions by reconstructing the accounting records and ascertained the actions taken by the company and vendor both pre and post-sale.
Money laundering
We assisted Insolvency Practitioners with a case whereby a company had transferred £500,000 through an apparently unconnected company. That company was controlled by a 76 year old lady who also happened to control numerous other companies. This case had come to the attention of the police and we provided extracts from our report to assist them in their investigations relating to a money laundering scheme.
Missing motor vehicles
From a review of the accounting records, we identified a number of motor vehicles that the company owned but had not been listed on the company’s Statement of Affairs.
Resale of motor vehicles
Our investigations identified a vehicle in the accounting records that had been sold to an individual with links to the company for the sum of £26,000. During the course of our work our team located the same vehicle listed for sale online for £43,000.
Bounce Back Loan used to pay Director’s personal credit card
The company had taken a £50,000 Bounce Back Loan from a leading UK bank, our investigations found that on the very same day that the funds were received, they were transferred in full to the director’s personal bank account and used to pay off the director’s personal credit card debt.
Illegal dividends
Our investigations found that the directors/shareholders continued to pay themselves dividends even though the company had negative reserves. Furthermore, the directors/shareholders were including an unrealised gain when calculating the distributable reserves. The excess dividends amounted to in excess of £300,000.
EFURBS & EBTS
The directors received tax planning advice relating to payments the company made to an EBTS which subsequently was determined to be disguised remuneration and now HMRC are seeking recovery of the tax and national insurance ‘avoided’. Our role was to liaise with the directors and HMRC with a view to reaching a satisfactory conclusion for both parties.
Overdrawn Director’s Loan Account
Following the appointment of the Liquidators we took full control of the Company’s accounting software and reviewed the accounting transactions contained therein. Our investigations identified combined amounts due from the two directors of £125,000.
Our investigations resulted in a settlement agreement being agreed with the directors to repay the overdrawn loan account in full.
Repayment of Excess Fees Charged by Lender.
We were asked to review the circumstances surrounding the demise of a special purpose vehicle LLP. Our investigations found that upon the sale of a commercial property, the LLP were charged exit fees by the Lender in excess of those stated in the terms of the loan agreement.
We assisted the Liquidators in recovering £60,000 in over charged fees from the lender.
Other Services
We also assist Insolvency Practitioners with the following:
- Completion of CT600’s and Corporation tax computations
- Completion of VAT returns
- Assistance with VAT matters post appointment