The former director of a security company, Richard Thomas Phizacklea, was given a suspended custodial sentence, disqualified from being a company director and ordered to pay court costs by Northampton Crown Court. This was after an investigation and prosecution by the Insolvency Service and the Department for Business, Innovation and Skills.
Mr Phizacklea of Gayton in Northamptonshire who was already subject to a six-year disqualification as a director, was sentenced after pleading guilty to ‘being concerned or taking part in the management of a limited company’, contrary to an Undertaking he had signed in July 2002.<br><br>Following his guilty plea, 74 year-old Mr Phizacklea was sentenced to 50 weeks imprisonment suspended for two years, disqualified from being a director for eight years and ordered to pay prosecution costs of £2,000.<br><br>Commenting after the case, Stephen Speed, Chief Executive of the Insolvency Service said: “The Insolvency Service will take firm action when we find that undertakings given to protect the public and the business community have been breached.”<br><br>Mr Phizacklea had been the director of a company called Lasermine 98 Limited, which went into voluntary liquidation in 2000. As a result of the investigation into his conduct as a director of that company, he signed an Undertaking in July 2002, not to be involved in the management of any limited company until July 2008. The Undertaking had the effect of disqualifying him from ‘being a director or in any way, whether directly or indirectly of being concerned or taking part in the management of a company’. The Undertaking also contained the warning that he may be prosecuted for a criminal offence if he acted in contravention of it.<br><br>The court heard that less than two months later, despite the Undertaking, Mr Phizacklea persuaded two workers with his business, which provided security guards to businesses, to sign up as directors of a company he had set up, namely T R Phizacklea Limited.<br><br>The court also heard that one of the directors felt he was ‘a director in name only’ and that Mr Phizacklea took all major decisions to do with the company. This included authorising payments out of the company’s bank account and being involved in board meetings, to which this same director was never invited. In addition, Mr Phizacklea used the company’s vehicles for his and his wife’s personal use and put his tobacco, drink and even his personal dog food bill through the company.<br><br>R T Phizacklea Limited was placed into compulsory liquidation in April 2007 on the petition of HM Revenue & Customs for VAT arrears.<br><br>Commenting on the case<br><br>Graham Mills, an investigator with the Department for Business, Innovation and Skills, said after the case: “The sentence imposed on Mr Phizacklea sends a clear message to directors that they have a duty to abide by the terms of restrictions imposed on them following the signing of an Undertaking.. We can and will investigate directors who deliberately seek to circumvent the terms of such disqualifications by acting as shadow directors."
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