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SolicitorRM, Solicitor
Category: Bankruptcy Law
Satisfied Customers: 5223
Experience:  Director and Principal Solicitor. UK
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If you trade as a shadow company of an insolvent company

Customer Question

If you trade as a shadow company of an insolvent company (not yet put into administration) moving customer and inventory to the new shadow company what are the consequences
JA: Where are you? It matters because laws vary by location.
Customer: uk
JA: What steps have you taken so far?
Customer: non im a major creditor
JA: Is there anything else the Lawyer should know before I connect you? Rest assured that they'll be able to help you.
Customer: Company is insolvent but has not been put into administration.. One of the existing director is attempting to move assets into a new shadow comapny and continue to trade under his own name
Submitted: 13 days ago.
Category: Bankruptcy Law
Expert:  Virtual-mod replied 13 days ago.

I've been working hard to find a Professional to assist you with your question, but sometimes finding the right Professional can take a little longer than expected.

I wonder whether you're ok with continuing to wait for an answer. If you are, please let me know and I will continue my search. If not, feel free to let me know and I will cancel this question for you.

Thank you!
Customer: replied 13 days ago.
Expert:  TetyanaP-admin replied 11 days ago.
I apologise as we have not yet been able to find a Professional to assist you. Do you wish for me to continue to search for someone to assist you or would you like for us to close your question at this time?
Thank you for your patience,
Expert:  SolicitorRM replied 10 days ago.

Good morning, welcome to just answer I am a solicitor and reviewing your question for you. If upon piercing the corporate veil it is apparent that the company has moved customers and assets thereby making itself insolvent and  taking away any hope of recovering financiall, this can be treated as unlaful trading and potentially fraudulent on the part of the directors and breach of directors fiduciary duty to the shareholders and the company can land directors in prison. assets moved can be clawed back. Any clarification please do not hesitate to send your follow up message. Always glad to help. All the best.