Wednesday, January 30, 2013
A property boss who lost £1.2m belonging to more than 300 British troops has been disqualified from running a business for nine years, a government regulator has revealed.
Paul Smith, director of Blue Force Property Limited - a letting agency in Hornchurch - cannot act as a director of a limited company from February 11 this year to February 11 2022, following an investigation by the Insolvency Service (IS).
Blue Force Property was set up in 2004 exclusively to help armed forces personnel buy and let homes while serving overseas or living in forces’ accommodation.
Mr Smith, 47, of Manningtree, Essex, and his staff repeatedly assured the soldiers that cash would be held securely in individual ring-fenced accounts, according to the IS.
But in reality the company, which managed lettings and collected rents, moved funds from these client accounts into its own trading account and that of an associated company,
When the company went into liquidation in March 2011 there was a £1.2million gap in the books - all owed to soldiers.
David Brooks, a chief examiner for government body, said: “Many of the people who lost out as a result of this company’s demise were stationed overseas and had no choice but to trust Blue Force to look after their affairs on their behalf. This trust was broken and the money – money that many of them had risked their lives to earn - was lost.
“Directors who seek to gain an unfair advantage over their competitors by using clients’ funds to prop up their own accounts will be investigated. This behaviour is unfair to those who play by the rules and protect their clients’ funds and, most of all, it is unfair to the clients who risk losing their money.
“The Insolvency Service will seek to remove these people from the business environment.”