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Ed Turner
Ed Turner,
Category: Law
Satisfied Customers: 1477
Experience:  Director and Consultant Solicitor (Self-Employed) at Ed Turner LLB Limited
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I run a company that has been charged with fraudulent

Customer Question

I run a company that has been charged with fraudulent trading. Me and my wife are also being charged as Directors. If the company was wound up I assume the charges against the company would have to end. I assume the charges against me and my wife would continue but with no evidence being provided on behalf of the company. I run another almost identical company and I could easily switch everything to the this company. I have been considering renaming the company charged for some time anyway. I understand a voluntary winding up takes about 2/3 months so this could be achieved before he case is actually heard. There would be no unpaid creditors, all existing bookings would be honored by the other company so it should be a relatively simple process.
JA: Where are you? It matters because laws vary by location.
Customer: england
JA: What steps have you taken so far?
Customer: Very few. Just considering options
JA: Anything else you want the Lawyer to know before I connect you?
Customer: no
Submitted: 7 months ago.
Category: Law
Expert:  Ed Turner replied 7 months ago.

Hello. I am Ed, a Solicitor qualified in England & Wales with over a decade’s experience in the legal profession advising clients.

I specialise in Commercial Contracts, Business Transactions, Employment, Dispute Resolution, Personal Injury and Road Traffic Law and will be able to resolve your legal problem today.

Regarding the site’s automatic offer of a Premium Service Phone Call, I shall be delighted to talk with you by phone to discuss your issue in greater detail if you accept the offer.

However, if you do not want a phone call, please cancel the offer for a Premium Service Phone Call and you will not be charged extra.

Expert:  Ed Turner replied 7 months ago.

To enable me to answer your query, please provide me with some further information about your legal issue and how you want a lawyer to help you.

Have you been accused of setting up a "Phoenix Company" out of the ashes of the old company have have transferred its assets at an undervalue, or the old company traded while insolvent?

Customer: replied 7 months ago.
No. I have not started to wind the company up yet. I was just thinking of it as a solution to my issue.
Expert:  Ed Turner replied 7 months ago.

Who has charged the company with fraudulent trading and why?

Customer: replied 7 months ago.
Trading Standards. We run a parking company. They claim because we moved cars between car parks and this was not made clear when booking. On 2 occasions cars were moved to a local authority car park as our car park was having new gates fitted but builder left the car park insecure as the new gates wouldn't fit. When they tried to get the cars out at 07:00 approx in the morning the ticket machine wouldn't work so they tailgated them out. My question though is not about the rights and wrongs but can the charges be avoided by winding up the company.
Expert:  Ed Turner replied 7 months ago.

"Fraudulent Trading" and "Wrongful Trading" are terms under the Insolvency Act to describe a company that is trading while insolvent and selling off assets at an undervalue to a buyer where the transaction is not at arm's length. That is why I was confused over the problem.

I don't think that dissolving the company will cease the investigation by Trading Standards as they can still pursue the responsible directors and employers personally.

Customer: replied 7 months ago.
But the current charges against the company - the first due to be heard early March would have to be dropped. I understand the first hearing if pleading not guilty is just to set a timetable for the case. The intention is to plead not guilty and then immediately start to dissolve the company hopefully then it would be dissolved before the case is actually heard. As you say the cases against the directors would continue
Expert:  Ed Turner replied 7 months ago.

The insolvency of a party does not automatically terminate a contract or court proceedings. It is like that that TS would keep your company on the Companies House Register on the basis that your attempt to liquidate it is a deliberate attempt to frustrate the proceedings. I cannot recommend that you take this step.

Customer: replied 7 months ago.
They could keep it on the register but it would have no assets or cash to pay any fine or costs. An alternative then would be to fight the case and if lost dissolve the company to avoid paying the fine and costs
Expert:  Ed Turner replied 7 months ago.

Possibly, but TS may seek an order for the Directors and Shareholders to pay the fine and costs personally.

Expert:  Ed Turner replied 7 months ago.

I have answered your questions as far as I am able to on the Portal. Obviously, there is a limited amount of advice I can give based on a few lines of text on the Just Answer instant messaging Portal. Very often the best I can do is “point you in the right direction” for the sake of seeking more detailed advice.

If you want further bespoke advice, I need to review all relevant correspondence and documents and advise in a telephone call. I will place an offer of a Premium Service Phone Call Request through on the Portal. You may accept or reject it at your leisure.

Otherwise, I shall be grateful if you will please give me a positive rating in order to close this thread.

Kind regards