Liquidator goes into administration while still holding my funds

[MangoIcecream]

Hi everyone,

I am living a nightmare right now, so I thought I would post my story to ask for advice.


With IR35, my client asked all contractors to go perm or leave.
All agents at the time were saying most contracts are now inside IR35, so eventually I did find a permanent position.
And as a result, I decided to close my company.

I went through a bit of research and choose one company.

I went through the MVL process, went through the paper work and sent part of the fund to that company while HMRC checks I am not owning any money.

It takes a while for HMRC to confirm its fine to close the company, on the company house website, my company is now owned by my liquidator company. I received a letter from HMRC about CT clearance and I am told by the liquidator that we are now waiting for PAYE and VAT clearance.

Yesterday, I decided to chase my liquidator and realised their website disappeared and the phone line does not exist anymore.

After a bit of research, I realised the company owner have lost his insolvency licence and the company has been put into administration.

This is a complete nightmare, I got in touch with the company who took over, that's the only thing that I can think of.

But I have little knowledge as to what I should do to get back my fund. Who can help? I am wondering if hopefully, it should be in a client account or if there is any insurance that would cover the fund in case something like this would be happening? At that point, I am not sure if anything was fraudulent. Of course, it could be.

Any advice on what I should do? How to get help?

[northernladuk]

I thought they had to keep clients money ring fenced in a different account to the their business one so it's protected, but if they've lost their licence there is a possibility they haven't been doing things properly.

You could drop Maslins a PM on here. He runs MVL Online and where he can't help your situation he can give you an idea how the finances should be stored and who to chase.

[Maslins]

Ouch. FWIW the first ~2/3 of your post all sounds very standard, no concerns there.

Re the last bit, not something I've had any direct experience of, but:
- client funds should be held separately from the liquidator firm's business funds (ie "your" money and "their" money should not be mixed).
- every liquidator should have an "alternate", basically another licensed insolvency practitioner who will take over any cases if the main liquidator becomes incapacitated in some way.
- every solvent liquidation should have bonding in place, which protects your company's assets against any possible malpractice by the liquidator.
You haven't named the firm/liquidator (no need for you to do so), so impossible for us to guess exactly what might have happened...but even if there was fraud in play and the liquidator has essentially stolen your money, you shouldn't lose out, the bonding should cover it and new liquidator deal with it. Be warned it may take a while to sort out though.

It sounds like you're aware who the administrator is? They should be who you contact. Try to remain calm and just ask for what you should expect and when, providing them with any information they ask for as inevitably they'll be trying to figure out what's happened, may not have ready access to historical documents re your case etc.

[MangoIcecream]

Thanks a lot, I did PM you some more details.

[BarbaraW]

Hello,

I have similar situation and I believe it might be even the same practicioner. I will name and shame: Adrian Duncan, company Savants.
I've been trying to close my LTD since February 2020. Absolute nightmare, they were not responding to emails, not taking the calls and emloyees had clearly no idea what they are doing. Most likely one person with a licence hired inexperienced and unqualified people.

Today I found out that Adrian lost the licence:

"Following hearings between 9 November 2020 and 18 January 2021 the ICAEW Review Committee made the decision to withdraw Mr Duncan’s licence as a result of persistent failures of competence, failures to abide by conditions set, failure to co-operate with the ICAEW and breaches of regulations, leading to concerns that the regulatory objectives set out in s.391 of the Insolvency Act 1986 would be undermined and resulting in a risk to the public.

Mr Duncan submitted an appeal and a panel of the ICAEW’s Appeal Committee met on 7 September 2021 which made the decision to dismiss Mr Duncan’s appeal. The Appeal Panel also ordered the appellant to pay Respondent’s costs summarily assessed in the sum of £17,500. Accordingly, Mr Duncan’s license has been removed."

I have no idea who took over from them, lines are not working, noone is responding to emails and I have no idea what to do.
I checked my invoice and there is no insurance, I was not aware I can have one, I thought that since liquidators need a special licence that my money is safe.

Any advice will be greatly appreciated.
Thank you,
Barbara

[ContractorBanking]

That's awful, hope you manage to get all your money back. Looks like it could be a drawn out affair.

Got me thinking, is there any way for you to check that your funds are actually held in their Client Money Account?

If they have, then I guess you've got the protection.

[BarbaraW]

I'm still waiting for information from the new IP who was appointed to take over.
I was told he stole clients money and run away from the country.
what is shocking to me:
* ICAEW knew he is dodgy for years (in the response to his appeal they says he demonstrated lack of competence for many years), yet they just recently removed his licence
* how the bank could allow him to transfer out all the money somewhere?? to one account? was that not suspicious?

I will be calling Barclays tomorrow where he held the funds and will be raising a fraud case.

IPs are regulated and I would have never thought that someone can just steal the money!

[cojak]

Ouch. There’s 160 active cases in the same position.

https://www.pro-manchester.co.uk/new...uring-limited/

I wonder where the little scrote will turn up? Australia perhaps? https://insolvencynewsonline.com.au/...-decent-drink/

[northernladuk]

Ouch. There’s 160 active cases in the same position.

https://www.pro-manchester.co.uk/new...uring-limited/

I wonder where the little scrote will turn up? Australia perhaps? https://insolvencynewsonline.com.au/...-decent-drink/

I hope it's totally different in this case but once the adminstrators get in money disappears like it's water. The amounts the administrators are taking from the Lendy/Savings Stream debarcle is eye watering.

[MangoIcecream]

This is such a horrible situation... and yes that is the same person.
BarbaraW, do you have some news from Barclays?

I've been told there was no bond on may fund, it was not in a client account and the insurance is void because there was fraud.