Despite facing a disqualification ban where it appeared that the company had no trading history and no entitlement to a Bounce Back Loan (“BBL”), all allegations were abandoned by the Insolvency Service after Suky Mann, our expert in director disqualification, successfully demonstrated that the application was in fact, influenced by a professional banking advisor.
Background
Our client, facing a significant period of disqualification, instructed Suky in what he considered his last effort in defending proposed disqualification proceedings. Having already corresponded at length with the Insolvency Service himself, the client had given up hope in trying to convey the context behind the allegations.
Our client faced allegations that he had knowingly overstated his company’s turnover to obtain a bounce-back loan when the company was, in fact, dormant and, therefore, not eligible for the loan. It was further alleged that, upon receipt of the loan, he used the monies for improper purposes.
He was facing a significant period off disqualification and a compensation order.
The challenge
This initially seemed to be a hopeless case, and those less experienced might have understandably turned this client away. However, Suky was undeterred by the headline-grabbing allegations and set about unravelling the circumstances that gave rise to the bounce back loan application.
It quickly became apparent that our client’s reliance on professional advice had led to him overstating the company’s turnover.
After taking the client’s detailed instructions, it transpired that our client was incorrectly informed that he could use historic turnover as opposed to the previous year’s turnover. What was even more astonishing was that our client was given this advice by an employee of the bank issuing the bounce-back loan. Indeed, he was told that based on the figures he had submitted for 2019, the company would not be entitled to any government support. Our client was advised that he should instead use the highest turnover achieved over the company’s trading life since incorporation.
Given that this advice came from the bank that was ultimately reviewing and approving the application, our client has no cause to question the accuracy of that advice.
The difficultly was proving that those discussions had taken place. On the face of it, our client faced an uphill battle in persuading the Insolvency Service of the bank’s advice. The Insolvency Service appeared unwilling even to consider our client’s version of events. However, Suky sought to challenge the Insolvency Service’s powers of investigation, inviting them to request and analyse the telephone records between the client and his bank. Following a robust and detailed letter of representations, the Insolvency Service abandoned the disqualification proceedings against our client, with no further action being taken against him.
Our approach
Aware of the challenges faced when dealing with conflicting accounts, Suky was focused squarely on undermining the Insolvency Service’s allegations and demonstrating the evidential weaknesses in its case.
Suky was unwavering in ensuring the Insolvency Service complied with its duty to conduct investigations fairly. She successfully argued that the imbalance of resources between the parties should not be a barrier to the proper interrogation of the evidence.
Without Suky’s perseverance and expertise, our client would now be facing a lengthy ban and the prospect of repaying the £50,000 bounce-back loan.
“I wish to express my profound gratitude for the excellent and professional service I received from Suky.”
A satisfied client
Our thoughts
This case is yet another example of the difference that expert advice can have on the outcome of your case. Understanding how to challenge the facts and the law is always key.
