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Richard Cole in successful £26m directors' disqualification

Richard Cole has been successful in a large-scale directors' disqualification in which he was instructed on behalf of the Secretary of State for Business Innovation and Skills before HHJ Keyser QC, sitting as a judge of the High Court in Cardiff.  
 
Mr and Mrs Hawkes (mother and son) ran a plywood importation business, F G Hawkes (Western Limited), which traded as RKL Plywood, in Swansea.  The company was placed into Administration in 2011.  The deficiency was in excess of £26 million.  The Secretary of State sought to disqualify both directors pursuant to the Company Disqualification Act 1986.  
Amongst the numerous allegations of unfitness, the Judge relied particularly upon the following:
• The production of misleading company accounts   – which did not properly reflect the Company’s financial relationship with Neath Rugby Limited (a company in which Mr Hawkes was a director and 50% shareholder) in respect of loans made to the rugby club, and Amadora Company Limited (a company which was 100% owned by FG Hawkes (Western) Limited) which had been loaned £4.5 million by FG Hawkes and also provided finance facilities by way of an unlimited guarantee to FG Hawkes (Western) Limited, but which was subject to an insolvency procedure in Cyprus.
• The submission of false VAT returns to HMRC between April 2010 and April 2011, involving under declarations of VAT in a total sum of around £1.5 million, for the purpose of enabling the Company to trade despite cash flow difficulties.  This at the same time that large sums were being transferred to Neath Rugby Limited and Neath football club (in which Mr Hawkes also had interest) 
 
Findings of dishonesty and deception were made against the directors and they fall to be disqualified for a period to be determined in July 2015.
 
The case is reported on Lawtel.
 
The Secretary of State for Business Innovation and Skills v Frederick Geraint Hawkes and Janis Hawkes [2015] EWHC 1585 (Ch)