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‘Dodgy’ property agency director banned for transferring £900k rent to personal bank account

by: Christine Toner
  • 25/09/2017
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‘Dodgy’ property agency director banned for transferring £900k rent to personal bank account
A property agency director who held rental income in his personal bank account has been branded 'dodgy' by the insolvency regulator and banned for eight years.

An investigation by the Insolvency Service found Nicholas Constable, who headed up Xenex Developments in Surrey, failed to ensure the company dealt with its rental income in the correct manner or maintained or preserved adequate accounting records.

The company went into administration in November 2015 owing almost £7m.

The investigation found Constable diverted rental income totaling nearly £900,000 into his personal bank account and that of a connected company. This action contravened the terms of a legal charge and resulted in missed interest of at nearly £400,000 for the charge holders.

Of the total diverted rental income, Constable has failed to provide accounting records which would verify whether £679,063 had ever been repaid or used for the benefit of the company’s creditors.

Robert Clarke, group leader of insolvent investigations at The Insolvency Service, said: “In this particular case, the director failed to act in the best interest of the company and its creditors and failed to ensure that the company operated in a transparent way by providing sufficient records to explain company transactions.

“This disqualification should serve as a reminder to other company directors who are tempted to operate in a similar way that the Insolvency Service will rigorously pursue enforcement action and seek to remove the protection of limited liability from them.”

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