By Andrew Young-
The boss of a Manchester spare parts company has been disqualified after he was caught spending money from company’s bank account using funds that were dishonestly obtained.
Modussur Khan, 32, from Oldham, was the sole director of Manchester Autospares Limited (MAL) throughout the life of the company. The company was incorporated in December 2011 and sold scrap parts for the motor industry from premises in Failsworth, Manchester.
The company ceased trading on 3 May 2016 and went into liquidation on 18 May 2016, owing creditors £61,374.
An Insolvency Service investigation, which followed the company’s liquidation, found that MAL operated a merchant services account whereby it received card payments from customers. The company took unauthorised payments from customers’ cards between 5 April and 25 April 2016 totalling at least £72,887.
The investigation found that the payments were not related to genuine purchases, and led to increased receipts into the company’s bank account. Also revealed by the investigation was that between 8 April and 22 April 2016, the company made payments totalling at least £71,816 from its bank account. using the fraudulently obtained funds, which Modussur Khan used to make personal purchases, a bureau de change withdrawal and other cash withdrawals.
Furthermore, MAL’s customers applied for refunds to the merchant services provider as they had not authorised payments to MAL. This led the merchant services provider to suffer a total loss of £56,791.
On 31 May 2018, the Secretary of State accepted a disqualification undertaking from Modussur Khan, in which he did not dispute making payments of £71,816 from the company’s bank account when he knew or ought to have known that at least some of these funds were obtained fraudulently.
His disqualification became effective from 21 June 2018 and lasts for 12 years, where he is banned from directly or indirectly becoming involved in the management of a company without the permission of the court.
Robert Clarke, Group Leader of Insolvent Investigations North at The Insolvency Service said:
This is a serious case of misconduct by the director. The disqualification of Modussur Khan sends out a clear message that where a corporate vehicle is used to facilitate actual or potential fraudulent activity, action will be taken to remove the directors from the corporate arena for a lengthy period of time.