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Insolvency Service cracks down on directors

The Insolvency Service has recently released new figures which show the high levels of director’s disqualification relating to illegal activity over the last year. From April 2016 to January 2017, 106 directors were disqualified for employing illegal workers with 88% of those receiving disqualification for six years or more.


An important part of the Insolvency Service is investigating the conduct of directors whose companies have entered administration or liquidation. The conduct of the three years before insolvency will be considered and this is backed up by legislation allowing the Insolvency Service to remove and prevent unfit directors from overseeing a business for up to 15 years.


Since April 2016, the 106 directors disqualified for employing illegal workers attempted to use insolvency procedure to shut down their business to avoid the fines placed on them by Home Office Immigration for illegal conduct. Their decision to do this would have left their creditors out of pockets for funds owed to them; as a result the directors were not only disqualified but heavily fined.


The Insolvency Service tackles financial wrongdoing which is a major focus of the service to help boost economic growth in the UK. Removing rogue directors and shutting down businesses which are being run illegally will help other businesses who are being put on the back foot financially for simply following the law.

Directors who employ illegal workers rarely pay PAYE and National Insurance contributions as well as paying lower wages which gives them an unfair advantage over competitors and makes the job hunt harder for job seekers looking for legitimate employment on a fair wage.


Please do not hesitate to contact us here at The Timothy James Partnership.

Added: 22 Jun 2017 09:54

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Insolvency Practitioners Association
About Us

We are an independent firm of specialist Licensed Insolvency Practitioners located in Bromsgrove, Worcestershire.

At The Timothy James Partnership, we work very closely with local businesses and professionals, providing guidance on formal insolvency procedures and advice on restructuring businesses.

We recognise that at times, companies find themselves in difficult financial circumstances and our aim is to provide practical solutions in these situations.