Director disqualification

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We advise directors facing disqualification proceedings and can also advise creditors or others who want to pursue directors legally

Solicitor advice for directors facing possible disqualification

We have a highly experienced, specialist team with a proven track record of assisting directors facing proceedings for disqualification.

Instructing us means you will get experienced help in :-

advising you whether you have reasonable prospects of successfully arguing that a disqualification would be unnecessary and/or disproportionate.
where appropriate, seeking to reduce the length of any disqualification order as much as is possible.
representing you if you have been disqualified and a further claim is made that you are in breach of the order in some way such as acting as a shadow director.

Reasons a director can be disqualified

Company directors can be disqualified for serious incompetence, financial impropriety or where there have been deliberate acts which are unlawful or illegal.

In addition to being disqualified, depending on the underlying reason, directors may be held personally liable financially for losses resulting to the company or creditors and in very serious cases, may be criminally liable.

Under the Company Directors Disqualification Act 1986 any person may report a director and assert that he or she should be investigated.

Situations where directors are at risk of disqualification generally include :-

Wrongful trading in the lead up to insolvency.
Failure to prepare and/or submit the company's statutory accounts.
Where the company's accounts are inaccurate.
Misuse of company assets.
Failing to co-operate - with an appointed Insolvency Practitioner or the Official Receiver.

Implications of being disqualified

Even after the disqualification period ends, the repercussions often continue and typically include :-:

Disclosure Requirements - even after the disqualification expires, you may be obligated to disclose it in certain situations, potentially limiting future employment opportunities, and particularly at executive levels.
Restricted Business Activities - disqualification can restrict your involvement in specific regulated businesses, especially financial services or regulated businesses, hindering your employment options.
Funding Challenges - if you set up a new business after your disqualification ends, securing funding is likely to be much more difficult .
HMRC Scrutiny - disqualification can raise red flags for HMRC, making them more likely to request bonds (guarantees) for your company's PAYE (payroll taxes) and VAT (sales tax) payments.

Negotiating with the Insolvency Service

Whilst there is no UK equivalent of a US style plea bargain, it is possible to try and agree a less damaging categorisation of ban and this is something we can assist with.

The Insolvency Service can recommend to the Secretary of State that it is in the public interest to agree that the disqualification period should be in a certain bracket. The seriousness of wrongdoing is categorised :-