January 2023 Round-Up: The UK’s latest insolvency and bankruptcy statistics

This month we cover the insolvency stats for December 2022 and we look at three insolvency news stories from January 2023. Including:

• A used car dealer banned for 11 years for BBL abuse
• An IT consultant banned for 8 years for £24,000 BBL abuse
• 11-year directorship ban for £41,000 BBL abuse

Read last month’s news round-up: Bankruptcy and Insolvency News December 2022

Used car dealer given an 11-year ban for BBL abuse

Mathius Thompson, sole director of West Midz Cars Ltd in Ladywood, Birmingham applied for a Bounce Back loan of £50,000 to support the used car dealership’s operations. 

At the time of the application turnover from 2019 was estimated at £287,500. Despite receiving maximum funds from the government-backed scheme, liquidation loomed 5 months later with debt amounting to £53,500 including repaying the said loan – triggering an investigation by Insolvency Service.

They found that Mr Thompson had exaggerated his turnover for 2019. The company only saw a £2,500 turnover, with the company’s bank statements showing no income or trading activity. This would have not entitled West Midz Cars to any amount on the BBL scheme. 

A compensation order is now being sought to repay the £50,000 and Mr Thompson has been banned for 11 years as a company director from the 30th of January 2023.

8-year ban for IT consultancy director

Moira Wood, the sole director of an IT consultancy in Guildford, Surrey called Clockwork Compliance Services Ltd applied for and was granted a £24,000 Bounce Back Loan from the government. 

Unfortunately, however, her company fell into liquidation two years later in February 2022 owing large sums to creditors along with the full value of loan amounts owed. 

An investigation by The Insolvency Service revealed that before bankruptcy Ms Wood had transferred £23,400 into her personal bank accounts. There was no proof these monies were used according to legal obligations or indeed benefit the Clockwork Compliance business endeavours at all.

Moira Wood has now been disqualified from the directorship of any company for 8 years by the Secretary of State for Business, Energy and Industrial Strategy from the 30th of January 2023.

Read more stories of BBL abuse: Financial Consultant Disqualified for Abusing BBLs

£41,000 BBL abuse leads to 11 year ban

In 2020, Ioan Adrian Mociar applied for a £41,000 Bounce Back Loan as the sole director of Midi Construction Ltd in Harrow. According to the rules of the loan scheme, he estimated his business’s annual turnover at £166,000 – even though it had only recently begun trading the previous year in June 2019. 

Two years later however and with debts totalling around £46,000 including full repayment owed to the lender plus HMRC taxes due too; an investigation by Insolvency Service was triggered upon liquidation of Midi Construction Ltd in December 2021.

The investigation discovered that Mr Mociar had significantly overestimated his turnover and Midi Construction received £29,600 more than it was entitled to. It further discovered that £39,700 had been transferred from the company bank accounts between October and November 2020 with no indication they were used to benefit the business.

Ioan Mociar is now disqualified from running a business in any way without the express permission of the court for 11 year. His disqualification commenced on the 6th of January 2023.

Read more director bans: Rotherham Directors Banned After Fraudulent Claim

England and Wales Monthly Insolvency Statistics

Company Insolvencies during December 2022

• There were 1,964 company insolvencies in December 2022, 32% higher than the same month in 2021 (1,489)
  • 183 compulsory liquidations.
  • This is three and a half times higher than in 2021, but only 8% higher than in 2019 before the pandemic.
  • 1,659 CVLs, 22% higher than in December 2021.

Individual Insolvencies during December 2022

• 1,979 DROs were registered, and 397 bankruptcies in December 2022.
• On average, there were 7,233 IVAs registered in the 3-month period leading up to December 2022. This is 9% higher than the previous year.
• A 14% increase in Breathing Space registrations occurred in December 2022 (4,803).

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