Paul Smith, a director at Blue Force Property, has been banned for nine years following an investigation by the Insolvency Service.
It found that Smith’s company had inadequately protected his clients’ funds from his own business accounts. Blue Force Property, which specialised in allowing service personnel to buy residential properties and let them out while based overseas, went into administration in March 2011 with a £1.2m hole in its accounts – all owing to members of the armed forces.
Smith has been banned from acting as a director of a limited company until February 2022.
The Insolvency Service stated that the firm had repeatedly assured the soldiers that any surplus funds were being held securely in a ring-fenced account.
David Brooks, a chief examiner for the Insolvency Service, said: “Many of the people who lost out as a result of this company’s demise were stationed overseas and had no choice but to trust Blue Force to look after their affairs on their behalf. This trust was broken and the money – money that many of them had risked their lives to earn – was lost.
“Directors who seek to gain an unfair advantage over their competitors by using clients’ funds to prop up their own accounts will be investigated. This behaviour is unfair to those who play by the rules and protect their clients’ funds and, most of all, it is unfair to the clients who risk losing their money.
“The Insolvency Service will seek to remove these people from the business environment.”
